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Policy
Centre Government's Policy on Renewable Energy
Development of renewable energy technologies, market and projects has been aided by a variety of policy and support measures by Government. Major policy initiatives taken to encourage private/foreign direct investment to tap energy from renewable energy sources include provision of fiscal and financial incentives under a wide range of programmes being implemented by the Ministry and simplification of procedures for private investment, including foreign direct investment, in renewable energy projects.
The policy is clearly directed towards a greater thrust on over all development and promotion of renewable energy technologies and applications. The recent policy measures provide excellent opportunities for increased investment in this sector, technology up-gradation, induction of new technologies, market-development and export promotion.
Policy Measures
A host of fiscal incentives and facilities are available to both manufacturers and users of renewable energy systems, which include:
100% accelerated depreciation for tax purposes in the first year of the installation of projects/systems.
No excise duty on manufacture of most of the finished products.
Low import tariffs for capital equipment and most of the materials and components.
Soft loans to manufacturers and users for commercial and near commercial technologies.
Five year tax holiday for power generation projects.
Remunerative price under alternate power purchase policy by State Government for the power generated through renewable energy systems, fed to the grid by private sector.
Facility for Banking and wheeling of power.
Facility for Third party sale of renewable energy power.
Financial Incentives/Subsidies for devices with high initial cost.
Involvement of women not only as beneficiaries but also for their active contribution in implementation of renewable energy programmes.
Encouragement to NGOs and small entrepreneurs.
Special thrust for renewable energy in North-Eastern region of the country. 10% of Plan funds earmarked for North-East towards enhanced and special subsidies.
Allotment of land on long term basis at token lease rent and supply of garbage free of cost at project site by State Governments, in respect of projects on energy recovery from municipal waste.
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