How Solar PV Plants Are Financially Beneficial For MSME Sector?

India’s substantial and sustained economic growth has led to an increase in demand for energy resources. In such a case, using renewable energy is one of the most desirable ways to address increased demand, diversifying energy infrastructure, and improving energy security.

The MSME sector, which has witnessed steady growth over the past few years, is the backbone of the national economic structure. The sector contributes about 30% towards the country’s GDP and provides over 110 million jobs. This sector is also one of the largest consumers of energy in the economy, accounting for about 25% of the total energy consumed in the industrial sector. However, volatile market conditions and increasing energy expenses are among the key factors affecting the long-term profitability, competitiveness, and sustainability of the MSME sector.

The Government of India has set an ambitious target to achieve 100 GW solar energy by 2022 from its rich and untapped solar resources. The MSME sector has a crucial role to play in reducing greenhouse gas emissions and contributing to the country’s clean energy goals. MSMEs can contribute to creating nearly 16 GW of rooftop solar capacity by 2022. Meeting 40 percent of the 40 GW target set by the Government of India for rooftop solar installations in the country under the 175 GW Renewable Energy by 2022 target.

MSME is the most critical sector for advancing the country’s growth. A large amount is being paid by the MSMEs for power consumption, which contributes to up to one-fifth of the overall production costs. There is a strong business case for MSMEs to install rooftop solar and achieve significant savings to achieve the cost-competitiveness.

Advantages of Rooftop Solar Adoption For MSMEs

➮ Less electricity bill due to power generated by solar plant

➮ Through Net-Metering facility the surplus power generated from solar plant will be carried forward to the next month

➮ Uninterrupted power supply

➮ Solar reduces tax liability as adopting solar for commercial sector provides 40% accelerated tax benefit that can be availed in the first year itself

➮ Installing solar plants makes the industry self-sufficient in terms of energy needs

➮ Adopting solar will create a positive impact on your brand image, making the industry a socially and environmentally responsible business.