Brief

India Energy Subsidy Briefing July 2019

As part of its work on energy policy and sustainable development in India, the Global Subsidies Initiative publishes a regular briefing on issues related to energy subsidies.

By Balasubramanian Viswanathan on July 17, 2019

As part of its work on energy policy and sustainable development in India, the Global Subsidies Initiative publishes a regular briefing on issues related to energy subsidies.

Below are highlights from the July 2019 edition:

  • As a result of high crude oil prices in late 2018, the government announced a reduction in excise duty for oil and gas that is expected to result in foregone revenue of INR 10,500 crore (USD 1.6 billion) in fiscal year (FY) 2019. Increasing connections to liquefied petroleum gas (LPG) cooking cylinders drives up gas subsidies.
  • The Central Government launched programs to support solar power, including KUSUM and Phase-II of the Grid Connected Rooftop Solar Programme.
  • India approved an INR 10,000 crore (USD 1.4 billion) electric vehicle (EV) incentive scheme through Phase-II of the FAME program.
  • The Supreme Court ruled in favour of financially stressed coal-fired power stations, giving them more time before their debts will be foreclosed. While the government supported the ruling, analysts fear greater uncertainty over the future of these assets.
  • The Central Electricity Regulatory Commission (CERC) announcements on the passthrough of costs are expected to further distress electricity distribution companies (DISCOMs), which faced combined losses of INR 24,000 (USD 3.4 billion) in the first nine months of FY 2019. 

For any additional or more detailed information, please do not hesitate to contact Christopher Beaton or Vibhuti Garg.

Brief details

Topic
Subsidies
Energy
Region
India
Focus area
Climate
Publisher
IISD
Copyright
IISD, 2019