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Budget2016 Power - read breaking and trending Budget2016 news, stories, headlines. Business insider India is providing latest, handpicked stories related to the Power category.

Budget2016 Power - read latest and trending Budget2016 news and headlines

Finance Minister Arun Jaitley accepted that though the country has immense potential of coal energy production, the discovery is below expectations. Coal production growth has been highest in two decades and the country has seen highest ever LED lights distribution in 2015.
 
In order to revive the power sector, the government would incentivise gas production from areas which are not exploited like deep sea and unutilized deep sources.
 

	The government would provide calibrated market freedom. We also need to increase the production of nuclear energy in the country. And a long term vision suits best. Hence Rs. 3000 crore per annum would be allocated for generation of nuclear energy. 
 

	(Image credits: indiatimes)

Government to allocate Rs. 3000 crore for nuclear energy generation

Economic Survey 2016 hints towards a positive growth of the power sector that is almost crippled with problems. Here’s the health report of the power sector.
 

	• There has been record addition to generation capacity. 2014-15 marked the highest ever increase in generation capacity: 26.5 GW, much higher than the average annual addition of around 19 GW over the previous five years. 
 

	• Capacity enhancements in the power sector are unprecedented. These measures have helped to reduce India’s peak electricity deficit to 2.4 per cent, the lowest ever.
 

	• There has been a comprehensive initiative to improve the health and performance of power distribution companies—UDAY, the Ujwal DISCOM Assurance Yojana
 

	• Indian Railways is attempting to shift to open access for power purchase.
 

	• Renewables have received a major policy push. Targets have been revised from 32 Gigawatts to 175 Gigawatts by 2022. In the latest round of auction under the National Solar Mission, tariff reached an all time low of Rs. 4.34 /KWh.
 

	• Tantalising signs of moving to One Market in Power are becoming evident.
 

	Though the power sector has seen sweeping changes but it is still almost paralyzed with challenges, said Jaitley.
 

	Hence Jaitley came out with some long term policy issues for the revival of the sector.
 

	• Power tariff schedules are currently complex. Given high tariffs on industry, firms may be shifting from purchasing electricity from utilities to generating their own power.
 

	1. 47 per cent of firms report using a diesel generator
 

	2. Between 2006-07 and 2014-15, electricity procurement from utilities grew by 4.6 per cent annually, slower than the 9.3 per cent growth in self-generation.
 

	• Cross-subsidy surcharges and non-price regulatory measures are key tools for balancing DISCOMS’ equity and access considerations, but they may also hinder the creation of a nationwide electricity market.
 

	• Compared to other developing countries, India’s domestic power tariff schedules have greater scope for progressivity. Increases in tariffs for rich households can be achieved while maintaining or reducing tariffs for the poor.
 

	The Economic Survey 2015-16 suggest that tariffs can be made simple and transparent, reducing the gap between producers and distributors and by taking advantage of the possibility of greater progressivity in rate-setting, charges for the poor could be reduced while generating more revenues.
 

	State Governments and State Regulators should work together. The power sector is a perfect crucible for making effective the cooperative-competitive federalism experiment that is now India, the Survey adds.

	 
	 
	(Image credits: Indiatimes)

Economic Survey 2016: Sweeping reforms in power but tariffs must come down

Semiconductors is one space which has not taken off in India yet. Blame it on the inability to compete with the cost structures in the existing markets, or the lack of focus by the Indian government on this sector. However, with the market being strong, and people wanting to do more electronic manufacturing in India - this can definitely help in setting up an eco-system. 
 
Just ahead of the Budget, we spoke to NXP semiconductors Ashok Chandak, Sr. Director Global Sales and Marketing, to learn the challenges this sector is facing in India, and therefore its expectations from the upcoming Budget. Here’s what he had to say: 
 
“Owing to the rising interest of businesses in the Internet of Things, Connected Cars, Security and wearable computing, the electronics and semiconductor industry is growing rapidly. With initiatives like “Make in India” and “Digital India”, the country has observed an accelerated interest in localising the designs and manufacturing in ESDM space over the last 12 months along with other sectors. Several Indian and Global companies are showing a good amount of interest to setup the operations in India as Import still constitutes over 65% of the total electronic goods demand in India. With the trend of major reduction in Exports from India, the initiatives to reduce import duty burden on electronics will help the foreign exchange reserves and also currency stability. 
 
