Primarily we have seen rooftop solar investors claiming AD benefits; Utility-scale solar companies who contribute to the capacities, generally, haven’t claimed AD benefit. Reduction in AD will affect rooftop solar especially among industrial customers, as this has been one of the attractive factors in the purchase decision for such customers. It will also level the playing field as all companies that were ineligible to claim AD benefits will now be able to compete with companies that were able to claim AD benefits on the same parameters, paving way to more competitive and rational tariffs. ENERGETICA INDIA: What opportunities has the government missed to further boost renewable energy in India? Mr. Tulsi Tanti: The government has set the target of 175GW renewable energy by 2022 and 30% -35% carbon emission reductions by 2030. We recommend that the government considers the following points to help achieve the ambitious targets • Continuation of General Based Incentives (GBI) and long term visibility on GBI beyond 2017, at least until 2022. • Reinstatement of Accelerated Depreciation at 80% • GST for renewable energy should be pegged at zero rate, since electricity is not subsumed under the proposed GST framework • Finance should be made available at a reduced rate (for instance a rebate of 5%) for projects that procure products having 70% content in value terms from domestic suppliers similar to Brazilian Make in Brazil policy by BNDES (Brazilian Economic and Social Development Bank) through FINAME code • Companies with acceptable levels of credit rating should be allowed to issue tax-free bonds • Draft a policy for sharing hedging risk for borrowings in the sector (manufacturing and projects), thereby reducing cost of energy, making renewable energy more competitive and acceptable to utilities by Accelerated Depreciation dressing the forex risk involved in obtaining international funding. Mr. Ramesh Kymal: With looming energy needs in the country, renewable energy is poised to play a crucial role in changing the fortunes of energy security in the country. This can be possible only through adequate support from the government in the form of mandates & long term consistent policy and the current government has been proactive in pushing the Renewable Energy agenda for the country. Any alteration or removal of the existing fiscal incentives will certainly pose challenges to the industry in achieving the ambitious government targets of 60 GW of wind power by the year 2022. ENERGETICA INDIA: Will the increase in coal cess help the renewable energy industry? How? Mr. Tulsi Tanti: • In line with the commitments at COP21, the government is taking many initiatives to focus to further renewable energy and reduce carbon emissions. Coal cess has been doubled to Rs. 400/tonne and this is bound to cause a rise in traditional l fuel sources and energy generated thereof • As a result, we will need alternative, less expensive sources of fuel and renewable energy, almost having reached grid parity, is a very viable solution • This gives a major boost to the renewable energy sector and also creates the resources to achieve the targets set by the government and meets the growing energy needs driven by the Make in India initiative. Mr. C M Venugopalan: The increased coal cess may not have a huge impact on coal-based power pricing. However, this will send a right message towards adoption of renewable energy based power. Further, a higher cess should lead to a larger corpus fund for clean energy investments like solar, which is good news; but again, with Coal Cess /Clean Energy Cess now being renamed as “Clean Environment Cess” (which will focus on not only clean energy initiatives but also other environment related projects), the availability of a larger corpus fund may or may not directly help the solar industry. We will have to wait and see what portion of the funds will be allocated towards renewable energy initiatives. ENERGETICA INDIA: What kind of possible opportunities do you see for renewable energy in village electrification? Mr. Tulsi Tanti: • With 5,500 out of over 18,000 villages receiving electrification within six and a half months of the 1,000 days target being set, the goal of 100% rural electrification by 1st May, 2018 is well within reach. • Renewable energy, having almost reached grid parity, will be pivotal in meeting this target which poses incredible opportunity for the sector and to boost rural economy. • Off-grid solutions can play a significant role to provide affordable and clean energy for all. The potential of renewable energy-powered off-grid solutions to stimulate clean energy output in the country needs to be harnessed and specifically to achieve rural electrification. Mr. C M Venugopalan: Currently remote villages either have no power infrastructure or are sustaining on power generated by diesel generator sets for essential applications. Key advantages of installing solar minigrids are a shorter timeline for commissioning and minimum losses from transmission and distribution. Other upsides include freedom from power cuts and income generation for rural youth via operation and maintenance being done by local village representatives. Rural mini-grids using solar energy thus help in improving the local village infrastructure and economy. Bosch’s rural electrification projects in Tamkhua (Bihar), Darewadi (Maharashtra) and Viral (Karnataka) are living examples of how rural micro-grids using solar energy have helped villages have a better life and uplift the local economy. The government of India has had several focused policies and initiatives; however, there have been challenges in implementing them at the ground level. The recent announcement about driving 100% rural electrification by May 1st, 2018 is a welcome initiative. This calls for coordinated action by State and Central government agencies RENEWABLE ENERGY 38 energetica INDIA · MAR | APR16
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