3311LS(E).p65

Short title,

extent and

commencement.

THE NATIONAL RENEWABLE ENERGY CREDIT

SUPPORT BILL, 2021

SHRI RITESH PANDEY, M.P.

BILL

to promote progressive shift in generation, transmission, distribution, trading and usage

of electricity from conventional energy sources to renewable energy and for

matters connected therewith.

BE it enacted by Parliament in the Seventy-second Year of the Republic of India as

follows:—

CHAPTER I

PRELIMINARY

1. (1) This Act may be called the National Renewable Energy Credit Support Act, 2021.

(2) It extends to the whole of India.

(3) It shall come into force on such date, being not later than one year from the date of

assent by the President, as the Central Government may by notification in the Official Gazette,

appoint.

Bill No. 1 of 2021

As INTRODUCED IN LOK SABHA

2. In this Act, unless the context otherwise requires,—

(a) "appropriate Government" means in the case of a State, the Government of

that State, and in all other cases, the Central Government;

(b) "Ministry" means the Ministry of New and Renewable Energy;

(d) "Renewable energy sources" means energy derived from non-depleting

resources and includes the following sources—

(i) wind;

(ii) solar radiation;

(iii) mini hydro;

(iv) biomass;

(v) biofuels;

(vi) landfill and sewage gas;

(vii) municipal solid waste;

(viii) industrial waste;

(ix) geothermal energy;

(x) ocean energy;

(xi) any other energy source, as may be notified by the Ministry; and

(xii) hybrids of above sources.

(e) "Tax Credit" means an amount of money that a taxpayer shall subtract from

taxes owed to the appropriate Government or local authority.

3. (1) The appropriate Government and local authority concerned shall take all such

measures, as it deems necessary, for the promotion of adoption of renewable energy in

public buildings, residences, companies, commerce, industries and agriculture.

(2) The appropriate Government shall promote adoption of renewable energy for the

purpose of electricity generation, its supply to, and self-consumption by, public buildings,

residences, companies, commerce, industries and agriculture:

Provided that the entity generating or supplying electricity based on renewable energy

shall comply with the such measures as may be specified by the Central Electricity Authority

under sections 53 and 73 of the Electricity Act, 2003:

Provided further that such electricity generating company may establish, operate, and

maintain a generating station without obtaining a license under the Electricity Act, 2003, if it

complies with the technical standards relating to connectivity with the grid referred to in

clause (b) of section 73 of Electricity Act, 2003:

Provided also that any individual or community, who intends to generate and supply

electricity from renewable energy sources, shall not require any license but shall be required

to comply with such measures, as may be specified by the Central Electricity Authority under

sections 53 and 73 of the Electricity Act, 2003:

(3) The appropriate Government including local authorities shall promote adoption of

renewable energy through its initiatives and programmes in villages and especially amongst

women, the Scheduled Castes, the Scheduled Tribes and any other weaker and vulnerable

sections of society.

Definitions.

Promotion of

adoption of

Renewable

Energy in

Public

Buildings,

Residences,

Companies,

Commerce,

Industries, and

Agriculture.

36 of 2003. 30

36 of 2003.

(4) The appropriate Government shall create a national, uniform and mandatory

renewable electricity energy purchase obligation or similar requirement on all entities within

one year of the coming into force of this Act.

(5) The Central and the State Electricity Regulatory Agencies constituted under the

Electricity Act, 2003 shall have the responsibility and authority to ensure compliance to such

electricity purchase obligations.

4. (1) The appropriate Government and the local authorities, as the Case may be, shall

provide such tax-cut or credit on the electricity bill, being not less than ten per cent. and not

more than thirty per cent. as it may deem fit, to the individuals, communities, public buildings,

residences, companies, commerce, industries and agriculture that use renewable energy

for the purpose of personal consumption:

Provided that the appropriate Government and the local authorities shall allow such

tax-cut or credit to the above-mentioned entities through a verification mechanism as per

the Electricity Act, 2003 within one-year of the said electricity bill:

Provided further that the burden of such tax-cut or credit shall be reimbursed to the

exchequer by the Central Government up to seventy per cent. and by the State Government

up to thirty per cent.

