- Battery energy storage systems with a capacity of 4,000mwh will be supported by the government via viability gap funding, which will attract investment towards such projects.
- Inter-state transmission system for evacuation and grid integration of 13 GW Renewable Energy from Ladakh will be constructed with an investment of Rs207bn, of which, support from the Centre would be of Rs83bn.
- Reforms Linked Distribution Scheme (RLDS) allocation for SEBs hiked 107% to Rs118bn; this however linked to achievement of targets such as AT&C loss reduction etc.
- Budgetary allocation to SECI (Rs20.5bn) and Rs357.7bn towards IREDA; will go a long way in promoting the RE projects.
- Outlay of Rs197bn under green hydrogen mission towards transition of the economy to low carbon intensity and lower dependence on fossil fuel imports. Government has set an annual production target is set to 5 MMT by 2030. This was announced earlier and reiterated in the budget.
- Government stated that it is formulating a policy to support pump storage projects (PSP’s).
- Green credit program will be notified by the government under the Environment (Protection) Act.
- Distribution in the form of repayment of capital is now taxed for REITs and INVITs. REITs/INVITS usually distributes its income in the form of interest, dividend and repayment of capital. Now, only divided remains exempt.
Analysts of IIFL Securities believe mixed impact of the budget announcements on the power sector.