CleanTech/ Renewable Energy, Finance, Other, solar

Status quo for solar industry- No provision for Phase II -VGF this budget

According to reports, the Budget has nothing specific to the solar industry, but the industry is not unhappy about it. In fact, the industry is sanguine about the fact that status quo has been maintained, there being no customs duty on solar cells and modules, as has been demanded by domestic manufacturers.

The Budget does not set apart any sum for providing ‘viability gap funding’ to the projects that would be set up under the Phase II of the Jawaharlal Nehru National Solar Mission. The plan of the Ministry of New and Renewable Energy (MNRE) was to engender creation of 750 MW of solar photo voltaic capacity in 2013-14 by providing viability gap funding.

Asked about this, the Secretary of Solar Independent Power Producers’ Association, Jagdish Agarwal, told Business Line that MNRE had cautioned the solar industry not to expect budgetary support for the ‘viability gap funding’. “Therefore, we are not shocked,” he said.

He said that SIPPA was happy over the promise of low cost finance that would be made available to renewable energy projects out of the National Clean Energy Fund, routed through Indian Renewable Energy Development Agency, a non banking finance company under the MNRE.

Pashupathy Gopalan, Managing Director, SunEdison, which is the largest foreign investor in the Indian solar energy space, said that it was “a little disappointing” that the Finance Minister has not provided any support for the National Solar Mission’s Phase II. But he said that it was good that IIFCL and ADB would come together and give credit enhancements for projects to go to the bond markets.


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