+
 Rooftop solar projects CFA to be calculated as per revised GST rates
POWER & RENEWABLE ENERGY

Rooftop solar projects CFA to be calculated as per revised GST rates

The Ministry of New and Renewable Energy (MNRE) told the media that the Central Financial Assistance (CFA) for rooftop solar projects would be calculated as per the revised Goods and Services Tax (GST), excluding the GST rates.

According to MNRE, the old GST rates will be valid for invoices raised before 1 October 2021. To calculate CFA, the GST will be added to the benchmark or the tender value.

Previously, MNRE reduced the benchmark costs for grid-connected rooftop solar projects for 2021-22, excluding the GST. The new benchmark costs range from Rs 35.89 per W to Rs 46.92 per W, while earlier, the range was Rs 39.08 per W to Rs 51.1 per W.

MNRE told the media that after the revision of GST rates for renewables, it decided to revise the benchmark costs, excluding the GST rates.

MNRE said that the state implementation agencies should submit a separate list of systems with the new GST rate and the invoices while claiming CFA. They must also submit a declaration that the documents have been checked to the revised GST.

Earlier this year, the GST council said that for specific renewable energy equipment, the GST rate would be increased to 12% from 5%.

The rise in GST rate is a challenge for the project developers as it will impact the project cost. Some solar developers said that the increased GST rate would make many renewable energy projects unviable.

For the past six months, solar developers have faced challenges due to increased prices of solar modules and metals. Increased GST is also a challenge for them as the renewable energy sector has started to recover from the distress of the second wave of the Covid-19 pandemic.

Image Source

The Ministry of New and Renewable Energy (MNRE) told the media that the Central Financial Assistance (CFA) for rooftop solar projects would be calculated as per the revised Goods and Services Tax (GST), excluding the GST rates. According to MNRE, the old GST rates will be valid for invoices raised before 1 October 2021. To calculate CFA, the GST will be added to the benchmark or the tender value. Previously, MNRE reduced the benchmark costs for grid-connected rooftop solar projects for 2021-22, excluding the GST. The new benchmark costs range from Rs 35.89 per W to Rs 46.92 per W, while earlier, the range was Rs 39.08 per W to Rs 51.1 per W. MNRE told the media that after the revision of GST rates for renewables, it decided to revise the benchmark costs, excluding the GST rates. MNRE said that the state implementation agencies should submit a separate list of systems with the new GST rate and the invoices while claiming CFA. They must also submit a declaration that the documents have been checked to the revised GST. Earlier this year, the GST council said that for specific renewable energy equipment, the GST rate would be increased to 12% from 5%. The rise in GST rate is a challenge for the project developers as it will impact the project cost. Some solar developers said that the increased GST rate would make many renewable energy projects unviable. For the past six months, solar developers have faced challenges due to increased prices of solar modules and metals. Increased GST is also a challenge for them as the renewable energy sector has started to recover from the distress of the second wave of the Covid-19 pandemic. Image Source

Related Stories

Gold Stories

Next Story
Infrastructure Urban

KONE Opens India's First Digital Experience Centre in Pune

KONE, a global elevator and escalator manufacturer, has inaugurated its first Digital Experience Centre (DEC) in India, located in Pune. The facility aims to showcase how artificial intelligence (AI), connectivity and data-driven technologies can enhance customer experiences and improve building operations.The centre was inaugurated by Jussi Herlin, Executive Vice Chair, KONE Corporation; Philippe Delorme, President and CEO, KONE; and Nandan Nilekani, Co-founder and Chairman of the Board, Infosys.Designed as an interactive customer environment, the facility demonstrates digital solutions cover..

Next Story
Infrastructure Urban

CII GreenCo Launches Circularity Guidelines for Indian Industry

The Confederation of Indian Industry (CII) GreenCo Council has launched the CII GreenCo Circularity Guidelines – Pilot Version at the 17th CII GreenCo Waste & Resource Management Summit 2026 in Chennai. The initiative aims to strengthen resource efficiency, waste reduction and circular economy practices across Indian manufacturing and process industries.The guidelines introduce a structured framework with circularity indices covering raw materials, consumables, packaging and other resource inputs. These indicators will help industries assess existing practices, identify opportunities to ..

Next Story
Infrastructure Energy

Global Electronics Association Launches IPC-1783-CO2E Standard

The Global Electronics Association has introduced IPC-1783-CO2E, a new international standard aimed at improving consistency, transparency and comparability in product carbon footprint reporting across the electronics manufacturing industry.The standard, titled International Standard for Data Collection and Reporting of CO2 Equivalent (CO2e) Emissions for the Electronics Manufacturing Supply Chain, provides industry-specific guidance for collecting, estimating and reporting carbon emissions data.With increasing regulatory requirements and customer expectations, electronics manufacturers face c..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code