The government reinforced its focus on green energy by proposing a slew of initiatives, including an allocation of ₹35,000 crore for various energy transition initiatives, underscoring India’s lead in addressing climate change.
The Union Budget for FY24, which was presented in Parliament on Wednesday by Finance Minister Nirmala Sitharaman, comes at a time when India has assumed the presidency of the G20, while the world explores a sustainable narrative for affordable and clean energy.
Furthermore, the first budget under the Amrit Kaal reinforces the criticality of clean energy transition in India’s growth with government including ‘Green Growth‘ as one of its seven priorities, which the Finance Minister emphasised acts as “Saptarishi guiding through the Amrit Kaal.”
Allocations
“This Budget provides ₹35,000 crore for priority capital investments towards energy transition and net zero objectives, and energy security by the Ministry of Petroleum and Natural Gas (MoPNG),” she said in the Budget speech.
Besides, Battery Energy Storage Systems (BESS) with a capacity of 4,000 MWh will be supported with viability gap funding. A detailed framework for pumped storage projects will also be formulated. Inter-State transmission system for evacuation and grid integration of 13 GW renewable energy from Ladakh will be constructed with investment of ₹20,700 crore including central support of ₹8,300 crore.
The recently launched National Green Hydrogen Mission, with an outlay of ₹19,700 crore, will facilitate transition of the economy to low carbon intensity and reduce dependence on fossil fuel imports.
Industry upbeat
Mahesh Palashikar, President-South Asia, GE, said “We are encouraged by the commitment of capital investments of ₹35,000 crore to accelerate energy transition towards net zero.”
Rajiv Mishra, MD, Apraava Energy, noted that increased outlay of ₹1.3-lakh crore will allow States to continue working on power distribution reforms and enhance power infrastructure including installation of smart meters.
The allocation of ₹12,072 crore for reform linked power distribution scheme in FY24 is higher against ₹6,000 crore estimated in FY23, which should help in increasing power supply situation and help discoms move towards a healthier market, he added.
While, Pratik Kamdar, Co-Founder Neuron Energy, said the customs duty exemption on capital goods and machinery to manufacture Lithium-ion will have a domino effect on the overall sector with the over substantial decrease in the overall cost of the finished products wherein the battery packs are likely to reduce by 5 per cent coupled with lower initial investments.