India Solar, Wind, Biomass, Biofuels – EAI

Central and State Government Solar Policies

Latest News for Energy Efficiency, Solar, Wind, Biomass Power, Biofuels, Waste to Energy

Central Government


India is faced with the challenge of sustaining its rapid economic growth while dealing with global threat of climate change. There are some observed changes in climate parameters in India too, like increase in surface temperature by 0.4 ˚C, variation in monsoon patterns, rise in sea levels by 1.06-1.75mm per year, extreme weather conditions breaking over 130 years records, Erratic water flow in perennial rivers originating from Himalayas. Alongside, the fast depleting conventional sources of power generation have worsened the situations that prophecy of energy crisis. India, in recent times, has started emphasizing power generation from renewable sources that is either grid interactive or off grid. India actively engaged in multilateral negotiations in the UN Framework Convention on Climate Change (UNFCCC), in a positive, constructive and forward-looking manner. In order to achieve a sustainable development path that simultaneously advances economic and environmental objectives, on 30 June 2008, the National Action Plan for Climate Change (NAPCC)  was framed with eight core missions:


Click here to know the latest state wise solar policies, incentives, bids and more.


  1. National Solar Mission – renamed Jawaharlal Nehru National Solar Mission (JNNSM)
  2. National Mission for Enhanced Energy Efficiency
  3. National Mission on Sustainable Habitat
  4. National Water Mission
  5. National Mission for Sustaining the Himalayan Ecosystem
  6. National Mission for a Green India
  7. National Mission for Sustainable Agriculture
  8. National Mission on Strategic Knowledge for Climate Change


Jawaharlal Nehru National Solar Mission (JNNSM)

The National Solar Mission was framed to promote the use of solar energy for power generation and other application; also promoting the integration of other renewable energy technologies like biomass and wind with solar energy options. The Solar Energy can be tapped via two routes solar thermal and solar photovoltaic. Thus the framework is targeted to achieve Solar energy utilization via these routes:

NSM Phase Utility Grid Power Off Grid Solar Solar Collector (sq. meters) REMARKS
2010-13 1000-2000 200 7 million Focus on capturing the low-hanging options in solar thermal and on promoting off-grid systems to serve populations without the access to commercial energy and modest capacity addition in grid based systems
2013-17 4000-10000 1000 15 million Capacity will be aggressively ramped up to create conditions for up scaled and competitive solar energy penetration in the country after taking into account the experience of the initial years
2017-22 20000 2000 20 million To create favorable conditions for solar manufacturing capability, particularly solar thermal for indigenous production and market leadership.

Tax Incentives, Subsidies and Incentives under JNNSM

Various tax exemptions, capital subsidies and incentives are available for several components and sub-components of solar energy value chain. JNNSM promotes the assembly of solar modules after import of cells which is free from import taxes. Some steps to avails subsidy can be summarized as shown:

Other benefits like Generation based incentives (GBI), 80% accelerated depreciation income tax benefits on renewable energy products including solar. Several products like Solar lanterns, street lights, blinkers and traffic signals are to be manufactured under specifications laid down by MNRE to avail capital subsidy benefits. Also the Generation based incentives.

Policies supporting Grid-interactive Renewable Power

National Rural Electrification Policy 2006

Rural Electrification is high time need for india where still 45 million households are un-electrified. Several goals are set under this policy:

  • Access to quality and reliable electricity at reliable rates and minimum lifeline consumption of 1unit/household/day by year 2012.
  • For remote villages where grid electrification is not feasible, off-grid based solutions based on stand alone systems to be taken up for supply of electricity.
  • Every state to come up with rural electrification plan mapping details of electricity delivery mechanism that may be linked to district development plans and this has to be intimated to appropriate commission.

Rajiv Gandhi Gramin Vidyutikaran Yojana (RGGVY)

This scheme is being implemented by Rural Electrification Corporation for permitting stand alone systems, rural electrification, bulk power purchase & management of local distribution (through franchisee model). Under this scheme, projects could be financed with 90% capital subsidy. For households below poverty line, 100% capital subsidy would be provided as per norms of Kutir Jyoti Programme. Main provisions under this policy are to set up-

Rural Electricity Distribution Backbone (REDB): Provision of 33/11 KV (or 66/11 KV) sub-stations of adequate capacity and lines in blocks where these do not exist.

Creation of Village Electrification Infrastructure (VEI): Electrification of un-electrified villages, un-electrified habitations and provision of distribution transformers of appropriate capacity in electrified villages/ habitation(s).

Decentralised Distributed Generation (DDG) and Supply: Decentralised generation cum-distribution from conventional sources for villages where grid connectivity is either not feasible or not cost effective provided it is not covered under the programme of Ministry of Non-conventional Energy Sources for providing electricity from non-conventional energy sources under their remote village electrification programme.

