Proposed carbon tax waiver on coal may pose risks to India’s renewables growth: Fitch


PTI, Jan 6, 2020, 3:59 PM IST

New Delhi: Fitch Solutions on Monday said that the centre’s proposed carbon tax waiver on coal may pose substantial downside risks to India’s renewable sector growth.

In a bid to alleviate significant debt levels in the power industry, India has proposed to waive carbon taxes on coal (Rs 400 rupees/tonne), it said.

This comes at a time where aggressive bidding and rapid fall in tariff prices in country’s renewable power auctions have squeezed profit margins for project developers and threatened the economic feasibility of the project pipeline in the renewables sector.

The proposed carbon tax waiver on coal will “weigh on renewables growth,” Fitch Solutions said, adding that the carbon tax waiver was likely to make coal-fired power cheaper, increasing the use of coal.

It expects coal to continue dominating India’s power sector, making up a share of slightly under 70 per cent of the total power generation mix by 2029, with non-hydro renewables at 15.6 per cent.

“We stress that the continued push for lower tariffs in the tender process has already resulted in the undersubscription and cancellation of a few auctions across FY’18 and FY’19,” it said.

Most notably, Tamil Nadu, one of India’s largest renewable energy states, has decided to cease wind and solar auctions for the time being due to undersubscription in the previous two.

Coal-powered projects had faced some headwinds in recent years, noted by multiple project cancellations and stiff competition from non-hydro renewable sources, as the cost of renewables in India has fallen below that of coal and gas.

Udayavani is now on Telegram. Click here to join our channel and stay updated with the latest news.

Top News

Maharashtra Polls: Eknath Shinde targets Uddhav for `giving up’ Bal Thackeray’s principles for power

Will appear before Lokayukta for questioning in MUDA case, says CM Siddaramaiah

Lies have short life, Cong’s ‘fake’ narrative smashed: Fadnavis

Temple idols found desecrated in Hyderabad, case registered

SC junks plea against quashing of LOC issued to ex-house help of Sushant Singh Rajput

JPC chairman Jagdambika Pal to visit K’taka on Nov 7 to meet farmers protesting Waqf notices

Indian boxer Mandeep Jangra wins WBF’s world title

Related Articles More

CBDT allows tax officials to waive or reduce interest due from assessee

Markets fall in early trade amid unabated foreign fund outflows

New software for fast-tracking project approvals: Karnataka Minister Patil

In-flight passengers can access WiFi services only when allowed, say new rules

SEBI mulls separation of non-regulated activities; ‘cross-default’ definition for debenture trustees

MUST WATCH

Gho Pooja in Deepavali Festival

Melukote Deepavali

Ganapathi Co-operative Society Ltd

Udayavani Chinnara Banna 2024

Annapoorna Aahar | Food Places In Mysore


Latest Additions

Waqf Issue: JPC chair Jagdambika Pal to visit Hubballi, Vijayapura on November 7

Maharashtra Polls: Eknath Shinde targets Uddhav for `giving up’ Bal Thackeray’s principles for power

Shivamogga: Wild elephant dies due to electrocution form farm fence; Landowner detained

Folk singer Sharda Sinha’s condition critical, PM in direct contact with treating doctors

Weight loss could help one manage PCOS symptoms, study suggests

Thanks for visiting Udayavani

You seem to have an Ad Blocker on.
To continue reading, please turn it off or whitelist Udayavani.