(2) The Central Government shall provide such tax-cut or credit on the corporate tax,

being not less than ten per cent. and not more than thirty per cent., as it deems appropriate,

to companies, commerce, industries and agriculture that generate and supply renewable

energy for the purpose of electricity consumption:

Provided that the Central Government shall allow such tax-cut or credit to the above-

mentioned entities through a verification mechanism to be notified within one-year of the

coming into force of this Act:

Provided further that the burden upto thirty per cent. of such tax-cut or credit shall be

reimbursed to the Central Government by the State Government.

(3) The Central Government shall provide such tax-cut or credit on the corporate tax,

being not less than ten per cent. and not more than thirty per cent., as it may deem appropriate

to companies, commerce, industries and agriculture that generate and use renewable energy

for their commercial purposes:

Provided that the Central Government shall allow such tax-cut or credits to the above-

mentioned entities through a verification mechanism to be notified within one-year of the

coming into force of this Act:

Provided further that the burden upto thirty per cent. of such tax-cut or credits shall be

reimbursed to the Central Government by the State Government.

5. (1) The appropriate Government shall financially support individuals, communities,

public buildings, residences, companies, commerce, industries and agricultural units that

intend to buy equipment or necessary infrastructure for using renewable energy for the

purpose of personal consumption, through its various programmes, policies, subsidies or

by arranging a mechanism through appropriate loans.

(2) The appropriate Government shall financially support individuals, communities,

public buildings, residences, companies, commerce, industries and occupational activities

that intend to buy equipment or necessary infrastructure for generating renewable energy

by themselves for self-consumption through its various programmes, policies, subsidies or

by arranging a mechanism through bank-loans.

(3) The appropriate Government shall financially support individuals, communities,

public buildings, residences, companies, commerce, industries and agricultural units that

intend to buy equipment or necessary infrastructure for generating and supplying renewable

energy through its various programmes, policies, subsidies or by arranging a mechanism

through bank-loans.

Tax-cut or

credits for the

adoption of

Renewable

Energy.

Financial

Support for

the adoption

of Renewable

Energy.

5 36 of 2003.

6. (1) The appropriate Government shall provide equipment and necessary

infrastructure for using renewable energy for the purpose of electricity or cooking or both

to women, the Scheduled Castes, the Scheduled Tribes and any other weaker and vulnerable

sections of society.

(2) The appropriate Government shall fund programmes to any other marginalized

community who intend to buy equipment or necessary infrastructure for using renewable

energy for the purpose of personal consumption and agricultural units.

7. If an individual, community, public building, residence, company, commerce, industry

or agriculture that receives a tax-cut or credit, financial support or any similar incentives for

the adoption of renewable energy fails to comply with the provisions of this Act, the

appropriate Government—

(a) shall revoke such tax-cut, financial support or similar incentives; and

(b) may impose on the such entity such penalty as may be prescribed.

8. The appropriate Government shall create incentive and facilitation framework to

assist companies, commerce and industries to make investment in renewable energy projects.

9. No person shall establish or expand or cause to establish or expand any

manufacturing facility for production of any energy sources with fully fossil-fuel based

energy system after the coming into force of this Act.

10. (1) The appropriate Government shall establish such number of regional renewable

energy funds, as it may deem necessary, keeping in view the population of the particular

region.

(2) The Fund shall be co-ordinated and operated by the Central Government through

the Ministry.

(3) The monies to the Funds shall be credited by the —

(i) appropriate Government;

(ii) corporate social responsibility mechanism;

(iii) levy of cess;

(iv) international finance;

(v) funds received under any climate agreement;

(vi) any penalty received under this Act; and

(vii) such other sources, as the Central Government deems fit.

(4) The Funds shall be used for supporting all the objectives of this Act.

11. Notwithstanding anything in the Company Act, 2013 or the rules made thereunder,

the companies shall mandatorily credit funds into the Regional Renewable Energy Fund

under the corporate social responsibility policy in furtherance of environmental sustainability.

12. (1) The appropriate Government shall create a rural renewable energy security

programme to provide access to renewable energy for various purposes for rural population.

(2) The appropriate Government shall fund programmes which shall help those who

intend to buy equipment or necessary infrastructure for using renewable energy for the

purpose of agriculture.

Other

mechanisms

to support for

adoption of

renewable

energy for all.

Revocation of

tax-cut or

credits, etc.

