The central government on Friday allowed state-owned power giant NTPC to invest more than the ceiling of 30 per cent of its networth in its subsidiary NTPC Green Energy Ltd (NGEL).
NTPC's net worth stood at Rs 1.28 lakh crore, as per its annual report for the financial year 2021-22.
This assumes significance given the NTPC's ambitious target of 60 GW of renewable energy by 2032. Presently, the maharatna central public sector undertakings require approval of the Union Cabinet to invest an amount more than 30 per cent of its net worth.
"Cabinet approves exemption to NTPC Ltd from the extant guidelines of delegation of power to Maharatna CPSEs for making an investment beyond the prescribed limit in NTPC Green Energy Ltd," an official statement said.
It has also exempted NGEL's investment in NTPC Renewable Energy Ltd (NREL) and its other JVs/subsidiaries (joint ventures), subject to a ceiling of 15 per cent of its net worth beyond the monetary ceiling of Rs 5,000 crore to Rs 7,500 crore, towards achieving a target of 60 gigawatts of renewable energy (RE) capacity by parent NTPC Ltd, the statement added.
In line with its commitment to COP 26, India is working towards a low carbon emission path while meeting its development goals. The country is aiming to reach 500 GW of non-fossil energy capacity by 2030.
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According to the statement, NGEL has 15 green assets of 2,861 MW, which are operational/nearing commercial operation date (COD) and through its subsidiary, NREL (NTPC Renewable Energy Ltd) is set to expand its RE (renewable energy) portfolio by participating in competitive bidding and multiple emerging opportunities in the green energy business.
The exemption given to NTPC will aid in improving India's global image as a green economy, it explained, adding that it will also decrease India's dependency on conventional sources of energy by diversifying its energy generation and will also decrease the country's coal import bills.
Further, it will also help in ensuring a 24x7 power supply to each and every corner of the country, the statement said.