Rumi Engineer, Head -Green Buildings, Godrej Green Building Consultancy Services & Head of Energy Conservation, Godrej & Boyce Ltd
Rumi Engineer shares expectations from the upcoming Union Budget 2014-15
Promoting energy efficiency is a critical area where the industry is hopeful that the new government would prioritize. Lending to renewable energy projects need to be treated as priority sector and the government should aim to have an integrated view as far as energy policies are concerned coupled seamlessly with the funding climate in which lenders operate.
Fortunately, the newly elected government recognizes the importance of this sector and recently announced a regulation whereby it will be mandatory for all state governments to implement the minimum requirements for energy efficient design and construction set by the central government to meet the challenges of depleting resources, increased urbanization and rapid construction by 2017.
It has also announced that the Bureau of Energy Efficiency (BEE) will make the Energy Conservation Building Code (ECBC) mandatory to shift its focus to building energy-saving structures to reduce the energy consumption through design and choice of material and equipment. Looking at the positive focus and importance being given by the government, given below are a few pointers towards what we can expect in the upcoming budget:
- Eco-friendly products and projects, especially green building projects need to be fully supported by the government and the budget should specifically try to incentivize green buildings by allowing tax breaks, higher depreciation benefits, lower funding rates, longer repayment periods for finances etc. In addition, there should be higher allocation in the union budget to the States, specifically to implement the ECBC standards and designs which the 12th Five Year plan has categorized as mandatory for all States.
- The current threat of a much lower monsoon would surely make all corporate (industries) and individuals understand the criticality of using water efficient products. It is not only the threat of a low monsoon, but the fact that our country is faced with a deep threat of water starvation should be enough to have the new government promote water efficient products and processes. Thus norms relating to recycling of water, sewage recycling etc. should be made stringent and supported with incentives of lower taxation and duties.
- Norms relating to minimum energy efficiency which can be achieved only if there are strict guidelines and rules relating to usage of energy efficient products. Attractive incentives may be initiated by using the indirect tax routes such as lower excise / customs duty for energy efficient products to encourage the practice.
- Rationalization of the tax structure in the power sector, especially those relating to equipment for solar energy would help the industry immensely. Strategic approach on the demand side management as well simplification of policies and procedures to address the issues which energy producers are facing on fuel shortages need to be addressed in the budget.
The author is Rumi Engineer, Head of Green Buildings at Godrej Green Building Consultancy Services & Head of Energy Conservation, Godrej & Boyce Ltd.
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