Union Minister of Power and New & Renewable Energy R. K. Singh. File

Union Minister for Power and New and Renewable Energy R. K. Singh on July 21 said that in order to achieve the net-zero carbon emission target, storing the renewable energy is necessary so that it becomes available round-the-clock.

Chairing the inaugural function of G20 14th Clean Energy Ministerial meeting and 8th Mission Innovation meeting in Goa, Mr. Singh also said that the governments will have to work on building storage capacities of renewable energy.

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Minister Singh said, “If you want to get to net zero (carbon emission), then you will have to store the renewable energy so that it is available round-the-clock and that is a problem. The cost of storage is huge. The G20 Ministerial meeting will discuss the problems that lie on the path of climate action, energy transition and the strategies to achieve it.”

“We kept talking about how important energy transition is and how important climate change is. But if we were actually serious, we would have more capacity of batteries. We have only one country doing it,” he said, without naming the country.

Mr. Singh said that another challenge is that the reserves of lithium are limited and the bulk of the reserves are tied up by just one or two countries. “That is a major problem which we need to solve,” he said.

“We also need to address the question of chemistry – why only lithium and why not sodium-ion (in manufacturing batteries). I would request – let’s get together and crack this challenge of storage,” the Minister said.

Talking about India’s initiatives in this area, Mr. Singh said that the country plans to use green hydrogen and green ammonia as storage.

“We are huge on pumped storage. We have 33,000 MW of pumped storage under different approvals. We have established 1,500 MW of pumped storage,” he said.

The Minister said that the G20 countries also need to address supply chain issues which were exaggerated by the COVID-19 pandemic and the Ukraine war. “India’s energy demand grew by 9.5% last year as the economy grew by 7.5%,” he said.

“The challenge is to add more capacity to the energy generation…We have added 1,82,000 circuit kilometres of transmission lines so that we can generate solar installations in Rajasthan and consume it anywhere. We have one grid-one market,” he pointed out. The Minister also cautioned about the use of low-carbon hydrogen.

“The problem with this one kilogram of hydrogen from natural gas will get you about 10 kilogram of carbon dioxide. How do we guarantee that it won’t leak out – that is a problem,” he said.

Preparations are are on for the 3rd G-20 Finance Ministers and central bankers meeting in Gandhinagar. File
| Photo Credit: ANI

India will push its Group of 20 partners at a meeting it is hosting to support its proposal to raise the share of taxes multinational companies pay to countries where they earn “excess profits”, government officials said.

India’s proposal, which has not been previously reported, could temper optimism among G-20 members such as Australia and Japan that the meeting of Finance Ministers and central bankers in Gujarat would make progress on a long-awaited overhaul of global corporate taxation.

More than 140 countries were supposed to start implementing next year a 2021 deal overhauling decades-old rules on how governments tax multinationals. The present rules are widely considered outdated as digital giants like Apple or Amazon can book profits in low-tax countries.

The deal, pushed by the U.S., would levy a minimum 15% tax on large global firms, plus an additional 25% tax on “excess profits”, as defined by the Organisation for Economic Cooperation and Development (OECD).

But several countries have concerns about the multilateral treaty underpinning a major element of the plan, and some analysts say the overhaul is at risk of collapse.

“India has made suggestions to get its due share of taxing rights on excess profits of multinational companies,” one official said. The suggestions have been made to the OECD and will be discussed “extensively” during the G-20 meeting on Monday and Tuesday, the official said.

Three officials, who asked not to be named as discussions with the OECD were ongoing and the G-20 meeting had not begun, said India wants significant increases in the tax paid in countries where the firms do business. They did not specify how much India is seeking.

India’s Finance and External Affairs ministries and the OECD did not respond to requests for comment.

Under the agreement, global corporations with annual revenues over 20 billion euros ($22 billion) are considered to be making excess profits if the profits exceed 10% annual growth. The 25% surcharge on these excess profits is to be divided among countries.

India, fighting for a higher share of taxes for markets where firms do business, is the world’s most populous country and set to become one of the biggest consumer markets. Indian people’s average income is set to grow more than 13-fold to $27,000 by the end of 2047, according to a survey by the People’s Research on India’s Consumer Economy.

The G-20 host nation will also propose that withholding taxation be de-linked from the excess profit tax principle. The rules now say countries offset their share of taxes with the withholding tax they collect.

Withholding tax is collected by companies while making payments to vendors and employees, and remitted to tax authorities.

The OECD in a document issued on Wednesday said a few jurisdictions have expressed concerns over allocating taxing rights among countries.

“Efforts to resolve these issues are under way with a view to prepare the Multilateral Convention for signature expeditiously,” it said.