Renewable energy subsidies in India fell 35% between the 2016-17 and 2018-19 fiscal years, according to a new study released on Thursday by the International Institute for sustainable development (IISD) and the energy, environment and Water Council (ceew).
According to the report on India’s energy subsidies, there are already signs that support for renewable energy will increase again, but due to the impact of covid-19, keeping it on track is crucial.
Karthik Ganesan, a ceew researcher, said: “policy decisions such as the solar safeguard tax and the auction price cap mean that the growth rate of new capacity has slowed down, so has the spending on state subsidies.”
He added that resources after covid-19 would face unprecedented tightening. “This provides a good opportunity for the government to control specific fossil fuel subsidies, while creating more fiscal space for promoting renewable energy and other welfare programs.”
India has shifted a lot of public resources to clean energy in the past six years, according to the report. Since 2014, subsidies for fossil fuels have fallen by more than half, while subsidies for renewable energy and electric vehicles have more than tripled and half. The report expects India’s long-term goal of renewable energy development to be maintained.
“India has made incredible progress in renewable energy deployment over the past few years, and has stood out in the process The future is uncertain, and the first priority is to be healthy and help people meet their basic needs. At the same time, we must not forget our ambition to achieve a clean energy transformation. ” Christopher Beaton of IISD said.
Oil and gas subsidies increased by 65% over the same period, the report said.
According to the report, the health and economic crisis caused by covid-19 will affect subsidy spending. The collapse of world oil prices and the government’s stimulus package will be key factors affecting the energy sector in the coming months.
One of the co authors of the study, vibhuti Garg of the International Institute for sustainable development, said rising oil prices and initiatives to promote clean cooking have been the main drivers of growing support for fossil fuels since fiscal 2017.
“In the wake of the covid-19 crisis, there is no doubt that subsidies for petroleum products will decline significantly in 2020, and other energy markets will also be shaken. Fossil fuels have been taxed more to help fill the tax gap. Government stimulus first needs to help people cope with the crisis, but energy sector stimulus must avoid new fossil fuel subsidies that will limit air pollution and greenhouse gas emissions for years to come. “