Home India No incentive for renewable energy under GST: Investors
No incentive for renewable energy under GST: Investors

No incentive for renewable energy under GST: Investors


The fear is that tax holiday, excise and customs concessions might evaporate

Stakeholders in the renewable energy sector have expressed concern over the effect that the implementation of the goods and services tax (GST) will have on the industry.At the inaugural session of Energizing South 2016, a two-day conference and exposition on “Smart – Reliable – Sustainable Power”, being organized by Confederation of Indian Industry (CII) here on Monday, industry stake holders presented their concerns about the implementation of GST.

Currently the sector enjoys many fiscal incentives like 100 per cent tax holiday on earnings for 10 years, concessional excise and custom duties and so on.However, with the introduction of GS,T all this will come to an end, which in turn will impact the cost of setting up renewable projects.Earlier in the day, SD Dubey, chairman, Central Electricity Authority, Ministry of Power, Government of India said that southern states have a lot of potential in solar and wind energy generation.

India has set the target of 140 GW installed capacity by 2020 for the renewal sector, out of which over 60% is expected to be in the southern region.”The southern region states have to focus on evolving standards for grid connectivity. Energy efficiency and generation of renewable energy will be the two key factors that would help the country cut its CO2 emission by 35% by 2030 – by then renewable energy sector would account for about 40% of power generation,” he added.

Similalry Arvind Jadhav, chief secretary, government of Karnataka said that there was a need for the stakeholders to change their mindset and realize that energy is both conventional and a sunrise industry. They have to come up with new, innovative solutions in the wake of technology disruptions and new consumer demands.The world is asymmetrical and hence there will be asymmetry in the power sector as well. There is a need to align all stakeholders, including engineers, producers, administrators and software professionals and move forward, said Jadhav.

However, most stake holders present during the conference expressed their concerns over the implementation of GST and it acting as an impediment towards adding capacity to the renewable energy sector, which despite the concession has been progressing at snail’s space in the region, which faced one of the worst power crises in the summers of 2015-16.The government authorities on the other hand said that they have already worked out a possible outcome of the impacts due to the implementation of GST and will take up the matter so that the interest of the consumers and service providers is not hampered.



Anand Gupta Editor - EQ Int'l Media Network


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