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MNRE seeks exemption from safeguard duty for current solar power projects

<p>The ministry of new and renewable energy (MNRE) has urged the finance ministry to exempt solar power projects under implementation from 25% safeguard duty imposed on imported solar equipment. Solar power developers had voiced their concerns about raising additional capital, saying they did not factor in safeguard duty while bidding for projects.</p> <p>While the government has already allowed developers to pass on the additional costs to distribution companies, resorting to the measure is a cumbersome process. Developers will have to approach Central Electricity Regulatory Commission for availing pass through. The process usually takes around a year and a half, even if developers approach the regulator for having a tariff hike approved, the whole process of availing a pass through will involve a lot of back and forth between the regulator, distribution companies and the developers.</p> <p>Even as the prices of modules have fallen sharply in the past five months, developers cannot be deprived of the benefit resulting from it. The falling module prices do not really add up as developers are already facing other risks, whether it is in terms of the cost of borrowing, or currency fluctuation.</p>