Guidelines under the JNNSM for Off-grid Solar Applications

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The JNNSM envisions to have 200 MW capacity of off-grid solar applications installed by 2013 (end of Phase 1) and overall a 2,000 MW capacity by 2022. The project implementation process has been decentralised in that banks and other financial institutions can initiate proposals and are channel partners in the disbursement of the funds, in addition to the state nodal agencies (SNAs). Under the scheme, various off-grid PV systems up to a maximum capacity of 100 kWp will be supported by the ministry. It is expected that systems above 100 kWp will largely be grid-connected. Some of the salient features of the new guidelines include:
1. The guidelines for off-grid projects involve an upfront capital subsidy of `90 per Wp and a soft loan of 5% for 50% of the capital cost. The customer must pay 20% of the cost towards a down payment. The benchmark costs are estimated to be `300 per Wp. This sum includes five years of annual maintenance of the system. The loans will be routed through the National Bank for Agricultural and Rural Development (NABARD).
2. Performance standards have been mandated for the components of the systems. Product specifications for grant of subsidy have not been given, as was the case previously, thereby giving latitude to service providers to innovate and customise their products as per end-user requirements with performance standards. This is a welcome change.
3. For programme administrators like SNAs, who used to be the sole channel previously, 70% of the funds will be disbursed on sanction and the rest on completion of the project, as compared to 50% of each earlier. Release of funds will be back-ended to other entities.
4. Monitoring and evaluation is proposed at two levels. At the first level, all deployment will be given certain parameters for complying with IT-enabled transparency requirements. The projects might be required to provide brief details, photographs and possibly the details of beneficiaries on an online portal of the Indian Renewable Energy Development Agency (IREDA). At the second level, there is a proposal to bring in civil society organisations, eminent persons and corporate houses for the monitoring and verification of the projects.
5. The scheme will be reviewed by an internal review committee at half-yearly and yearly intervals, and modifications therein will be incorporated by the ministry within the framework of boundary conditions.
The implementation process continues to be in project mode,a as it is argued that this aids in focused
deployment in both region and application.4 The negatives, however, could be higher transaction costs and delays in approval, which could lead to uncertainty and risks for the project developers. A more rigorous social audit along the lines of the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) should be encouraged for evaluation of projects under the JNNSM. Overall, the new guidelines have brought in some welcome enhancements to the previous MNRE policy under the solar PV programme.

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