- The government’s efforts announced in Union Budget 2023-24 for supporting and promoting green energy are recognisable.
Need for transition:
- Increase in energy demands: The country’s population and India’s appetite for energy to propel the economy are set to surge exponentially.
- To generate employment and support the economy: An urgent imperative and an opportunity to catalyse new industries, generate jobs on a sizeable scale and add to overall economic output.
- Sticking to global commitments: Budget 2023-24 is in accordance with the World Economic Forum’s Annual Meeting in Davos where India holds the key to hitting global climate change targets given its sizeable and growing energy needs.
Budget’s proposal for green energy:
- Boost for indigenous electric vehicle components: With the electric vehicle (EV) revolution poised to take off as every automobile major rolls out new EV models to tap demand, the availability of indigenously produced lithium-ion batteries has become a necessity, especially to lower the cost of EVs.
- Suitable Tax exemptions: To exempt customs duty on the import of capital goods and machinery required to manufacture lithium-ion cells used in EV batteries.
- Filling the gaps: The establishment of a viability gap funding mechanism to support the creation of battery energy storage systems with a capacity of 4,000 MWh.