Uttar Pradesh Permits Agricultural Land to be Leased for Solar Projects

The Uttar Pradesh government has recently passed a bill which says that agricultural land can now be used for solar energy generation, thereby increasing the investment potential of renewable energy projects in the state.

The UP-Revenue Code (Amendment) Bill, 2019, replacing an ordinance amending the Uttar Pradesh Revenue Code has been passed recently, and it has streamlined the process of converting agricultural land to non-agricultural land through an amendment to Section 80.

As per the ordinance, an owner of agricultural land in the state can convert it for industrial, commercial, or residential use based on the approvals received on their applications for the same purpose. Amongst other uses, the land can also be leased by the owner for either agricultural purposes or for setting up solar energy projects in the state. The maximum time duration for which the land can be leased for agricultural purposes is 15 years. This duration may be extended if intended by both the entities. The maximum duration for establishing a solar energy project on the land has been set for 30 years.

The land is the biggest roadblock for solar energy development in India today. Land acquisition, transmission bottlenecks, and gaining approvals for various phases of the project are hindering commissioning datelines in multiple installations. The new bill passed by the UP government, will promote a seamless process of land acquisition, coupled with increasing investor confidence in solar projects within the ambit of the state. This may also motivate other states to follow suit.

Recently, the Gujarat government also amended its laws about the development of wind and hybrid energy development parks in the state. The government has allocated land in Kutch, where the wind potential is rather substantial. The area needed for 30 GW wind and hybrid projects will be prepared appropriately for the projects. Central government agencies will issue tenders for 20 GW of projects.

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