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A National Adaptation Fund for Climate Change (NAFCC) has been established with a budget provision of Rs. I350 crore for the years 2015–16 and 2016–17. It is meant to assist in meeting the cost of national- and state- level adaptation measures in areas that are particularly vulnerable to the adverse effects of climate change.
The overall aim of the fund is to support concrete adaptation activities that reduce the adverse effects of climate change facing communities, sectors and states but are not covered under the ongoing schemes of state and central governments. The adaptation projects contribute towards reducing the risk of vulnerability at community and sector level.
Coal Cess and the National Clean Energy Fund
India is one of the few countries around the world to have a carbon tax in the form of a cess on coal. Not only has India imposed such a cess but it has also been progressively increasing it (form Rs. 50 per tonne of 2010 to Rs. 200 by 2015–16 and Rs. 400 by 2016-17). The NCEF (National Clean Energy Fund) which is supported by the cess on coal was created for the purposes of financing and promoting clean energy initiatives, funding research in the area of clean energy and for any other related activities.
The PAT (Perform Achieve and Trade) scheme under the National Mission on Enhanced Energy Efficiency was introduced as an instrument for reducing specific energy consumption in energy-intensive industries with a market- based mechanism that allowed the trading of ESCerts (energy saving certificates). The ESCerts, issued by the GoI, are traded through the power exchanges in the country.
For India, renewable energy has become a major focus area. The GoI has set an ambitious target of achieving 40 per cent cumulative electric capacity from non-fossil fuel-based energy resources by 2030. India is currently undertaking the largest renewable capacity expansion programme in the world.
Major highlights regarding it are as given below:
(i) Renewable energy capacity target has been increased to 175GW by the year 2022, out of which 100GW is to be from solar, 60 GW from wind, 10 GW from biomass and 5 GW from small hydro power projects.
(ii) The First RE-INVEST (Renewable Energy Global Investment Promotion Meet and Expo) were organized in February 2015 to provide a platform for the global investment community to connect with stakeholders in India.
The objective of the RE-INVEST series of conference expos is to showcase India’s renewable energy potential and the government’s efforts to develop and scale up the country’s installed renewable energy capacity to meet the national energy requirement in a socially, economically and ecologically sustainable manner. A total of 273,000 MW green commitments, including 62,000 MW of renewable manufacturing, were received in the event.
(i) The ISA (International Solar Agency) was launched by India at COP 21 in Paris in December 2015. The ISA will provide a special platform for mutual cooperation among 121 solar-resource-rich countries lying fully or partially between the Tropic of Cancer and Tropic of Capricorn. The Secretariat of the ISA will be hosted by India.
(ii) Development of Solar Cities Programme is another ambitious scheme of India. Under it 56 solar cities projects have been approved.
(iii) Solar Parks (32 such parks approved by February), each with the capacity of 500 MW and above.
(iv) Ultra Mega Solar Power Projects to be developed in the next five years in various states.
(v) National Offshore Wind Energy Policy 2015 is another major renewable energy policy initiative. It aims at helping offshore wind energy development, including setting up of offshore wind power projects and research and development activities in waters, in or adjacent to the country, up to the seaward distance of 200 nautical miles exclusive economic zone (EEZ) of the country from the base line.
(vi) Accelerated Depreciation Benefits scheme for wind power projects have been restored by the GoI in 2016 (which were withdrawn in July 2014). This will help in creating a robust manufacturing base for wind turbines in the country.
(vii) To provide adequate amount of investment, the Reserve Bank of India has included renewable energy in the PSL (priority sector lending) for scheduled commercial banks.
(viii) The new National Tariff Policy (January 2016) for electricity has a focus on the environmental aspect with major provisions such as (Economic Survey 2016-17)—
• 8 per cent of electricity consumption (excluding hydro power) shall come from solar energy by March 2022;
• New coal/lignite based thermal plants to establish/procure/purchase renewable capacity;
• Bundling of renewable power with power from plants whose Power Purchase Agreements have expired or completed their useful life;
• No inter-state transmission charges for solar and wind power;
• Procurement of 100 per cent power produced from ‘waste-to energy’ plants;
• Ancillary services to support grid operation for expansion of renewable energy, etc.