[Budget 2020] FM announces new smart meters scheme; allocates Rs 22,000 crore to power and renewable sector

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[Budget 2020] FM announces new smart meters scheme; allocates Rs 22,000 crore to power and renewable sector

[Budget 2020] FM announces new smart meters scheme; allocates Rs 22,000 crore to power and renewable sector

Industry News
Feb 01,20

Smart meters scheme, which is aimed at reducing financial stress of Discoms, will help companies like Secure Meters, HPL Electric & Power Ltd, etc

[Budget 2020] FM announces new smart meters scheme; allocates Rs 22,000 crore to power and renewable sector

Mumbai

The government will soon launch a new scheme of smart meters which will give consumers the freedom to choose the supplier of prepaid meters and rate as per their requirement. The power distribution companies are under financial stress and the Power Ministry has been trying to implement smart meters.

During her Budget 2020 speech, Finance Minister Nirmala Sitharaman, stated, “Ï urge the states to replace conventional energy meters with smart meters in next three years. This would give the consumers the freedom to choose the supplier and the rate as per the requirement.”

The new smart meters scheme will benefit the manufacturers like Secure Meters, HPL Electric & Power Ltd, etc.

Nirmala Sitharaman has proposed to allocate Rs 22,000 crore to power and renewable sector in Budget 2020.

Besides, corporate tax cut will be available for power generation companies as well. Government will grant 100 per cent exemptions for sovereign wealth funds in infrastructure and other notified sector with minimum lock-in of three years. The rate of withholding tax has been extended to 2023 for FPIs.

India's commitment under the Paris Agreement action will kick-in from January 1,2021. The Budget 2020 has also proposed closure of power plants with higher emissions and utilising this land for other purposes. This means the government will not agree to requests from power generation companies for extending emission deadlines. One will have to wait and watch if the government walks the talk.

Budget 2020 has allocated Rs 4,400 crore to encourage state governments to plan for strategies to have clean air.

PM Kusum Scheme reduced dependence on diesel and kerosene and relied on social energy. Total of 20 lakh farmers can set up standalone solar pumps, said Nirmala Sitharaman. Further, the government aims to help 15 lakh solarise grid-connected pump sets. Farmers can also use barren land for solar energy and have a livelihood out of it, said FM. The Budget 2020 also proposes to set up solar plants along the tracks of railways to give a boost India’s renewable energy sector.

According to CRISIL, “Powering railways via solar farms on land near tracks will be negative for discoms as it takes lucrative consumers away.”

Anish De, Partner and Leader for Energy and Natural Resources KPMG in India, commented, “Big push for solar power for farming and for fallow lands by extending the Kusum scheme. This could potentially result in 10-15 GW of new capacity creation if it materialises. This will be a big push for farmer’s income, but will in turn require lesser demand for grid scale power, targets for which then should be adjusted downwards.”

FM Nirmala Sitharaman has allocated Rs 6,000 crore for BharatNet. She said India has embraced sharing economy with aggregators displacing regular businesses. Analytics, IoT and AI are changing the world. A policy will bv setting up to build data centre parks throughout the country. All public institutions at Gram Panchayat levels will be provided with digital connectivity. Fibre to home through BharatNet will link 100,000 Gram Panchayats in FY21 itself.