PM Surya Ghar Yojana: Here's How It Could Help Recover Capital Cost In 2.5 Years
If someone sells the entire power produced (360 units), the customer can earn an additional income of Rs 2,880 per month or Rs 34,560 per year.
The subsidy allocation of Rs 78,000 for up to a 3 KW rooftop solar plant under the Pradhan Mantri Surya Ghar Yojana could help people recover their capital costs in less than 2.5 years.
Assuming the capital cost of Rs 52,000 per kilowatt—which is what the Maharashtra government announced for its rooftop plant—the installation cost for a 3 KW plant will be Rs 1.57 lakh.
If the subsidy provided is Rs 78,000, the customer will have to pay the remaining Rs 79,000 from their pocket.
A 3 KW plant generates, on average, close to 360 units of electricity. With free electricity for 300 units per month, the customer will sell the remaining 60 units on the grid, making an additional Rs 480 per month or Rs 5,760 per year.
If someone sells the entire power produced (360 units), the customer can earn an additional income of Rs 2,880 per month or Rs 34,560 per year. At this rate, the investment of Rs 79,000 can be recovered in 2.5 years.
If we assume the customer takes a loan of Rs 79,000 to install the plant at a 10% interest rate, the installation cost will go up to Rs 1 lakh, and the payback period will increase to three years, said Rupesh Sankhe, vice president and senior power analyst at Elara Securities Ltd.
“We expect a good response to this scheme if they get Rs 8 per unit selling price,” Sankhe said.
PM Surya Ghar Yojana
The scheme was first announced as the PM Suryodaya Yojana on Jan. 22 and aims to provide rooftop solar facilities to 1 crore households. On Feb. 1, Finance Minister Nirmala Sitharaman announced that 1 crore families could enjoy free electricity for up to 300 units.
Prime Minister Narendra Modi announced the subsidy structure of the scheme on Feb. 13.
Under the scheme, customers can avail up to Rs 78,000 for up to 3 KW of project installed, Rs 30,000 each for two kilowatts and Rs 18,000 for the third kilowatt. The amount has been capped at Rs 78,000 for projects above 3 KW.
Those installing the project on their rooftops will get the subsidy amount credited to their accounts 30 days after getting the commissioning report from the local distribution company that helped with the installation.
The government will invest Rs 75,000 crore under the scheme.
More details on vendors and whether the initial costs will be borne by the customer or the vendor are awaited.
