India's New Energy Policy: Complete 350MW Solar Project in 2016

Karnataka, India recently enacted the latest solar energy policy, which includes a 350MW solar project planned for completion in 2016. The government will appoint 40 MW direct sales for the different distribution companies in the state, commonly referred to as ESCOMS, up to 200 MW. State utilities obtained a total of 50MW of bundled solar thermal power for the development of the project. The difference between photovoltaic solar energy and concentrated solar energy (CSP) has not yet been determined.

The remaining 100MW consists of projects under the US Renewable Energy Certificate (REC) mechanism. These projects will not enjoy the preferential tax rate, but will generate RECs when selling solar energy to the utility grid with the average energy purchase cost of the distribution company (APPC). The APPC of each state will be different; between 2010 and 2011 APPC was between 1.60 and INR 2.69 per kilowatt-hour.

These projects completed as part of the 200MW project in 2016 will be between 3MW and 10MW. However, the minimum number of CSP items must be 5MW, and the maximum amount is unlimited.

The Electricity Regulatory Authority of the State of Karnataka in India has granted a 25-year standardized tax rate for state projects, valid until March 31, 2013. The maximum tax rate for photovoltaic projects is 14.50 Indian rupees per kWh, while that for CSP projects is 11.35 Indian rupees per kWh.

Karnataka will continue to support projects similar to India's National Solar Energy Development Mission (NSM); and set goals for the further development of a 126MW solar project from 2013 to 2014 through MSN and State Solar Energy Policy.

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