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Union Budget 2017: FM proposes massive cuts in excise and customs duties for clean energy equipment

Giving A Boost To Clean Energy Programme, Finance Minister Arun Jaitley On Wednesday Proposed Massive Cuts In Excise And Custom Duties On Materials Used In Solar And Wind Plants, And Also Announced The Second Phase Of Solar Park Development For 20 GW Capacity.

PTI | Updated on: 01 Feb 2017, 09:13:24 PM
Union Budget 2017: FM proposes massive cuts in excise and customs duties for clean energy equipment

New Delhi:

Giving a boost to clean energy programme, Finance Minister Arun Jaitley on Wednesday proposed massive cuts in excise and customs duties on materials used in solar and wind plants, and also announced the second phase of solar park development for 20 GW capacity.

“In solar energy, we now propose to take up the second phase of Solar Park development for additional 20,000 MW capacity,” Jaitley said while presenting the Budget for 2017-18 in the Lok Sabha on Wednesday.

Besides, the minister also proposed to feed about 7,000 stations with solar power in the medium term saying that a beginning has already been made in 300 stations and works will be taken up for 2,000 railway stations as part of 1000 MW solar mission.

Commenting on the budget proposals about renewable energy, Power Minister Piyush Goyal told that his ministry would soon start auction for another 20GW of solar parks in the country as announced in the Budget.

The Finance Minister has proposed zero basic customs duty (BCD) on solar tempered glass for use in manufacture of solar cells/panels/modules. At present BCD on those is 5 per cent.

Similarly, he proposed to reduce countervailing duty (CVD) on parts/raw materials for manufacture of solar tempered glass for use in solar photovoltaic cells/modules, solar power generating equipment or systems, flat plate solar collector, solar photovoltaic module and panel for water pumping and other applications, to 6 per cent from existing 12.5 per cent.

The budget has also proposed to reduce excise duty on these materials to 6 per cent from existing 12.5 per cent.

It is also proposed to reduce the BCD, CVD and SAD(Special Additional Duty) of 24 per cent on resin and catalyst for manufacture of cast components for Wind Operated Energy Generators to 5 per cent. Budget has also proposed zero excise duty on these materials from existing 12.5 per cent.

All items of machinery required for fuel cell based power generating systems to be set up in the country or for demonstration purposes attract BCD, CVD and SAD of 30 per cent which would be reduced to 11 per cent. The budget has proposed to reduce excise duty on these items to 6 per cent from existing 12.5 per cent.

Similarly, it is proposed to reduce BCD, CVD and SAD of 30 per cent on all items of machinery required for balance of systems operating on biogas/bio-methane/ by-product hydrogen to 11 per cent. The budget has also proposed to reduce excise duty on these materials to 6 per cent from 12.5 per cent.

However, it is proposed to levy 6 per cent excise duty on solar tempered glass for use in solar photovoltaic cells/modules, solar power generating equipment or systems, flat plate solar collector, solar photovoltaic module and panel for water pumping and other applications. At present there is no excise duty on these materials.

India has set an ambitious target of adding 175 GW of renewable energy by 2022 which includes 100 GW of solar, 60 GW of wind, 10 GW from biomass and 5 GW from small hydroelectric projects (upto 25 MW each). 

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First Published : 01 Feb 2017, 08:52:00 PM

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