Budget Allocation and Financial Support for Green Energy

A substantial ₹26,549 crore has been allocated to the new and renewable energy sector, marking an increase of ₹9,251 crore compared to previous budgets.

• ₹600 crore has been earmarked for the development of green energy corridors to efficiently transport renewable energy.
• ₹2,600 crore is allocated for the PM-KUSUM scheme (Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan), up from ₹2,525 crore last year.
• ₹20,000 crore has been allocated for the PM Surya Ghar: Muft Bijli Yojana, reflecting an 80% rise from ₹11,100 crore.
• ₹600 crore has been allocated to the National Green Hydrogen Mission, an increase from ₹300 crore in previous years.

Government Initiatives and Reforms

The budget prioritizes the PM Surya Ghar: Muft Bijli Yojana, which is aimed at harnessing solar energy to meet India's energy demands. It also extends various schemes like PM Surya Ghar, Green Energy Corridors, Renewable Energy Parks, PM-KUSUM, and the National Green Hydrogen Mission to further boost the renewable energy sector.

Key Announcements for the Solar Sector in Union Budget 2025

• Increased Funding for Solar Projects: A dedicated ₹10,000 crore fund has been allocated to support the development of large-scale solar parks, rooftop solar installations, and off-grid solutions, encouraging private investment and sector growth.
• Extension of the PLI Scheme: The Production-Linked Incentive (PLI) scheme for solar modules has been extended with an additional ₹24,000 crore, aimed at promoting domestic manufacturing and reducing dependence on imported components.
• Customs Duty Reductions: Reductions in customs duties for solar components, including inverters and batteries, will lower the cost of solar projects.
• PM Surya Ghar Yojana 2.0: This new scheme aims to install rooftop solar systems in 10 million households over the next three years, offering subsidies and low-interest loans to make solar energy more accessible.
• ₹2,600 crore for PM-KUSUM: The allocation for the PM-KUSUM scheme has increased by 3%, now set at ₹2,600 crore, which aims to boost farmers' income, promote irrigation, and reduce diesel reliance in agriculture.
• Green Hydrogen Integration: A budget of ₹2,000 crore has been dedicated to projects focused on green hydrogen powered by solar energy, enhancing the integration of both sectors.
• R&D Investment: ₹1,500 crore has been allocated for research and development in advanced solar technologies, which will drive innovation and cost reduction in the solar sector.
• Tax Benefits for Developers: The budget includes provisions for tax holidays and accelerated depreciation benefits for solar developers, enhancing the financial viability of solar projects.
• Grid Modernization and Expansion: The budget outlines an investment of ₹5,000 crore in modernizing the grid infrastructure to accommodate the increased influx of solar energy.
• 
  

Comparison with Budget 2024 Provisions

While Budget 2024 took important steps towards promoting green energy, Budget 2025 significantly expands on these efforts. Budget 2024 allocated:

• ₹10,222 crore for the renewable energy sector, with additional funds directed at solar energy projects, green fuel initiatives, and agricultural energy solutions.

In contrast, Budget 2025 provides substantial increases in funding, particularly for solar energy and green hydrogen, reflecting India's enhanced commitment to achieving its clean energy objectives.

Impact and Future Outlook for the Green Energy Sector Post-Budget 2025

The provisions in the 2025 Budget are set to significantly enhance India’s renewable energy capacity, bringing the country closer to its long-term goals of net-zero emissions by 2070 and a 50% renewable energy share by 2030. With a focus on overcoming challenges like high costs and grid integration, this budget lays a strong foundation for the growth of the solar industry. It is expected to drive innovation, create jobs, and encourage the widespread adoption of sustainable energy.