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					</table><p>With India&#8217;s long-winded election process coming to a close and Narendra Modi sworn in as Prime Minister for a third consecutive term, the country&#8217;s aggressive renewable energy push is likely to continue.</p>
<p>In the Bharatiya Janata Party&#8217;s (<a href="https://www.bjp.org/home" target="_blank" rel="noopener">BJP</a>) second term in office, renewable energy was one of the cornerstones of the government&#8217;s economic agenda. The government undertook a series of initiatives to strengthen India&#8217;s energy security by augmenting solar and wind capacity to complement coal-based thermal, which is still the country&#8217;s primary energy source. India <a href="https://www.mercomindia.com/india-third-solar-power-producer" target="_blank" rel="noopener">displaced</a> Japan to become the third-largest solar energy producer in 2023.</p>
<p>Going into the elections, the BJP had outlined its ambitious clean energy vision in its manifesto. It promised &#8216;energy independence&#8217; by 2047 and a reduction in petroleum imports through a mix of electric mobility, a network of charging stations, renewable energy generation, and improved energy efficiency.</p>
<p>Much before the election schedule was announced, the government <a href="https://www.mercomindia.com/cabinet-approves-new-rooftop-solar-subsidy-program" target="_blank" rel="noopener">approved</a> the ₹750.21 billion (~$9.05 billion) PM-Surya Ghar: Muft Bijli Yojana, a program to install rooftop solar on 10 million households.</p>
<p>Among other significant promises, the BJP emphasized incentivizing private sector investment in large-scale battery energy storage systems infrastructure to foster renewable energy integration, grid stability, and resilience.</p>
<p>Expanding green hydrogen production, developing technologies to make India a major green hydrogen production hub, and positioning the country as a global manufacturing hub for wind, solar, and green hydrogen were also part of the BJP&#8217;s manifesto.</p>
<p>Unlike other elements of the government&#8217;s economic agenda, renewable energy has not faced political opposition in India. Many states have also embarked on clean energy programs. For instance, Tamil Nadu and Karnataka, where non-BJP parties are in power, are among the leading states in the country for wind and solar energy.</p>
<p>The Opposition Congress Party&#8217;s manifesto also devoted significant space to renewable energy. Committing itself to mobilizing the massive capital required for India&#8217;s green energy transition and achieving the goal of net zero by 2070, it had vowed to set up a Green Transition Fund of India together with state governments and the private sector.</p>
<p>Interestingly, one of the allies in the new government will be the Telugu Desam Party of Andhra Pradesh. Its leader, N Chandrababu Naidu, who will take over as chief minister of the state for a fourth time, has the reputation of being a forward-looking, industry-friendly politician. Andhra Pradesh added  the fifth-largest solar capacity of 4.9 GW in the first quarter of 2024, according to Mercom India’s <a href="https://www.mercomindia.com/product/q1-2024-india-solar-market-update" target="_blank" rel="noopener">Q1 2024 India Solar Market Update</a> .</p>
<p>With the political consensus about the need to integrate more renewable energy capacity into the country&#8217;s power mix, the BJP-led coalition govrernment can be expected to help sustain the growth trajectory the sector saw in the party&#8217;s earlier two terms in office.</p>
<p>Addressing the party after the BJP and its alliance partners won enough seats to form a government, Modi hinted at policy continuity regarding clean energy. He spoke about India&#8217;s commitment to the clean energy transition, green industrialization, and green mobility.</p>
<p>In recent years, India&#8217;s energy demand has kept pace with rising industrial activity. This year has already seen a peak energy demand of 250 GW, driven also by unprecedented summer temperatures across India. Solar and wind have played a significant role in meeting this demand.</p>
<p>With R.K.Singh, who was Minister of Power and New and Renewable Energy, and his deputy in the Ministry of New and Renewable Energy Bhagwant Khuba losing their seats in the elections, new ministers will be given charge of these portfolios.</p>


