Plan panel wants cess on polluting energy sources

New Delhi, Feb 21 (PTI) The Planning Commission todaypitched for a cess on polluting energy sources like petroland diesel to cross subsidise the clean energy initiatives inthe country.

"There is very strong case for introducing cross subsidyby charging a cess on polluting energy specifically in orderto subsidise non-polluting energy," Deputy Chairman ofPlanning Commission Montek Singh Ahluwlia told a conference onClimate Change.

Ahluwalia said, "Unless we make it (non-polluting energy)self sufficient, the promotion of clean energy like wind andsolar will all become subject of the actual amount ofsubsidy that can be provided in the budget."

The government, he said, "has taken a very important stepin this direction last year by introducing a five per centcess on coal whether imported or domestic to create greenenergy fund which will be used to support either research orimplementation of such projects."

According to him in the absence of such cess on pollutingenergy like petrol and diesel, the clean energy initiatives inthe country would have to be dependent on government subsidy.

In that case it had to compete with plethora of subsidies inother areas.

"We have a lot of humane social subsidy requirements forhealth, livelihood and education. If we add on an additionalsubsidy requirement for climate change...we will not get thefull amount," he pointed out.

Ahluwalia also stressed on the need for aligning country''senergy prices with the global rates and said, "because theclimate change is ultimately caused by the use of fossilfuels, one critical issue is that we must have correct energyprices."

"The underpricing of energy based on fossil fuels inwhatever form is only an encouragement to use more energy. Itwould be impossible in my view to achieve the objective of(programmes on )climate change, if they are not embedded inoverall policy framework where energy prices are notsubsidised."

Ahluwalia also stressed on the need for raising usercharges on water for activities like its recycling andtreatment.

The amount of water used by poor is very very low andmost of the underpricing of water is used by the non-poor, headded.

"We need to raise user charges to cover some of theactivities. The cost of recycling water should be borne by theusers so that poor can be insulated from bearing such costs,"Ahluwalia said. PTI KKS CS