GST impact on thermal power sector to be marginally positive: ICRA
Reduction in tax rate on domestic coal will provide a relief in the cost of power generation even after accounting for an increase in capital cost due to higher tax rates in boiler, turbine, generator segment, research and ratings agency ICRA said today. The GST Council earlier this month placed domestic coal under the 5 per cent tax slab under the Goods and Services Tax (GST) while imported coal will continue to attract basic customs duty (BCD). “It is estimated to provide relief in variable cost of generation by about 3-4 paise per unit in case of domestic coal. However, the variable cost of generation for imported coal generators would increase by 7 paise per unit,” the report said. Given that the tax slab for coal varied from 11 to 12 per cent, it will lead to a positive impact for domestic coal users and a negative for imported coal users according to ICRA. On the other hand, for the wind energy sector, the impact of GST is marginally negative due to increase in capital cost — higher tax rates in wind turbine generator—as the wind energy sector has been availing various concessional rates and tax exemptions, the report added. According to ICRA, there will be a marginally negative impact on Boiler, turbine and generator equipment for thermal power projects for which GST would be applicable at the rate of 18 per cent. “Overall impact including for balance of plant equipment and GST on service component is estimated to increase the capital cost for imported BTG based projects by 2 per cent,” the report said. As per the government’s notification, BCD would also continue for imported components. ICRA report stated its impact would vary depending on the Value Added Tax (VAT) rate applicable in a state and the mix of imported equipment. Tomas Plekanec Womens Jersey
Solar panels to attract 5 per cent rate under GST: Revenue Secy Hasmukh Adhia
The centre has finally clarified that solar panels will attract a 5 per cent tax rate under the Goods and Services Tax (GST), contrary to the 18 per cent rate which was announced earlier. “All solar equipments and its parts would attract 5% GST only,” Revenue secretary Hasmukh Adhia tweeted. Power, coal, mines and renewable energy minister Piyush Goyal had on 19 May said the 18 per cent rate for solar will not impact the solar power tariffs. “Tariffs for solar projects vary from project to project. The rise will be compensated by the decline in corruption and operational difficulties,” Goyal had said at a media conference. The government had also announced that the rate finalised for coal stood at 5 per cent. ETEnergyworld was the first to report the anomaly on 20 May. Rajeev Kapoor, Secretary at the ministry of new and renewable energy secretary had told ETEnergyworld that the renewable energy sector and all parts related to it will remain under the 5 per cent tax slab. ALSO READ: How will the higher tax rate impact the solar power sector? As per chapter 85 of the GST rates finalised by the government, all renewable energy based devices and spare parts were classified under the rate of 5 per cent. Kapoor had also stated that there was an anomaly which would be addressed soon. The government is reportedly expected to issue a clarification on the confusion over tax rates for solar power sector at the next GST council meeting which will be chaired on June 3. Kyle Okposo Authentic Jersey
Bihar announces mega renewable power policy; to add 3,400 MW in five years
The Bihar government has come up with a new renewable power policy for the state where it looks to set up over 3,400 Megawatt projects based on non-fossil fuel-based resources in the next five years. The policy is likely to spur investments to the tune of Rs 20,000 crore in energy projects, according to Centre for Energy and Environment Development (CEED), a non-profit organization active in Bihar’s energy space. The state’s Cabinet last week cleared the policy called ‘Bihar Policy for Promotion of New and Renewable Sources, 2017’ and is likely to notify the same soon. Under the policy, the state government is mulling setting up 2,984 MW capacity based on solar energy, 282 MW on biogas and 200 MW small hydropower plants. Of the total solar capacity, the state plans to set up 1,000 MW rooftop solar projects and 1,00 MW as mini grid projects. Composed of solar modules, a battery bank, and an inverter, a mini-grid system can offer solar power as the primary power source and later switch to alternative power sources when solar power is insufficient for meeting demand. The renewable energy capacity addition of Bihar is in line with central government’s plan to have capacity of 175 Gigawatt built on alternative sources of