The government’s push for renewable energy has been one of its main defence against criticism for using fossil fuels. However, government subsidies to the renewable sector have fallen by nearly 45 percent since their peak in (financial year) 2017, according to a latest study, which states that support for the sector needs a revival.
The study, “Mapping India’s Energy Subsidies 2021: Time for renewed support to clean energy”, by the International Institute for Sustainable Development (IISD) and the Council on Energy, Environment and Water (CEEW) found that subsidies to renewable energy fell from Rs. 154 billion (15,470 crore) in (FY) 2017 to Rs. 85.77 billion (Rs. 8,577 crore) in (FY) 2020.
It argued that to ensure India’s clean energy transition is smooth it is crucial that the financial support for the renewable energy sector continues. It explained that the renewable energy subsidies are at a standstill due to a combination of factors including grid-scale solar and wind achieving market parity, lower deployment levels, and subsidy schemes nearing the end of their allocation period.
The report said India’s public sector units make massive annual investments in the energy sector as it is noted that over the last six years from (FY) 2014 to (FY) 2020, the seven energy-related units invested Rs. 2.5 trillion (Rs. 2.5 lakh crore) in 183 projects.