New Delhi, Sep 23 : The reduction of Goods and Services Tax (GST) on the renewable energy value chain from 12 per cent to 5 per cent will save up to Rs 1'1.5 trillion by 2030, Union Minister for New and Renewable Energy, Pralhad Joshi, has said.

The savings will be essential to reaching the nation's goal of 500 gigawatts (GW) of installed renewable energy (RE) capacity by 2030, Joshi stated during a media event.

India has already added 252 GW of this, and an additional 248 GW is anticipated to be installed over the next five years.

"This GST cut will result in savings of approximately Rs 1 to 1.5 trillion. This will be the biggest advantage,' the minister said.

The Ministry of New and Renewable Energy (MNRE) projects that the tax cut will lower project costs and increase consumer access to clean electricity.

A utility-scale solar project's capital cost, which was previously approximately Rs 3.5'4 crore per MW, will now be reduced by Rs 20'25 lakh per MW. This results in cost savings of more than Rs 100 crore for a 500 MW solar park, increasing tariff competitiveness.

A 3 kW rooftop solar system will cost between Rs 9,000 and Rs 10,500 per household, which will encourage adoption under the government's PM Surya Ghar: Muft Bijli Yojana.

The Centre is also creating a detailed plan to create an ecosystem for solar manufacturing that is self-sufficient, encompassing polysilicon, wafers, and ingots.

Joshi suggested using programs like Production Linked Incentive (PLI) or Viability Gap Funding (VGF) to promote domestic manufacturing.

In addition to modules and cells, MNRE is working to add wafers and ingots to the Approved List of Models and Manufacturers (ALMM).

ALMM List III for wafers would be implemented starting in June 2028, according to a draft amendment, provided that at least three separate manufacturing facilities with a combined 15 GW capacity are in place.

/IANS