India may use money raised from a tax on coal producers to fund new transmission lines that would help distribute power from clean energy projects.
A proposal is being prepared for the Finance Ministry to distribute the money to states expecting significant amounts of renewable energy capacity that don’t have the infrastructure to utilize the power that will be generated, said Pramod Deo, chairman of the Central Electricity Regulatory Commission.
India’s transmission network only delivers electricity to one out of three Indians, an obstacle that threatens the growth of Asia’s second-fastest growing major economy, the International Energy Agency said in September.
India’s coal tax, which took effect on July 1, is expected to raise 25 billion rupees （$554 million） in the first year and will be used for clean energy projects, according to Environment Minister Jairam Ramesh. Both imported and domestically mined coal, which fires more than half of the nation’s electricity generation, is taxed at 50 rupees a metric ton.
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