The Rajasthan government has unveiled the Rajasthan Investment Promotion Scheme (RIPS) 2024, designed to enhance large-scale investments in renewable energy, battery energy storage systems, and green hydrogen technologies.
RIPS 2024 aims to drive renewable energy development in Rajasthan through a stakeholder-driven approach by lowering operational and setup costs and contributing significantly to India’s national target of 500 GW RE capacity by 2030.
The policy includes several incentives to promote renewable energy investments in the state.
Exemptions and Reimbursements
The following exemptions and reimbursements are applicable for RE units:
- 100% exemption from electricity duty for seven years
- 75% exemption on stamp duty and reimbursement of the remaining 25%
- 75% exemption on conversion charges with reimbursement of the remaining 25%
- 100% reimbursement of mandi fees/market fees for seven years.
RE units are exempt from Pollution Control Board fees for obtaining Consent to Establish and Consent to Operate certifications to help streamline regulatory processes and reduce initial compliance costs for setting up RE projects 100% subsidy on cross-subsidy surcharge (CSS) and additional surcharges (AS) for RE generated and consumed within the state for the production of green hydrogen for a period of seven years and governed by the Integrated Clean Energy Policy of Rajasthan.
Transmission and Wheeling Charges
- Exemptions are provided on transmission and wheeling charges for RE units and BESS.
- RE-integrated storage projects with a capacity of 5% of the RE capacity will be eligible for exemption of 75% on transmission and wheeling charges for a period of seven years
- For standalone battery storage systems (BESS) exceeding 5% of RE capacity, additional exemptions of 1% on transmission and wheeling charges are offered for every 1% increase in storage capacity, up to 30% capacity. Beyond 30%, the projects are exempt from 100% transmission and wheeling charges.
- Standalone BESS is exempt from 100% transmission and wheeling charges for supply of power during peak hours or non solar hours for a period of seven years.
- BESS connected to the 11 kV or 33 kV grid sub-stations are exempted from 100%transmission and wheeling charges for a period of seven years.
- Also, if a RE plant supplies energy to a green hydrogen plant within the state, 50% of the energy supplied is exempted from transmission and wheeling Charges for a period of seven years. This policy is only applicable for green hydrogen plants governed by the Integrated Clean Energy Policy of Rajasthan). The eligibility criteria and limits for CSS, AS, and transmission and wheeling charges related to green hydrogen projects will be governed in accordance with the applicable provisions of the Integrated Clean Energy Policy of Rajasthan.
Captive Renewable Power Projects
Under the programme, upto 51% of the investment in captive RE projects, including solar energy projects, are categorised under the Eligible Fixed Capital Investment. For group captive power projects with agreements over 12 years, 100% of the investment is counted towards the EFCI, helping such projects qualify for higher capital or investment subsidies.
Captive RE projects are granted a 100% exemption from banking, wheeling and transmission charges. These projects also receive a 100% exemption on land tax for seven years and there is no cap on the capacity of captive solar power plants. Captive solar power plants can bank 100% of their energy and withdraw it without restrictions during peak hours.
For “behind the metre” RE projects, there’s no ceiling on maximum generation capacity, and these projects are forever exempt from electricity duty, provided they do not inject power into the grid during off-peak hours.
Capital and Investment Subsidies
RE projects can avail capital subsidies based on project size, with mega or ultra projects receiving more.
- Investment subsidy: A 75% reimbursement of the SGST due and deposited for a period of seven years. The ceiling amount is INR 10 crore per annum for the first three years and INR 15 crore per annum for the fourth to seventh year.
- Capital subsidy: A subsidy of 13–28% of the EFCI, disbursed in annual installments over 10 years. The percentage of subsidy depends on the project’s EFCI.
- Turnover-linked incentive: An incentive of 1.20–2.0% of the net sales turnover, disbursed annually for 10 years. This provides ongoing financial support after the project installation.
Carbon Credit Trading System
The renewable energy sector is on among the ten sectors approved by the Bureau of Energy Efficiency for the Carbon Credit Trading System.
Additional Benefits for Power-Intensive Sectors
Manufacturing enterprises in power-intensive sectors that use RE receive a 5% reimbursement on state taxes or a 5% point reimbursement on natural gas for seven years.
In addition to these incentives, the scheme encourages sustainable practices. Eligible companies can access benefits up to a maximum of Rs 12.5 crore, including a 50% reimbursement of environmental project costs and a 50% waiver on consent fees under the Rajasthan Green Rating System. Companies that have already invested Rs 50 crore in Rajasthan are also eligible for a 10% subsidy on machinery utilizing clean production technology.
