The Centre wants to promote a circular economy through its focus on renewable energy transition and biogas
Finance Minister Nirmala Sitharaman announced the FY24 Union Budget in Parliament February 1, 2023. The minister listed “Green Growth” as one of the seven priorities of this year’s Budget.
The focus has majorly been on renewable energy transition and biogas to promote a circular economy. A sum of Rs Rs 35,000 crore has been announced for priority capital investment towards energy transition and net zero objectives. Rs 10,000 crore has been announced to build waste-to-wealth plants under the Galvanizing Organic Bio-Agro Resources Dhan scheme (GOBAR-DHAN) scheme.
The FM said, “India is firmly moving towards the net-zero carbon emission target of 2070 to usher in green industrial and economic transition. This budget builds on our focus on green growth.”
As part of the Rs 35,000 crore capital expenditure, Rs 5,000 crore would be for strategic storage filling of oil reserves and Rs 30,000 crore support would be for oil marketing companies (OMCs) to take up projects which contribute towards the goals of energy transition, security and net-zero carbon emissions target by 2070.
The minister announced an outlay of Rs 19,700 crore for the recently launched National Green Hydrogen Mission. This would facilitate the transition of the economy to low carbon intensity and reduce dependence on fossil fuel imports.
The target is an annual production of 500 MMT (million metric tonnes) of green hydrogen by 2030. Rs 10,222 crore has been allocated toward the renewable energy sector. This outlay is an increase of 48 per cent over last year’s allocation of Rs 6,900.68 crore.
Other announcements in the sector include a viability gap funding (VGF) for battery energy storage systems with a capacity of 4,000 MWh; Rs 20,700 crore for an interstate transmission system of 13 GW renewable energy from Ladakh; a Green Credit Programme under the Environment Protection Act, of 1986; and, funds to scrap old vehicles under the Vehicle Scrapping Policy mentioned in Budget 2021-22.
In the biogas energy sector, 500 new ‘waste to wealth’ / CBG plants would be established under GOBARDHAN. These will include 200 compressed biogas (CBG) plants and 300 community or cluster-based plants with a total investment of Rs 10,000 crores.
A Centre for Science and Environment team led by director-general Sunita Narain, was part of the interministerial committee with key ministries concerning waste management and prepared a roadmap.
It was based on the committee’s recommendation to the Union Government that they planned to establish 500 compressed CBG plants across the country. In Sitharaman’s speech, she also announced that “to avoid cascading of taxes on blended compressed natural gas, I propose to exempt excise duty on GST-paid compressed biogas contained in it.”
This exemption will help the sector grow and develop a market of its own.
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