India's Energy Transition: Mapping subsidies to fossil fuels and clean energy in India
This report maps out the context, magnitude, trends and impacts of India’s energy subsidies. It aims to enhance transparency and dialogue on energy choices in India and to help track shifts in government support from fossil fuels to renewables.
The reviewed subsidies are grouped according to the energy type they benefit: a) coal; b) oil and gas; and c) renewable energy. In addition, we single out the grouping of subsidies to d) electricity transmission and distribution (T&D) that are, in theory, neutral to the energy source, though in practice benefit mostly coal because of its dominance in India’s electricity generation. Subsidies to nuclear power and large hydropower were excluded due to the lack of data.
If finds that energy subsidies from the central government declined substantially between FY2014 and FY2016, from INR 216,408 crore (USD 35.8 billion) to INR 133,841 crore (USD 20.4 billion). While the large majority of this expenditure supports fossil fuels and a fossil-fuel-dominated electricity system, the trends also show a sharp decline in fossil-fuel subsidies and an increase in renewable energy subsidies, suggesting a shift in priorities. Full details on the subsidies identified and quantified are provided in the report and its annexes.
Energy subsidies have wide ramifications beyond government budgets, including for markets, society and the environment, and are linked to issues such as stranded assets, enhancing energy access, public health and climate change. Transparency can help to enable an informed debate among the public and policy-makers on how well aligned they are with India's objectives.
Additional downloads
You might also be interested in
India’s stimulus for renewables is a ‘mixed bag’ for energy transition
A new report shows the government’s stimulus is a 'mixed bag' for the country’s energy transition.
Are Countries Walking the Talk on Cutting Carbon?
In the race against climate change, increasing ambition over time is key. But revised commitments from parties to the Paris Agreement lack two critical components of ambitious climate action.
Electricity overcharging: Cross-subsidies cost businesses Rs 75k crore in FY19
Since the National Tariff Policy 2016 prescribed the tolerable extents of cross-subsidy among various segments of electricity consumers, the market-distorting system hasn’t seen a smidgen of correction.
Electricity subsidies increased 32% since FY 2016: Report
New Delhi: Direct tariff electricity subsidies from the state governments have increased 32 per cent since FY 2016, amounting to Rs 1,10,391 crore ($14.96 billion) in FY 2019.