In a new policy move, the Ministry of New and Renewable Energy (MNRE) has announced financial incentives for DISCOMs to support rooftop solar installations. The notification proposes a financial support of up to INR 3.75m (USD 55,000)/MW for up to 1,350 MW of rooftop solar capacity. The funds can be used by DISCOMs for multiple activities including upgradation of distribution network and IT infrastructure, building consumer awareness campaigns, setting up consumer helplines, training employees, rating installers etc. Delay in grid connection is one of the main challenges affecting the growth of rooftop solar in India.By offering financial support to the DISCOMs, MNRE is trying to alleviate their concerns about loss of profitable customers and additional network investments required for growth of rooftop solar.Financial support for DISCOMs is a very good move but MNRE needs to make sure that eligibility conditions and funds disbursement process is not unduly restrictive.Indian government’s aim is to grow rooftop solar to 40x the current installed base of 1 GW in a little over five years. This is a formidable target and grid connection is one of the main challenges affecting the growth of this market.
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