Assam Unveils INR 77,353 Crore Green Energy Investment Plan in 2026-27 Budget

The Assam Government has announced an investment of more than INR 77,353 crore for the power sector in the 2026-27 Budget, marking the largest allocation for the sector in the state's history.

Presenting the 2026–27 Budget, Assam Finance Minister Jayanta Malla Baruah said that the investment is aimed at strengthening the state's energy infrastructure, expanding renewable energy capacity and supporting its goal of emerging as the 'Green Energy Hub' of Northeast India.

A significant share of the proposed investment has been earmarked for renewable energy projects, with a strong focus on pumped storage and hydropower. The government has approved four pumped storage projects with a combined capacity of 4,900 MW, involving an estimated private investment of INR 27,100 crore. In addition, 11 small hydel projects with a total capacity of 137.2 MW and an investment of INR 2,617 crore are under planning and implementation.

The Budget also includes a pipeline of 75 MW of solar power projects worth INR 456 crore and a 25 MW/100 MWh Battery Energy Storage System (BESS) project estimated at INR 170 crore. The government said these initiatives are expected to improve renewable energy integration and help Assam become a power surplus state for the first time.

As part of its environmental measures, the state has proposed the introduction of a Green Cess on selected polluting activities. The cess will be levied on stone crushers, coke based industries, brick kilns, commercial groundwater extraction and the transfer of second hand vehicles. According to the Finance Minister, the revenue generated will be utilised for afforestation, pollution control, biodiversity conservation and climate adaptation programmes, in line with the principle that polluters should contribute towards environmental restoration.

The Budget also includes measures to promote cleaner fuels and electric mobility. The government has reduced the Value Added Tax (VAT) on Piped Natural Gas (PNG) from 14.5 percent to 5 percent to encourage wider adoption of cleaner fuel and reduce household energy costs. To support electric vehicle adoption, the Budget provides a 3 percent Motor Vehicle Tax subvention for EV buyers. Government employees purchasing electric vehicles under the revamped Apon Bahan scheme will be eligible for a 4 percent interest subvention.

To strengthen the state's transmission network, the government has earmarked INR 4,600 crore for grid substations and power evacuation infrastructure. Over the next five years, Assam plans to add 15,000 circuit kilometres of transmission lines and establish 120 new substations to improve power supply reliability and facilitate the integration of renewable energy. The 120 MW Lower Kopili Hydroelectric Project has entered trial commissioning and is currently supplying 55 MW to the grid, with full commercial operations expected by July 2026.

The Budget also provides INR 2,500 crore for underground cabling of Guwahati's overhead power distribution network. The first phase of the project will cover major stretches, including Paltan Bazar, AT Road and GS Road, with the objective of improving public safety, enhancing power reliability and modernising the city's infrastructure.

In the bioenergy sector, Oil India Ltd. is implementing five Compressed Bio Gas (CBG) plants across Assam. In addition, Suzuki R&D Centre India, the National Dairy Development Board (NDDB) and North East Dairy and Foods Ltd are jointly developing a CBG project at Kalgachia. The state government also announced that a dedicated CBG Policy is in the final stages of preparation and is expected to facilitate greater private investment in the sector.

Energy analysts said that the Budget reflects Assam's long term strategy to expand renewable energy capacity, modernise its electricity network and strengthen energy security. They noted that the emphasis on pumped storage projects, along with investments in transmission infrastructure, battery storage and bioenergy, is expected to support the state's growing power demand while positioning Assam as a major clean energy hub in the Northeast.