energy by 2022. Of this 175 GW, the government plans to add 100 GW solar power capacity, 60 GW wind, 10 GW from biomass and 5 GW from small hydro projects. “The policy is expected to open up massive new avenues for jobs and livelihood opportunities in the state; particularly in supply chain, operation, and maintenance for grid-connected and off-grid or decentralized renewable energy projects,” CEED said in a statement. It further said the policy provides a host of economic incentives to project developers for setting up renewable energy projects, which includes exemption of electricity duty, Value Added Tax (VAT), distribution charges and cross-subsidy surcharges. CEED said the provisions to de-risk private sector investment in mini-grid projects are also included in the policy given the fact that remote areas of Bihar possess huge potential for mini-grids and it is important to tap those potential with suitable investment climate. Josh Sitton Womens Jersey
Barring 6 states and Chandigarh, India to turn power surplus this fiscal
Most parts of the country will have surplus power availability in the current financial year thanks to higher electricity generation, the Central Electricity Authority said. The apex power sector planning body said in a report that in 2017-18, there will be anticipated energy surplus of 8.8 per cent and peak-hour surplus of 6.8 per cent. While the eastern region will be able to meet its demand almost in full, other four regions will have surplus power varying from 3 per cent to 13 per cent, the report released on Monday said. Barring six states and a union territory, all other parts of the country will be power surplus on average during the year, as per the data based on gap between electricity requirement stated by states and electricity availability. However, the data does not reflect the true power outages scenario in states that may choose to shed load due to financial inabilities or technical failure. The report said that overall the country recorded the lowest ever demand-supply gap of 0.7 per cent in 2016-17, both in terms of energy and peaking. “Even this demand-supply gap was due to factors other than non-availability of power in the country,” it said. The load generation balance report for 2016-17 had, however, predicted a national average power surplus of 1.1 per cent in that year. There will be surplus energy in a number of states in the southern and western regions while some demand-supply gap is likely to be experienced by some states, mostly in northern, eastern and north-eastern regions, the report for 2017-18 said. In peak hours, power surplus is likely to prevail in all the regions — 6.7 per cent in northern, 17.2 per cent in western, 1 per cent in southern, 10 per cent in eastern and 5 per cent in north-eastern region. Joe Looney Womens Jersey
OPINION: Bring electricity under GST soon
One glaring anomaly in the forthcoming rollout of the goods and services tax (GST) is that electricity duty remains outside its purview. While scores of central and state taxes are to be done away with to usher in GST -so as to modernise the indirect tax regime, eschew cascading taxes on inputs, with set-offs provided for taxes already paid in the value chain -an important sector like electricity is to remain outside the GST regime for the foreseeable future. Such exclusion makes no sense. Electricity duty can be as high as 25-30% in a few states, but the average is about 8% levied on consumers. The tax needs to be made amenable for input tax credit, otherwise it would in effect cascade economy-wide. Keeping something as essential as electricity outside GST would be retrograde, inefficient and perversely deny input tax credits in a vital sector that is undergoing path-breaking and transformative change. Note that the GST Act defines `work contracts’ as services. And the power sector is essentially a mesh of contracts for engineering, procurement, construction (EPC) to generate electricity, boost energy efficiency and shore up renewable power. Yet, input tax credit would not be available on EPC contracts, with electricity outside the GST regime. Further, the Finance Act of 1994, in section 66D, lists transmission and distribution (T&D) of electricity in the negative list of services. So, no input tax credit is possible for T&D activity either. Keeping electricity outside GST is not international practice. The state governments seem chary of giving up electricity duty as they collect considerable sums on that account, even as they surreptitiously seek to indulge in fiscally reckless giveaways in power. Including electricity in GST would actually boost transparency in the sector. Niles Paul Womens Jersey
No uptake for rooftop solar in Indian cities
India might be playing a leadership role in bringing the world together for the International Solar Alliance, but it is struggling with the adoption of solar rooftops in its metro cities, a recent study has shown. Despite friendly policies and net metering guidelines in several states and a subsidy of 30 per cent offered by the Ministry of New and Renewable Energy (MNRE), the installation of solar rooftop systems has been dismal in leading metros in the country, especially in Chennai and Mumbai, according to the study. According to the study, titled Indian Cities Slacking on Rooftop Solar, Delhi, which offers metered connections and a generation-based subsidy in its solar policy, has also failed to shine. The study, by Greenpeace India, says that while the country has made good progress in reaching its 60 GW utility scale solar electricity targets, deployment is particularly slow in the residential rooftops sector. The government has earmarked 40 GW as the rooftop solar target by 2022, but as of December 2016, only over 1 GW worth of installations have taken place. Delhi, which has a current estimated solar potential of 1.25 GW in buildings and has an official target of installing 1 GW by 2020 and 2 GW by 2025, has installed only 35.9 MW of solar rooftop capacity. Out of this, only 3 MW is from residential installations. Mumbai has also been slow in installing solar rooftops in residential buildings. Out of 1.72 GW estimated solar potential, as calculated by the Indian Institute of Technology, Bombay, the city has installed only 5 MW of residential solar. Tamil Nadu, which offers Rs 20,000 subsidy for domestic consumers under the Chief Minister’s Solar Rooftop Capital Incentive Scheme, has also not been able to make significant progress. The state has a rooftop solar target of 350 MW but not even 2 MW have been installed. “Despite the national incentive in the form of a 30 per cent capital subsidy, and a range of state incentives and schemes, rooftop solar is yet to take off in the same manner as large-scale solar. However, this does not mean India should lower its ambitious targets, as some have suggested. Rather, the government must step up and play a more proactive role in encouraging rooftop installations,” said Pujarini Sen, Climate and Energy Campaigner, Greenpeace India. “As the convenor and a founding member of the International Solar Alliance, and a country with abundant solar potential, India’s commitment to clean energy must continue to be robust.” A Greenpeace poll showed significant public interest in adopting solar power. Close to 55 per cent of the 812 participants expressed willingness to invest and install solar. Despite this interest, awareness and various incentive schemes, the thrust on solar rooftops has largely been in the government, institutional and commercial buildings as opposed to homes. The report cites lack of familiarity with the process and fear of bureaucratic red tape as the main reasons for the slow uptake of solar rooftops in the residential sector. Other reasons are insufficient knowledge among citizens about the financial incentives and attractive return-on-investment, perception that large upfront capital investment is required, and ineffective implementation of net metering in various states. “If central and state governments are serious about boosting solar, they must do a better job of reaching out to resident welfare associations and community groups to encourage people to shed their inhibitions and embrace rooftop solar,” said Sen. However, the challenges on the ground are more complex. Developers stress that there is a problem of lack of uniform roofs in the country and the fact that roofs are often used for various purposes that doesn’t leave enough space to install big panels. A 10 KW solar plant that can power three air-conditioners and is sufficient for a three-bedroom apartment needs around 1,000 sq. ft. of terrace area. Ved Prakash Goyal, an advisor to Applied Solar Power Management, part of the ENGIE group, the largest utility company in the world, said: “In India, everyone puts the water tank on the south side of the roof and it is the direction where you get maximum solar energy. Plus, you have various things on roofs which reduces the available area needed for solar.” The government has also announced putting 18 per cent tax on solar panels under the new Goods and Services Tax (GST) regime, though this number may be revised. While industry feels the currently proposed tax rate will increase cost of solar projects by 12 per cent, Goyal says that this will not be an impediment as far as solar rooftops are concerned. “The prices of solar modules are going down and it is expected that they might further decrease by roughly five per cent in the next six months, so may be the net effect of GST would be one per cent. In any case solar energy is becoming cheaper to install and the time is ripe for the government to do the needful to boost it further. With the right steps, I can foresee a boom in residential solar rooftops in the next two years.” India, where there is an issue of both land availability and air pollution, is also a country with over 300 million buildings and as many rooftops. Dan McCullers Womens Jersey
Thermal power stations in MP consume excessive coal
At a time when state-owned thermal power generation companies are facing acute scarcity of coal and there is hardly 4-5 days of coal stock left—thermal power plants are using as much as 45% excessive coal! Shri Singaji Thermal Power Station in Khandwa district leads the pack when it comes to consuming excessive coal. The power station, which is the latest one and inaugurated in 2015, is among one of the worst performers. The power station has coal stock for only four days and is consuming around 45% excess coal. Going by reports accessed by TOI, a total of 760 grams of coal was consumed for producing 1 unit of power on May 26. This coal costs around Rs 1.8 and the transportation cost for coal is around Rs 1.20. This means production of one unit of power works out to around Rs 3—forget costs like wear and tear, salary and oil consumption. Similarly for Sanjay Gandhi Thermal Power Station, though it has consumed around 15% excess coal on May 26, it is far more than its own standards. Going by the same report, it consumed around 750 grams of coal to produe one unit of power on May 26. Sources say this was not a one day phenomenon at Shri Singaji Thermal Power Station. It is same ever since it went on stream, producing energy. As per power plant design, it should consume around 450 grams of coal for producing a unit of power, but its consumption remains above 600 grams for one unit of power. Apart from it,the thermal power station receives washed refined coal, this increases coal costs by nearly 20%, but it is practised to ensure less coal is consumed to produce energy. When contacted, Madhya Pradesh Power Generation Company Limited executive director (fuel management) A K Sankule said, “For three of our power stations, things have been nearly fixed. For Singaji, there is some problem, but we are hopeful of ensuring normalcy in a couple of days.” Asked about excessive consumption, Sankule says, “Some units at Sanjay Gandhi Thermal Power Station are old and maintenance work is in the pipeline. At Shri Singaji, we are mulling technical adjustments in the plant.” Riley Reiff Womens Jersey
Now, cables under ground to power Maharashtra city
The recent pre-monsoon showers exposed the shaky condition of the overhead power cables, which snapped at ease and left many city areas in dark for hours in the rain. Soon, city consumers will not have to suffer from power cuts due to damage poles and electricity wires. The city has received Rs 22.66 crore for building an underground power network under the Integrated Power Distribution Scheme (IPDS) of the Maharashtra State Electricity Distribution Company Limited (MSEDCL). M G Shinde, chief engineer of MSEDCL, Kolhapur zone, said the present elevated power supplying network is vulnerable to nature’s wrath. “Despite our maintenance, strong winds, heavy rain can disturb power supply. To provide interrupted power supply in the city, we have received RS 22.66 crore under IPDS. The tender process has been completed and work will start soon,” he said. Shinde added, “Under the scheme, we will form 118 km underground network of low tension lines and a network of 47 km of high tension line in the city. The company will install 168 feeder pillars in the city. Consumer can look forward to uninterrupted power supply with stable pressure with the underground network.” He explained that the underground power cables are much safer than the overhead power supply network and has longer life. “Another major advantage of underground network is that it will prevent the power theft. An elevated power network needs constant maintenance for uninterrupted power supply. We can also save on maintenance costs after installation of underground power network,” he said. Executive engineer of Kolhapur urban division Sunil Mane said they are some facing problems in roadside digging to lay the underground cables. “The municipal corporation has become hurdle in the work as it officers are not cooperating despite our promise to pay digging charges. Once these issues are resolved, our work would be completed at a better pace,” he said. Uday Gaikwad, city-based environmental activist, said the MSEDCL has already delayed underground power supply