Aggressive Renewable Energy Push Likely to Continue in Modi 3.0


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					</table><p><a href="https://www.mercomindia.com/mnre-do-away-cpsus-involvement-rooftop-solar" target="_blank" rel="noopener"><strong>Days after Prime Minister Narendra Modi announced 300 units of free electricity through rooftop solar projects installed under the PM Surya Ghar: Muft Bijli Yojana, the Ministry of New and</strong></a> Renewable Energy (MNRE) has told industry stakeholders that it is rethinking the implementation of the program. Sources told Mercom that MNRE, in an interaction with industry stakeholders, that Central Public Sector Undertakings designated as the implementing agencies may no longer be involved in executing the program.</p>
<p><strong><a href="https://www.mercomindia.com/mnre-holds-almm-reimposition-order-abeyance" target="_blank" rel="noopener">The MNRE has kept in abeyance its recent order reimposing the Approved List of Models and Manufacturers regulation from April 1, 2024.</a></strong> On February 9, 2024, the ministry confirmed the reimposition of ALMM with exemptions for projects set up under open access solar and those in advanced stages of construction and rooftop solar projects with no subsidy. The MNRE has now stated that the previous order will stay in abeyance till further orders are issued.</p>
<p><a href="https://www.mercomindia.com/punjab-floats-rooftop-solar-projects" target="_blank" rel="noopener"><strong>The Punjab State Power Corporation (PSPCL) has invited bids to set up 31.37 MW rooftop solar power projects at various office buildings, 66 kV grid substations, hydel projects, and thermal projects of</strong></a> PSPCL at different locations under seven packages. The last date for the submission of bids is March 14, 2024. Bids will be opened the next day. Bidders must provide an earnest money deposit equal to 2% of the project cost, with a maximum limit set at ₹2 million (~$24,087.08). Except Package 7, whose limit is set to ₹800,000 (~$9,634.51)</p>
<p><a href="https://www.mercomindia.com/government-pilot-projects-hydrogen-trucks-buses" target="_blank" rel="noopener"><strong>After initiatives aimed at using green hydrogen to decarbonize the shipping and steel sectors, the government has turned its attention towards transportation.</strong></a> MNRE has launched pilot projects to use green hydrogen in the long-haul transportation sector under the National Green Hydrogen Mission. The program aims to support the deployment of green hydrogen through fuel cell electric vehicles and hydrogen internal combustion engine-based trucks and buses in a phased manner. It will also explore blending green hydrogen-based ethanol, methanol, and other synthetic fuels to run automobiles.</p>
<p><a href="https://www.mercomindia.com/arunachal-pradesh-500-solar-water-pumps" target="_blank" rel="noopener"><strong>Arunachal Pradesh Energy Development Agency has invited bids to commission 500 DC solar water pumping systems of 2 HP to 7.5 HP capacity at various locations in the state under the Component B</strong></a> of Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan program. The systems should carry a warranty and include annual maintenance contracts for five years. The project’s estimated cost is ₹173.95 million (~$2.09 million). The pumps must be commissioned within 120 days of receiving the work order.</p>
<p><a href="https://www.mercomindia.com/grid-connectivity-hybrid-projects" target="_blank" rel="noopener"><strong>The Madhya Pradesh Electricity Regulatory Commission has clarified that Regulation 2(xix) of the MPERC (Cogeneration and Generation of Electricity from Renewable Sources of Energy) Regulations,</strong></a> 2021 expressly states that hybrid renewable projects can be situated at two distinct locations and are permitted to inject power into the grid from two points. The order is in response to a petition filed by Madhya Pradesh Power Transmission Company seeking clarification regarding the definition of a renewable hybrid energy project.</p>
<p><a href="https://www.mercomindia.com/eu-targets-domestic-green-technology-2030" target="_blank" rel="noopener"><strong>The European Union has reached a provisional agreement on legislation aimed at boosting the bloc’s production of green technologies needed to achieve its goal of cutting carbon emissions by at least</strong></a> 55% by 2030 compared to 1990 levels. The legislation called the “Net-Zero Industry Act” is intended to support domestic manufacturing of key technologies like solar panels, wind turbines, batteries, and carbon capture. The goal is to use domestically produced green technology to cover 40% of the EU’s needs by 2030.</p>
<p><a href="https://www.mercomindia.com/executives-in-the-renewables-industry" target="_blank" rel="noopener"><strong>Check out Recent Executives Appointments in the Renewables Industry</strong></a></p>


