Shimla, Himachal Pradesh – The Himachal Pradesh Cabinet, led by Chief Minister Sukhvinder Singh Sukhu, has approved a pioneering joint investment model aimed at accelerating solar power deployment across the state while simultaneously empowering local governance. This strategic initiative, involving the state government, Himachal Pradesh Energy Development Agency (HIMURJA), and Gram Panchayats, marks a significant step towards decentralized renewable energy generation and community-level economic development. The decision, made on June 28, 2025, underscores the state's commitment to reducing reliance on conventional energy sources and fostering sustainable growth.

Under the newly sanctioned Green Panchayat Scheme, HIMURJA will formalize agreements with selected Gram Panchayats for the installation of 500 KW solar power plants. The initial phase targets 100 panchayats, with each project anticipated to generate a substantial monthly revenue of approximately ₹25 lakh. This revenue will be distributed among the key stakeholders through a structured model: 30 percent allocated to HIMURJA, 20 percent to the state government, and a significant 40 percent directly to the respective Gram Panchayats. Furthermore, a dedicated 10 percent share of the revenue will be earmarked for the welfare of orphans and widows within the panchayat, integrating social equity into the energy transition framework.

To bolster the financial viability and encourage broader participation in solar energy production, the Cabinet has also introduced a comprehensive interest subsidy program for new solar projects. Projects ranging from 100 KW to 1 MW in tribal areas will benefit from a five percent interest subsidy, acknowledging the unique challenges and development needs of these regions. Similarly, projects between 250 KW and 2 MW in non-tribal areas will receive a four percent interest subsidy. These financial incentives are designed to stimulate self-employment opportunities and attract private investment into the state's burgeoning renewable energy sector.

This collaborative approach is poised to not only enhance Himachal Pradesh's clean energy capacity but also to establish a robust, self-sustaining model for rural electrification and local economic empowerment. By directly involving Gram Panchayats in the ownership and revenue-sharing of these assets, the scheme fosters a sense of local ownership and ensures that the economic benefits of renewable energy are directly channeled back into the communities. The initiative aligns with India's broader national goals for renewable energy expansion and serves as a potential blueprint for other states seeking to implement decentralized, community-centric clean energy solutions. The long-term implications include enhanced energy security, reduced carbon footprint, and improved socio-economic indicators in rural Himachal Pradesh.