The total non-fossil fuel based energy capacity of the country has reached 217.62 GW. So, the country seems to be in line with the goal to achieve 500 GW of non-fossil fuel-based energy capacity by 2030, thus emerging as a global leader in clean energy. And, as expected, the budget has outlined some appropriate fiscal measures to boost that growth momentum by developing a robust renewable energy ecosystem and diversifying the renewable energy portfolio. 

The targeted step towards building a localised manufacturing capability to produce PV cells, electric vehicle (EV) batteries, motors and controllers, electrolysers, wind turbines, very high voltage transmission equipment and grid scale batteries is a move in the right direction. The objective is to build a self-sufficient pathway to clean energy transition by setting up an indigenous manufacturing supply chain. The duty exemption in capital goods for EV battery manufacturing will strengthen the EV manufacturing ecosystem in the country. 

The decision to reduce custom duties on solar cells and modules as well as on key inputs for manufacturing EV batteries will have a growth-multiplier impact in the renewable energy sector in terms of accelerated renewable energy and EV adoption, employment generation, etc. In addition, the prospect of domestic value addition unlocks opportunities for greater public private participation which will drive the country towards its Net Zero emissions target 2070. 

A localised supply chain also makes projects of the renewable energy EPC solutions providers and independent power producers economically viable and cost efficient. The allocation of Rs 26,549.38 crore to the Ministry of New and Renewable Energy will also boost the confidence of the renewable energy sector and will inspire all the stakeholders to work together to fast-pace clean-energy transition. 

The solar energy segment in particular  has received a massive boost in the budget, as the government has earmarked Rs.24,224.36 crore towards that segment. That’s good news for Gujarat as the state government has set a goal to attain 100 GW of solar energy production by 2030. The state currently accounts for 13 percent of the country’s total solar capacity. The latest budget announcements will create an enabling environment for Gurajat to realise its full potential and lead the renewable energy production. 

In fact, most parts of the country are blessed with at least 300 sunny days in a year, which roughly translates into over 5000 trillion kWh per year. The number is more than India’s total energy consumption per year.