However, the momentum needs to be sustained with policy aggravation at various levels of manufacturing, operations and business. Therefore, Budget 2016 is highly awaited where everyone is expecting policy level improvements to expedite growth. Manufacturing is key government focus and hence, it is important to rationalize Import Duty to promote the on-ground manufacturing and not just assembling. This will enable greater access to better technology and will be a huge enabler to the ESDM industry to help provide superior technology to a wider audience at more competitive rates. With innovation and design being at the core of ‘Make in India’, we believe the government should promote R&amp;D benefits to encourage more innovations from India and preference to Made in India products. Investment allowances for IT adoption can promote India as a premiere destination for both hardware and software development and hence, requires attention from the government. Early introduction of GST is also expected to bring a uniform taxation standard across India, which in return will boost the commercial transactions in the country and benefit both corporations and consumers. 
 
Considering the large number of motor vehicle accidents in country, it is necessary to give major filip to the active safety. The regulations mandate on ABS , TPMS , Intelligent Transportation systems , Advanced driver assistance systems and Emission norms, would help to deploy technology and make the drives safer and more comfortable. Indian and global technology and auto companies are investing heavily to make ADAS and ITS a reality. While automakers are struggling with ways to protect their new and existing connected cars, there are technologies that can protect the privacy and security from the very start. The funding support for intelligent transport systems infrastructure and tax benefits for the ADAS , Digital Radio and Active Safety equipped vehicles would be very helpful in this direction. The government also needs to support promotion of the hybrid and electric vehicles and utilize technologies in order to promote innovation in the automotive space and reduce emissions in the country. 
 
The Payment and Banking industry in India undergoing a major change in view of the major boom in e-Commerce and payment bank licences. While the security aspects have to be taken into account upfront. It is desirable to provide tax benefits for the cyber security, Secure Mobile Transactions, Chip based secure payment cards, Point of Sales terminals and infrastructures, to proactively address the end to end security needs of future and add to Make in India initiative. India is still struggling on the T &amp; D losses. The mandate on the Smart Metering and Smart Grid in addition to smart cities initiatives will help not only the T &amp; D losses but also help in having reliable and sufficient power to the citizens of the country. 
 
In summary , the Government need to provide benefits and encouragement for enabling secure connections and secure infrastructure for a smarter India and deployment of the technology solutions that make lives easier, better and safer.” 
 
(As told to Anushree Singh, Business Insider India)

More investment in this sector will
revolutionize the power sector and this is what it needs right now

Nearly 40% of India’s 1.2 billion residents do not have access to reliable electricity and like all other sectors, power has also been on the priority when it comes to announcing big schemes. Prime Minister Narendra Modi has pledged to eliminate the void that has crippled the sector for the past two years. To achieve the target, the centre has launched the Deendayal Upadhyay Gram Jyoti Yojana (DDUGJY) and approved Rs. 43,033 crores to strengthen sub-transmission and distribution infrastructure in rural areas. But one of the main challenges that the government is facing right now is last mile connectivity. Though 96.7% villages are connected, according to 2011 census only 33% households, that is around 8 of 24 crores, do not have electricity. 
 

	Modi has announced measures for this too. The centre has got state run enterprises to invest over Rs. 55,000 crores for better grid connectivity. But the whole mission is full of challenges that the government needs to pass in order to ensure 24x7 power for all by 2019. Experts see 2019 as only a far-fetched dream with the present conditions.
 

	Challenges
 

	1. The real test is to connect the grid efficiently between producers and distributors. The current transmission system is insufficient to transfer power from surplus parts of the country to the deficit parts. States are also unable to buy cheaper power.
 

	2. Another fundamental issue is the gap between the cost of delivery and the ability of the customers to pay for that power.
 

	3. To ensure recovery of debt-ridden distributors so that they are able to set tariffs that reflect the true cost of power is another test the government has to pass.
 

	4. India also needs to increase the amount of coal it mines, while also cutting down on theft.

	 
	 
	(Image credits: indiatimes)

Budget 2016: Too little too late to ensure 24x7 Power for All by 2019?

The Indian<a href="http://www.businessinsider.in/Budget-2016-likely-to-give-oil-cess-relief-to-domestic-producers/articleshow/50482483.cms"> power</a> system is the fifth largest in the world and among the most complex. With an annual electricity production of 1,031 billion units (BU), it is among the top five power consumers across the globe, and the demand is expected to touch 1,900 BU by 2020. Still, it is far below the average global consumption. 
 

