The government has implemented a series of measures to promote renewable energy development and facilitate investment in the sector. These measures include:
- Permitting Foreign Direct Investment (FDI) up to 100 percent under the automatic route: This policy allows foreign investors to invest in renewable energy projects in India without prior approval, streamlining the investment process and encouraging foreign participation in the sector.
- Waiver of Inter State Transmission System (ISTS) charges for inter-state sale of solar and wind power: ISTS charges are waived for projects commissioned by June 30, 2025, incentivizing the sale and transmission of renewable energy across state boundaries.
- Expansion of transmission infrastructure: The government is investing in the construction of new transmission lines and sub-stations to enhance the capacity for evacuating renewable power from generation sites to the grid.
- Declaration of trajectory for Renewable Purchase Obligation (RPO): RPO targets are established up to the year 2022, mandating obligated entities to procure a certain percentage of their energy from renewable sources, thus driving demand for renewable energy.
- Establishment of Renewable Energy (RE) parks: RE parks provide developers with land and transmission infrastructure on a plug-and-play basis, simplifying the process of setting up renewable energy projects.
- Implementation of various schemes: Initiatives like Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM), Solar Rooftop Phase II, and 12000 MW CPSU Scheme Phase II aim to promote the adoption of renewable energy technologies across different sectors.
- Notification of standards for solar photovoltaic systems/devices: Standardizing deployment guidelines ensures quality and safety standards are met, promoting confidence among investors and consumers.
- Establishment of Project Development Cell: This cell facilitates investment in renewable energy projects by providing assistance and support to investors throughout the project development process.
- Introduction of Standard Bidding Guidelines: Tariff-based competitive bidding guidelines ensure transparency and efficiency in the procurement of power from grid-connected solar PV and wind projects.
- Enforcement of payment mechanisms: Government orders mandate that power must be dispatched against Letter of Credit (LC) or advance payment, ensuring timely payments to renewable energy generators and reducing financial risks.
- Launch of Green Term Ahead Market (GTAM): The GTAM facilitates the procurement of renewable energy power through power exchanges, offering a platform for buyers and sellers to trade renewable energy in the country’s market.
FAQs Related to Measures Taken by the Government of India to Boost Renewable Energy
1. What is Foreign Direct Investment (FDI) in the context of renewable energy, and how does the government’s policy impact it?
Answer: Foreign Direct Investment (FDI) refers to investment made by foreign entities into renewable energy projects in India. The government permits FDI up to 100 percent under the automatic route, allowing foreign investors to invest without prior approval. This streamlines the investment process and encourages foreign participation in the renewable energy sector.
2. How does the waiver of Inter State Transmission System (ISTS) charges benefit renewable energy projects?
Answer: ISTS charges are waived for inter-state sale of solar and wind power projects commissioned by June 30, 2025. This incentivizes the sale and transmission of renewable energy across state boundaries, facilitating the integration of renewable energy into the national grid.
3. What steps has the government taken to enhance transmission infrastructure for renewable energy?
Answer: The government is investing in the construction of new transmission lines and sub-stations to improve the capacity for evacuating renewable power from generation sites to the grid. This infrastructure expansion supports the integration of renewable energy into the electricity network.
4. How does the declaration of trajectory for Renewable Purchase Obligation (RPO) impact renewable energy adoption?
Answer: The government has established RPO targets up to the year 2022, mandating obligated entities to procure a certain percentage of their energy from renewable sources. This policy measure drives demand for renewable energy and encourages investment in renewable energy projects.
5. What role do Renewable Energy (RE) parks play in promoting renewable energy development?
Answer: RE parks provide developers with land and transmission infrastructure on a plug-and-play basis, simplifying the process of setting up renewable energy projects. This initiative streamlines project development and accelerates the deployment of renewable energy capacity.
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