The Ministry of New and Renewable Energy (MNRE) has said 1% of the Central Financial Assistance (CFA) component will be imposed as a service charge on rooftop solar installations under the PM Surya Ghar: Muft Bijli Yojana to provide financial support to implementing agencies.

The government has allocated ₹6.57 billion (~$78.24 million) to cover service charges associated with implementing the program’s various components. The funds will be utilized by REC and state implementing agencies (SIA).

The Mission Directorate, headed by a joint secretary in charge of rooftop solar, will be responsible for the program’s implementation. It will have the authority to utilize the entire outlay for the service charge component of the program to deploy IT systems and manpower and to conduct seminars and meetings.

REC will provide secretarial, managerial, and implementation support to the Mission Directorate in the Ministry of New and Renewable Energy. It will be eligible for a base service charge of 5% of the overall financial outlay of the service charge component of ₹328.5 million (~$3.91 million). This charge will be disbursed to REC over three equal annual installments at the beginning of each financial year. It will also be eligible for management and infrastructure support charges of up to 5% of the overall financial outlay of the service charge component.

MNRE/Mission Directorate can also ask REC to undertake services that may be outsourced/ contracted out through an open, transparent, competitive, tender-based rate discovery process or awarded on a nomination/limited inquiry basis. In such cases, REC will request funds under the service charge component.

Ministries and government-owned entities may mutually decide the terms of reference and the transaction rate. The REC will be authorized to incur expenditures under the service charge head.

SIAs will be allocated ₹2 billion (~$23.81 million) out of the service charge outlay as base service charge. The state-specific allocation for base service charge will depend on the number of domestic consumers or ₹5 million (~$59,547) (whichever is higher) per the General Report on the Power Sector by the Central Electricity Authority. SIAs will receive the funds in three equal annual installments at the beginning of each financial year.

In case multiple agencies are working for PM Surya Ghar-related works, the state Energy/Power Department may issue orders for the reallocation of service charges within its subordinate agencies from the overall service charge accruing to the state SIAs.

The relevant agencies selected by the state governments to implement model solar villages will be given a service charge of ₹500,000 (~$5,954)per model solar village. This will be further increased to ₹750,000(~$8,932)per Model Solar Village for the implementation of model solar villages in certain states.

MNRE recently introduced provisions for including brand owners and channel partners in vendor registration to accelerate rooftop solar installations

In July, the ministry issued the operational guidelines to implement the PM Surya Ghar: Muft Bijli Yojana for the component ‘Incentive to Power Distribution Companies.