The Uttar Pradesh Government has announced the budget for the financial year (FY) 2022-23 and allocated funds for renewable energy project development in the state.

Presenting the budget, Finance Minister Suresh Kumar Khanna said that the state’s economy was moving in the right direction to become a $1 trillion economy, as committed by Prime Minister Modi.

The budget touched on the renewable sector, and many announcements were made during the course of the presentation reiterating the government’s stance on the transition to a cleaner and greener economy.

Stressing the need to promote renewable energy, the Finance Minister said that a Green Energy Corridor would be developed in the Bundelkhand area to evacuate 4 GW of solar power. The state is working towards increasing its utility-scale solar installations, promoting the shift to renewables for power supply within the state and outside.

According to the Mercom India Solar Project Tracker, Uttar Pradesh has 2.3 GW of operational solar capacity and 714 MW in the pipeline. Due to its favorable low landed cost and energy banking policies, open access installations are growing in the state.

The state is also planning to promote grid-connected rooftop solar projects across various cities and rural areas. Currently, the state has 255 MW of rooftop solar installations.

To improve power distribution infrastructure in the state, the government has allocated ₹55.3 billion (~$712.20 million) for the revamped distribution sector program started by the central government. The program was launched to improve the operational efficiencies and financial sustainability of DISCOMs by providing financial assistance for modernization and strengthening of distribution infrastructure.

The government plans to reduce the irrigation cost for the farmers in the next five years. Under the Pradhan Mantri Kisan Urja Suraksha evam Utthan Mahabhiyan (PM-KUSUM) program, the government would provide farmers with 15,000 solar pumps during the course of the year.

The government is also planning to set up industrial corridors near greenfield expressways, and for the first phase of the program, ₹5 billion (~$64.39 million) has been allocated. This investment is expected to increase the development of manufacturing units from various sectors in the state.

To promote energy from organic waste, ₹24.92 billion (~$320.92 million) has been allocated to develop 14 projects, including projects for the production of bio-ethanol, biogas, methanol, bio-diesel, and bio-coal, among others.

Under the Babuji Kalyan Singh Gram Unnati Yojana, the government aims to set up solar street lights on roads across all the villages in the state. A total of ₹225 million (~$2.90 million) was allocated for this purpose.

As part of the Central Smart City Program, to develop sustainable, eco, and citizen-friendly cities in the country, the state has five of its major cities listed. It has proposed an investment of ₹2.01 billion (~$25.89 million) to develop these smart cities.

As a part of its environmentally friendly initiatives, the government aims to increase the forest coverage in the state, which is currently at 9.23% of the geographical area, to be increased to 15% by 2030. The state government has further allocated an amount of ₹350 million (~$4.51 million) for this purpose.

The state budget announcements aim to align with the central policies and the renewable target of 500 GW by 2030 set for the country. Kerala and Maharashtra were two other states which had recently announced extensive investments to help expand their renewable energy expansion.

Earlier, Uttar Pradesh had sold the highest amount of power in the day-ahead market (DAM) in the second quarter (Q2) of 2021, accounting for 13.9% of all power sold in the quarter.

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