The announcements by the Hon’ble Finance Minister during her budget address are positive for the renewable energy industry in India. The budget is progressive, focuses on the future, and builds on the broader economic recovery underway in the country. In her budget speech, the finance minister delineated four priority areas, (1) PM Gati Shakti, (2) Inclusive Development, (3) Productivity Enhancement & Investment, Sunrise Opportunities, Energy Transition, & Climate Action, (4) and Financing of Investments. The decision to increase capital expenditure by an impressive 35.4% in FY23 will help India sustain its growth momentum and achieve a projected GDP growth between 8% and 8.5%.
The announcements reiterate the government’s commitment to sustainable growth and previously announced renewable energy ambitions. The government’s decision for an additional allocation of INR 19,500 crores under the PLI scheme for manufacturing high efficiency solar PV modules will give a huge fillip to domestic manufacturing. It will help the country achieve its ambitious goal of 280 GWs of installed solar capacity and generate 500 GWs of non-fossil energy by 2030. In addition, it will also improve the availability of solar modules in the country, thereby ensuring timely project deliveries while creating incremental employment.
The government’s announcements around batteries and energy storage augurs well for India’s deep decarbonisation ambitions of reducing 1 billion tons of carbon emissions from total projections by 2030. The decision to announce a battery swapping policy and inter-operability standards with an emphasis on battery/energy-as-a-service, creation of special mobility zones with zero fossil fuel policy, and the decision to assign infrastructure status to energy storage systems will encourage the private sector to develop sustainable and innovative solutions and further advance the energy storage ecosystem in the country. It will allow the renewable energy industry to partner commercial & industrial customers in their decarbonisation journey, standardise battery specifications, and improve EV adoption. The move will also increase grid stability as the share of renewable energy in the energy mix continues to rise and aid in financing for energy storage projects.
We welcome the government’s announcement to issue sovereign green bonds for mobilising resources for green infrastructure. This would help the government in accelerating the electricity grid and other associated energy infrastructure upgrades.
With this budget, the government has clearly indicated that it will take the lead with public investment. This intent should give private sector the necessary confidence boost and motivation to invest in the country and support the needs of the economy – job creation, revenue generation, infrastructure development, social welfare, and climate action.
Together these announcements will accelerate India’s progress towards a carbon neutral future.
The author is Chair, FICCI Renewable Energy CEOs Council and Managing Director & Chief Executive Officer, Azure Power