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Clean energy fund: no solid action yet for effective use

According to reports, the performance of National Clean Energy Fund (NCEF), meant for funding research and innovative projects in clean energy sector, is reported to be unimpressive. While 15 projects seeking funds of about Rs 2,000 crore has been recommended, there is no clarity on the amount actually disbursed under the fund.

The government proposed the creation of the National Clean Energy Fund (NCEF) in the Union Budget 2010-2011 by imposing a clean energy tax (cess) of Rs 50 per tonne on all coal produced as well as on coal imports in India. However since its inception in July 2010, there is no clarity on the use of the NCEF for only clean energy sector.

The total tax revenue generated under NCEF was Rs 1,066.45 crore for 2010-11 and Rs 3,249.40 crore 2011-12. During the current fiscal, it is expected to add about Rs 3,864.20 crore. Thus, Rs 8179 crore would available by the end of FY13 under the fund. However, only fifteen projects envisaging total support of Rs 1,974.16 crore, out of the total corpus have been recommended by the Inter-Ministerial Group so far, according to an official statement.

But the there is no information on the disbursement side and the experts have been pointing out that NCEF is proposed to be used for the development and deployment of clean energy technologies in India, but no concrete action has yet been put in place for its effective utilisation and in some cases it has been diverted a few other areas other than clean energy segment.

“The proposals brought forth by sponsoring national Ministries were found to mostly lack quality and innovativeness, which failed to advance the stated objective of the NCEF. Furthermore, the bulk of the NCEF fund remains unutilised. There is a need to revise NCEF guidelines to eliminate ambiguity surrounding the use of its funds, and to limit its use for meeting regular budgetary shortfalls of ministries. Funding to support various Ministries’ regular activities should be met from the appropriate sources available within the existing financing structure of the general budget,” pointed out India Wind Energy Outlook 2012 report.

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