The union cabinet has raised the target of solar power capacity installation five times to 100 GW (1,00,000 MW) in India including 40 GW rooftop and 60 GW through large and medium scale grid connected solar power projects by 2022.
The total anticipated investment to meet the expanded target is around Rs 6,00,000 crore ($93.6 billion) of which Rs 15,050 crore will be provided in the first phase as capital subsidy to promote solar capacity addition in the country.
Apart from this, solar power projects with investment of about Rs 90,000 crore would be developed using bundling mechanism with thermal power. Further investment will come from large PSUs and Independent Power Producers (IPPs), the government said in a cabinet note on Wednesday.
The government may also approach bilateral and international donors as also the Green Climate Fund for achieving the ambitious target.
Solar power can contribute to the long-term energy security of India, and reduce dependence on fossil fuels that put a strain on foreign reserves and add to pollution in the country.
The government has been looking to increase the contribution from renewable energy sources to boost power shortage in the country.
The previous government had launched the Jawaharlal Nehru National Solar Mission (JNNSM) in 2009, which set the target of deploying 20,000 MW of grid connected solar power by 2022.
In the last two to three years, the sector has witnessed rapid development with installed solar capacity increasing from 18 MW to about 3,800 MW during 2010-15.
The price of solar energy has also come down significantly from Rs 17.90 per unit in 2010 to under Rs 7 per unit. With technology advancement and market competition, this clean source of energy is expected to reach grid parity by 2017-18.