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Gujarat’s New Budget Emphasizes on the Growth of Rooftop Solar Sector

With Gujarat’s state budget announced for the current financial year (FY) 2019-2020, a target of 30 GW of renewable capacity of 2022 has been set. The goal consists of both solar and wind, and out of this targeted capacity, 20GW will only be used for the state whereas 10 GW will be consumed by the national implementing agencies and their respective project.

The state government is focusing again on the generation of solar rooftop projects in Gujarat with a new budget- a provision of INR 10 billion for a brand new rooftop solar photovoltaic (PV) program.

Under the Gujarat solar policy 2019 it was proposed that about 2,00,000 families will be provided with rooftop solar, and the beneficiaries will be given a subsidy of up to 40% of the capital cost for the project of 3 kW and a subsidy of 20% on the system cost for the range of 3 kW to 10 kW.

This will be treated as an added incentive on the subsidy, which is already being implemented by the central government and is said to help in quickly adapting the rooftop solar PV by the residential customers.

What this will do is- help the state entities meet their renewable purchase obligation by the upcoming financial years. The state has its RPO set at 14.30% for the current financial year (2019-2020), 15.65% for 2020-2021 and 17% for 2021-2022.

Now, this is done keeping in mind the modification of land laws for the development of wind and hybrid parks in the state by the government. In Gujarat, the land has been earmarked for both the above-mentioned projects which will be auctioned by the state agencies as well as the central agencies.

According to a project tracker done by Mercom’s India solar, the state has a solar capacity of 2.1 GW with nearly 1.1 GW of solar projects through various stages of development.

A new trend has been seen where a lot of states with limited land availability are now opting for rooftop solar and for the same they have been allocating portions of their budgets keeping in mind the growth of this fledgeling sector.

For example, during the starting of the year, the Kerala state government had just announced their budget, which gave a push on setting up the rooftop solar projects in the state. While at the same time pushing for the development of the electric vehicle sector.