Budget expectations: Bring electricity under GST, says power engineers’ body

New Delhi: Power engineers’ body, All India Power Engineers Federation (AIPEF), on Thursday said they want the Union Budget to make announcement on bringing electricity under the goods and services tax (GST). 

AIPEF said they also want a slash in lower clean energy cess and strengthening of power network in rural areas from the Budget. 

“Electricity should be brought under the GST. With electricity kept outside the purview of the GST, set-off of taxes in power generation, transmission and distribution has not been rationalised with the resultant increase in the cost of power due to the cascading of taxes,” said AIPEF in a statement.

It added that the cost of mismanagement by the private sector should not be allowed to get passed on to consumers, whether it is from stressed assets problems or revision of power purchase agreements.

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The other expectation from the Budget was in terms of higher coal price due to clean energy cess. “With large capacity additions in solar and wind, clean energy cess, which is around Rs 400 per tonne charged on coal, can be brought down to Rs 100 per tonne, as the cost of coal has gone exorbitantly high. This relaxation would benefit the consumers themselves,” the power body said.

Power engineers’ body considers lack of infrastructure as one of the main reason for the country’s inability to achieve 100 per cent household electrification by 31 December 2018, and, therefore, expect financial assistance to strengthen the power network. 

According to the data available, all the households of the country could not be electrified in Saubhagya Yojna by 31 December. 

The statement said, “Power system network in far away rural areas require more finances to get strengthened to meet the requirements of new added connections in one year, this problem needs to be addressed in Budget.” 

AIPEF also highlighted the importance of renewable energy. “The renewable energy sector is eligible for various tax exemptions and concessions owing to the significant set-up costs associated with it as well as the government’s agenda of promotion of green energy. However, charging infrastructure and storage infrastructure is a must to fully utilise renewable energy, which requires a big budget provision in Budget 2019-20,” it added.

India has 348 gigawatt (GW) installed capacity against peak load demand of 170 GW, even then about one crore households have no access to electricity.[ETENERGY World]