MSMEs Should Avail Concessional Debt Finance to Install Rooftop Solar: Gadkari

Nitin Gadkari has invited MSMEs to look at accessing concessional debt finance to install rooftop solar systems to improve business efficiency

Union Minister of Micro, Small and Medium Enterprises (MSMEs) and Road Transport & Highways Nitin Gadkari has invited MSMEs in India to look at accessing concessional debt finance to install rooftop solar systems to improve their business efficiency.

Addressing 10th Annual Small Business Congress 2021 & Awards https://t.co/886E4HK2Mp

— Nitin Gadkari (@nitin_gadkari) February 26, 2021

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The Minister while addressing the virtual event said that rooftop solar offers an excellent value proposition to MSMEs by significantly bringing down the cost of electricity consumption, which on average, is up to one-fifth of their overall operations cost. The minister observed that a large amount (average Rs 8 and higher per unit) is being paid by the MSMEs for power consumption, which contributes to up to one-fifth of the overall production costs.

“I believe there is a strong business case for MSMEs to install rooftop solar and achieve significant savings to achieve the cost-competitiveness. I am confident that MSMEs will stand together in generating and consuming solar power using their rooftops,” he said.

“To assist MSMEs in implementing rooftop solar projects, the ministry is working with the World Bank on a credit guarantee program to make financing accessible to unrated MSMEs. Considering the rates of solar power from large utility power plants have come down to a record Rs 1.99/kWh, MSMEs must leverage this opportunity to bring down their energy expenses,” he added.

Addressing the event, Junaid Ahmad, Country Director India, World Bank, said the World Bank is committed to the cause of MSMEs and investment in this industry will aid India’s aim to become ‘Aatmanirbhar‘ or ‘self-reliant’.

“By facilitating MSMEs to decarbonise their power consumption in a sustainable manner, India can achieve a twin objective of greening the economy and uplifting MSMEs to become highly competitive by reducing its power costs,” he added.

Recently, the minister had urged power minister RK Singh to reconsider a recent controversial decision to restrict net metering in solar rooftop projects. In a letter to Singh dated February 15, Gadkari noted that while more and more micro, small and medium enterprises (MSMEs) were installing solar rooftop projects, thereby contributing to the share of clean energy in the grid, the notification might well discourage them.

“It is feared that this share will shrink in the near future, affect power generation of the nation, as it is feared that the new amendments are going to affect the savings of the small units and individuals,” Gadkari said in a letter.