Investments

in Renewable

energy

projects.

Prohibition

on new

investments

on fully

fossil-fuel

based energy

system.

Regional

Renewable

Energy Fund.

Mandatory

Corporate

Social

Responsibility

in Renewable

Energy.

Rural

Renewable

Energy

Security

Programme.

18 of 2003.

(3) The appropriate Government shall fund programmes which will help indigenous

community who intends to buy equipment or necessary infrastructure for using renewable

energy for the purpose of electricity and cooking.

(4) The appropriate Government shall especially utilize the Regional Renewable

Energy Fund for ensuring access to renewable energy for rural population.

13. (1) The appropriate Government shall fund various programmes and policies that

create necessary awareness on the importance of using renewable energy for any purpose

as identified under this Act.

(2) The appropriate Government shall fund various research programmes which

identify and develop indigenous sources of renewable energy.

(3) The appropriate Government shall appoint local volunteers in various regions

who shall help in fulfilling the objectives of this Act.

14. (1) The appropriate Government shall, from time to time, formulate, monitor and

review policies and schemes pertaining to implementation of renewable energy.

(2) The appropriate Government shall impose such penalties, as it deems necessary, to

those entities who violate any of the provisions of this Act.

(3) The appropriate Government shall publish updated set of technical safety, quality

standards and any other data that is important for the adoption of renewable energy.

15. (1) The Central Government may, by notification in the Official Gazette, make rules

for carrying out the purposes of the Act.

(2) Every rule made under this Act by the Central Government shall be laid, as soon as

may be after it is made, before each House of Parliament, while it is in session, for a total

period of thirty days which may be comprised in one session or in two or more successive

sessions, and if, before the expiry of the session immediately following the session or the

successive sessions aforesaid, both Houses agree in making any modification in the rule or

both the Houses agree that the rule should not be made, the rule shall thereafter have effect

only in such modified form or be of no effect, as the case may be; so, however, that any such

modification or annulment shall be without prejudice to the validity of anything previously

done under that rule.

Outreach and

Friends for

Renewable

Energy.

Monitoring,

Penalty and

Reporting

Requirement.

Power to

make rules.

STATEMENT OF OBJECTS AND REASONS

The National Renewable Energy Credit Support Bill aims to address the urgent need

for India to adopt sustainable solutions to satiate its growing energy demand in the face of

the global climate crisis. Traditional energy sources come from the combustion of fossil

fuels (coal and petroleum)—which is a chemical process that emits gases such as carbon

dioxide, methane, and nitrous oxide. These are greenhouse gases that prevent heat from

escaping the earth's atmosphere, thereby warming the surface of the earth. An increased

concentration of greenhouse gases in the earth's atmosphere as a result of human activities

such as the combustion of fuel for industrial power generation has resulted in global warming,

which is the phenomenon driving global climate change.

The consequences of climate change are already beginning to manifest themselves as

existential threats to coastal settlements as well as food production. In India, where a large

population of farmers still depend upon rainfall for irrigation, climate change is disrupting

rainfall patterns in the form of delayed onset, floods, droughts, and shorter rainy periods.

Additionally, it is also responsible for the increasing intensity of heat waves experienced by

much of the country. Therefore, the need of the hour is to avert the disastrous effects of

climate change by containing global warming to within 1.5 degrees of temperature rise by

2050. As one of the world's largest economies with the second largest human population,

India has a unique responsibility to fulfil the commitments of the Paris Agreement of 2016 by

advocating for development that is sustainable, ethical, and equitable.

In the backdrop of the growing threat of climate change in India, renewable energy is

the key for India's continued and sustained growth. This Bill aims to address this need by

giving a boost to the renewable energy ecosystem in the country. To that end, this Bill

espouses the introduction of taxation incentives to both the producers, distributors and

consumers of renewable power sources. The Bill also aims to promote the development of

the renewable energy infrastructure in under-served areas through the establishment of a

Regional Renewable Energy Fund that is funded by a public-private partnership as well as a

Rural Renewable Energy Security Programme. The Bill also caters to the energy needs of

vulnerable populations such as scheduled castes, scheduled tribes and geographically

isolated communities.

On the economic front, India is a large importer of oil and natural gas, and this Bill aims

to move towards establishing energy independence in order to reduce our fiscal deficit.

