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Parliamentary Standing Committee : Review on renewable energy capacity addition targets

Parliamentary panel has cited that Ministry has failed to achieve yearly targets of clean energy capacity addition, which may dwindle the mission of achieving 175 GW of renewables by 2022. It is also pointed out that there are lot of disputes and ambiguities regarding applicable rate of GST on solar power generating system, where renewable energy devices and spare parts have been kept in 5 per cent GST slab whereas the effective rate has come out to be about 9 per cent. This ambiguity will lead to increase in generation cost and pose a threat to the viability of the ongoing projects. Accordingly panel has directed to take up this matter with the Ministry of Finance on urgent basis.

Also banks are reluctant to fund renewable energy projects due to bad debts and investors are apprehensive of solar and wind project to turn into non-performing assets. Committee has directed to hold discussion with discom to ensure timely payment from discoms to developers or generators, so as to improve condition and build investor confidence in the solar segment.