Parliamentary panel objects to diversion of clean energy fund to compensate states for GST

Economic Time, December 10, 2018

A parliamentary panel, headed by BJP’s Murli Manohar Joshi, has taken objection to the Centre’s move to divert a large chunk of the Rs 86,440-crore National Clean Energy Fund (NCEF) to compensate states for their revenue loss following the rollout of goods and services tax. Such a move, says the committee on estimates, will impact efforts to check global warming.

In its report on the Performance of National Action Plan on Climate Change (NAPCC), the committee has expressed its “concern” that despite the coal cess helping generate substantial revenue, the fund was not made available to fuel clean energy initiatives, people aware of the content of the report told ET. Even the low allocation, it observed, was not utilised, indicating “poor planning and execution” by the implementation agencies.

The report is likely to be tabled in Parliament during the winter session beginning Tuesday.

Of Rs 86,440.21 crore collected as coal cess from 2010-11 to 2017-18, only Rs 20,942.29 crore was transferred to the NCEF, panel sources told ET. And, of the allocated amount, Rs 15,911.49 crore went to fund clean energy projects. In addition to this, the government sourced cash from cess levied on other items to fund Rs 60,500 crore of GST compensation to states, they said. In the report, the 30-member committee of parliamentarians has strongly recommended adequate financial resources to the NCEF, the sources said.

The committee in the report suggests that the Centre compensate the shortfall in the NCEF and put in place effective monitoring mechanisms to ensure full utilisation of the allocated funds.

The NCEF, now known as the Clean Environment Fund, was created in 2010-11 out of the cess on coal produced locally or imported, with the idea that the polluter pays for the financing and promotion of clean energy initiatives, including research. Through this kitty, government funds schemes such as the green energy corridor for boosting the transmission sector, the Namami Gange project, Green India Mission and the National Solar Mission.

The committee finding is most critical of the National Water Mission, run by the Ministry of Water Resources, River Development & Ganga Rejuvenation. Relying on the Niti Aayog’s Composite Water Management Index, 2018, the report states that the database on availability of water was “unreliable” due to the use of obsolete collection techniques and methodologies, they said. The water resources ministry has informed the panel that a comprehensive exercise to map all the water bodies in the country was being carried out.

This news can also be viewed at: