In a bid to promote clean energy, the government on Tuesday exempted parts and components used in wind-operated electricity generators (WOEG) like tower, rotor and blades, from excise duty.
In a circular, the Central Board of Excise and Customs clarified that “parts such as tower, nacelle, rotor, blades, wind turbine controller etc of WOEG are eligible for exemption from central excise duty”.
The CBEC had received references from trade regarding availability of exemption from excise duty to the parts and components of WOEG, popularly known as ‘wind turbines’. As such the government is already focussing on renewable energy, considered as clean energy, to meet the country’s growing power demand. It has set a target of 175 GW renewable power generation, including 100 GW solar energy, 60 GW wind energy, and 10 GW from bio-mass.
“The move is a welcome and long-awaited measure. It will go a long way in improving the finances of wind energy firms. These companies have been facing an issue of payment of excise duty on the various parts that go into making a wind energy station without any method of availing a credit or set-off on the same,” MS Mani, senior director, Deloitte India, said. He added that since the supply of electricity to the state electricity authorities does not attract excise duty or service tax, it has not been possible to offset the same.