New Delhi, 27/01/2025: With the Union Budget 2025-26 around the corner, renewable energy leaders are urging the government to reduce taxes and provide better financial support to speed up India’s clean energy efforts. A major demand is lowering the Goods and Services Tax (GST) on solar panels and wind turbines from 12% to 5%. They are also calling for a uniform 5% GST on all types of batteries, as current rates vary widely, making energy storage solutions more expensive.
The high GST on batteries is a concern for many in the industry. Lithium-ion batteries are taxed at 18%, while other batteries like lead acid and sodium face a steep 28% GST. Meanwhile, electric vehicles are taxed at just 5%. Debi Prasad Dash, President of the India Energy Storage Alliance, said aligning battery GST rates with electric vehicles would help boost investment and make energy storage more affordable.
Industry leaders are also asking for better financial policies to encourage domestic manufacturing and reduce reliance on imports. Dr. Amit Paithankar, CEO of Waaree Energies, suggested expanding the Production-Linked Incentive (PLI) scheme to help Indian companies increase production. Prashant Mathur, CEO of Saatvik Green Energy, added that simplified GST policies for solar panel production and easier loans would attract more investors and support growth in the sector.
India’s renewable energy capacity has grown significantly, crossing 200 GW in September 2024 and reaching 214 GW by November- a 14% increase over the previous year. However, experts like Ratul Puri of Hindustan Power and Naresh Mansukhani of Juniper Green Energy say this progress needs continued government support. They are urging the budget to focus on solar, wind, green hydrogen, and grid upgrades to help India reach its goal of 500 GW renewable energy capacity by 2030.
