Maintaining its focus on India’s Renewable Energy plans, Finance Minister Arun Jaitley while presently Union Budget 2017-18 said the government would now take up the second phase of solar park development in the country to add 20,000 MW.
The seriousness and focus of the government on Renewable Energy was clearly visible when Jaitlley said that around 7,000 railway stations would be fed through solar power in the medium term and work has already begun in that respect in 300 stations.
On rural electrification in line with Prime Minister Narendra Modi’s vision to provide electricity to all villages, Jaitley said India was confident of meeting its 100 % rural electrification target by May 2018 and allocated a sum of Rs 4,814 crore to its flagship scheme Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY).
On its part, the Indian industry also applauded the Budget proposals for the power sector. “We commend the efforts and government’s commitment to rural electrification and the announcement of an additional 20,000 MW of solar target, a welcome step that gives a much needed boost to the renewable sector,” said Anil Sardana, MD & CEO, Tata Power.
“However, we believe that for renewable sector to achieve its potential strengthening the Renewable Purchase Obligations (RPO) mechanism is essential and should be part of government’s larger vision for renewable energy.”
Sardana added that the move towards improving electricity access to rural India will be instrumental in contributing to the social and economic development of the country. “Tata Power will also continue to amplify government’s initiatives for rural development, as we partner with surrounding communities,” he said, adding that the increased budget for the DDGJY will strengthen and uphold the ongoing work of feeder separation and sub-transmission & distribution infrastructure.
This, Sardana said, is a positive step towards augmenting the reliability and quality of supply distribution network which is affected due to poor financial health of discoms.
He added that he was hopeful that the industry’s long pending demand that the electricity sector will be included in the GST regime will soon set into a roll-out stage.
“The Union Budget 2017-18 is in sync with government’s progressive agenda to energise Indian economy. We appreciate government’s enthusiasm to promote clean energy and reliable energy access to every citizen of our nation by adding 20 GW of solar power generation capacity and allocating higher resources for rural electrification,” said Sterlite Power CEO Pratik Agarwal.
This, he added. will require robust and timely power transmission networks that can deal with unpredictable renewable energy. “With rapidly expanding renewable energy capacity, execution of transmission networks is the need of the hour.”
Gokul Chaudhri, Leader, Direct Tax, BMR & Associates LLP said the single biggest tax change that impacts the energy industry is the extension for carry forward of Minimum Alternate Tax. (MAT)
“The power, oil and gas, and mining industry has been impacted by the sluggish crude and commodity prices and this impacts their ability for setting of the MAT credits within the existing time period. This change is therefore helpful. Equally is the measure to build strategic storage with enabling tax framework,” he said, adding that the lowering of custom duty on LNG will help the natural gas industry and their user industries like power. “The budget therefore helps with no hurts in the proposals that focus on this sector,” Chaudhri said.