MNRE Issues Guidelines for 'Service Charge' Under PM Surya Ghar: Muft Bijli Yojana

The Ministry of New and Renewable Energy (MNRE) has issued comprehensive operational guidelines for the implementation of the 'Service Charge' component under the 'PM Surya Ghar: Muft Bijli Yojana', an ambitious program aimed at installing rooftop solar systems in one crore households across India.

The scheme received  approval in February 2024, with an estimated financial outlay of INR 75,021 crore, and plays a pivotal role in enhancing renewable energy capacity, particularly through the expansion of rooftop solar installations.

The guidelines specifically address how service charges will be utilised to ensure smooth execution of the project, which plays a pivotal role in enhancing India’s residential solar capacity and contributing towards the country’s renewable energy goals. The guidelines lay out the framework for service charges, which are pegged at 1 percent of the Central Financial Assistance (CFA) allotted to residential consumers. These charges are crucial for administrative and technical support, with approximately INR 657 crore set aside for this purpose.

The National Programme Implementation Agency (NPIA) will receive 5 percent of the total allocated service charges to manage national-level activities, including infrastructure upgrades, personnel management, and centralised monitoring. These funds are essential for ensuring the effective rollout of the scheme.

The NPIA, in collaboration with State Implementation Agencies (SIAs) and local distribution utilities, will oversee regional implementation, ensuring efficient adoption of solar technology. This cooperative approach is expected to facilitate widespread dissemination of solar benefits across the country.

It may be mentioned that the creation of Model Solar villages, which is an integral part of the program, will serve as demonstration projects showcasing the advantages of rooftop solar energy. These villages will receive special funding—INR 5 lakh per village and INR 7.5 lakh for those in special category states and Union Territories like Uttarakhand, Himachal Pradesh, Jammu and Kashmir, Ladakh, and northeastern states—to help implement solar solutions and highlight their potential at the community level.

The initiative will also promote smart energy solutions such as net metering, real-time monitoring, and consumer engagement via modern digital interfaces. To ensure the scheme's success, the MNRE has empowered the Mission Directorate to utilise the full service charge component, subject to approval from the Competent Authority. The funds will cover a wide range of activities, including the deployment of IT systems, the establishment of project management units, and the organisation of seminars and meetings. The NPIA will provide secretarial and managerial support to the Mission Directorate, managing the operational aspects of the scheme.

The base service charge for the NPIA stands at 5 percent of the total outlay for service charges, amounting to INR 32.85 crore, which will be disbursed in three equal annual installments. Additional financial support will be provided to the NPIA to strengthen its management and infrastructure, including IT infrastructure and manpower, to meet the scheme's target of installing 1 crore rooftop solar units.

The MNRE has also granted the NPIA the flexibility to outsource services or enter into contracts for critical implementation tasks, following competitive and transparent procedures. State Implementing Agencies (SIAs), primarily distribution utilities, will receive substantial financial support under the scheme.

A total of INR 200 crore has been allocated to SIAs, which will be distributed based on the number of domestic consumers served by each agency, with a minimum of INR 50 lakh. This funding will be provided in three equal annual installments, allowing SIAs to develop the necessary administrative capacity to implement the scheme. In states with multiple agencies promoting rooftop solar, the state Energy or Power Department may reallocate service charges to support subordinate agencies. Agencies implementing Model Solar Villages will also benefit from financial assistance under the scheme.

A service charge of INR 5 lakh will be provided for each Model Solar Village, increasing to INR 7.5 lakh for villages in special category states and union territories. This funding will be released once the program is successfully implemented in the respective villages.

The service charges will cover various expenses, including establishing Program Management Units (PMUs) and Project Management Cells (PMCs). The funds will also be used to deploy manpower, upgrade IT systems, facilitate net-metering, and enhance consumer services.

MNRE has emphasised the importance of efficient use of these funds to ensure smooth implementation of the scheme. 

The MNRE has reserved the right to amend the service charge guidelines as necessary to ensure the scheme's successful implementation. Any amendments will require approval from the Minister of New and Renewable Energy. This initiative is expected to significantly contribute to India’s renewable energy targets and its global climate commitments.