Budget: Energy transition gets fund boost, green growth key economic driver

The Centre has entrusted the oil ministry, which naturally has the highest fossil-fuel footprint, to steer the energy transition of the country

Oil, Energy
Photo: Bloomberg
Shreya JaiSubhayan Chakraborty New Delhi
2 min read Last Updated : Feb 02 2023 | 12:38 AM IST
Making green growth the key component of Amrit Kaal is the Bharatiya Janata Party-ruled central government’s vision for the coming 25 years.

Union Finance Minister Nirmala Sitharaman on February 1 announced a slew of policies for the green economy. In line with the country’s Net Zero 2070 target and allied climate goals, the Union Budget gave a push to a green industrial and economic transition.

A record high budgetary grant went to energy transition, which would be a key driver in reducing carbon emission and leap towards green fuels and green energy sources.

“This Budget provides Rs 35,000 crore for priority capital investments towards energy transition and net-zero objectives, and energy security by the Ministry of Petroleum & Natural Gas (MoPNG),” said Sitharaman in her Budget speech.

The Centre has entrusted the oil ministry, which naturally has the highest fossil-fuel footprint, to steer the energy transition of the country.

According to the expenditure budget of MoPNG, Rs 30,000 crore has been allocated to oil-marketing companies (OMCs) and the balance for strategic oil reserves. It is expected the capital outlay to the OMCs would be focused on new-age fuels — green hydrogen, ethanol, and other biofuels.

The OMCs are currently in the process of drafting a comprehensive plan on ramping up green hydrogen production. Under the newly announced Rs 19,000-crore Green Hydrogen Mission, mandatorily procuring green hydrogen has been stipulated for various sectors, including refineries.

The OMCs have also begun to produce ethanol from bio residue and agri waste. The plan is in sync with the Centre’s long-term target of higher levels of ethanol blending with petroleum. E20, or petroleum blended with 20 per cent ethanol, will be retailed from April 1.


Battery-energy storage systems up to 4,000 megawatt-hour capacity and pumped storage projects will be supported with viability gap funding for furthering investors’ interest.

Central support with Rs 8,300 crore was announced for the Rs 20,700-crore interstate transmission system, being built for evacuation and grid integration of 13 gigawatt of renewable energy from Ladakh.

The minister also announced a Green Credit Programme under the Environment (Protection) Act.

One subscription. Two world-class reads.

Already subscribed? Log in

Subscribe to read the full story →
Subscribe to Business Standard digital and get complimentary access to The New York Times

Quarterly Starter

₹900

3 Months

₹300/Month

SAVE 25%

Smart Essential

₹2,700

1 Year

₹225/Month

Save 46%

Super Saver

₹3,900

2 Years

₹162/Month

Subscribe

Renews automatically, cancel anytime

Here’s what’s included in our digital subscription plans

Access to Exclusive Premium Stories Online

  • Over 30 behind the paywall stories daily, handpicked by our editors for subscribers

Complimentary Access to The New York Times

  • News, Games, Cooking, Audio, Wirecutter & The Athletic

Business Standard Epaper

  • Digital replica of our daily newspaper — with options to read, save, and share

Curated Newsletters

  • Insights on markets, finance, politics, tech, and more delivered to your inbox

Market Analysis & Investment Insights

  • In-depth market analysis & insights with access to The Smart Investor

Archives

  • Repository of articles and publications dating back to 1997

Ad-free Reading

  • Uninterrupted reading experience with no advertisements

Seamless Access Across All Devices

  • Access Business Standard across devices — mobile, tablet, or PC, via web or app

Topics :Nirmala SitharamanBudget 2023Green energyCarbon emissionsoil marketing companiesethanol

Next Story