The C-Suite Intelligence

India Union Budget 2025 – Budgetary Allocations For MNRE

By  Nitika Sharma , Shreyanshi Pandey , Mansi Singh
1 min read

INDIA UNION BUDGET 2025 -26

  • The budgetary support for on grid solar energy under union budget 2025-26 is INR 1500 crores. This is 85% less than that announced in the budget of 2024-25.
    Revised allocation for 2024-25 is significantly low which may be indicative of delay in realization of projects.


  • The allocations for PM Surya Ghar Muft Bijli Yojana and PM Kusum Scheme has seen increase from 2024-25 due to positive response for these scheme shown by the country.

    PM SGMBY has helped increase the adoption of solar rooftop across the country.



  • The budgetary support for wind energy under union budget 2025-26 is INR 500 crores. This is 37.5% less than that announced in the budget of 2024-25. GoI is giving impetus on increasing standalone onshore and offshore wind projects as well as hybrid projects. Does this decline in the support indicates a shift in the focus of government? The budgetary support for hydro energy under union budget 2025-26 is INR 50 crores.

    The allotment of funds to hydro energy have seen significant rise of 271% from 2023-24 to union budget of 2024-25 and 2025-26. This increase may be due to increase focus on developing pumped hydro storage projects in the country for supporting round the clock power supply.



  • The budgetary support for grid connected bio power under union budget 2025-26 is INR 30 crores.

    This is 62.5% less than that announced in the budget of 2024-25 while for off grid bio power the expenditure has seen an increase of 60% to 200 crores from that of 124 crores in budget of 2024-25.

  • The fund support for storage and transmission system and national green hydrogen mission has been consistent from FY 2024-25 to FY 2025-26 representing GoI’s efforts to diversify India’s energy mix promoting innovation in the sector of energy storage and making India world leader in the production and export of green hydrogen.


  • The increase in budgetary support for IREDA to ₹34,974.99 crore in FY 2025-26 signals a stronger commitment by the government to accelerate the growth of renewable energy in India. This boost reflects a focus on expanding renewable energy capacity, meeting climate targets, and enhancing financial support for clean energy projects.



    The funds are likely to strengthen IREDA’s role in financing innovation, and energy storage solutions, thus contributing to India’s transition towards a sustainable energy future. While decrease in the allocations for SECI may represent the trend of delay in progress of bids and realization and commission of the renewable projects which may be due to supply chain or land availability issues.

  • The increase in central spending on programs like Information and Public Advertising (I&PA), Human Resources Development and Training (HRDT), International Relations, and Research and Development (R&D), with a significant importance for R&D and HRDT, indicates a strong focus on strengthening the country’s knowledge economy, global presence, and human capital.

    The expenditure in R&D suggests a push for innovation and technological advancements, while allocation for HRDT reflects an emphasis on skill development, workforce training, and capacity building. Together, these efforts highlight the government’s intent to foster growth through enhanced research, global collaboration, and a more skilled workforce to drive national progress.


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CURRENT LANDSCAPE OF EV MANUFACTURING - MOROCCO

Morocco’s role in making Africa epicenter of global electric mobility production & trade

MOROCCO POSITIONING ITSELF AS A SIGNIFICANT HUB FOR EV TRANSITION

Morocco is increasingly positioning itself as a significant hub for strategic influence and innovation in the evolving landscape of EV transition. The country aims to further integrate itself into global value chains and bolster its standing as a leader in sustainable industrial development. However, the electric vehicle production in the country as of 2024 is in the infancy stage.
The country currently produces between 40,000 and 50,000 electric vehicles per year, including the Fiat Topolino, Opel E-Rocks, and Citroën Ami mini-EVs. However, Morocco’s electric vehicle production capacity is expected to increase to around 100,000 units by 2025. By 2030, electric vehicles produced in Morocco are expected to account for up to 60 percent of all cars exported, according to the Ministry of Industry and Trade.

Investments in Morocco for the EV & its Value Chain

Morocco is emerging as a key hub for Chinese companies eager to lead the charge in e-mobility. Through strategic partnerships, the country is laying the groundwork for a robust electric vehicle industry and supply chain, paving the way for a sustainable, tech-driven automotive future. With $10.5 billion in investments backing these agreements, Morocco is accelerating toward a greener, smarter future on the road.


