Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman has announced to bring out a policy document on appropriate energy transition pathways that balance the imperatives of employment, growth and environmental sustainability. While presenting the Union Budget 2024-2025 in Parliament today, the Minister said this is in continuation to the Government strategy to sustain high and more resource-efficient economic growth, along with energy security in terms of availability, accessibility and affordability.

The Union Minister announced following measures in this regard:

PUMPED STORAGE POLICY

The Finance Minister said that a policy for promoting pumped storage projects will be brought out for electricity storage and facilitating smooth integration of the growing share of renewable energy with its variable & intermittent nature in the overall energy mix.

Terming energy transition as critical in the fight against climate change, the Finance Minister announced to expand the list of exempted capital goods for use in the manufacture of solar cells and panels in the country. Further, in view of sufficient domestic manufacturing capacity of solar glass and tinned copper interconnect, the Budget 2024-25 proposed not to extend the exemption of customs duties provided to them.

RESEARCH AND DEVELOPMENT OF SMALL AND MODULAR NUCLEAR REACTORS

Nuclear energy is expected to form a very significant part of the energy mix for Viksit Bharat as emphasized by the Finance Minister. Towards that pursuit, the Government will partner with the private sector for (1) setting up Bharat Small Reactors, (2) research & development of Bharat Small Modular Reactor, and (3) research & development of newer technologies for nuclear energy. The R&D funding announced in the interim budget will be made available for this sector.

ADVANCED ULTRA SUPER CRITICAL THERMAL POWER PLANTS

The Finance Minister also said that the development of indigenous technology for Advanced Ultra Super Critical (AUSC) thermal power plants with much higher efficiency has been completed. Smt. Sitharaman said a joint venture between NTPC and BHEL will set up a full scale 800 MW commercial plant using AUSC technology and the Government will provide the required fiscal support. She said that development of indigenous capacity for the production of high-grade steel and other 15 advanced metallurgy materials for these plants will result in strong spin-off benefits for the economy.

ROADMAP FOR ‘HARD TO ABATE’ INDUSTRIES

The Finance Minister also added that a roadmap for moving the ‘hard to abate’ industries from ‘energy efficiency’ targets to ‘emission targets’ will be formulated. She announced that appropriate regulations for transition of these industries from the current ‘Perform, Achieve and Trade’ mode to ‘Indian Carbon Market’ mode will be put in place.

SUPPORT TO TRADITIONAL MICRO AND SMALL INDUSTRIES

The Finance Minister said that an investment-grade energy audit of traditional micro and small industries in 60 clusters, including brass and ceramic, will be facilitated. Financial support will be provided for shifting them to cleaner forms of energy and implementation of energy efficiency measures. The Minister said the scheme will be replicated in another 100 clusters in the next phase.

PM SURYA GHAR MUFT BIJLI YOJANA

In line with the announcement in the interim Budget, PM Surya Ghar Muft Bijli Yojana has been launched to install rooftop solar plants to enable 1 crore households obtain free electricity up to 300 units every month. The scheme has generated remarkable response with more than 1.28 crore registrations and 14 lakh applications, and the Government will further encourage it, said the Finance Minister.

Pumped storage policy to enable electricity storage and smooth integration of variable renewable energy into the grid. A policy for promoting pumped storage projects will be issued to enable electricity storage and smooth integration of variable renewable energy. The Budget expands the list of exempted capital goods for solar cell and panel manufacture while discontinuing customs duty exemptions for solar glass and tinned copper interconnect. The Government will support R&D and private sector partnership for small nuclear reactors and fund indigenous deployment of Advanced Ultra Super Critical thermal technology through a public joint venture with fiscal support, alongside a roadmap to shift hard to abate industries from energy efficiency to emission targets and into the Indian Carbon Market.