Budget 2019: Solar Sector Gets Only 1.1% Increase in Allocation

After the revised estimation of last year’s budget allocation is taken into account, this year's budget has seen a rise of just over a percent for the solar sector

The union budget for 2019-20 has provided for a budgetary allocation of Rs 3,004 crore for the solar power sector, including both grid-interactive and off-grid projects, a mere 1.1 % increase over Rs 2,969 crore provided in the revised estimate for last financial year (2018-19).

This is in stark contrast to the 57% jump in budgetary allocation for solar power projects seen in the revised estimate of 2018-19 compared to actual figures of Rs 1,889 crore for 2017-18.

The budgeted expenditure for the current fiscal includes Rs 2,479 crore as Central Financial Assistance (CFA) for capacity addition of 7,500 Megawatt projects. The rest – Rs 525 crore – is provided for off-grid and decentralised solar sector.

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The Rs 525 crores allocation includes implementation of Ph-III of the off-grid solar PV programme, which covers installation of 3 lakh solar street lights, distribution of 25 lakh solar study lamps and installation of solar power packs of total aggregated capacity of 100 MWp.

“In addition, under AJAY Ph-II over 3 lakh solar street lights would be installed. Further 20 MWeq projects of Concentrated Solar Thermal (CST) will be undertaken,” the budget papers said. The allocation for grid-interactive solar power projects at Rs 2,479 crore accounts for 59 % of the total budgetary allocation of Rs 4,272 crore for renewable energy projects connected to the grid.

The total allocation for the wind energy projects for the current financial year stands at Rs 920 crore, a 3 % decline over Rs 950 crore provided in the Revised Estimate of 2018-19. According to the budget papers, this amount is for past liability for the Generation Based Incentive (GBI) scheme which has been discontinued from April 1, 2017. The government is planning for a wind energy capacity addition of 4,000 Mw in 2019-20.

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