Union Budget India 2013-14: Generation Based Incentives (GBI) for wind projects reintroduced

India budget

Greentech Lead India:  Finance Minister P Chidambaram today said the generation based incentives (GBI) to wind energy projects is reintroduced to boost investment in the renewable energy sector.

Wind power producers were given GBI @ Rs. 0.50 per unit of electricity fed into the grid for a period not less than 4 years and a maximum period of 10 years with a cap of Rs. 62 lakhs per MW.  The scheme ended in March 31 last year.

Wind energy manufacturers have been insisting on getting the incentives back again.

According to wind industry association members, generation-based incentives will be the driver for independent power producers (IPP) in the wind power sector.

Ramesh Kymal, Indian Wind Turbine Manufacturers Association (IWTMA), recently said at least projects up to 5 MW should be given the facility of accelerated depreciation on their windmills if they do not avail generation-based incentives.

Also read: Wind energy investments in India reduced due to lack of policies

The re-introduction of GBI is expected to boost the confidence of stakeholders in the wind energy sector. The government has allocated Rs. 800 crore to Ministry of New & Renewable Energy for this purpose.

In the Union Budget, the Government has also decided to provide low interest rate funds from Clean Energy Fund for green projects for a period of five years.

The Budget has also announced an investor friendly policy on shale gas-based revenue-sharing.

Other highlights pertaining to environmental concerns include:

Incubators set up by companies in academic institutions will qualify for Corporate Social Responsibility (CSR) activities

Rs 500 crore would be allocated for addressing environmental issues faced by textile industry

5 million tons Dabhol LNG import terminal to be operated at full capacity in 2013—14