Solar power incentives in Punjab, a boon for farmers

Thanks to a host of incentives and initiatives by the Punjab government, solar investment in Punjab is turning out to be a boon to the farmers looking for alternative model of diversification.

Solar power incentives in Punjab, a boon for farmers

Several farmers who have leased out land for solar power generation are a happy lot and the government too now has set up a target of harnessing 2000 megawatt (MW) solar energy within two years. The target may not be far-fetched with state averaging around 300 sunny days annually.

In fact going by the claims of officials in the Punjab Energy Development Agency (PEDA), there has been a 25-fold increase in the solar power production in the state in just two years. Presently, 225 MW has been tapped with an investment of around Rs.1500 crore ($235 million), where the production was barely 9MW in 2012.

New schemes for farmers

The government has launched a “Land on lease” scheme in which the farmers are being encouraged to set up solar power plants ranging from 1 MW to 2.5 MW in the fields to promote solar energy which is also called clean energy.  Such was the response that within two months after its launch more than 3,500 acres of land was offered by farmers to investors for setting up the solar projects. The scheme was backed up with the concessions being offered by the state government. The government has also been granting exemption to investors from the ‘change of land use’ (CLU) charges under the state’s policy of promoting non-renewable energy sources.

Mini solar energy plants

A number of farmers have evinced interest in having own mini solar-energy plants. The state government has so far processed 174 solar-energy plant proposals in an average time of 38 days. The government has also decided to allot projects of 1-to-2.5-MW capacity to farmers, with a target of generating a total of 500 MW. Already 6,000 acres of land has been registered with Punjab Energy Development Agency (PEDA) for this purpose
Five acres of land and investment of Rs.5 crore is required for installing a 1 MW solar power plant. If a farmer wants, he can easily get a bank loan up to Rs.5 crore, a PEDA official told IANS.
As per the latest scheme, a farmer can give land on lease after PEDA approval for 30 years at an annual lease from Rs.35000 to Rs.50,000 per acre with a five per cent annual rise in the amount of lease. As giving land on lease in no way curtail farmers from cultivating crops, the lease amount would be an additional income for the farmers.

Net-metering policy

The net-metering policy has been introduced keeping in view farmers’ interest in particular. Under the policy the amount of power a household utilises and the amount of power it feeds into the state grid is measured. Accordingly the state government makes the payment for the power which is diverted to the grid. The policy was announced in November 2014. Under the net-metering policy PEDA has already received applications from about 1100 households for setting up solar plants.

  ‘Single window”

To make the process of approval hassle free the government has introduced a single window system for solar energy investors in the state, where approval is to be given within 30 days.


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