Government approves Rs 5050 crore funding to push solar projects

The government today approved a ‘viability gap funding’ (VGF) of Rs 5,050 crore for setting up over 5,000 MW of grid linked solar power projects under the Jawaharlal Nehru National Solar Mission.

“The Cabinet Committee on Economic Affairs has given its approval for setting up over 5,000 MW of Grid-Connected Solar PV Power Projects on build, own and operate basis,” an official statement said.

After the meeting, Power Minister Piyush Goyal said, “To push solar energy programme, a scheme to provide Rs 5,050 crore VGF for setting up 5,000 MW capacity has been approved.”

Elaborating further the minister said, “The VGF will be provided through reverse bidding. Whosoever will quote the lowest VGF will win. One part of these funds will be for domestic modules. These companies will be given Rs 1.25 crore per MW and those coming through international competitive bidding will get Rs one crore per MW).”

Goyal expressed hope that the VGF reverse bidding auction will help in reducing the power tariff in future.

According to the statement, it will be implemented by Solar Power Developers (SPDs) with VGF under Batch-lV of Phase-ll of the JNNSM. The total investments expected under this scheme is about Rs 30,000 crore.

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