	As on June 2015, <a href="http://www.businessinsider.in/Budget-2016-If-you-are-concerned-about-ever-increasing-power-bills-read-this-/articleshow/50865175.cms">all-India generation capacity</a> stood at 275 gigawatts (GW) with a contribution of 69% from thermal energy, 15% from hydro, 13% from renewable, and 2% from nuclear sources. The eastern region contributes 12% to the total generation capacity. Despite the efforts to generate more electrical energy by using multiple energy sources, the country has recorded a shortage of 3.6% of demand in FY15. As per the Central Electricity Authority’s (CEA) Load Generation Balance Report 2015-16, in spite of the expected capacity addition of 20 GW, the country will probably experience energy shortage.
 

	Growth in industrial activities, population, economy, prosperity and urbanisation, along with rising per-capita energy consumption, has widened the gap of energy access in the country.
 

	Experts also say that while there is supply, lack of technology is hindering its potential from being unlocked to its full power. Allocation of funds and tax exemption are the most important <a href="http://www.businessinsider.in/Budget-2016-Impact-of-FDI-in-real-estate-sector-and-future-expectations/articleshow/50866872.cms">expectations</a> of the sector to achieve the government’s ambitious vision ‘24x7 Power for All by 2019’. All hopes are pinned onto the upcoming budget of the new government.

	 
	 
	(Image credits: indiatimes, Ministry of Power, Coal and New &amp; Renewable Energy)

Budget 2016: Long way to go for 24x7 Power for All

As Budget 2016 nears, concerns about the staggering sectors are increasing. Power sector is one of them, that has not seen any significant upward curve in its growth chart in the last five years. State Electricity Boards are facing bankruptcy. They aren’t able to pay the suppliers from whom they buy power. Apart from supply shortage, there is power theft too that is aggravating the problem. This comes at a time when inadequacy of coal supply has almost paralysed the sector. 
 

	One can see why the whole power sector is waiting with bated breath, with lot of hopes pinned on Finance Minister Arun Jaitley.
 

	Here’s what the sector expects from the upcoming Union Budget 2016.
 

	Vision 2022
 

	The government should give priority to its ambitious RE power target of 175 Gw by 2022. This will bring the much needed spark back in the sector.
 

	New technology thermal capacity plants
 

	Though the new government is betting big on renewable energy this year, a decision applauded by all, the government should not ignore the power that can be generated by thermal power plants. The first question that comes is where all the coal will come from. Here’s the trick. The supply is already there. Due to lack of other resources there are numerous partially completed projects hanging around in the plants.
 

	Technology has the solution. All the government needs to do is to recognise it and apply new technology in thermal capacity plants to complete stalled projects within a stipulated time.
 

	Transmission and Distribution
 

	It is high time the government focussed on the Transmission &amp; Distribution segment. Several ready power projects are stranded due to either a missing transmission link or because the states are unable to buy the power. Granting infrastructure status to investments in the T&amp;D sector will bring in more participation in the sector.
 

	Power tariff
 

	Sometimes a king needs to rule (instead of leading) to eradicated misrule from his kingdom. Our government is in such a position now. Hiking power tariff might not be a welcoming step, but it is the call of the moment.
 

	GST
 

	Removal of electricity from the exempt category of goods in the GST would ensure improvement of business metrics in the power sector.

	 
	 
	(Image credits: indiatimes)

Budget 2016: If you are concerned about ever increasing power bills, read this.

Ahead of Union Budget 2016 which Finance Minister Arun Jaitley will announce on February 29, Indian power producers have proposed to the government a slew of tax benefits to incentivise investments in the sector. 
 
In a letter to the ministries of finance, coal and power Independent Power Producers Association of India (IPPAI) asked the government to extend a 10-year tax holiday to companies that start power generation by March 31, 2020. 
 
“Industry players have called for the extension of the sunset tax clause for power companies to include plants that provide power till March 2020 as opposed to 2017 earlier,” said the letter. 
 
The association has also asked for minimum alternate tax to be reduced to 10 per cent. With regards to coking coal, IPPAI has asked for reduction in customs duty on it. 
 
“Import duty of coking coal had been increased to 2.5 per cent in the Budget for 2014-15.” It said a negligible quantity of coking coal was available domestically, and therefore called for duty on it to be exempt. 
 
IPPAI has also contested the clean energy cess levied on thermal power producers asking that it should be restricted to only those power producers who do not adopt clean technologies / modernise their plants. 
 
Image credit: Indiatimes

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