Daily News Wrap-Up: MNRE Rethinks CPSUs’ Involvement in Rooftop Solar Program


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					</table><p>The government has moved the target year to install 500 GW of non-fossil energy capacity to 2031-32 from 2030, Union Minister for <a href="https://powermin.gov.in/" target="_blank" rel="noopener">Power</a> and <a href="https://mnre.gov.in/" target="_blank" rel="noopener">New &amp; Renewable Energy</a> R K Singh has informed Parliament.</p>
<p>Prime Minister Narendra Modi <a href="https://www.mercomindia.com/india-become-carbon-neutral-2070" target="_blank" rel="noopener">announced</a> India’s commitment to achieving the milestone at the COP26 Summit in Glasgow, Scotland, in November 2021. He had also said India aimed to become a carbon-neutral economy by 2070.</p>
<p>Since then, the Power Minister has consistently maintained that the 2030 target would be reached even before the deadline. He went on record to say that India would have achieved 50% of its power generation capacity from renewable sources in 2023 itself if the country had not lost two years due to the COVID-19 pandemic.</p>
<p>The 500 GW target year could have been reset because solar and wind power installations have not been keeping pace with the yearly targets, even while electricity demand has been burgeoning.</p>
<p>For instance, in the first nine months of 2023, India installed 5.6 GW of solar power capacity, a ~47% year-over-year drop from 10.5 GW. Utility-scale solar project installations fell by 54% to 4.2 GW, a 54% YoY decline, according to Mercom India’s <a href="https://www.mercomindia.com/product/q3-2023-india-solar-market-update" target="_blank" rel="noopener">Q3 2023 India Solar Market Update</a>.</p>
<p>To accelerate the commissioning of solar projects, the Ministry of New and Renewable Energy suspended the implementation of the Approved List of Models and Manufacturers mandate until the end of March 31, 2024. The suspension of the ALMM was to facilitate developers importing solar modules and commissioning their projects without delays.</p>
<p>However, coal-based thermal power is getting a push. In replies to two separate questions, Singh said the Central Electricity Authority had carried out generation planning studies in the context of the stressed scenario. To meet the country&#8217;s base load requirement by 2032, the government has assessed the coal and lignite-based installed capacity to be 283 GW against the present installed capacity of 214 GW.</p>
<p>“Considering this, the Government of India proposes to set up an additional minimum of 80 GW coal-based capacity by 2031-32. Currently, 26,380 MW of thermal capacity is under construction, 11,960 MW has been bid out, and 19,050 MW is under clearance,” the minister said.</p>
<p>In furtherance of the coal push, the CEA has advised thermal power utilities not to retire or repurpose coal-based power stations of more than 200 MW capacity before 2030 to ensure the availability of power.</p>
<p>In the last three years, 19 coal-based thermal power plants with a total capacity of 2.3 GW were retired.</p>
<p>Last December, India refused to <a href="https://www.mercomindia.com/india-says-no-triple-renewables-cop28" target="_blank" rel="noopener">endorse</a> a pledge signed by over 118 countries at the COP28 Summit in Dubai to triple renewable energy capacity by 2030. Doing so would have meant committing to a deal on phasing down coal.</p>
<p>In the run-up to COP28, Singh had said, “There is going to be pressure on nations at COP to reduce the usage of coal. We are not going to do this since our point of view is clear that we are not going to compromise on the availability of power for our growth, even if it requires that we add coal-based capacity.”</p>
<p>India has been witnessing a sharp increase in power demand in the last few years. Last year, the CEA <a href="https://www.mercomindia.com/indias-power-demand-rise-sharply-256-gw-2024-25" target="_blank" rel="noopener">forecast</a> an all-India peak power demand of 256.53 GW in the financial year (FY) 2024-25, rising sharply from FY 2023-24. Power demand will likely soar above 256 GW in September 2024, the CEA said.</p>


