India is looking firm to develop alternate source of energy in the country and for this purpose the government is likely to subsidize the running of solar power plants. The subsidy to solar power plan would help to develop a renewable energy infrastructure to prohibit the high costs.

According to the minister for renewable energy Vilas Muttemwar, renewable energy accounts for about 7.5 percent of country’s installed generation capacity of 127,673 MW. A bigger part of the capacity is wind-based and the solar power has less share in the total energy generation capacity.

Vilas Muttemwar further said that the ministry would provide financial aid of 12 rupees per kilowatt-hour in case of solar photovoltaic energy generation and 10 rupees per kilowatt-hour in solar thermal power to the electricity grid. He told the media persons during a press conference that the private sector was likely to invest about 10 billion rupees in solar plants in the next five years till 2012.

The private sector would consider a maximum capacity of 10 megawatt (MW) in almost every state and a maximum of five MW per developer will be considered under the scheme. However, the government wouldn’t allow the capital investors to apply under the scheme.

According to the report, the electricity will be sold by the developers to state-run establishments. They would get the incentives that would be for a period of 10 year and based on the tariff the utilities provide.