Ministry of New and Renewable Energy (MNRE) has benchmarked the costs of rooftop solar power plants for the current fiscal. The new benchmark costs are lower by around INR 5000-6000 per KW than it was last fiscal. Cost of solar energy has been going down YOY. That’s why MNRE has revised the price downwards.
Here is a quick glance at the new costs:
This is the first time where the ministry has separately issued the costs for special category states. These are the states eligible for 70% capital subsidy on rooftop solar project costs. Other states are eligible for 30%. However, only a few consumers are eligible for the subsidy. They are residential consumers, consumers from the social sector, and institutions or organizations recognized under society registration act or formed as trusts. Further, the project capacity should not be more than 500 Kwp.
The above benchmark costs are inclusive of total system cost and its installation, commissioning, transportation, insurance, five years AMC/CMC, and applicable fees and taxes. Projects that will come up after the effective date of the MNRE notification will have to follow the new benchmarks.
How does benchmarking rooftop solar cost help?
Benchmarking the costs, in essence, means to set an upper cap on the costs of CAPEX projects. For example, If a client from special category state wants to install a project of size 60 KW, his maximum cost per KW (without subsidy) for the project cannot be more than INR 53,000 per KW. For other states, the cost (without subsidy) of the project cannot be more than INR 48000 per KW. (Refer to the image above).
Presence of immense players in the Indian Solar Market has brought saturation. Therefore information including costs varies greatly from installer to installer. Benchmarking brings uniformity in pricing to some extent. It also keeps consumers informed about costs.