The Energy and Resources Institute (TERI) released a discussion paper titled ‘A Fiscally Responsible Green Stimulus’ to suggest measures that would lead to demand and job creation and accelerate India’s transition towards cleaner air and a lower carbon economy.
The paper explores ideas which can both create economic demand and jobs, and result in substantial private investment primarily through policy and regulatory interventions. By focusing on demand-side interventions, the proposals aim to support initiatives which would become independently viable, and which will, in turn, be able to generate employment. Some of the measures, such as those which aim to increase access to clean and reliable energy in rural areas, will also help power rural enterprises, creating virtuous cycles of investment and employment. By creating additional demand in the market, the measures being proposed would enhance the utilization of the liquidity created through the stimulus package the government has announced.
The proposals suggested by TERI are : a. Incentivizing Cleaner Transport Vehicular traffic is a significant contributor to air pollution and of PM2.5 emissions. Incentivizing fleet modernization of existing vehicles to BSVI, use of electric vehicles and provision of buses for public transport are proposed. The following measures are recommended: 1. Introduction of a 50% rebate on vehicle taxes (including GST) on purchase of new BSVI vehicles in exchange for scrapping of older vehicles. 2. Government credit guarantee for purchase of buses to meet the shortfall of public transport in the country. 3. Transition to (i) use of electric buses for inner city transport and (ii) use of electric vehicles only by the government for inner city use. Charging infrastructure to be put by Distribution Companies. 4. The implementation is to be spread over the next five years. 5. The potential stimulus would be `160,000 crores per annum.
Renewable Energy from Agricultural Residues Announce a commercially viable procurement price for the next five years for briquettes made from crop waste. Briquettes would be used as fuel for co-firing, up to 10%, in thermal power plants. The stimulus potential is `22,470 crores per annum.
Renewable Energy from Animal Husbandry Waste Introduce a commercially viable feed-in tariff for purchase of electricity generated from animal husbandry waste (excreta from cattle, poultry, pigs, etc.) by Distribution Companies. The slurry waste can be additionally sold as organic manure. The full use of animal waste may take 6-8 years. This has an investment stimulus potential of `88,000 crores.
Promoting Solar Generation in Rural India Announce a commercially viable feed-in tariff for purchase of electricity generated from rural areas in the kW range by Distribution Companies. Farmers would get more income and the Distribution Companies would save around `3 per unit. Assuming 1 MW potential in a village, the national potential is 600GW. It may take up to 10 years to achieve the full potential. This has a stimulus potential of `27,00,000 crores.
Green and More Competitive MSMEs : The stimulus package envisaged by the government can be used to finance investments in the MSME sector for enhancing competitiveness through energy efficiency. India has around 700,000 registered factory sector manufacturing enterprises. Achieving an average of 15% savings through energy efficiency technologies and best practices in energy intensive units would result in estimated savings of `15,000 crores every year.
Creation of Domestic Manufacturing Capacity for Solar Power and Energy Storage Invite bids for solar power with-storage with the condition that manufacturing with full value addition would be done in India. This would result in self-reliance in this critical area. Capturing the domestic demand for solar equipment would be able to generate a value of `2,94,000 crores by 2030 through import substitution. The total stimulus being proposed would be approximately `40,00,000 crores (or 540 billion USD) which would be spread over the coming decade.
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