The Indian solar energy sector has several expectations from the upcoming union budget.
A majority of industry stakeholders anticipate tax reduction, better rate of interest, subsidies for developers in the Union Budget 2019-20.
Last year, various policy initiatives as part of ’24X7 power to all’ were announced to ensure last-mile connectivity. This year too the trend is likely to continue.
The highlight of achievements in the power sector over the last five years is electricity connections reaching over 96% households.
The next focus is electrification of every house. This target is nearing the cent per cent goal.
Deendayal Upadhyaya Gram Jyoti scheme was launched in the 2014-2015 with the aim of taking connections to distant and difficult terrains.
All budgets since then have seen an increase in allocations for this head.
Industries have also been given tax rebates to encourage production of renewable energy. The government has set a target of installing 175 GW of renewable energy capacity by the year 2022.
Pradhan Mantri Sahaj Bijli Har Ghar Yojana – ‘Saubhagya’ yojana was launched by the Prime Minister on 25th September, 2017.
Since then free electricity connections to all households in rural areas and poor families in urban areas are being provided.
In the 2018 budget an allocation of Rs 16,000 crores was made for this scheme.
Now, that cent per cent electrification target is nearing completion production companies in the power sector are hoping for some incentives in this budget.
Many of these companies are burdened with massive loans. They hope that the focus on increased manufacturing will open a window of relief for them. Both traditional and renewable power production has witnessed a massive surge since 2014.
India today not only meets its power needs but is also generating excess capacity.
As a result a huge market is emerging especially for renewable energy. The solar power sector is hoping for lowering of interest rates on long term loans. A tax rebate for small units using solar energy will also help this sector.
The government is well aware that such initiatives will go a long way in achieveing the goal of generating 100 Gigawats of solar power. And this budget will likely focus on this area.