India’s Union Budget 2022-23 has announced a clear focus on energy transition, with the goal of achieving “green growth” in the coming years. The government has set its sights on four transformative opportunities, including the economic empowerment of women, integrating traditional artisans with the MSME sector, and tourism. To achieve this goal, the budget provides Rs. 35,000 crore for priority capital investments in net-zero transition and energy security by the Ministry of Petroleum and Natural Gas.
In addition to this, the country has updated its nationally determined contribution (NDC) to fight climate change, committing to reducing the emissions intensity of its Gross Domestic Product (GDP) by 45% from 2005 levels by 2030 and sourcing about 50% of its energy requirement from non-fossil fuel-based sources by 2070. The budget also promises to support battery energy storage systems and formulate a framework for pumped storage projects. To achieve meaningful energy transition, the government plans to provide risk guarantees, demand aggregation measures, and viability gap financing for hydrogen electrolysers and offshore wind.
The budget also targets the production of 5 million metric tons of green hydrogen annually by 2030, with an outlay of Rs. 19,700 crore. The creation of an interstate transmission system for the evacuation and grid integration of 13 GW of renewable energy from Ladakh is also on the horizon. Additionally, the government plans to revamp the compensatory afforestation process to improve access to funds and increase the survival rate of plantations.
The budget introduces various initiatives to increase energy efficiency and lower carbon intensity, with a strong emphasis on creating green job opportunities. The National Green Hydrogen Mission’s outlay of Rs. 19,000 crore would contribute to India’s green growth and net zero carbon future, making it an energy-secure and responsible country. To achieve this, the budget targets alternative fertilizers and balanced use of chemical fertilizers, ‘waste to wealth’ plants, compressed biogas plants, and the promotion of coastal shipping as an energy-efficient mode of transport.
While the Union Budget 2022-23 has taken significant steps towards green growth, there remains a need for continued investment in renewable energy sources, as well as the promotion of sustainable development practices. Nevertheless, the government’s commitment to net-zero transition and energy security marks a significant milestone towards a cleaner and greener future for India.