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In recent years, newer clean energy sectors have emerged, which includes fuels such as green hydrogen, plant based biofuels, energy storage among others | Photo: Shutterstock.com
Srivatsan Iyer, global CEO, Hero Future Energies said, the green energy industry was looking for the reduction of GST rates on renewable energy components.
“Lowering GST on solar modules, wind turbines, and electrolysers from the current rates to 5 per cent would significantly reduce project costs and thereby, reduce cost of renewable power and hydrogen to consumers across India,” Iyer said, adding that reducing or eliminating customs duties on imported solar cells and modules would enhance the economic feasibility of solar projects and for projects involving green hydrogen.
Gupta, however, also said that the Budget should encourage key equipment manufacturing for module and cell manufacturing in India itself through promoting suitable policy, regulatory, financial and tax regime for the same. “India has a strong history of inhouse equipment manufacturing yet our reliance on RE manufacturing machinery and equipment is almost 100%. In the next phase, this reliance should be reduced to zero,” he said.
New sectors need new rules
In recent years, newer clean energy sectors have emerged, which includes fuels such as green hydrogen, plant based biofuels, energy storage among others. The energy sector experts point out, initial subsidy support, tax relaxation on import of crucial raw materials would help the indigenous industry grow rapidly.
Iyer said the industry is hopeful for the Budget to support the growth of green hydrogen and battery storage through viability gap funding and subsidies. “This support is essential for making hydrogen competitive with other alternatives and fostering the development of a robust battery storage market,” he said.
Raju Kumar, partner and energy tax leader, EY India said the green hydrogen mission launched in 2021 would require policy support to address infrastructure, storage, and transportation related challenges. “On the GST front, important areas to consider would be reduction in GST on hydrogen to foster greater adoption and inclusion of natural gas within the GST framework,” Kumar said.
Earlier this year, the Centre announced a new scheme for promoting rooftop solar. While Rs 75,000 crore of central funding has been allocated for the programme, Kumar is of the view that for rapid rooftop solarisation, power distribution companies “may receive financial thrust to develop a country-wide infrastructure for transmission and metering”.
First Published: Jul 02 2024 | 9:39 AM IST