India’s 500 GW Non-fossil Energy Target Moved to 2031-32

<p>In a meeting with the Ministry of Power (<a href="https://powermin.nic.in/" target="_blank" rel="noopener noreferrer">MoP</a>) and the Ministry of New and Renewable Energy (<a href="https://mnre.gov.in/" target="_blank" rel="noopener noreferrer">MNRE</a>), Prime Minister Narendra Modi highlighted the need for a more holistic approach for solarizing the agricultural sector and innovative models in the rooftop solar sector.</p>
<p>He said that the entire supply chain for the agricultural sector, ranging from solar water pumps to decentralized solar cold storages, must be developed in a more holistic approach. He also stated that every state must have at least one fully solarized city. The city can be the capital or a popular tourist destination and must be powered solely through rooftop solar power.</p>
<p>PM Modi also said that the country needs to boost its production of ingots, solar wafers, cells, and modules. This would also have the additional benefit of generating employment.</p>
<p>Speaking about the power sector collectively, he added that it needs to enhance consumer satisfaction, operational efficiency, and improving financial sustainability. Regarding the power distribution segment, he said, “Instead of looking for a one-size-fits-all solution, the Ministry should put in place state-specific solutions to incentivize each state to improve its performance.”</p>
<p>Additionally, Modi encouraged the Ministry of Power to ensure that distribution companies are transparent on their performance parameters and asked the Ministry to promote the use of “Make in India” equipment in the power sector.</p>
<p>Mercom recently <a href="https://mercomindia.com/discoms-power-bills-online-covid-19/" target="_blank" rel="noopener noreferrer">reported</a> that despite all the relief provided considering the ongoing pandemic, many DISCOMs, including those in <a href="https://mercomindia.com/uttar-pradesh-power-discoms-grapple/" target="_blank" rel="noopener noreferrer">Uttar Pradesh</a>, <a href="https://mercomindia.com/madhya-pradesh-ministry-payment-delays/" target="_blank" rel="noopener noreferrer">Madhya Pradesh</a>, and <a href="https://mercomindia.com/andhra-discom-invokes-force-majeure/" target="_blank" rel="noopener noreferrer">Andhra Pradesh</a>, refused to pay power generators claiming their inability to collect power dues from the consumers. Mercom recently <a href="https://mercomindia.com/bailing-out-power-discoms-every-crisis/" target="_blank" rel="noopener noreferrer">published a report</a> on the recent fiscal stimulus provided to distribution companies and why it’s not a good idea.</p>
<p>Previously, the Prime Minister also <a href="https://mercomindia.com/prime-minister-modi-stock-power-lockdown/" target="_blank" rel="noopener noreferrer">held</a> a meeting to take stock of the power sector amid the COVID-19 pandemic. In the meeting, the Prime Minister discussed various measures and long-term reforms for enhancing sustainability, resilience, and efficiency of the sector. The meeting was attended by the Home Minister, Finance Minister, Minister of State for Power, and Minister of State for Finance along with senior government officials.</p>
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<p>Image credit: Kremlin.ru / CC <a href="https://creativecommons.org/licenses/by/4.0" target="_blank" rel="noopener noreferrer">BY</a></p>


Prime Minister Stresses the Need to Boost Domestic Production of Solar Components

