Council on Energy, Environment and Water Integrated | International | Independent

Budget 2023: CEEW Unpacks What It Means for Energy Transition, Energy Storage and Natural Farming

Speaking at India's Union Budget Session for 2023-24, Finance Minister Nirmala Sitharaman highlighted green growth as a key priority for Budget 2023. She briefed that many programmes and schemes were being implemented for green fuel, green energy, green farming, green mobility, green buildings, green equipment, and creating policies for efficient energy use across various economic sectors. 

The Finance Minister announced an outlay of INR 35,000 crore for green energy transition and a green credit programme to encourage behavioural change among companies, individuals and local bodies. Further, she informed that one crore farmers will be facilitated to adopt natural farming in the next three years.

Battery Storage 

Rishabh Jain, Senior Programme Lead, said: 

“The Viability Gap Funding (VGF) support for the 4 GWh battery energy storage system announced in the Union Budget and greater thrust on pumped hydro are critical to help India move towards meeting the Energy Storage Obligation targets. The VGF support should, however, be leveraged to increase our understanding of the technology and application and should not be considered as a continuous tool for support. Further, the exemption of customs duty for capital goods and machinery for lithium-ion battery manufacturing will reduce the final prices of batteries and make electric vehicles more affordable for consumers. CEEW Analysis suggests that the key equipments for battery cell manufacturing are imported and have a majority share in the overall infrastructure costs. Going forward, the government must aim to acquire critical minerals from overseas and build the capability to process them”

Natural Farming 

Apoorve Khandelwal, Senior Programme Lead, said: 

“The Union Budget shared by the finance minister included three major announcements that can potentially enhance nutritional security, improve farmer livelihoods, and further climate resilience. Firstly, supporting one crore farmers in the next three years through the National Mission on Natural Farming is a welcome move that needs to be targeted in areas with low-risk and high-returns, such as rainfed regions, and complemented with a focus on rigorous evidence of its efficacy and impact in different settings. Second, the scaling up of 'Shree Anna' – millets – was expected in the International Year of Millets. The government must focus on cross-learning between the Indian states for sharing of best practices, particularly from the front-runners like Odisha. Lastly, the PM-PRANAM and pilots on shifting financing of schemes from being ‘input-based’ to ‘result-based’, could chart a pathway towards reshaping incentives and risks to nudge farmer choices towards economically remunerative but nutritionally-rich and ecologically resilient crops and cropping approaches.”