KUSUM Scheme: Need, Significance, Drawbacks

The Ministry of New and Renewable Energy (MNRE) had launched a massive solar-pump programme called PM-KUSUM in February this year. This scheme, though well-intended, has numerous drawbacks and is in need of reforms for it to be successful in the long run.

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What is PM-KUSUM?

  • The Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) is a scheme that aims to set up 25,750 MW solar and other renewable capacities by 2022 to power the irrigation pumps.
  • This scheme provides a total Central financial support of Rs.34, 422 crores including service charges to the implementing agencies.
  • This scheme has three components:
  1. Component A: 10,000 MW of Decentralized Ground Mounted Grid Connected Renewable Power Plants of individual plat size up to 2 MW.
  2. Component B: Installation of 17.50 lakh standalone Solar Powered Agriculture Pumps of individual pump capacity up to 7.5 HP.
  3. Component C: Solarisation of 10 lakh Grid Connected Agriculture Pumps of individual pump capacity up to 7.5 HP.

What is the need for this scheme?

  • It will enable setting up of grid-connected renewable power plants each with a capacity of 500 KW to 2 MW in the rural areas.
  • The installation of standalone solar water pumps will fulfill the irrigation needs of farmers not connected to the grid.
  • Furthermore, the solarisation of existing grid-connected pumps can make farmers independent from grid supply.
  • The farmers will also be able to sell surplus solar power generated to the DISCOM and can get an extra income.

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What will be the outcome of this scheme?

  • The scheme is expected to provide positive outcomes. This includes:
  1. Decentralised solar power production
  2. Reduction in transmission losses
  3. Reduces agriculture subsidy burden on DISCOM, thereby contributing to its financial health.
  4. This scheme also provides for energy efficiency and water security for farmers.
  • 25,750 MW solar capacity can power approximately 11.5 million 3 HP pumps or 7 million 5 HP pumps. Currently, it is estimated that nearly 30 million irrigation pumps are operational in India. Of this, 21 million are electric and 9 million are diesel-based.
  • This scheme has the potential to convert one-third to one-fourth of all irrigation pumps into solar-power pumps in 3 years.
  • This swift transition is possible because the scheme makes the pumps affordable to medium and large farmers.
  • These pumps come with a 30% subsidy from the Union and State government each.
  • There is also the provision to take bank loans for 30% of the cost.
  • Therefore the farmers shall pay only 10% of the cost to buy the solar pumps.
  • This, in other words, will bring forth a high demand for solar pumps.

What are the benefits of this scheme?

  • This scheme can act as a short-term strategy to enhance the farmers’ income and financial security as this scheme allows for the selling of surplus electricity from the solar plants to the DISCOM.
  • The solar power is far cheaper and eco-friendly than that of the power obtained from diesel off-grid. Thus, solar pumps will reduce the cost of irrigation considerably.
  • The effect is significant in states like Bihar, where the farmers are highly dependent on diesel pumps.
  • Hence, the scheme will enable the farmers to grow more crops, at a cheaper cultivation cost.
  • In Punjab, the electric pumps have a dominant position and the power subsidy to the agriculture sector is about Rs.7000 crore per annum.
  • Therefore, this scheme will play a significant role in reducing the subsidy burden in states like Punjab.
  • The most important benefit of this scheme is that the solar cycle matches the irrigation cycle.
  • Hence, the farmers will get assured irrigation for at least 6 hours during the day time. They also need not remain awake at night to irrigate the farms since there is an assured grid supply at night in most states.

What are the drawbacks of this scheme?

  • According to a report from Centre for Science and Environment (CSE), a Delhi-based non-profit, PM-KUSUM scheme is not a “silver bullet” to overcome the challenges of irrigation supply, subsidy burden on discoms and farmer’s distress.
  • This report also stated that this scheme may result in overexploitation of the groundwater. This is not a good sign because, currently, both the quality and quantity of the groundwater are depleting at an alarming rate and the condition of the aquifers has reached a crisis point.
  • The findings of this report are based on the surveys of farmers in three districts in Maharashtra, Uttar Pradesh, and Andhra Pradesh.
  • In regions with water scarcity, the solar pumps are unable to provide adequate irrigation due to the depleting groundwater.
  • Furthermore, this scheme may not help reduce the discoms’ subsidy burden as the installation of the pumps is not mandatorily linked to the decrease in the subsidised agricultural power supply.
  • Though this scheme aims to reduce the subsidy burden of the state discoms, it does not have any clear goals or provisions to ensure subsidy reduction.
  • The subsidised solar pumps are being installed without accompanying cuts in the agriculture supply or a reduction in subsidy.
  • Thus, this may increase the total subsidy burden on states.
  • The CSE report also stated that the PM-KUSUM’s proposed scheme of installing solar plants on the farmlands will only benefit the wealthy farmers, as it requires a large investment or the ability to lease land for 25 years.
  • For example, in Pilibhit (Uttar Pradesh), most of the subsidised solar pumps had been installed by large farmers.
  • Also, this scheme does not provide any provision to utilize the surplus power from the off-grid pumps to light the houses and businesses.

What can be the way forward?

  • High priority must be given by the government to change the current practice of overexploitation of the groundwater.
  • If the government fails to do so, the World Bank predicts that around 60% of the aquifers in India will be in a critical state by 2032.
  • As this scheme involves the large-scale deployment of the solar pump, without a comprehensive plan to monitor and control water usage by these pumps, it may make this prediction a reality.
  • Therefore, this scheme needs comprehensive reform.
  • It is possible to increase renewable energy usage, reduce groundwater exploitation and help small and marginal farmers.
  • This can be done only if PM-KUSUM scheme is viewed as a water and agriculture scheme and not merely as a renewable energy scheme.
  • This scheme needs reforms in agricultural support price, rationalisation of power tariff, direct benefit transfer and water-efficient irrigation.
  • The focus of this scheme should also be on water conservation rather than just be a tool to promote renewable energy and high return in the agriculture sector.
  • The measures that can be taken in this context include the following:
  1. The Centre could implement irrigation reforms in the states through the KUSUM scheme.
  2. This scheme should only be provided to the states that are willing to take stringent measures to improve irrigation efficiency and control groundwater usage.
  3. This scheme can simultaneously provide for setting up of micro-irrigation system along with the solar pumps.
  4. Initiatives can also be undertaken to mandate rainwater harvesting across the country.
  5. The government, while undertaking these initiatives, must closely monitor the groundwater usage.
  6. The Indian government can also set strict mandates on the pump size and depth of the bore-wells.
  7. The government can also incentivize low water-intensive crops in the regions that are suffering from water scarcity.
  8. Deployment of the off-grid solar pumps must be limited to the areas where the grid cannot be reached and the groundwater is abundant.
  9. Also, these off-grid solar pumps must be used for rural electrification purposes.
  10. Otherwise, it should be developed into a community-based water sale models to maximize the utilization and reduce the water wastage.
  11. The solarisation of the rural feeders should be accompanied by a gradual increase in electricity tariffs.
  • If these measures are taken into account, the groundwater exploitation and burden of agriculture subsidy can be reduced considerably.

Conclusion:

Though the promotion of renewable, eco-friendly resources and increasing farmers’ income are laudable, there is a need for taking into consideration the long-term problem of negative impact on the environment. Thus, a reform of this well-intended scheme can bring in not only inclusive growth but also address multiple problems that India is currently facing like climate change, water scarcity, food insecurity, etc.

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