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MNRE Issues Clarification on Applicability of CFA for Solar Rooftop Programme Ph-II Under VNM Arrangement

MNRE Issues Clarification on Applicability of CFA for Solar Rooftop Programme Ph-II Under VNM Arrangement

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The Ministry of New and Renewable Energy (MNRE) issues clarification on applicability of Central Financial Assistance (CFA) available under Rooftop Solar (RTS) Programme Phase-II for solar systems installed under Virtual Net Metering (VNM) arrangement.


The Ministry is implementing Rooftop Solar Programme Phase-II for which the guidelines were issued in August 2019. Under this Programme 4000 MW rooftop solar (RTS) capacity addition is targeted in residential sector through Central Financial Assistance (CFA) by individual household or by GHS/RWA.

Some of the States and UTs are having provision of VNM, wherein a group of consumers of a Distribution company can install a solar plant within the area of the same company and avail benefits of net metering against the solar power fed into the grid from that solar plant.

A clarification has been sought by different stakeholders on the applicability of CFA available under RTS Programme Phase-II for residential consumers installing solar plants under VNM arrangement.

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In this regard, the ministry said that the CFA applicable under RTS Programme Phase-II of MNRE will also be applicable for solar plants set up under VNM arrangement, subject to following conditions: –

i. CFA would be available only for residential consumers of rural areas,
ii. Considering that connected load of a residential consumer in rural areas would generally be not more than 3 kW, each participating consumer under VNM would be allowed to install capacity upto 3 kW and avail subsidy available under RTS Programme Ph-II.
iii. Solar plant installed under VNM shall supply power to the same distribution sub-station (HT or LT side) through which the participating consumers are connected. This will ensure reliable power supply to the participating consumers and other benefits of co-locating power generation and consumption.

Further, to facilitate the installation of solar plants under VNM arrangement the ministry has prepared a Concept Note covering some of the possible business models including CAPEX, RESCO and Utility operated model.

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View the Concept Note on Virtual Net Metering:

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