Energy majors may shell out .2% cess for national fund
Energy majors such as ONGC, IOC, Reliance, Cairn, NTPC and Gail may have to shell out about 0.2% of their turnover towards the National Energy Fund (NEF).
By Rajeev Jayaswal, TNN |
NEW DELHI: Energy majors such as ONGC, IOC, Reliance, Cairn, NTPC and Gail may have to shell out about 0.2% of their turnover towards the National Energy Fund (NEF). The government is considering a proposal to levy a cess to fund research & development (R&D) activities in the energy sector through the NEF.
The proposal has been discussed at the PM’s Energy Co-ordination Committee recently and is likely to be included in the forthcoming Budget, sources said.
Large energy firms would be identified on the basis of their turnover. The cess is proposed to be levied on a firm that has a turnover of Rs 100 crore or more. The cess is expected to raise Rs 1,000-1,200 crore annually. The fund will be over and above the Rs 610 crore provided by the Centre for R&D activities in the nuclear energy sector, a source in the government said.
While funding the nuclear initiative is significant, there has been no focus on R&D for the long-term energy security. A meagre allocation of Rs 70 crore is made to fund other R&D activities in the energy sector.
Even domestic companies are shying away to undertake R&D activities in a big way. A company like NTPC spent only 0.025% of its turnover on R&D in 2005-06 whereas for international companies such as GE, it is as high as 2%.
It is also proposed to strengthen the Bureau of Energy Efficiency (BEE) by making it an autonomous body. It is proposed that BEE should widen its scope to look at all energy-efficiency issues. It should be empowered to identify opportunities, set targets and design programmes for various sectors where energy efficiency could be achieved, sources said.
The energy coordination committee, which is chaired by the prime minister, also includes the finance minister, petroleum minister, power minister and coal minister. One of the major roles of the committee is to identify key areas requiring energy policy initiatives so that the overall objectives of economic development, energy security and energy efficiency are met.
The proposal has been discussed at the PM’s Energy Co-ordination Committee recently and is likely to be included in the forthcoming Budget, sources said.
Large energy firms would be identified on the basis of their turnover. The cess is proposed to be levied on a firm that has a turnover of Rs 100 crore or more. The cess is expected to raise Rs 1,000-1,200 crore annually. The fund will be over and above the Rs 610 crore provided by the Centre for R&D activities in the nuclear energy sector, a source in the government said.
While funding the nuclear initiative is significant, there has been no focus on R&D for the long-term energy security. A meagre allocation of Rs 70 crore is made to fund other R&D activities in the energy sector.
Even domestic companies are shying away to undertake R&D activities in a big way. A company like NTPC spent only 0.025% of its turnover on R&D in 2005-06 whereas for international companies such as GE, it is as high as 2%.
It is also proposed to strengthen the Bureau of Energy Efficiency (BEE) by making it an autonomous body. It is proposed that BEE should widen its scope to look at all energy-efficiency issues. It should be empowered to identify opportunities, set targets and design programmes for various sectors where energy efficiency could be achieved, sources said.
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The energy coordination committee, which is chaired by the prime minister, also includes the finance minister, petroleum minister, power minister and coal minister. One of the major roles of the committee is to identify key areas requiring energy policy initiatives so that the overall objectives of economic development, energy security and energy efficiency are met.
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