News Excerpt:

The Union Budget has given a boost to several clean energy commitments made in the interim Budget, although it did not introduce any new schemes.

More detail about news:

• The Pradhan Mantri Surya Ghar Muft Bijli Yojna, which aims to provide subsidized rooftop solar installations to one crore households, has been allocated nearly ₹10,000 crore this year—more than double the ₹4,970 crore spent on solar power (grid) last year.
• This scheme offers 300 units of free electricity, with households paying a minimum of ₹20,000 based on the installed system's capacity, potentially offset by a low-interest, collateral-free loan.
• Only houses with suitable roofs and existing grid connections are eligible, and consumers will still pay for net power supplied and consumed via the grid.

Boost for Nuclear Energy:

• Finance Minister Nirmala Sitharaman announced that National Thermal Power Corporation (NTPC) and Bharat Heavy Electricals Limited (BHEL) are jointly setting up a highly efficient 800 megawatts advance ultra supercritical (AUSC) thermal power plant.
• The Minister emphasized investment in constructing Small Modular Nuclear Reactors (SMRs), which are expected to play a crucial role in the energy mix for a developed India.
• The government plans to partner with the private sector to set up Bharat Small Reactors, conduct research and development for Bharat Small Modular Reactors, and explore new nuclear energy technologies.
• The R&D funding announced in the interim Budget will support this sector. SMRs, compact versions of nuclear reactors, provide up to 300 MW of power.
• The Minister also reiterated a 2018 proposal to develop an Advanced Ultra Supercritical (AUSC) thermal power plant through a collaboration involving the National Thermal Power Corporation (NTPC) and Bharat Heavy Electricals Ltd. (BHEL), although no specific budgetary allocations were mentioned.

New and Renewable Energy Sector:

• Union Budget 2024 has allocated ₹19,100 crore to the Ministry of New and Renewable Energy, a significant increase from the revised estimates of ₹7,848 crore for Budget 2023-2024.
• Additionally, ₹851 crore has been allocated to wind and other renewable energy programs, compared to the revised estimate of ₹946.30 crore.
• The National Green Hydrogen Mission will receive ₹600 crore, up from the ₹100 crore allocated last year.
• The bioenergy program is also seeing a boost, with ₹300 crore allocated this year compared to ₹75 crore previously.

Critical Mineral Mission:

• Government will establish a Critical Mineral Mission to boost domestic production, recycling, and international acquisition of critical mineral assets. It also aims to create an impetus for acquiring such minerals abroad.  
• Critical Mineral Mission is complemented with reduced import duties. Budget proposed fully exempting customs duties on 25 critical minerals and reducing basic customs duties on two, which will significantly boost the processing and refining of these minerals.
• Additionally, the government plans to auction blocks for offshore mineral extraction.
• This initiative aims to reduce India’s heavy reliance on imports and mitigate risks from global geopolitical instability.

Compressed Biogas (CBG):

• The interim budget laid the groundwork for major progress in biofuels, particularly through the phased integration of Compressed Biogas (CBG) in both vehicles and households. The plan targets the establishment of 750 CBG projects by 2028–29, with an investment potential of ₹37,500 crore. 
• It also introduced a biomass collection financial assistance scheme, allocating ₹564.75 crore until FY 2026–27, to support biogas producers by aiding the acquisition of biomass aggregation machinery.

Emission Targets Likely to be Set for Polluting Industries Soon: 

• For the first time, the Finance Minister's Budget speech indicated that polluting industries such as iron, steel, and aluminium will need to meet specific emission targets.
• Current Scenario:
  • Currently, Indian industries have no emission restrictions in exchange for carbon credits but are incentivised to achieve energy efficiency targets through the Perform, Achieve, Trade scheme in place since 2015.
  • While emission norms traditionally applied to large industries, the Budget suggests tightening these norms for small and micro-scale industries as well.

• Implementation in a phased manner:

• An investment-grade energy audit of traditional micro and small industries in 60 clusters, including brass and ceramic, will be facilitated.
• Financial support will be provided to help them transition to cleaner energy sources and implement energy efficiency measures.
• This scheme will be extended to another 100 clusters in the next phase.

India Carbon Market:

• The budget speech mentioned forming a pathway for “hard to abate” industries to shift from energy efficiency targets to “emission targets”.
• Appropriate regulations for transition of these industries from the current ‘Perform, Achieve and Trade’ (PAT) mode to ‘Indian Carbon Market’ mode will be put in place.
• These directives align with the proposed India Carbon Market, which has been in development for a few years.
• A carbon market or emission trading scheme functions as a platform where carbon credits, created by preventing carbon emissions, can be traded.