1.) What is Component A of PM-KUSUM Scheme?

Component A of PM-KUSUM scheme aims to support the installation of 10,000 MW of decentralized ground-mounted grid connected solar power plants termed as Renewable Energy Power Plant (REPP) of size up to 2 MW.

 

2 Who are eligible to setup Solar Power Plants under Component A?

The following termed as Renewable Power Generators (RPGs) are eligible:

• Individual farmers,

• Group of farmers

• Water User Associations,

• Farmer Producer Organisations (FPO)

• Primary Agriculture Credit Societies (PACS)

• Community/cluster-based irrigation system

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3 Where can the RPGs install the solar power plant?

The RPGs can set up solar power plant on barren, uncultivable, pastureland or marshy lands. Agricultural land is also permitted under the scheme provided that solar plants are installed in stilt fashion (i.e., raised structure for installation of solar panels) and with adequate spacing between panel rows for ensuring that farming activity is not affected.

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4 What is the eligible capacity of ground mounted solar power plant?

The eligible capacity of ground mounted solar power plant is between 500 kW to 2 MW. Solar power plants of size less than 500 kW may also be allowed in specific cases based on technocommercial feasibility.

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5 Is it necessary that the substation should be in 5 km radial distance and whether sites with 11kV feeders in the proximity can be considered even though they were not within 5 km radial distance from the substation?

The Renewable Energy Power Plant (REPP) will be preferably installed within five km radius of the sub-stations in order to avoid high cost of sub-transmission lines and to reduce transmission losses.

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6 How can I benefit from Component A of the scheme?

Power Purchase Agreement (PPA) will be signed between RPG and DISCOM for a period of 25 years wherein the RPGs can earn by selling the renewable power generated to the DISCOMs at a feed-in-tariff (FiT) as determined by the State Regulatory Commission (SERC). If farmer(s) decides to lease his (their) land(s), then he (they) can earn lease income.

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7 Is there any penalty for shortfall in solar power generation by solar power plant?

No, there is no penalty for shortfall in solar power generation. 8 What checks do the SIA have to see in order to allot a pump at site? SIAs are required to check Land Record Papers, Aadhar Card, Other information like address proof, location of land, irrigation details etc. before allotting pump to a beneficiary.

 

IMPLEMENTATION METHODOLOGY

1 How can I apply under Component A?

DISCOMs ascertain the RE generation capacities near the substations and invite the Expression of Interest (EOI) to participate in the selection process.

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2. Can I get more than one REPP installed?

Yes, but only if they are connected to a different substation and located at a different place.

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3 When can the installation of REPP commission?

The selected power generator shall commission the solar power plant within twelve months from date of issuance of Letter of Award (LoA).

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4 What is a Power Purchase Agreement (PPA)?

A PPA to be executed between the DISCOM and the RPG is a legal contract signed which binds the DISCOMs to purchase the generated power from the RPG at a pre-determined feed-in-tariff. It has to be executed within two months of the date of issue of Letter of Award (LoA) by DISCOM or any agency authorized by the DISCOM & is binding for 25 years.

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5 Is there any kind of penalty for delay in signing PPA?

Yes. In case, the selected power generator fails to execute the PPA within the stipulated time period given in the scheme guidelines, the Bank Guarantee equivalent to EMD shall be en-cashed by DISCOM as penalty.

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6 What kind of payments/Bank Guarantees are required from RPGs?

A non-refundable processing fee from the interested RPG needs to be submitted, which in no case shall be higher than Rs. 5000 per MW or part thereof of the capacity applied for. The RPG shall provide the following Bank Guarantees to DISCOM as follows:

• Earnest Money Deposit (EMD) of Rs. 1 Lakh/ MW in the form of Bank Guarantee along with EoI.

• Performance Bank Guarantee (PBG) of Rs. 5 Lakh/MW within 30 days from date of issue of Letter of Award. The Bank Guarantees against EMD shall be returned to the selected power generator on submission of valid

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PBGs. COSTS & FINANCES​

1 How much does set up of REPP cost?

It costs approximately Rs. 4 crores per MW to install the solar power plant.

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2 Is there any subsidy support available?

No subsidy support is available under Component A. The RPGs are required to arrange the capital for installing the plants on their own.

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3 What if I am unable to arrange the required capital, am I still eligible under the scheme?

In this case, one can either take a loan from the financial institutions or can opt for developing the solar power plant through developer(s) or local DISCOM where one can lease his land to the developer or DISCOM and will get lease rent. In this case the DISCOM or the developer will be termed as the power generator.

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4 Is there any eligibility of developer for becoming a power generator?

Yes. The eligibility for a developer to become a power generator is that the net-worth of the developer should not be less than Rs. 1.00 Crore per MW (of the capacity applied).

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5 Is financing readily available for installing solar power plant?

Yes. One can take loan for installing solar power plant on his or her field. Banks provide loans for solar panels under priority sector lending guidelines of RBI. For more details please visit the link: https://m.rbi.org.in/scripts/BS_ ViewMasDirections.aspx?id=11959

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ROLES & RESPONSIBILITIES

1 Who is the Implementing Agency under this component?

DISCOMs /GENCO/ any other Department designated by State Government will be the implementing agencies for Component A Each state will be having a separate implementing agency. The list can be found using the link: https://mnre.gov.in/img/documents/uploads/ file_s-1591004979688.pdf

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2 What role MNRE will undertake for implementation of the Scheme?

The broad roles of MNRE under this component are:

• Allocate initial capacity for Pilot Project to DISCOMs based on their demand and readiness for implementation

• Monitoring and evaluation of the successful implementation of the scheme

• Issuance of Model PPA and Model Lease Agreement for the implementation of the scheme

• Release Procurement Based Incentive (PBI) to the DISCOMs

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3 What role will DISCOM undertake under the scheme?

The broad roles of DISCOM under this component are:

• Determine demand for sanction under the scheme along with details on their readiness to implement the component A

• Declare solar power capacity that can be connected to a 33/11 kV sub-station and carry-out the procedure for selection of power generator.

• Issue LoA and sign PPA with power generator and provide connectivity at the sub-station to the power generator.

• In case, power generator has taken land from a farmer/group of farmers on lease, pay monthly lease rent to the lessor directly in his/her bank account before 5th day of the month following the month for which the lease rent is due.

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4 What are the roles that State Nodal Agency (SNA) will undertake under the scheme?

SNA will coordinate with States/UTs, DISCOMs and farmers for implementation of the scheme. They will assist the farmers in project development activities including feasibility studies, PPA/EPC contracts, getting funds from financial institutions, etc.