The National Bank for Agriculture & Rural Development (Nabard), in association with the Union ministry of new and renewable energy, has firmed up plans to promote solar energy penetration through a multi-agency approach.
Nabard, run by the central government, has launched a capital subsidy-cum-refinance scheme for installation of solar off-grid (photovoltaic and thermal) applications. This is to enable cooperative banks and regional rural banks (RRBs) to extend capital subsidy and loans at subsidised rates to people opting to install solar applications such as home lighting, water heaters and irrigation pumps.
Nabard executive director Prakash Bakshi told Business Standard: “Under the scheme, the borrowers will get 30 per cent capital subsidy and bank loan at five per cent interest per annum for installing solar devices in their premises. To begin with, the scheme would cover solar home lighting systems (photo-voltaic) having PV module capacities ranging from 10 Watt-peak (Wp) to 200 Wp per unit and Flat Plate and Evacuated Tube Collector-based water heating systems. The scheme is likely to be extended to cover higher PV modules shortly.”
He said Nabard was also encouraging banks to set up demonstration solar home light (SHL) units in about 20 of their branches, with 50 per cent subsidy from Nabard. “Over 10 RRBs and three cooperative banks have opted to do so. The average cost of an SHL is about Rs 13,500, with a loan of about Rs 10,000 per unit. The advantage is that villagers see a live demonstration of the effectiveness of the SHL when they visit the branch and may opt for loans on being satisfied that it is useful. Since this is a home lighting system, it is not expected to generate revenues, but the savings made on kerosene and erratic electricity is enough to repay the loan in three to four years.”
According to Bakshi, financing of SHL has been taken up in a big way by 25 RRBs, which have financed 100,000 such units. “The lead is taken by Aryavart Grameen Bank in Uttar Pradesh, which alone has financed more than 20,000 units. The Gurgaon RRB has also financed about 10,000 units. It is now picking up in Rajasthan and the six RRBs of the state have planned to finance 70,000 SHL units during the current financial year,” he informed.