Eyeing solar shift, Centre plans to announce subsidy for milk farmers

NEW DELHI: The government is planning to shift the country’s entire milk sector to solar energy—from farmers onward to processors—through an upfront subsidy of 30%. A policy, in the works, will be announced soon, Dilip Rath, the chairman of National Dairy Development Board (NDDB), told HT on Wednesday.

The largest chunk of India’s milk business runs on a co-operative business model, which is essentially a collectivised model of dairy farming where producers and milk processors are stakeholders. In the first phase, the milk sector’s power consumption from conventional sources— mainly grid electricity and diesel—will come down by up to 25%.

Farmers will also be able to sell back surplus power to a solar grid at rates decided by state agencies.

This is nearly certain as a dairy farmers’ net use of solar power (only for dairy activities) will be less than total solar power that can be produced, based on usage patterns, as seen in the case of farmers of Gujarat’s Solar Pump Irrigators Cooperative Enterprise. “We are looking at the entire milk value chain for this transition. The 30% subsidy will come from the ministry of new and renewable energy,” he said.

District-level milk unions will get the subsidy to install solar equipment for dairy farmer households, who use common plants for chilling milk to increase their shelf life. “Frequent power outages affect milk quality. Solar will give a more reliable power source and through these unions, farmers will be able to sell surplus power back to the grid,” Rath said.

Milk cooperatives, who aggregate milk supplies and process them, will also qualify for the subsidy. The programme will be then dovetailed to the so-called KUSUM (Kisan Urja Suraksha Evam Utthaan Mahaabhiyan) scheme, which aims to incentivise farmers to rely more on solar power. The NDDB propelled the “Operation Flood” that saw India emerge as the world’s largest milk producer.