Morocco's strategic location at the crossroads of Europe, Africa, and the United States uniquely positions it to capitalize on opportunities in the electric vehicle (EV) industry. Nestled between the EU and Africa, the country can efficiently access both markets. The short 14-kilometer distance between Morocco and Europe, via the Strait of Gibraltar, provides seamless supply chain logistics, advanced technologies, research, and a ready consumer base. Meanwhile, its connection to Africa presents exciting opportunities for market expansion in a continent with growing demand for electric vehicles.
The port of Tanger Med, Africa's largest port, located 45 km northeast of Tangier and opposite Spain, enhances Morocco's strategic advantage, serving as a vital trade gateway. This boosts Morocco’s role as a prime investment destination and a key hub for the production, innovation, and export of EVs and related technologies.

Morocco's venture into electro-mobility is not a solo journey but one built on strong strategic partnerships with leading global industry players, including China. These collaborations aim to develop a solid foundation for the electric automotive industry and its supply chain, driving a future that is both sustainable and technologically advanced. A landmark achievement in this regard is the agreement to establish Africa's first Gigafactory by Gotion High-Tech Co., Ltd. This investment, signed on June 6, 2024, marks a significant milestone in Morocco's role in shaping the future of the EV industry.


WHAT ROADBLOCKS MOROCCO SHOULD OVERCOME ?

To Evolve as a Global Export Hub for EV/EV supply chain
  • Addressing regulatory hurdles, establishing clear guidelines for EV deployment
  • Fasten deployment of EV charging infrastructure. Morocco targets 2500 EV charging stations across the country by 2026
  • Focusing on affordability & accessibility of EVs to the masses
  • Investing in indigenous battery manufacturing capabilities and fostering partnerships with global leaders in battery technology bolster Morocco's position in the electro-mobility landscape
  • Increase in public awareness & perception: Effective public outreach campaigns, education initiatives, and demonstrations highlighting the benefits of electro-mobility are essential in shifting perceptions and fostering a culture of sustainability and innovation.
  • Boost to Digital Infrastructure and Business Models: Aligned with smart city strategies, leverage digital technologies to establish a connected and intelligent transportation network, enhancing the efficiency and safety of EVs

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Eninrac’s insights upon Recovery of legacy dues in the Deviation Settlement Mechanism (DSM) Pool Account in pursuance of DSM Regulations, 2024. NLDC’s communication reflects ambiguity in the minds of some of the discoms about the order dated 15.10.2024 of the Commission approving the detailed procedure for recovery of charges in case of deficit in the DSM Pool Account. For the sake of clarity and to ensure timely payment of the DSM dues, the Commission clarifies that the methodology approved in the detailed procedure vide the Order dated 15.10.2024 is applicable for recovery of charges in case of the deficits in the DSM Pool Account "as on and from 16th September 2024."

Eninrac Insights: Non-Payment of Dues and Its Impact on Ancillary Service Providers

1. Ancillary Service Providers:

  • Delayed Payments: The non-payment of dues directly leads to delays in compensating ancillary service providers, potentially creating financial stress for entities reliant on timely payments for operational continuity.

  • Erosion of Trust: Persistent delays may reduce trust in the regulatory framework and discourage ancillary service providers from actively participating in the grid security market.

  • Reduced Capacity for Services: Financial uncertainty could limit the ability of ancillary service providers to maintain or scale their operations, affecting their capability to support grid stability during high-demand periods.

2. Grid Reliability and Security:

  • Operational Risks: Ancillary service providers play a critical role in managing grid deviations and ensuring stability. Any financial disincentive may result in fewer ancillary services being available, increasing the risk of grid instability.

  • Emergency Preparedness: In times of peak demand or unexpected outages, the lack of robust ancillary service support could jeopardize emergency response capabilities.

3. Consumers:

  • Service Reliability: A shortage of ancillary services may lead to more frequent and prolonged outages, impacting industries, households, and essential services.

