The government of Gujarat has approved a policy that aims to develop the state’s small-scale distributed solar photovoltaic (PV) sector.

According to a Gujarat government official, “The policy aims to facilitate the development of small-scale solar PV projects with sizes ranging between 0.5 and 4 MW. It will lead to setting up of solar PV projects in scattered pockets of barren and uncultivable land at a fast pace. The policy will provide visibility to small developers in terms of available tariff for the sale of power and help promote small-scale entrepreneurs.”

The government official further informed that the policy would be in force for five years. Projects installed and commissioned within the operative period of policy will be eligible for benefits under this policy for the entire 25-year term of their power purchase agreement (PPA).

The official also informed that the Gujarat Energy Development Agency (GEDA) would be the nodal agency for implementation of this policy. Developers of such projects will also be made to submit a bank guarantee of ₹500,000 (~$7,137.75)/MW at the time of entering PPA.

Key Highlights

• The policy will facilitate the development of small-scale solar PV projects with sizes ranging between 0.5 MW to 4 MW.
• Projects installed and commissioned within the operative period of policy will be eligible for benefits for the useful life of the project: 25 years.
• Any company, corporation, or individual can set up projects under this policy for the sale of power to utilities for their renewable purchase obligation.
• The applicable tariff for PPAs for such projects will be the average tariff discovered in GUVNL auctions in the past six months plus ₹0.20 (~$0.0029)/kWh.
• Interconnection voltage of project of up to 4 MW will be 11 kV or 66 kV.
• Solar project developers must provide performance guarantee at the rate of ₹500,000 (~$7,150.25)/MW.
• GEDA will be the nodal agency.
• For the time being, these projects will be exempted under scheduling procedure from the intrastate availability-based tariff.
• Operation and maintenance of the evacuation line will be the project developer’s responsibility.

This policy is another stride towards making Gujarat a hub for renewable energy generation. Towards the beginning of 2019, the Gujarat Electricity Regulatory Commission (GERC) announced new regulations for the forecasting, scheduling, and deviation settlement of solar and wind generating sources in the state.

Towards the end of January 2019, the state government of Gujarat modified its land laws relating to the development of wind and hybrid (wind and solar) parks in the state. The land has been earmarked for wind and wind+solar hybrid projects auctioned by Gujarat state agencies as well as central agencies.