The electricity tariff in Karnataka has risen by ₹2.89 per unit, marking one of the most significant increases implemented by the state government.
Rather than fretting over escalating energy bills, why not seize this opportunity to transition to solar power? It’s a wise decision that can potentially slash up to 80% of your monthly electricity costs while also lowering your carbon footprint.
Solar Subsidy in Karnataka
In 2022, the central government introduced a standardized Central Financial Assistance (CFA) scheme. Recently, the MNRE enhanced this incentive as part of the new PM Surya Ghar Muft Bijli Yojana.
Although the Karnataka government doesn’t offer an independent subsidy, residential consumers installing grid-connected rooftop solar systems can access CFA via the national portal for rooftop solar. Below are the subsidy details:
| Capacity | Subsidy |
| Up to 2kWp | ₹30,000/ kW |
| For 3kWp | ₹78,000 |
| For Capacities above 3kWp | ₹78,000 (Fixed) |
Karnataka RE Policy 2022-27
The Karnataka government has made the development of renewable energy capacity a top priority, as evidenced by the launch of the ambitious RE policy.
In March 2022, the state government ratified the Karnataka Renewable Energy Policy for the period 2022-27. Specifically targeting solar energy, the policy aims to achieve a 1000 MW capacity of grid-connected rooftop solar projects by 2027.
Outlined within the policy are additional key objectives, including:
- Expansion of grid-connected rooftop installations across public and private structures.
- Enhancement of floating solar installations on existing dams and reservoirs.
- Establishment of ground-mounted and rooftop PV plants for electric vehicle charging.
- Establishment of an ecosystem for distributed solar by transitioning agricultural pumps and feeders to solar power.
- Promotion of wind-solar hybrid installations.
To realize these objectives, the state government has implemented several measures under the new policy:
- Authorization for renewable energy developers to sell generated energy both within and outside the state, in compliance with electricity guidelines.
- Streamlining the process of land procurement for renewable energy projects.
- Encouragement of rooftop installations on residential, commercial, and industrial buildings through net metering and gross metering.
- Facilitation of peer-to-peer trading among grid-connected entities.
- Allocation of water bodies on a long-term lease or rental basis for floating solar projects.
- Furthermore, the state cabinet plans to assist 10,000 farmers in installing solar power systems under the PM KUSUM Yojana category-B.
Potential for Businesses in Karnataka
In recent years, numerous businesses have begun investing in Karnataka’s solar sector. For instance, the e-commerce giant Amazon recently revealed plans to construct a wind-solar hybrid project in the state. Additionally, Tata Power Renewable Energy is set to allocate over ₹3000 crores towards solar project development.
Following suit, many other organizations have either already invested in Karnataka’s renewable energy industry or have announced intentions to do so. The state’s appeal to investors in the clean energy domain stems from its favorable policies.
To illustrate, Karnataka offers incentives to foster clean energy development, including an investment promotion subsidy, up to 100% exemption on stamp duty, and complete exemption on electricity duty for a duration of 8 years.
For larger enterprises venturing into clean energy, Karnataka extends support such as up to 2.25% of turnover as an investment promotion subsidy for 6-10 years and full reimbursement on land conversion fees.
Additionally, the government extends financial benefits to consumers with an installed solar capacity of 1 MW, encompassing 40% accelerated depreciation on the system and a 10-year Tax holiday on solar projects.
Furthermore, the state has been actively promoting open-access systems. According to a recent report, Karnataka led in open-access capacity solar installations during the first half of 2022. The government also prioritizes green open-access projects over conventional open-access projects.
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Solar Energy Generation in Karnataka
The solar potential of Karnataka is over 25 GW. The state receives an average of 240-300 sunny days, with solar radiation of 5.4 to 6.4kWh/m2/day. The state has a total installed solar capacity of 9.3 GW (as of 31st October 2023) .
What’s more, Karnataka stands 3rd in the list of the top solar-powered states in India!
The Pavagada Solar Park (or Shakti Sthala) in the Tumakuru district of Karnataka is India’s second-biggest solar power plant, having previously been the world’s largest of its kind, with a production capacity of 2,050MW.
In September 2023, the Karnataka Energy Department also announced plans to expand the capacity of the solar park by 3 GW. The state government aims to make the solar park the largest in Asia again.
Moreover, the state government is developing three more ultra-mega solar power projects, each with a capacity of 2,500 MW in the Bidar, Koppal, and Gadag districts.
These numbers showcase the bright future of solar in Karnataka.