Lower module and component costs are projected to support 5-7 lakh green jobs over the next decade.New Delhi: The recent cut in the goods and services tax (GST) on renewable energy equipment from 12 per cent to 5 per cent will save power distribution companies up to ₹3,000 crore annually in procurement costs, Union Minister of New and Renewable Energy Pralhad Joshi said on Wednesday at the ET Energy Leadership Summit 2025.
“We are not just generating green power, we are also building the machines that generate it,” Joshi said, noting that the rate cut is already resulting in companies lowering prices of solar modules and cells.
According to the Ministry of New and Renewable Energy, the rationalisation of GST rates across the renewable value chain is expected to bring down the cost of clean energy projects by 3-4 per cent, directly benefiting households, farmers, industries, and developers.
A typical 3 kW rooftop system under the PM Surya Ghar: Muft Bijli Yojana will now be cheaper by about ₹9,000–10,500, while 10 lakh solar pumps under PM-KUSUM will collectively save farmers around ₹1,750 crore.
The reform is also expected to boost domestic manufacturing under Aatmanirbhar Bharat, with India targeting 100 GW of solar manufacturing capacity by 2030. Lower module and component costs are projected to support 5-7 lakh green jobs over the next decade.
“Green growth is also smart economics. With solar rooftops and pumps, consumers get reliable power, while states save thousands of crores,” Joshi said, urging global investors and climate funds to step forward, calling India’s renewable energy sector “one of the safest and most attractive destinations for green capital”.
Officials estimate that faster renewable deployment enabled by the GST cut could avoid an additional 50-70 million tonnes of CO2 emissions annually by 2030, as India targets 500 GW of non-fossil fuel capacity by the end of the decade.
- Published On Sep 24, 2025 at 01:11 PM IST
