Hurdles in rooftop solar adoption in Assam

The adoption of rooftop solar systems has double benefits — it substantially reduces the electricity bills of residential consumers and increases renewable energy generation that is critical for the country achieving its climate goals. The number of installations compared to total applications under the PM Surya Ghar: Muft Bijli Yojana remaining still very low is baffling, as a large number of consumers in the state demonstrated great enthusiasm to adopt rooftop solar systems when the scheme was launched last year. The higher rejection of bank loans sought by consumers for installation of rooftop solar is learnt to have resulted from reluctance on the part of most banks, except a few public sector ones, to support the scheme that is a cause for concern. Banks unwilling to support the scheme are reported to have pressed for collateral and rejected loan applications on the grounds of lack of adequate security. Under the scheme, the entire process, right from submission of application to disbursal of Central Financial Assistance (CFA) to beneficiary households, is completed online. The average time taken in processing the CFA is 15 days, provided all required information and documents are furnished correctly. Without hassle-free financing of the scheme by all the banks, the installation of subsidised rooftop solar systems will continue to be slow. The importance of increasing solar adoption in ecologically fragile regions like the Northeast region does not need to be pointed out. The PM Suryaghar has increased the supply of renewable energy in the electricity grid, and more households installing it in the state would imply the contribution by the state towards the country’s goal of decarbonising the power sector by increasing the share of renewables in the energy mix. The reduction of fossil-fuel-based thermal power in the grid is vital to reduce carbon emissions in the energy sector. Official estimates show that across the country, around 45% of residential consumers are receiving zero electricity bills on the installation of rooftop solar. As the state’s own generation is inadequate to meet the rising peak hour demand, the Assam Power Distribution Company Limited purchases from the national grid to meet the shortfall, due to which the electricity bills have risen for consumers. In such a situation, expeditious installation of solar rooftops would have reduced the burden on residential consumers. The Assam Integrated Clean Energy Policy 2025, notified by the state government in February, envisaging the promotion of solar rooftops in the government and domestic sectors, is reflective of the government’s commitment to promoting renewable energy. The policy states that such projects will be promoted under “PM-Surya Ghar: Muft Bijili Yojana” or any other scheme of the central and state governments. The policy seeks to empower residential households to generate their own electricity by installing grid-connected solar rooftop projects that provide a strong policy push for solar rooftop adoption. The implementation of the policy crossing the hurdle posed by reluctance by banks to finance the residential installation will be crucial to translate the policy announcement into action. Apart from solar power, the policy also includes other clean power technologies such as wind power, wind-solar hybrid power, mini and small hydro, pumped storage plants, battery energy storage systems, biofuels/biomass & waste-to-energy projects, etc., which signal the readiness of the state to receive investments in these technologies. The policy aims to achieve a target capacity addition of 11.7 gigawatts of renewable power projects over the next five years, including 600 MW under rooftop in the residential sector, 3000 MW under grid-connected ground-mounted plants, 1000 MW under rooftop solar in the industrial and commercial sectors and 300 MW under rooftop solar at government buildings. Alignment of the policy with the central and state government schemes for rooftop solar adoption provides the scope for the state government to take the initiative to address the challenges faced in the implementation of the PM Surya Ghar in the state. Smooth implementation of the scheme is crucial to sustain the enthusiasm of the consumers for adoption of solar systems. The higher number of installations and doing so in an expeditious manner will also be key determinants for similar schemes to be initiated by the state government under the new policy. The review of the progress of the implementation of the PM Surya Ghar cannot be left as a routine review of bank performance in respect of the implementation of various central government schemes and projects. A comprehensive review of the scheme vis-à-vis progress of rooftop solar adoption in the state will lay a solid foundation for advancing renewable power use among consumers. The role of consumers in the transition from fossil fuel-based energy generation to renewable energy generation is crucial, as it is the consumers who will create the demand for renewable energy, based on which power producers, both in the public and private sectors, will be able to make realistic projections of the demand and supply situation.