REDB, VEI and DDG would also cater to the requirement of agriculture and other activities including irrigation pumpsets, small and medium industries, khadi and village industries, cold chains, healthcare, education and IT. A total of 2,11,673 villages have been electrified among which 1,19,708 previously electrified villages have been intensively electrified.


Policies supporting Off-grid renewable power

Remote Village Electrification Programme

This project covers all those villages that are not under RGGVY scheme. The decision for choosing particular technology for power generation in such remote areas is taken by state implementation agency after examination of technical feasibility and resource availability. The projects are eligible for central financial assistance and developers can propose projects under the format specified in the policy document. Out of 8722 villages sanctioned under this scheme, 6446 have been completed and 1705 villages under progress. And out of 2533 hamlets sanctioned, 1587 have been completed.

 Special Area Demonstration Project Programme

The Special Area Demonstration Project Scheme of the MNRE has been introduced with an objective of demonstrating application of various Renewable Energy systems in a project mode at places of National and international importance The SADP Scheme is being implemented into two parts- Demonstration of Renewable Energy Systems at Prominent Places and the Energy Park scheme. Prominent places of national and international importance are categorized under world heritage sites, religious and educational institutions, tourist destinations, Zoos, museums, National Parks etc. Renewable energy Park scheme started in 1995, having objectives of creating awareness among rural and urban masses about the use and benefits of the renewable energy by demonstrating new and renewable energy systems and devices through working systems, cut models, LED models, blow ups etc. 30 State level renewable energy parks and 484 district level Renewable Energy Parks have been sanctioned so far.

Renewable Energy Supply for Rural Areas

This scheme was framed with the objective of developing and demonstrating commercially viable models for de-centralized energy supply in rural areas from renewable sources. The implementation partners for the programme are: Ministry of New and Renewable Energy (MNRE), National Thermal Power Corporation Limited (NTPC Limited) and Kirloskar Oil Engines Limited. The partners are to frame out the business, governance and revenue models for target areas. The project is under demonstration mode for 30 target villages in Chhattisgarh.

Renewable Energy for Urban, Industrial and Commercial Applications

The programmes implemented under this scheme are working for developing: Solar energy systems and devices (including solar thermal and solar photovoltaic systems);  Energy recovery from urban, industrial and commercial wastes; and Bioenergy and cogeneration in industry.

  • Under MNRE’s the Energy Efficient Solar/Green Buildings Programme, GRIHA rating system is being promoted for a target of supporting 4 million sq.meter built up area during 11th Plan. So far, 117 projects with 4.98 million sq.meter built up area with 81 projects from Government Departments with 3.22 million sq. meter built up area have been registered for GRIHA certification. An independent registered society ‘Association for Development and Research in Sustainable Habitats’ (ADaRSH) for promotion and implementation of GRIHA rating system has been set up in the country.
  • Under “Development of Solar Cities Programme” the Ministry had proposed to support 60 cities/towns for Development as “Solar/ Green Cities” during the 11th Plan period with the aim to promote the use of renewable energy in urban areas. At least one and a maximum of five cities in a State is being supported. Systems that can be installed are: Solar street lights, Solar traffic signals, Solar blinkers, Solar power packs/inverters, Solar illuminating hoardings/ Bill boards and other systems of community use as felt necessary by Implementing Agencies.
  • Under the Akshay Urja programme, shops are being established in each district to make renewable energy products easily available to people and provide after sales and repair services. The programme is in operation through State Nodal Agencies . Financial support in terms of soft loans from designated banks and a maximum of 2.40 lakh as recurring grant/incentive for first two years of operation from the Ministry is available for establishing such shops. Service Charge is also provided to SNAs. A total of 294 shops in 31 States / UTs, (including 113 Aditya Solar Shops) have been established under the scheme.

Know about the Central Schemes.

 State Government

Three state governments: Rajasthan, Gujarat and Karnataka have come up with their separate solar policy. Summary of three state’s solar policy is given here

State Gujarat Rajasthan Karnataka
Target PV- 365MW Thermal- 350MW
  2013 2017
PV 150 MW 200 MW
Thermal 150 MW 200 MW
200MW (40MW annually)
Project Capacity 2-25MW

PV: 5-10 MW;
Thermal : 5-50 MW

PV: 3-10 MW;
Thermal: Min 5 MW

Operative Period 30/03/2014


Sale of Power Period 25 years 25 years 25 years
Sale of Power Tariff

Year1-12: Rs. 15.00/12.00
Year 13-25: Rs. 5.00/3.00

Year 1-12: Rs. 10.00/9.00 Year 13-25: Rs. 3.00/3.00

Tariff based competitive bidding Tariff based competitive bidding with base price @ Rs. 14.50 /kWh (max)
Power Evacuation 66kV 33kV and above 11kV and above
Current Status PPAs signed for about 1200 MW Allotment in progress Allotment in progress



Know about the State Schemes.


Other states are planning to bring up renewable energy policy, if not a specific solar policy.