Budget 2015: No incentives but bigger targets for renewable energy  

India renewabale energy

In a budget speech that saw many maiden proposals, Finance Minister Arun Jaitley highlighted the need to generate more electricity from green energy sources within the country.

The government has announced an extensive renewable power production target of 1,75,000 MW for the next seven years.

Of the total 1,75,000 MW to be achieved by 2022, solar power holds a major share of 1,00,000 MW.

Further, the solar energy segment will attract private sector investment. The budget however, did not incentivize investment or manufacturing in the solar sector.

However, the budget proposed an excise duty cut on round copper wire and tin alloys for use in the manufacture of solar PV ribbon subject to certification by Department of Electronics and Information Technology.

Wind energy target is set at 60,000 MW while biomass target is set at 10,000 MW by 2022. Small hydro projects will contribute 5,000 MW, said minister in his budgetary proposals.

The budget also announced establishing of five more ultra- mega power projects that will require heavy investments of around Rs 1 lakh crore.

“Five more ultra- mega power projects (UMPPs), under the plug and play model will be set up with total investments of Rs one lakh crore,” said, Arun Jaitley, finance minister in his first full-year Budget for 2015-16. The states where these projects will be installed are not announced.

UMPP is coal-based thermal power project with 4,000 MW generation capacity. Under the “plug and play” system coal blocks will be auctioned.

In addition, with an aim to minimize environmental pollution and promote greener traffic, minister has earmarked Rs 75 crore for faster adoption and manufacturing of electric vehicles in 2015-16. Automobile industry has welcomed this proposal.

“Government is launching a scheme for faster adoption and manufacturing of electric vehicles (FAME), with an initial outlay of Rs 75 crore,” minister said while presenting the Budget for 2015-16 in the Lok Sabha.

The country’s renewable energy sector has a target to attract USD 200 billion in investments from international and domestic firms with an aim to tap the potential of green power.

The budget aims to boost job creation through renewal of growth and investment and promotion of domestic manufacturing.

Prime Minister Narendra Modi advocates for greener energy promotion in the country for a sustainable development and has set ambitious goals to promote domestic manufacturing through ‘Make in India’ promising more job opportunity.

Sabeena Wahid

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