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Business News/ Budget 2019 / News/  Budget2020: KUSUM solar power pumps scheme to be expanded

New Delhi: As part of the National Democratic Alliance (NDA) government’s strategy to double farmers’ income by 2022 and further burnish India’s green energy credentials, the Pradhan Mantri Kisan Urja Suraksha evam Utthan Mahabhiyan (KUSUM) will be expanded to provide 2 million additional farmers with standalone solar pumps.

Under the scheme, surplus electricity generated by farmers will be bought by state electricity distribution companies (discoms) to help boost the country’s emerging green economy. According to the earlier plan of the scheme, announced in February 2018 budget, around 1.75 million off-grid agricultural solar pumps were to be covered initially.

In addition, 1.5 million farmers will get help to shift to solar power pumps from grid-connected pump sets. To make the transition attractive, the capacity of the solar panels will be doubled to that of the present pumps, which would help farmers sell at least 50% of the electricity generated. It is estimated that of the 30 million agricultural pumps in India, a third are fuelled by diesel.

Announcing the expansion of the solar power pumps scheme as one of the 16 action points, finance minister Nirmala Sitharaman, in her second budget speech said, “Pradhan Mantri Kisan Urja Suraksha evem Utthan Mahabhiyan (PM KUSUM) to be expanded to provide 20 lakh farmers in setting up standalone solar pumps."

This comes in the backdrop of the International Solar Alliance (ISA) achieving global disruption by bringing down the cost of solar-powered agricultural pumps by half, Mint reported on 28 November. India’s state-run Energy Efficiency Services Ltd (EESL) conducted the largest global price discovery exercise by aggregating the demand from 22 ISA member nations, in a potential order valued at $2.7 billion for 272,000 pumps. This brought down the price of solar-powered agricultural pumps by Rs50,000 to Rs60,000 per horsepower (hp) across categories from Rs1 lakh per hp at present.

As part of the earlier announcement to improve farmer income and reduce dependence on diesel pumps, the scheme was to involve an expenditure of about Rs1.4 trillion.

The government has been raising minimum support price of various crops including rice, wheat and pulses.

“Farmers who have fallow or barren land will be helped to set up solar power generation units and also sell surplus power to the solar grid and also make living out of even barren land," Sitharaman said.

The KUSUM scheme will also help cultivate unirrigated land and help in grid balancing. The plan will also help India meet its commitments to the United Nations Framework Convention on Climate Change that was adopted by 195 countries in Paris in 2015.

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Utpal Bhaskar
"Utpal Bhaskar leads Mint's policy and economy coverage. He is part of Mint’s launch team, which he joined as a staff writer in 2006. Widely cited by authors and think-tanks, he has reported extensively on the intersection of India’s policy, polity and corporate space.
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Updated: 01 Feb 2020, 12:22 PM IST
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