The Union Cabinet has approved the PM-Surya Ghar scheme, known as the Muft Bijli Yojana, which aims to install rooftop solar and provide free electricity to one crore households. The scheme, launched by PM Modi on February 13, 2023, has a total outlay of Rs 75,021 crore. The scheme not only promotes solar energy but also boosts the solar manufacturing and supply chain, providing direct employment to around 17 lakh people.
Under this scheme, residential rooftop solar installations will receive central financial assistance (CFA) that will cover a significant portion of the system cost. The CFA will cover 60% of the system cost for 2 kW systems and 40% of the additional system cost for systems between 2 to 3 kW capacity. The maximum CFA will be capped at 3 kW. For example, a 1 kW system will receive a subsidy of Rs 30,000, a 2 kW system will receive Rs 60,000, and a 3 kW system or higher will receive Rs 78,000 or more.
To avail the subsidy, households can apply through the National Portal and choose a suitable vendor for the installation of rooftop solar. The National Portal will provide relevant information and assistance in decision-making, including system sizes, benefits calculator, and vendor rating.
In addition to the subsidy, households will have access to collateral-free, low-interest loan products for the installation of residential rooftop solar systems up to 3 kW. The interest rate for these loans is currently set at around 7%.
The scheme also focuses on encouraging the adoption of rooftop solar in rural areas by developing a model solar village in each district. Urban local bodies and Panchayati Raj Institutions will receive incentives for promoting rooftop solar installations in their areas.
The PM-Surya Ghar scheme includes a component for payment security for renewable energy service company (RESCO) based models, as well as a fund for innovative projects in rooftop solar.
By implementing the PM-Surya Ghar scheme, households will not only be able to save on electricity bills but also earn additional income by selling surplus power to DISCOMs. A 3 kW system can generate more than 300 units of electricity per month on average.
The ambitious goal of the scheme is to add 30 GW of solar capacity through rooftop solar in the residential sector, generating 1000 BUs of electricity and reducing 720 million tonnes of CO2 equivalent emissions over the 25-year lifetime of the rooftop systems. This initiative is expected to create around 17 lakh direct jobs in manufacturing, logistics, supply chain, sales, installation, O&M, and other services.
