As part of the Union Budget 2024-25, the finance minister announced key measures in the power sector as follows:
Power sector reforms
Improving the financial and operational stability of electricity distribution companies, coupled with incentives for enhancing intra-state transmission capacity. Additional borrowing of 0.5 per cent of gross state domestic product will be allowed to states, contingent on these reforms.
Nuclear energy
Launch of the Nuclear Energy Mission to develop at least 100 GW of nuclear power by 2047 with Rs 200 billion allocation for research and development in small modular reactors (SMR). At least 5 indigenously developed SMRs will be operationalised by 2033. For an active partnership with the private sector towards this goal, amendments to the Atomic Energy Act and the Civil Liability for Nuclear Damage Act will be taken up.
Critical minerals
Full exemption from basic customs duty (BCD) on 25 critical minerals not available domestically. Exemptions for cobalt powder, lithium-ion battery scrap, lead, zinc, and others to support domestic manufacturing.
Lithium-ion battery production
Adding 35 capital goods for electric vehicles (EV) battery manufacturing and 28 capital goods for mobile battery production.
Clean technology manufacturing
A manufacturing mission focusing on increasing production of solar photo voltaic cells, EV batteries, motors, controllers, electrolysers, wind turbines, and high-voltage transmission equipment.
Tariff reduction
Reduction on the customs duty on solar cells from 25 per cent to 20 per cent. Duties on smart meters are also decreased from 25 per cent to 20 per cent.
Budgetary Allocation
- For 2025-26, the net budgetary allocation for the Ministry of Power has been pegged at Rs 218.47 billion (as against Rs 205.02 billion budgeted in 2024-25).
- The net budgetary allocation for the Ministry of New and Renewable Energy has been pegged at Rs 265.49 billion for 2025-26 (as against Rs 191 billion budgeted in 2024-25).