Given that fuel forms a large share of our imports, the Indian economy remains vulnerable to

a crude oil price shock that could feed into inflation. Additionally, by improving the renewable

energy generation and distribution infrastructure in the country, we can also generate more

national employment, especially more rural employment.

NEW DELHI; RITESH PANDEY

November 6, 2019.

PRESIDENT’S RECOMMENDATION UNDER ARTICLES 117(1), 274(1) AND

117(3) OF THE CONSTITUTION

[Copy of Letter No. 9/02/2016-P&C dated 15 December, 2020 from Shri R.K. Singh,

Minister of State of the Ministry of Power and New and Renewable Energy and Minister of

State in the Ministry of Skill Development and Entrepreneurship to the Secretary General,

Lok Sabha].

The President, having been informed of the subject matter of the National Renewable

Credit Support Bill, 2019* by Shri Ritesh Pandey, M.P., recommends the introduction under

articles 117(1) and 274(1) and the consideration of the Bill under article 117(3) of the

Constitution in Lok Sabha.

[*Bill, being perinted in 2021, the year in the title of Bill has been changed from 2019 to 2021.]

FINANCIAL MEMORANDUM

1. Sub-clause (1) of clause 3 of the Bill states that the appropriate Government shall all

such measures as it deems necessary for the promotion of adoption of renewable energy in

public buildings, residences, companies, commerce, industries and agriculture.

2. Sub-clause (3) of clause 3 of the bill states that the appropriate Government is under

an obligation to promote adoption of renewable energy through its initiatives and programmes

for all purposes in villages and especially among women, Scheduled Castes, Scheduled

Tribes, and any other weaker and vulnerable sections of society.

3. Sub-clause (1) of clause 4 of the bill states that the appropriate Government shall

provide tax-cut or credits on the electricity bill between 10-30% or a proportion it deems fit to

individuals, communities, public buildings, residences, companies, commerce, industries,

and agriculture that use renewable energy for the purpose of personal consumption.

4. Sub-clause (2) and sub-clause (3) of clause 4 of the bill states that the appropriate

Government shall provide tax-cut or credits on the corporation tax of not less than 10% and

more than 30% or it deems fit necessary to companies, commerce, industries and agriculture

that generates, supply and uses renewable energy for commercial purposes.

5. Sub-clause (1) of clause 5 states that the appropriate Government shall financially

support through its various programmes, policies, subsidies, or by arranging a mechanism

through appropriate loans for individuals, communities, public buildings, residences,

companies, commerce, industries, and agricultural units that intend to buy equipment or

necessary infrastructure for using, generating and supplying renewable energy for the purpose

of personal consumption and commercial purposes.

6. Sub-clause (1) and (2) of clause 6 states that the appropriate Government shall fund

programmes to any other marginalized community who intend to buy equipment or necessary

infrastructure for using renewable energy for the purpose of personal consumption and

agricultural units.

7. Clause 8 of the bill states that the appropriate Government shall create incentive and

facilitation framework which will assist companies, commerce, and industries to make

investments in renewable energy projects.

8. Sub-clause (1) of clause 10 of the bill states that the appropriate Government shall

establish several regional renewable energy funds and further fund them accordingly to the

rules under the clause.

9. Sub-clause (1) of clause 12 of the bill states that the appropriate Government shall

create a rural renewable energy security programme to provide access to renewable energy

for various purposes to rural populations and further obliges it to fund the programme.

10. Sub-clause (2) of clause 13 of the bill states that the appropriate Government shall

fund various research programmes which identify and develop indigenous sources of

renewable energy.

11. Sub-clause (3) of clause 14 of the bill states that the appropriate Government shall

publish updated set of technical, safety, and quality standards, and any other data that is

important for the adoption of renewable energy.

MEMORANDUM OF DELEGATED LEGISLATION

Clause 15 of the Bill empowers the Central Government to make rules for carrying out

the purposes of the Bill. As such the delegation of legislative power is of a normal character.

LOK SABHA

————

BILL

to promote progressive shift in generation, transmission, distribution, trading and usage

of electricity from conventional energy sources to renewable energy and for

matters connected therewith.

————

(Shri Ritesh Pandey, M.P.)

MGIPMRND—3311LS(S3)—18-01-2021.