MNRE Modifies Rules To Ease Land, Evacuation Constraints for Solar Power Plants

MNRE in its latest order has issued a modification in the scheme for “Development of Solar Parks and Ultra Mega Solar Parks Scheme”. In its bid to remove deterrents related to the availability of land and evacuation issues, the ministry has proposed these changes.

“In order to address the two most critical elements, such as land and power evacuation infrastructure for solar parks, a new mode is being introduced for development of renewable energy parks (solar/wind/hybrid/other RE parks) through Solar Energy Corporation of India (SECI),” the ministry said in a notification.

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Under the new guidelines, called Mode-7:

• SECI will make both government and private land available to successful bidders for setting up projects with the assistance of state governments.
• The state government would be paid a facilitation charge of Rs 0.02 per unit of power being generated in these parks.

This facilitation charge would be paid by renewable energy project developers for setting up projects in these lands in addition to any land cost. Also, no fund from Central Financial Assistance (CFA) would be used for the procurement of land, said the modified guidelines. The existing solar park scheme provides for CFA of Rs 20 lakh per megawatt (MW) or 30 percent of the project cost, whichever is less, for setting up of both the internal and external evacuation infrastructure.

The Solar energy Corporation of India or SECI would act as a Solar Power Park Developer (SPPD) and will get the external power evacuation infrastructure of the parks developed by the External Transmission Development Agency such as transmission utilities.

The ministry also said that about 16,650 MW capacity is still to be allocated under the scheme and the entire CFA available for this spare capacity under the solar park scheme would now be utilized for Mode-7.

Under the new guidelines, SECI would also set up a Payment Security Mechanism to make setting up of renewable projects in such parks more attractive. The idea is to ensure continuous payment to developers and mitigate risk due to default in payments by discoms.

Currently, India which has 34 solar parks operating in 21 states has a total capacity of 20,000 MW or 20 GW and wants to reach 100 GW capacity by 2022, which includes 40 GW of grid-connected rooftop solar and 60 GW in Solar parks.