Polluting power Company may pay carbon tax

The proposal would club India with a select group of countries that tax carbon emission directly and boost the renewable energy initiative. While the initiative could turn power stations more efficient and less polluting, it could push up power tariffs. The new tax would provide more funds for renewable energy initiative, whose share in total power mix is dismal,” an official source told. Carbon tax should not be standalone initiative and there was a need for introducing a system of emission trading in order to avoid problems in the country’s negotiating position on climate change. Most EU countries have a system of penalizing polluting industries, forcing them to buy carbon credits fro efficient industries. India proposes to add 78.577 mw of additional power generating capacity during the 11th Plan. Around 70 per cent of the capacity would come from the thermal sector. The gross installed capacity of grid interactive renewable power in the country is active renewable power in the country is active renewable power in the country is estimated at 11.273 mw, 8% of the total installed generation capacity in the country.


According to a recent United Nations Environmental Programme (UNEP) report, Global trends in sustainable energy investments, the country saw a sharp increase in deployment of renewable energy in 2007s with an installed capacity of 11.4 gw of renewable energy. With 7.8 gw of wind power installed in the country, wind energy seems to be drawing most of the investments. The UNEP report sys that in 2007, public market activity was marked by a series of foreign currency convertible bond (FCCB) issues from established renewable energy companies. While Suzlon raised $300 million in May and a further $200 million in September, Moser Baer picked up $15 million in solar energy. Indowind raised $47 million and Webel $16.8 million in 2007, the report says.
The trend is interesting considering that Indian companies did not raise money on domestic stock exchanges in 2006 for investment in renewable energy. According to Indian Renewable Energy Development Agency (Ireda) chairman & managing director Debashish investors in unsteady markets by providing a fixed return. Till 2007, convertible bonds were not issued by Indian renewable companies.


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