The ministry launched a scheme in 2010 under the Jawaharlal Nehru National Solar Mission to encourage installation of solar water heaters. The mission had set a target of deploying 20,000 MW of grid connected solar power by 2022 and reduce the cost of solar power generation in the country.
To promote the scheme, the government had announced a 30% subsidy on solar water heaters sold through the direct channel partners (DCPs) across the country. The subsidy amount was to be reimbursed to the channel partners.
Jaideep Malaviya, secretary general of STFI, said the subsidy attracted a large number of users and the area under solar water heaters grew steadily at the rate of 10 lakh sq meters per year. The direct channel partners working under the government scheme were required to sell the solar panels and other components at subsidized rates and later apply for reimbursement from the government.
Malaviya said, “The long pendency is forcing many direct partners to shut shop. India was the third largest market for solar water heaters after China and Germany, but 2013 saw it slipping to the 5th rank. Seeing the market growth, it is expected that the pendency may exceed Rs 500 crore in the current financial year, taking the burden to almost Rs 870 crore.”
“Of the Rs 375 crore pending, about Rs 55 crore is due for the year 2012-13 and Rs 320 crore for 2013-14,” said Malaviya. STFI officials said that if the amount is not disbursed within 10 days, the direct channel partners will protest.
“The STFI is of the view that the subsidy programme for solar water heaters should be done away with since the industry is self-sustainable,” said Malaviya.
Joint secretary in the ministry of new and renewable energy, Tarun Kapoor, said, “The subsidies were not paid till now due to unexpected growth of the programme and shortage of funds. We are trying to release the money as soon as possible and are hopeful of getting the money from the finance ministry (sic).”