Green Energy Relief: Solar Cookers, Heaters, Biogas & Wind Devices May Soon Attract Just 5% GST
Renewable energy gets a boost as the GST Council proposes slashing tax on solar, biogas and wind equipment to just 5%, lifting green stocks into focus.
Green Energy - Taxscan
Green Energy - Taxscan
The 56th meeting of the Goods and Services Tax (GST) Council was held at Sushma Swaraj Bhavan in New Delhi on September 03, 2025, chaired by Union Finance Minister Nirmala Sitharaman. The Council has proposed cutting the GST on renewable energy equipment such as solar cookers, biogas plants, solar water systems, and windmills from 12% to just 5%.
The reduced rate will apply to the following devices and their parts used in manufacture:
- Bio-gas plants
- Solar power-based devices
- Solar power generators
- Windmills and Wind Operated Electricity Generators (WOEG)
- Waste-to-energy plants/devices
- Solar lanterns and solar lamps
- Ocean waves/tidal waves energy devices/plants
- Photovoltaic cells, whether or not assembled in modules or made up into panels
- Solar water heaters and systems
For households and businesses, this could mean major savings. Clean‑energy tools like solar cookers and wind-powered devices often carry higher upfront costs. The GST cut is expected to reduce system prices and might also accelerate the adoption of sustainable options in rural and urban areas alike.
Market analysts say this policy signal has already put renewable energy stocks in the spotlight. Shares of companies like Adani Green, Tata Power, Waaree Energies and NTPC Ltd are expected to gain traction as improved affordability boosts demand.
At the same time, the GST Council’s move comes alongside tougher rules on fossil fuels. Coal, lignite, and peat have been moved into a higher 18% tax slab making traditional energy more expensive by comparison. This shift further underscores India’s tilt toward cleaner energy sources.
The new GST structure across goods and services is scheduled to take effect from September 22, 2025. The exact timeline for renewable energy equipment will depend on official notification but industry insiders expect the benefits to reach the market soon.
On balance, this reform marries household relief with India’s larger sustainability goals. For investors, businesses, and clean-energy champions, the message is loud and clear: green power is about to get even greener on your wallet and the planet.
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