What's In For Renewable Energy This Budget

Renewable Energy – Interim Budget India

India’s installed solar generation capacity had grown over ten times in the last five years and is now generating plenty of jobs, announced Mr. Piyush Goyal in the Indian Interim Budget 2019, presented on Feb 1st this year. India is looking at deploying renewable energy sources aggressively to reduce the state of pollution in its urban cities. The country is targeting to reduce its dependence on imports of fossil fuel and develop solar power as a prime source of energy by 2030.

However, the Indian Budget was pretty drab about renewable energy this year. Just a mere mention on EVs, energy storage and solar energy – that’s it.

“India will lead the world in the transport revolution through electric vehicles and energy storage devices, bringing down import dependence and ensuring energy security for our people,” said Goyal.

But how will this be done? There were no specified goals, incentives or subsidies announced. The scarcity of financing options and lack of manufacturing facilities is leading to a slow death for manufacturers.

Some highlights of the Budget:

a)  Abolishment of customs duties on tempered glass

b) Allocation of INR 2.17 billion to SECI

c) Small renewable energy companies to benefit from reduction of income tax to 25% for MSMEs

The year 2018 was a rough year for the solar sector given the doubts around GST, the introduction of safeguard duties and cancelation of several major auctions. As such, manufacturers and consumers alike were hopeful that the budget would grant some respite. Earlier budgets have also been disappointing for the solar industry, with no specific subsidies or grants announced. Compare and contrast renewable energy budget for previous years:

Budget 2018 For Renewable Energy Industry India

Key Takeaways for Indian Solar Industry Under Budget 2017

While the country’s commitment to clean sources of energy is clear, there is no long-term roadmap for its adoption. The minister announced that steps would be taken to encourage the distribution companies (DISCOMs) to buy the surplus solar power generated by the state governments. In addition, the Finance Minister spoke about rural electrification, Ujjwala Yojana, ISA (international solar alliance) etc.