Solar energy policy in Gujarat

This page outlines all the available funding and incentive schemes for solar energy in the state of Gujarat in India, both at the Federal and State level. If you notice anything that is incorrect or out of date, please let us know via our contact page.

Gujarat is the fourth leading Indian state in terms of installed solar power capacity, with 1,160 MW as of January 1, 2017, according to the Ministry of New and Renewable Energy (MNRE). Overall the state has seen a huge amount of large-scale solar power plants installed in recent years, and it’s only set to increase its embrace of a cleaner, fairer future.

Federal incentives for solar energy in India

Jawaharlal Nehru National Solar Mission

The Jawaharlal Nehru National Solar Mission by the Ministry of New and Renewable Energy (MNRE) has the ambitious goal of reaching 100 GW of grid-connected solar power by 2022, and making India a global leader in the development of solar energy. Currently India is on track to reach this goal, and a recent poll we conducted via Twitter showed that half of respondents thought that India would surpass this and install “much more than 100 GW” by 2022, proving that optimism abounds on this question.

The JNNSM is geared toward large-scale solar installations and not small-scale residential plants. It is rolled out in phases and batches, each of which consists of a reverse bidding auction. This means that bidders bid the price per kilowatt hour at which they would be willing to sell the electricity. The most recent auction, Phase II Batch I of the JNNSM, saw 505 MW of solar projects receive approval.

State incentives for solar energy in Gujarat

The state of Gujarat has strong policies in favour of stimulating solar energy in the region. What follows are the various policies, incentives, and financial rules Gujarat has enacted to stimulate growth in the solar energy sector in the state. For the 2016-2017 period, Gujarat has set a renewable purchase obligation (RPO) of 1.75%, according to p. 19 of the Gujarat Electricity Regulatory Commission (GERC) Discussion Paper 2016.

Solar feed-in tariff in Gujarat

The state of Gujarat differentiates between two types of solar systems: “kilowatt-scale” power plants (1 kW – 1 MW); and “megawatt-scale” power plants (1 MW and above). Energy produced by a solar plant will be purchased by the relevant distribution company (discom) at the following levelized tariffs from April 1, 2017 to March 31, 2018, according to p. 31 of the Determination of Tariff for Procurement of Power by Distribution Licensees and Others from Solar Energy Projects for the State of Gujarat:

Megawatt-scaleWithout accelerated depreciation benefit₹5.86
With accelerated depreciation benefit₹5.34
Kilowatt-scaleWithout accelerated depreciation benefit₹7.28
With accelerated depreciation benefit₹6.61

This was based on the following assumed tariff parameters:

Plant cost
Capital cost (megawatt-scale)₹615 lakhs per MW
Capital cost (kilowatt-scale)₹0.8 lakhs per kW
O&M cost (megawatt-scale)₹10.9 lakhs per MW per year
O&M cost (kilowatt-scale)₹0.01 lakhs per kW per year
Escalation of O&M cost5.72% per year


Performance parameters
Capacity utilisation factor (CUF)19%
Performance degradation1% per year
Auxiliary consumption (megawatt-scale)0.25% of energy generation
Auxiliary consumption (kilowatt-scale)0% of energy generation
Useful life25 years


Financial parameters
Debt-to-equity ratio70% debt; 30% equity
Loan tenure10 years
Interest rate on loan12.7% per year
Insurance cost0.35% per year
Interest on working capital11.85% per year
Working capital1 month’s O&M expense + 1 month’s energy charges at normative CUF
Rate of depreciation6% per year for the first 10 years and 2% per year for the next 15 years
Minimum alternate tax rate20.008% per year for the first 10 years
Corporate tax rate32.445% per year from the 11th year to the 25th year
Return on equity14% per year
Discount rate10.647% per year


Gujarat subsidy for rooftop solar

The State of Gujarat also offers a subsidy of ₹10,000 per kW of installed capacity up to a maximum of ₹20,000 per customer. It is paid by the Gujarat Energy Development Agency (GEDA) subsequent to installation and commissioning of a rooftop solar system.

Are you interested in installing solar in Gujarat?

If so, get in touch and learn how we can help you join us in the solar energy revolution.

15 Responses

  1. Gadher Jayeshkumar Jivan says:

    I am interested to establish m5w in Gujarat.

  2. M.S Patel says:

    I can installed at my own farm ? please advise how i install

  3. Vipul Patel says:

    Looking forward to roof top 6KW solar system 3 phase for our residential location in Gujarat, Vapi, Dist.Valsad.

  4. hello sir
    to make blogs


  5. hello
    thanks to shear good information regarding blog commenting..

  6. Hello!

    Thanks for sharing such a meaningful blog that really means good for poeples. We promote such meaningful things to audience reach, we just work in background to promote your hardwork.


  7. Parvathaneni venkatesh babu says:

    Hi I am interested my contact number 09441027577
    I am living VISAKHAPATNAM Andhra Pradesh

  8. Ahesanali says:

    I am interested for 1MW power plant.

  9. Teslim says:

    I am interested to know if I can install On-Grid Solar PV on my building terrace (2000 sft.) in Devgadh Baria (PIN-389380); please advise.

  10. Aruna chauhan says:

    Thank you for sharing such wonderful and meaningful blog.

  11. Yashpalsinh jadeja says:

    I have 12bigha land at my village in gujarat jamjodhpur taluka.I am interested in solar business.i want to know how much cost it will take and how much time i will recover my investment.

  12. says:

    I want start new solar plant

  13. Ashvinkumar.C.Vataliya says:

    I am interested and installing in gujarat solar power plant. Can you help me?

  14. jerambhai amipara says:

    mare 1mw solar plantni Mahiti Gujarati bhashama joie chhe …project riport …..aabhar…

  15. Patel Mustak says:

    Hello Sir,
    Its good information to share.
    Secondly i want to know for poltry farm 5,000 chicken plant how many kw plant we need to fix which can efficiwnt in all season.

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