work. “There is no coordination between Kolhapur Municipal Corporation and MSEDCL. The company implemented underground power network work in some parts in the city, but the main core area, which is vulnerable to electricity accidents, remains out of underground network. I have been demanding underground network since past many years for saving trees, clean city skyline and avoid accidents,” he said. He added the company should give priority to the crowded and historical building premises to lay the underground network. “It will reduce possibility of accidents and help create good environment. Underground power network would save trees. The company, every year, cuts tree branches reclining on power supply lines. This whole exercise can be avoided,” Gaikwad said. Despite several attempts, municipal corporation officials were not available for comment. Alexander Mogilny Jersey
India extends $500-mn credit line to Mauritius; ISA ratification among host of pacts
A $500-million line of credit (LoC) from India to Mauritius is among four agreements signed by the two countries following delegation-level talks headed by Prime Minister Narendra Modi and his Mauritian counterpart Pravind Jugnauth here on Saturday. “#IndiaMauritius – New Vistas for a Futuristic Partnership,” External Affairs Ministry spokesperson Gopal Baglay tweeted, listing out the agreements. The LOC agreement was signed between SBM Mauritius Infrastructure Development Co. Ltd and Export-Import Bank of India. Another agreement was signed on cooperation on maritime security between the two countries. A memorandum of understanding (MoU) was signed between the two sides for setting up of a civil services college in Mauritius. Another MoU was signed between the Council of Scientific and Industrial Research (CSIR) of India and Mauritius Oceanography Institute for research and education in marine sciences and technology. Mauritius also submitted its instrument of ratification of the India-initiated International Solar Alliance (ISA). The ISA, launched at the UN Conference of Parties (CoP) climate summit in Paris on November 30, 2015, by Prime Minister Modi and then French President Francois Hollande, is conceived as a coalition of solar resource-rich countries to address their special energy needs and provide a platform to collaborate on dealing with the identified gaps through a common, agreed approach. It is open to all 121 prospective member countries falling between the Tropics of Cancer and Capricorn. Earlier on Saturday, Jugnauth was accorded a ceremonial welcome at the Rashtrapati Bhavan here following which External Affairs Minister Sushma Swaraj called on him. Jugnauth arrived here on Friday on a three-day state visit to India. This is Jugnauth’s first visit abroad since assuming office this January. Sherrick McManis Jersey
Government clarifies tax on solar power equipment, parts at 5%
The government will levy a 5 per cent tax on all equipment required for generating solar power compared with nil duty now, a government official clarified, putting an end to confusion about the new taxation policy for the industry after its landmark tax reform. “All solar equipments and its parts would attract 5 per cent GST only,” Revenue Secretary Hasmukh Adhia said in a tweet on Sunday, contrary to the initially planned two tax slabs of 5 per cent and 18 per cent. India, the world’s third biggest greenhouse gas emitter, has set a target to produce 100 gigawatts of solar power in five years to fuel its economic expansion while reducing its carbon footprint. A flat 5 per cent tax on all solar power equipment will put the sector on par with domestic coal from July 1 and make solar energy generation more expensive. The 5 per cent tax, however, is in contrast to a previous notification that had fixed an 18 per cent tax on photovoltaic cells and panels, which account for a bulk of solar power generation costs. Domestic coal sales now attract a 11.69 per cent duty. State-run Coal India Ltd, saddled with millions of tonnes of unsold coal, is expected to be the biggest beneficiary of the decision. A tax on solar parts could hurt the young and booming industry, which relies heavily on cells imported from China. Solar tariffs in India had fallen to a record low of 2.44 rupees ($0.0378) per unit earlier this month. India is extending capital subsidies and cheaper loans for clean energy to help meet Prime Minister Narendra Modi’s goal of raising renewable energy capacity by more than five times in the next five years to fight climate change. Solar power generation capacity in India has more than tripled in less than three years to over 12 GW, helped by lower module prices and borrowing costs. ($1 = 64.5400 Indian rupees) Jordan Willis Womens Jersey