  • Economic Impact: Industries reliant on consistent electricity supply may face operational disruptions, indirectly affecting employment and economic productivity.

4. Distribution Companies (Discoms):

  • Operational Challenges: Discoms might face reputational and operational issues if ancillary service providers refuse or limit their services due to delayed payments.

  • Increased Costs: Discoms may need to resort to more expensive alternatives to manage grid deviations, further straining their financial resources.

5. Regulatory Framework:

Cascading Deficit Issues: Non-payment of dues creates a feedback loop of financial stress, undermining the stability of the DSM Pool Account and necessitating additional interventions from CERC.

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TBCB GUIDELINES FOR PROCUREMENT OF STORAGE CAPACITY – INDIA

Analysis of Ministry of Power Resolution of TBCB Guidelines for Procurement Storage Capacity & Stored Energy from PHSP

DESCRIPTION OF THE RESOLUTION

Tariff-Based Competitive Bidding Guidelines for the procurement of storage capacity or stored energy from Pumped Storage Plants (PSPs), issued by the Ministry of Power (MoP), India aims to support India's energy transition by enhancing grid stability, integrating renewable energy sources, and reducing peak-time electricity costs. The guidelines establish a transparent, standardized framework for procurement, ensuring fair risk-sharing among stakeholders, including developers, procurers, financial institutions, and regulatory bodies.

Key provisions include bidding structures, financial eligibility criteria, performance guarantees, and contract terms. The document also outlines the technical requirements, project timelines, and tariff structures for PSP development. Additionally, it highlights environmental considerations, land acquisition policies, and social impact assessments. By defining clear regulatory processes and dispute resolution mechanisms, these guidelines aim to attract investment, improve energy security, and drive long-term sustainability in India's evolving power sector.

The policy supports the National Electricity Plan 2023, which projects a need for 27 GW of PSP capacity by 2031-32. It enables cost-effective peak load management, reduces carbon emissions, and encourages public-private partnerships (PPPs) to accelerate storage infrastructure development while balancing economic and environmental factors.

ENERGY FLOW & ECONOMIC BENEFITS OF PHSPs


FINANCIAL FLOW & INVESTMENT REQUIREMENT - PHSP

The policy supports the National Electricity Plan 2023, which projects a need for 27 GW of PSP capacity by 2031-32. It enables cost-effective peak load management, reduces carbon emissions, and encourages public-private partnerships (PPPs) to accelerate storage infrastructure development.

ENVIRONMENT & SOCIAL IMPACT

KEY IMPACTS

Pumped Storage Plants (PSPs) play a crucial role in reducing carbon emissions by integrating renewable energy and minimizing reliance on fossil-fuel-based power generation. However, their development comes with environmental and social considerations.

PSPs require large reservoirs, which can lead to land acquisition challenges, deforestation, and ecosystem disturbances. Water resource management is a key concern, as PSPs may alter river flows and affect aquatic biodiversity. Additionally, local communities near project sites may face displacement and livelihood disruptions, necessitating resettlement plans and fair compensation.

To mitigate these impacts, PSP projects must undergo environmental impact assessments (EIA), adhere to sustainability guidelines, and implement afforestation programs. Proper stakeholder engagement and community development initiatives are essential to balancing economic benefits with ecological and social responsibility.

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Morocco Marching Towards Becoming The Global Export Hub For Ev & Its Supply Chain

Morocco Marching Towards Becoming The Global Export Hub For Ev & Its Supply Chain

Morocco’s role in making Africa epicenter of global electric mobility production & trade Investmen...

CERC DSM 2024: Suo-Motu Order on Recovery of Legacy Dues and Its Impact on Discoms and Ancillary Services

CERC DSM 2024: Suo-Motu Order on Recovery of Legacy Dues and Its Impact on Discoms and Ancillary Services

Eninrac’s insights upon Recovery of legacy dues in the Deviation Settlement Mechanism (DSM) Pool A...

TBCB Guidelines For Procurement Of Storage Capacity

TBCB Guidelines For Procurement Of Storage Capacity

Tariff-Based Competitive Bidding Guidelines for the procurement of storage capacity or stored energy...