MNRE Requests States to Prepare Conducive Renewable Energy Policies

MNRE Requests States to Prepare Conducive Renewable Energy Policies

The Ministry of the New and Renewable Energy’s Secretary Mr. Rajeev Kapoor requested the state government to draft a very conducive policy regime for this sector. Addressing during the concluding session of the National Review Meeting with the government officials in the state, he brought out the importance of the need for complying with the RPOs (Renewable Purchase Obligations). He even urged the states for checking the renewable power at the backdrop of India’s commitment to raise around 40 percent of the installed electric capacity from the non-fossil fuel sources by the end of 2030.

The secretary has gone on to urge the government to frame and also modify the policies and also prepare a conducive policy regime for renewable energy, according to an official statement after the conclusion of the 2-day review meeting. The mobile application of the solar rooftop system – Atal Rooftop Solar User Navigator (ARUN) and the information guide on the rooftop system got launched during this occasion.

India has been really active when it comes to improving the renewable energy situation in the country. In one of the recent press releases, the Power Ministry had made a request to the center to seek relief for renewable energy from the impact of GST.

The Union Power Ministry has informed the GST (Goods and Services Tax) council headed by Arun Jaitley, the finance minister that executing the GST in the present form may shoot up the power generation cost, particularly for renewable energy. This will further push the ability of the debt-ridden distribution firms for serving electricity until certain relief measures are built on.

Even though the solar panels and also the other equipment used for the power production will be coming under the GST, the main product that is electricity has been ruled out. This means to say that the power producers cannot set off some part of this indirect tax liability on the output using credit for the taxes that are already paid on the raw materials and also services availed.

In one of the presentations made to the GST council on 16th January, the Power Ministry proposed offering either the deemed export status or 0 GST rate for renewable power. The measures are aimed to spare the power producers from these tax costs of having electricity out of the GST and for compensating for the current tax exemptions.

As per the copy of presentation, the capital expenses of the renewable energy firms (wind as well as the solar) can actually go up by around 10 to 12 percent, which will warrant the power tariff increase of around 40 paise for wind power and about 50 paise for solar power. This happens due to the central excise duty exemptions as well as concessional state VAT on solar panels and equipment (0-5% levied by states) and will certainly make way for around 18 percent GST on raw materials and also services availed by the renewable power producers. India is taking all the measures to utilize renewable energy to the best possible extent.

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