PM-Surya Ghar Muft Bijli Yojana: Cabinet Greenlights Solar Installation in 100 Million Households, Offering 300 Units of Monthly Free Electricity per Family

PM-Surya Ghar Free Electricity Scheme approval paves the way for setting up solar plants in 1 crore houses, government will give subsidy of Rs 1 crore, Rs 78,000 to each family.

Union Minister Anurag Thakur highlighted that PM-Surya Ghar Muft Bijli Yojana will provide 300 units of free electricity to one crore households, along with an annual income of Rs. 15,000. The cabinet approval underscores the government’s commitment to providing sustainable energy solutions to citizens. Additionally, the government will provide a 60 percent subsidy for solar plants up to 2 kilowatts, with a 40 percent subsidy for every additional kilowatt, ensuring affordability and accessibility for families.

Over the past month, Prime Minister Narendra Modi has highlighted this scheme in numerous public engagements. Finance Minister Nirmala Sitharaman announced it in the interim budget on February 1, 2024, and on February 13, 2024, PM Modi declared its implementation.

Government officials assert that this MNRE Ministry scheme holds the potential to surpass the effectiveness of the Ujjwala scheme. While Ujjwala provided kitchen connections to individual households, the Surya Ghar Yojana aims to alleviate the electricity burden for households over time, offering electricity subsidies and establishing a dedicated team for associated servicing tasks, such as installation or repair of solar systems.

PM - Surya Ghar
PM - Surya Ghar Muft Bijli Yojana Picture Courtesy - Pixabay

Prime Minister Narendra Modi’s announcement of the ‘PM Surya Ghar: Free Electricity Scheme’ emphasizes the government’s focus on grassroots-level promotion of renewable energy. Urban local bodies and panchayats will play a crucial role in encouraging the adoption of rooftop solar systems within their respective jurisdictions.

To benefit from this scheme, applicants must be Indian residents, particularly targeting poor and middle-income families who own their houses. To access government subsidies, applicants must complete specific requirements, including the installation of a net meter and the submission of required documents for verification.

The application process is straightforward:

  • Visit the official website and select ‘Apply for Rooftop Solar.’
  • Choose your state and electricity distribution company, and provide your electricity consumer number, mobile number, and email.
  • Log in using your consumer number and mobile, and fill out the application form according to the provided guidelines.
  • Upon feasibility approval, select a vendor registered with your DISCOM for solar panel installation.
  • After installation, apply for a net meter along with plant details to complete the process.
  • Commissioning Certificate will be generated from the portal after installation of the net meter and inspection by the Discom.
  • Once you get the commissioning report. Submit bank account details and a canceled check through the portal. You will get the subsidy in bank account within the time of 30 days.

Like the Ujjwala scheme targeted households below the poverty line, the Surya Ghar Yojana is also directed towards this demographic. Plans are underway to extend solar system installations to other general population segments. Under the Surya Ghar Yojana, customers will not bear immediate costs for electricity connections; the government company will provide 40 percent of the cost as a loan, while the government will cover the remaining 60 percent as a subsidy.

Advantages of Grid-Connected Rooftop Solar Systems

  • Reduction in consumer electricity bills.
  • Efficient utilization of existing roof space without the need for extra land.
  • Short gestation period for installation.
  • Elimination of additional transmission and distribution (T&D) line requirements.
  • Decrease in T&D losses by balancing power consumption and generation.
  • Improvement in tail-end grid voltage and alleviation of system congestion.
  • Long-term enhancement of energy and ecological security through diminished carbon emissions.
  • Improved management of daytime peak loads by Discoms/Utilities.
  • Fulfillment of Renewable Purchase Obligations (RPOs) for obligated entities.

This initiative not only aims to reduce electricity bills for households but also to empower them economically.

The promotion of renewable energy through rooftop solar systems will contribute to India’s sustainable development goals for a Vikshit Bharat  by providing a reliable source of electricity to citizens. 

Interested households are encouraged to avail themselves of the benefits of the PM Surya Ghar scheme by registering on the official website and contributing to India’s transition towards a greener future.

To execute the plan, the government-owned company Indian Renewable Energy Development Agency (IRDA) has established a dedicated subsidiary. IRDA will play a pivotal role in expanding the scheme to rural areas in the near future. The MNRE Ministry’s forward-thinking approach includes the recognition that widespread installation of solar systems in millions of homes will necessitate a significant pool of trained manpower for servicing and maintenance. Consequently, plans are in place to train electricians locally to meet this demand.

Central Financial Assistance (CFA) and Additional Features of the PM-Surya Ghar Muft Bijli Yojana

The PM-Surya Ghar Muft Bijli Yojana not only aims to provide free electricity to one crore households through rooftop solar installations but also offers significant financial assistance and additional features to ensure the scheme’s success and impact.

Central Financial Assistance (CFA):

  • The scheme offers a CFA of 60% of the system cost for 2 kW systems, with an additional 40% of the system cost for systems between 2 to 3 kW capacity. However, the CFA is capped at 3 For example, at current benchmark prices, households can receive a subsidy of Rs. 30,000 for a 1 kW system, Rs. 60,000 for 2 kW systems, and for 3 kW systems or higher subsidy amount is Rs. 78,000.
  • To avail the subsidy facility , households should apply on the National Portal and select a suitable vendor for the installation of rooftop solar. The National Portal provides essential information such as system sizes, benefits calculators, and vendor ratings to assist households in making informed decisions.
  • Additionally, households can access collateral-free, low-interest loan products, currently at around 7%, for the installation of residential rooftop solar (RTS) systems up to 3 kW capacity, further reducing financial barriers to adoption.

Other Features of the Scheme:

  • The PM-Surya Ghar Muft Bijli Yojana includes the development of a Model Solar Village in each district of the country, serving as a role model for the adoption of rooftop solar in rural areas. This initiative aims to showcase the benefits and feasibility of solar energy in rural settings, encouraging widespread adoption.
  • Urban Local Bodies and Panchayati Raj Institutions will benefit from incentives for promoting RTS installations in their respective areas, fostering local participation and support for renewable energy initiatives.
  • The scheme also provides a component for payment security for renewable energy service company (RESCO) based models, ensuring reliability and sustainability in service delivery. Additionally, a fund is allocated for innovative projects in rooftop solar, encouraging research and development in the field.

Outcome and Impact:

Through the PM-Surya Ghar Muft Bijli Yojana, households will not only save on electricity bills but also generate additional income through the sale of surplus power to DISCOMs. A 3 kW system can generate more than 300 units of electricity per month on average, significantly reducing dependence on traditional power sources.

The proposed scheme is expected to add 30 GW of solar capacity through rooftop solar installations in the residential sector, generating 1000 BUs of electricity and reducing CO2 emissions by 720 million tons throughout the 25-year lifespan of rooftop installations.

Additionally, the scheme is estimated to create around 17 lakh direct jobs across various sectors, contributing to economic growth and employment generation.

Following the unveiling of this initiative during the Pran Pratishtha program at Ram Mandir on January 22, 2024, extensive review meetings have been conducted at various levels, ranging from the Prime Minister’s Office (PMO) to the Ministry of New and Renewable Energy (MNRE), to discuss its implementation.

Accessing the Advantages of PM-Surya Ghar: Muft Bijli Yojana:

To ensure maximum participation and benefit uptake, the government has launched a massive awareness campaign to inform and engage households. Interested households can register on the official website to avail themselves of the scheme’s benefits and contribute to India’s transition towards sustainable energy.