According to reports, acceding to demands from wind power generators, the government Friday announced it was reinstating the accelerated depreciation (AD) scheme which was withdrawn two years ago.
“This is being done because of the many requests from the wind energy sector, number of concessions for which development have been made in this budget,” Finance Minister Arun Jaitley said in parliament replying to the debate on the Budget for 2014-15.
“Necessary amendment will be made to the Finance Bill,” Jaitley added.
The Accelerated Depreciation (AD) scheme and Generation-Based Incentive (GBI) scheme, which provided subsidies for setting up wind-generated power plants, were withdrawn in 2012. While investors and generators have been calling for its restoration, however, only the GBI has been restored so far.
Currently, the AD schme is available for investments in other sources of renewable energy.
Investments in 2011-2012 in the wind energy sector was around Rs.19,000 crore and 3,200 MW was commissioned. In 2012-2013, the investments came down to Rs.10,200 crore for 1,700 MW.
India’s domestic wind manufacturing capacity exceeds 10,000 MW annually, mostly untapped for deployment within the country.
Budget 2014-15 proposals to boost wind energy include doubling of the annual Clean Energy Fund from Rs.4,000 crore, exempting special additional duty of 4 percent on parts and materials required for manufacturing wind operated generators, and increase of the clean energy cess from Rs.50 to Rs.100 per tonne for financing and promoting.