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When we talk about solar energy, we first consider solar system pricing, followed by solar panel subsidy schemes. Today, we will learn about the government’s solar subsidy scheme and the procedures in each state of India.

What does the term “Solar Subsidy” mean?

We all know that solar energy is a free and clean form of energy that minimises our reliance on natural resources like water and coal. The government intends to install solar panels on every home’s roof so that it can generate its own energy. The government provides financial assistance to people who want to put solar panels in their homes.

Why does the government provide solar subsidies?

According to solar industry experts, the government established this scheme to encourage solar in residential rooftop sectors, but owing to government policy and procedures, Solar Subsidy gradually abilities day-by-day in 2020. There is no further clarity on this.

Subsidy Advantages

#1. Customer Benefits

Residential homes (individual homes and large apartments) are eligible for the subsidy, but not commercial or industrial properties. Only Grid Connected Solar Systems are eligible for a solar subsidy (Without Battery System). Because installing a solar system is such a large expenditure, financial aid encourages people to do so and relieves part of the financial load.

  • Subsidy Amount – Up to 3kW receives a 40% subsidy, 
  • 4kW to 10kW receives a 20% subsidy, and 
  • More than 10kW receives no subsidy.

Installing a solar system and claiming a subsidy through the state DISCOM is the only option for homeowners. Customers’ information will be shared, and the nearest channel partner will be registered. All states’ DISCOMS can be found here.

If you install a solar system under a subsidy programme, the solar installation business will issue a 5-year performance warranty, after which you will be liable for the solar system on your own.

Commercial and industrial customers are not eligible for this subsidy since they are eligible for additional benefits such as accelerated depreciation, tax holidays, and excise duty exemptions.

#2. Channel Partner Benefits

A broader consumer base and more business benefit channel partners. Even though he desperately wants the subsidy, it is difficult for the average person to figure out how to receive it. The channel partner enters the picture at this point. He makes every effort to collaborate with the customer and government departments in order to speed up the process of obtaining a subsidy for the consumer.

#3 Benefits of DISCOMS 

Residential power usage decreases, allowing them to provide more in the commercial sector. Commercial locations, we know, use more electricity than residential areas.

The client is pleased because he received financial assistance, the channel partner is pleased because he gained a new customer, and the government is pleased because it is one step closer to achieving its solar target.

Subsidy Disqualifications

Let’s look at some of the disadvantages of the subsidies scheme:

#1. Customer Disadvantages: I believe there are two big disadvantages to installing a solar system under a government subsidy programme.

  • Less Warranty: If you install a solar system under the government’s solar subsidy programme, you’ll get a 5-year warranty on the entire system. After 5–7 years, you will need to replace the inverter.
  • No Top Brands: If you install a solar system using this method, you won’t be able to specify the solar panel and inverter brands you want, such as Loom Solar, Luminous, Microtek, Exide, Enphase, Solar Edge, and so on.

#2. The Merits of a Channel Partner: According to industry analysts, they are confronted with the following issues:

  • Significant investment
  • There is no guarantee that DISCOMs will return subsidy funds after providing system service and warranty for the next five years.

Solar Panel Subsidy Cost Estimation

Solar Panel Subsidy

People who install solar rooftop systems can receive subsidies from both the federal and state governments. The federal government provides a 30% subsidy to states in general categories for these systems. The central government provides subsidies of up to 70% to special states such as Uttarakhand, Sikkim, Himachal Pradesh, Jammu & Kashmir, and Lakshadweep.

Without a subsidy, the typical cost of installing a rooftop PV system should be between Rs 60,000 and Rs 70,000. To qualify for the generation-based incentive, the consumer must generate between 1100 and 1500 kWh per year.

An individual who is interested in receiving a subsidy must adhere to certain guidelines. He’ll need to call their power provider (or apply online with the relevant papers), who will inspect and approve the installation site. The electricity provider then pays a visit for an inspection. Customers can then take advantage of the subsidy. Contact G8Solar today!!