In a notification issued on Wednesday, the Ministry of New and Renewable Energy (MNRE) announced that it has received the approval by the President of India for the implementation of a subset of the existing 5,000 MW viability gap funding (VGF) program that includes developing 1,000 MW of solar projects in the northeastern states under Jawaharlal Nehru National Solar Mission (JNNSM).

This approval is for the implementation of the VGF program during financial year 2018-19 towards meeting the targets of JNNSM.

It will be implemented by the Solar Energy Corporation of India (SECI) in accordance with the MNRE guidelines.

Under the program, 1,000 MW of solar projects will be set up on build, own and operate (BOO) basis by the solar power developers (SPDs).

Here are some of the features of this program-

• Bidding would be conducted by SECI with a ceiling tariff of ₹3.0 (~$0.042)/kWh, with a maximum VGF of ₹10 million (~$0.14 million)/ MW.
• Minimum size of the project should be 5 MW due to land constraints in the northeastern states
• Commissioning of solar projects will be within 21 months from the date of signing of the power purchase agreements.
• VGF will not be given to any private party for private consumption of power.

In December 2018, MNRE amended the guidelines for the implementation of its program under which the government aims to develop 2 GW of solar PV projects with VGF as part of the the third batch of the National Solar Mission Phase-II.

The MNRE has amended guidelines for implementation of VGF program a few times.  In June 2018, MNRE amended the guidelines for the implementation of the VGF program for solar PV projects under NSM Phase-II.

In the same year, the MNRE also amended, for the fourth time, the VGF guidelines to develop 5 GW of solar projects with VGF under the fourth batch of the NSM Phase-II.