Context: 

Recently, the Union Ministry of New and Renewable Energy has notified Scheme Guidelines for the implementation of ‘Innovative Projects’ component under PM-Surya Ghar: Muft Bijli Yojana.

'Innovative Projects’ Component of PM-Surya Ghar 

• This component aims to identify and fund advancements in rooftop solar technologies, business models, and integration techniques.
• The component seeks to support startups, institutions, and industries in piloting new proof-of-concepts, with a focus on emerging solutions.

• Blockchain-based peer-to-peer rooftop solar (RTS), digital solutions for rooftop solar (RTS), smart building materials, grid responsive RTS with battery storage solutions, DISCOM IT systems for RTS management etc.

• Tenure: The project will have a maximum duration of 18 months.

• Funding: ₹500 crore has been allocated under the scheme for the Innovative Projects Component.

• Selected projects will receive financial assistance of up to 60% of the project cost or ₹30 crore, whichever is lower. 
• Additionally, annual awards for innovation will be granted to encourage further advancements, with prizes up to ₹1 crore. 

• The National Institute of Solar Energy (NISE) will serve as the Scheme Implementation Agency (SIA) for the Innovative Projects Component.

• NISE is an autonomous specialized institute under the Ministry of New and Renewable Energy (MNRE), for research and development, solar component testing and certification, capacity building, and development of solar products and applications.

About PM-Surya Ghar: Muft Bijli Yojana

• The Government of India approved the PM-Surya Ghar: Muft Bijli Yojana on 29th February 2024, with the aim to increase the share of solar rooftop capacity and empower residential households to generate their own electricity. 
• The scheme has an outlay of Rs 75,021 crore and is to be implemented till Financial Year 2026-27.

Implementing body:

• National Programme Implementation Agency (NPIA) at the National level
• State Implementation Agencies (SIAs) at the state level. 
• The Distribution Utility (DISCOMs or Power/Energy Departments, as the case may be) shall be the State Implementation Agencies (SIA) at the State/UT level. 

• The Union Ministry of New and Renewable Energy is the nodal ministry of the scheme.

• The scheme provides a subsidy of 60% of the solar unit cost for systems up to 2kW capacity and 40% of additional system cost for systems between 2 to 3kW capacity. The subsidy has been capped at 3kW capacity.

Other Features of the Scheme

• A Model Solar Village will be developed in each district of the country to act as a role model for the adoption of rooftop solar in rural areas.
• Urban Local Bodies and Panchayati Raj Institutions shall also benefit from incentives for promoting RTS installations in their areas.     
• The scheme provides a component for payment security for renewable energy service company (RESCO) based models as well as a fund for innovative projects in RTS.

Significance of the Scheme

• Free Electricity for Households: Households will be able to save electricity bills and earn additional income by selling surplus power to DISCOMs. 
• Reduced Carbon Emissions: It will reduce 720 million tonnes of CO2 equivalent emissions over the 25-year lifetime of rooftop systems.
• Employment Opportunities: The scheme will create around 17 lakh direct jobs in manufacturing, logistics, supply chain, sales, installation and other services.