New Delhi: The Centre has written to the states and port authorities asking them to identify land parcels of 50 to 500 acres for setting up hubs for manufacturing renewable energy equipment to meet domestic demands as well as to attract firms shifting base from China amid the Covid-19 pandemic.
“It may be stated that in a time when many companies are planning to shift their manufacturing base from China, it is opportune time for India to bring policy changes for facilitating and catalysing manufacturing in India,” the Union new and renewable energy ministry said in a statement on Saturday.
The pandemic originated from China, where it has disrupted supply chains and promoted many companies to think about shifting their manufacturing base to other countries.
Japan has allocated a package of $2.2 billion to help its manufacturing firms shift production out of China due to the outbreak.
The Tuticorin Port Trust, Madhya Pradesh and Odisha have expressed interest in setting up renewable energy parks, according to the ministry. The Centre is separately planning to utilise vacant land belonging to the railways to set up solar power plants of 30 gigawatts (GW) capacity. The railways plans to set up plants to generate 10 GW under the first phase.
According to officials aware of the development, renewable energy secretary, chaired a meeting with representatives of manufacturing companies last week to discuss. The ministry is in touch with trade commissioners and representatives of various countries to invite foreign firms to invest in India, they added.
India also reached out to the US India Strategic Partnership Forum, a non-profit organisation, earlier this week and sought collaboration to attract investments by American firms, the ministry said.
“These hubs will manufacture equipment like silicon ingots and wafers, solar cells and modules, wind equipment and ancillary items like back sheets, glass, steel frames, inverters, batteries etc,” an official said on condition of anonymity.
India has around 10 GW of wind equipment manufacturing capacity and imports nearly 85% of solar cells and modules. “To incentivise domestic manufacturing, the government of India has already announced provisions to enable levying of basic customs duty on import of solar cells and modules,” the ministry said.
The ministry has also set up a Renewable Energy Facilitation and Promotion Board to facilitate investment in the sector. “The ministry has also strengthened the clauses in Power Purchase Agreements (PPAs) to boost investor confidence. ... Power Finance Corporation, Rural Electrification Corporation Limited and Indian Renewable Energy Development Agency have reduced their repayment charges to 2% for enhancing the fund availability for new projects in the sector. IREDA [Indian Renewable Energy Development Agency Limited] has brought out a new scheme for project-specific funding to promote RE [renewable energy] manufacturing in India,” the ministry added.
India’s renewable energy sector has also been tasked to meet its power generation target of 175 GW by 2022.
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