India Doubles Tax on Coal to Fund Clean Energy, Environmental Projects

22,000 MW solar power capacity by 2022, a dedicated national-level program for promoting wind energy generation, implementation of the world’s largest solar power projects (with capacity of up to 4,000 MW), covering canals with solar panels, implementing dedicated transmission corridors for distributing electricity from renewable energy projects, and cleaning one of the largest rivers in India.  This is just a small list of initiatives that India plans to implement in the renewable energy and the environment protection sector.

Such initiatives would require billions of dollars of investment.  So India’s finance minister has decided to double the tax on every metric ton of coal mined or imported in the country.  Coal mining companies and importers have paid $0.83 per metric of coal since 2010, this tax has now been increased to $1.67.

The revenue raised from this tax feeds to the National Clean Energy Fund.  The fund was established to provide low-cost finance to renewable energy projects and the Green Corridors transmission project.  According to media reports, the fund was no way near being utilized and had an unused corpus of 8,300 crore ($1,376 billion).  With the new government planning to spend as much as $167 million for projects earmarked for this financial year (ending March 2015), things could change rapidly.

India Doubles Tax on Coal to Fund Clean Energy, Environmental Projects