<p>According to a communique reviewed by Mercom, the Indian Prime Minister Narendra Modi’s office has proposed waiving the Goods and Services Tax (GST) Compensation Cess, (earlier called the Clean Energy Cess which was India’s version of carbon tax) on coal to reduce the financial strain on distribution companies, besides helping the thermal power projects install flue gas desulphurization to curb pollution.</p>
<p>This proposal comes in light of the mandate to implement flue gas desulphurization (FGD) at thermal power projects in the country. The resulting investment in the FGD process is expected to result in increased power prices for customers.</p>
<p>FGD is the process of removing sulfur dioxide from exhaust flue gases of fossil-fuel power plants, and sulfur oxide emissions from processes like the incineration of waste material.</p>
<p>Earlier this year, the Ministry of Power (MoP) <a href="https://mercomindia.com/700-million-plan-for-ev-infrastructure-revamp/" target="_blank" rel="noopener noreferrer">proposed</a> a ₹835 billion ($11.70 billion) plan to meet the cost of development of Flue Gas Desulfurization to improve air quality and to conform to new norms notified by the Ministry of Environment Forest and Climate Change (MoEF &amp; CC) for power plants.</p>
<p>Projects which have the FGD facility at their sites would have to sell power at a higher cost after factoring in implementation costs. The communique stated that even with financing, the power tariff would increase by ₹0.30 – 0.35 (~$0.004 – 0.005)/kWh and would further burden DISCOMs that already <a href="https://mercomindia.com/discom-dues-to-power-generators-october-up-yoy/">owe</a> power developers over ₹844 billion (~$11.83 billion) in outstanding dues.</p>
<p>The National Clean Energy Fund (NCEF) was created in 2010 to fund the cost of research and innovative projects using clean energy technologies by public and private sector entities. The fund has evolved under the NDA administration and was rebranded as the Clean Environment Cess, from the earlier Clean Energy Cess, to include river cleaning and other projects. The Cess, which was ₹50 (~$0.74)/ton when it was introduced in 2010, was raised to ₹100 (~$1.5)/ton in 2014 and to ₹200 (~$3)/ton in the 2015-2016 budget. It was again doubled from ₹200 (~$3)/ton to ₹400 (~$6)/ton in the 2016-17 budget.</p>
<p>From 2010 to 2017, about ₹864 billion (~$13.3 billion) <a href="https://mercomindia.com/mnre-receive-rs-53-41-billion-817-million-national-clean-energy-fund-fy2017-2018/" target="_blank" rel="noopener noreferrer">has been collected</a> through the Clean Environment Cess, out of which only ₹296 billion (~$4.6 billion) was transferred to NCEF. Ministry of New and Renewable Energy (MNRE) had only received about ₹171 million (~$2.6 million) to that point.</p>
<p>The Government of India then enacted a bill to utilize the Clean Environment Cess (India’s version of carbon tax) collected on coal, to finance the Goods and Services Tax (GST) Compensation Fund, a non-lapsable fund that will form part of the public account of India.</p>
<p>The Goods and Services Tax (Compensation to States) Act, 2017 which came into force in April 2017, states that coal cess, along with other cess on pan masala, tobacco, aerated water etc., would constitute GST Compensation Fund and would be utilized to fund the States for five years to compensate them for potential losses on account of GST implementation. After five years, any amount left was to be shared on a 50 percent basis between the Center and States.</p>
<p>The PMO explained that by waiving the ₹400 (~$5.61)/ton cess, the increase in tariff would not be transferred to customers. Consequently, the requirement of subsidies from the government would also not increase, and this would make up for losses to the GST compensation cess.</p>
<p>This move, while positive for the Indian coal industry would, however, would make coal power slightly more competitive with solar and wind energy.</p>
<p>The total power capacity <a href="https://mercomindia.com/solar-accounts-india-total-installed-power-capacity/" target="_blank" rel="noopener noreferrer">installed</a> in India stood at 366 GW at the end of September 2019, with coal accounting for 53.8% and renewable energy capacity (including large hydro), making up 35.7% of the total installed power capacity in the country.</p>
<p>“The amount of clean energy cess fund going towards renewable energy and MNRE was only about 20% in 2017. The funds were already being diverted to river cleaning, water and sanitation, and other areas. The impact of this proposal on renewable energy development is likely to be minimal,” said Raj Prabhu, CEO of Mercom Capital Group.</p>
<p>Image credit: Shivang Dubey [CC BY-SA <a href="https://creativecommons.org/licenses/by-sa/4.0" target="_blank" rel="noopener noreferrer">4.0</a>]</p>


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