Srinagar, Oct 14:High loan rejection rates by Jammu and Kashmir Bank (J&K Bank) have emerged as a major hurdle in the implementation of the PM Surya Ghar Muft Bijli Yojana in Kashmir, prompting Chief Secretary Atal Dulloo to express dissatisfaction with the bank’s response and direct it to make concerted efforts to prevent applicants from abandoning the scheme.
The issue was flagged by the Kashmir Power Distribution Corporation Limited (KPDCL) during a review meeting chaired by the Chief Secretary on October 7, according to the official meeting document.
“50% application has been rejected by J&K Bank which has pulled back the progress,” the document records KPDCL as stating, highlighting the impact of loan rejections on the rooftop solar programme.
A representative of J&K Bank cited several reasons for pending cases, including applicants’ inability to contribute margin money, requests for vendor changes and customers’ unwillingness to proceed. The explanation, however, did not satisfy the Chief Secretary, who directed the bank to intensify its efforts to resolve the cases and ensure that consumers do not drop out of the scheme.
“However, the chair (Chief Secretary )was not satisfied with J&K Bank’s response and advised them to pull up and make all efforts so that customer/applicants does not move away,” said an official who was part of the meeting.
The review records that J&K Bank handles more than 95 per cent of loan applications under the scheme in Jammu and Kashmir and Ladakh, making its role critical to accelerating rooftop solar adoption.
The aggregate loan figures for Jammu and Kashmir, however, cover all banks. Of 61,566 applications submitted, 38,773 had been sanctioned and disbursed, 17,416 rejected and 5,367 remained under process. This means around 28 per cent of applications had been rejected, and nearly nine per cent were pending.
Kashmir accounted for 14,232 rejected applications, compared with 3,184 in Jammu. The number of sanctioned and disbursed applications stood at 25,384 in Kashmir and 13,389 in Jammu.
The Regional Office of J&K Bank in Jammu informed the review that several meetings had been held with the bank since July 30 to examine pendency at vendor and branch levels, including an ageing analysis of applications. Despite these efforts, the pendency had not improved significantly. A fresh analysis followed by further discussions with the bank was proposed.
The administration is also considering a digital mechanism for submitting loan applications and communicating approvals or rejections through the national portal, reducing the need for applicants to visit bank branches physically. The proposed arrangement is intended to improve transparency and ensure compliance with prescribed turnaround times.
The financing bottlenecks come as Jammu and Kashmir continues to expand residential rooftop solar installations under the scheme.
As of October 5, 46,133 systems had been installed against a target of 83,500, while 42,686 had been commissioned across the Union Territory. The commissioned installations represent around 51 per cent of the overall target.
KPDCL had installed 28,324 systems and commissioned 27,294 against its target of 44,000. Jammu Power Distribution Corporation Limited (JPDCL) had installed 17,809 systems and commissioned 15,392 against a target of 39,500.
The installed capacity stood at 165.24 MW, comprising 102.55 MW in KPDCL areas and 62.69 MW in JPDCL areas.
The administration had received 89,680 applications against the installation target of 83,500. Of these, 82,591 applicants had selected vendors and 69,460 consumer agreements had been uploaded. The gap between applications received and commissioned systems highlights the need to accelerate loan processing, installation and commissioning.
Beneficiaries had received Rs 344.14 crore in central subsidies and Rs 13 crore in Union Territory subsidies, taking the combined subsidy disbursement to Rs 357.14 crore.
The review also identified delays in changing vendors as a major concern for consumers seeking to proceed with rooftop solar installations.
Under the existing process, consumers who have uploaded vendor agreements and applied for bank loans may have to wait for the prescribed 45-day period before changing vendors, subject to the applicable portal provisions.
The Chief Secretary sought a review of the timeline and asked the Ministry of New and Renewable Energy to examine whether an alternative mechanism could address consumer difficulties without undermining the purpose of the waiting period.
The distribution companies were also directed to ensure adequate vendor availability across districts. Deputy Commissioners were asked to identify local bottlenecks and coordinate with the concerned agencies to accelerate implementation.
The review also examined progress under the Utility-Led Aggregation (ULA) model, for which the Ministry of New and Renewable Energy has conveyed in-principle approval for 2,22,568 installations in Jammu and Kashmir.
Installations had been identified for 1,85,568 households, leaving a gap of 37,000 against the approved scope. JPDCL had identified all 77,568 installations allocated to it, while KPDCL had identified 1,08,000 against its allocation of 1,45,000.
JPDCL had finalised nine firms covering 10 districts through 20 tender packages. KPDCL had completed reverse auctions in six districts, while the tendering process faced portal-related delays in Srinagar, Pulwama, Ganderbal and Shopian.
The review proposed adopting a 25-year Renewable Energy Service Company (RESCO) period across all 20 districts, noting that tariffs discovered for 10 years were higher than those for 25 years. The discovered tariffs were proposed to be placed before the Joint Electricity Regulatory Commission for approval, followed by the issuance of Letters of Intent to successful bidders, subject to the required approvals.
Separately, the administration reviewed plans to solarise 8,000 government buildings with a proposed capacity of 152 MW under the RESCO model.
The Jammu and Kashmir Energy Development Agency (JAKEDA) and NHPC have been assigned responsibility for implementing the programme, with each agency covering 50 per cent of the buildings. JAKEDA had placed work orders covering 5,185 buildings.
The review called for Power Purchase Agreements to be executed and work implemented at the earliest. It also noted that tariffs discovered under the JAKEDA process ranged from Rs 4.19 to Rs 5.20 per unit.
