MNRE Notification Extends Deadline for PM KUSUM Component A Completion

The Ministry of New and Renewable Energy (MNRE) has published a notification extending the deadline for projects allotted under Component A of PM KUSUM scheme to March 31, 2022. Component A refers to ground mounted projects on barren/waste land owned by farmers or in rural areas, with an overall target of 10,000 MW of such projects eventually. Solar Power plants of capacity 500 kW to 2 MW can be set up by individual farmers, groups of farmers, and panchayats.

The current extension supercedes the extension already granted for Covid-19 linked delays.

The MNRE notification says that as per PM KUSUM component-A guidelines, the timeline for completing grid-connected solar power projects is 12 months from the date of issuing the letter of award (LoA) to the farmer or developer.

The MNRE, had granted a 75-day extension for projects with commissioning dates between April 1 and June 15, 2021 in June this year.

While developers who have been provided letter of awards will welcome the decision, we understand that offtake had been slow in 2021-22 in any case, so overall impact is unlikely to be really big. Component B of PM KUSUM, which provides for off grid solar pumps has been the most popular option availed off till now, with Component C, that seeks grid connected solar pumps, faring poorly too.

This year, there has been a distinct uptick in tenders under component A, with many states coming out with large tenders of upto 500 MW. In just this quarter, we have tracked close to 1500 MW of tenders under component A of PM KUSUM. The outcomes of most of these are not public yet, although the response to some of the recent ones has apparently been good, when we tried to speak to discom officials. These projects, especially where farmers or farmer organisations are involved, usually take longer to get going owing to the unfamiliarity of the promoters with the process and technicalities, and the risk of falling for scamsters.

The MNRE has repeatedly warned people to beware of fraudsters posing as firms and agents that can get financing or approvals in place for PM KUSUM projects.