Finally MNRE has decided to discontinue the subsidy it was providing for solar water heaters. This was announced through a memorandum issued by the ministry a few days back. As per official announcement, the subsidies will stop from 1 October 2014. All systems where invoices were issued before 12 August 2014 can be completed subject to their application being filled by 30 September 2014.
The note adds that all Channel Partners and State Nodal Agencies can still continue to supply solar water heating systems at their end without MNRE assistance. But MNRE will still continue to advertise and promote solar water heaters across the country. The memo also mentions that MNRE is (still) working on a scheme for a five star rating system for solar water heaters.
Since over a year, MNRE has been facing issues regarding clearing its subsidy backlog. In another memorandum from the ministry, it has been announced that the outstanding subsidy for solar water heating systems will be released by IREDA to Channel Partners, State Nodal Agencies and other Stakeholders for installation of solar water heating systems by them in various States. For this purpose, IREDA will be provided 1% service charge towards fund handling. Quite a detailed process has been mentioned for this in the memo, it seems this will still take some more time.