In the early 1980’s, the Department of Non-conventional Energy Sources (DNES) came into existence with the aim to reduce the dependence of primary energy sources like coal, oil etc in view of the Country’s energy security. The DNES became Ministry of Non-conventional Energy Sources (MNES) in the year 1992 and now from 2006, the Ministry was renamed as Ministry of New & Renewable Energy (MNRE).
The growth of Renewable Energy in India is enormous and Wind Energy proves to be the most effective solution to the problem of depleting fossil fuels, importing of coal, greenhouse gas emission, environmental pollution etc. Wind energy as a renewable, non-polluting and affordable source directly avoids dependency of fuel and transport, can lead to green and clean electricity.
With an installed capacity of 21136.3 MW (March 2014) of wind energy, Renewable Energy Sources (excluding large Hydro) currently accounts for 13.86 % of India’s overall installed power capacity of 228721.73 MW. Wind Energy holds the major portion of 66.7 % (of 31707.2 GW total RE capacity) among renewable and continued as the largest supplier of clean energy.
In its 12th Five Year Plan (2012-2017), the Indian Government has set a target of adding 18.5 GW of renewable energy sources to the generation mix out of which 11 GW is the Wind estimation and rest from renewable sources like Solar 4 GW and others 3.5 GW.
(Source: Report of The Working Group on Power for Twelfth Plan 2012-17, Govt. of India, Ministry of Power)
The industry has represented its capability with good policy frame work to achieve a reference target of 15,000 MW, realistic target of 20,000 MW and an aspirational target of 25,000 MW in the plan period of 2012-2017.
The Wind Potential in India was first estimated by Centre for Wind Energy Technology (C-WET) at 50m hub-height i.e. 49 GW but according to the new survey at 80m hub height, the potential grows as much as 102 GW. This figure was adopted by the government as the official estimate. However, Lawrence Berkley National Laboratory (LBNL) has stated the potential is over 300 to 400 GW.
One of the major advantages of wind energy is its inherent strength to support rural employment and uplift of rural economy. Further, unlike all other sources of power, wind energy does not consume any water-which in itself will become a scarce commodity.
Overall the future of Wind Energy in India is bright as energy security and self-sufficiency is identified as the major driver. The biggest advantage with wind energy is that the fuel is free, and also it doesn’t produce CO2 emission. Wind farm can be built reasonably fast, the wind farm land can be used for farming as well thus serving dual purpose, and it is cost-effective as compare to other forms of renewable energy.
(Numerical Data Source : CEA, CWET, MNRE)
The manufacturing industry (IWTMA) is equipped proven technology from Europe with turbine size ranging from 250 KW to 2.1 MW of various technologies of stall, pitch, direct drive turbines with hub heights up to 100 meters and rotor size also up to 100 meters. The modern turbines are designed to harness even in low and medium wind regimes. The manufacturers have over 40 models and with a manufacturing capacity of over 9000 MW per annum.
With the time tested legal and fiscal system and India as a growing fast track economy is considered as a favored destination for industrial activity. This is proved by the fact that out of the 19 GW almost 95% is from private sector.
The entire wind energy industry is governed by solid foundations from the Electricity Act, viable regulatory procedures from CERC and other state regulatory policies. In the recent past, the tariff announced by states like Maharashtra, Andhra Pradesh, Madhya Pradesh, Kerala, Gujarat, Tamil Nadu and Rajasthan make investment attractive for a meaningful IRR.
The paradigm shift from retail market to the IPP market with major investors like Goldman Sachs, Black Stone, IDFC and others is proven demonstration of the interest of the private sector.
Capital cost in India is perhaps one of the lowest in the world and India is emerging as the fastest growing supply chain hub with many industries choosing for in-house manufacture of towers, blades, generators, convertors etc. The commercial arm of MNRE, IREDA and other financial and banking institutions has backed the industry as a stable market where there is assured off take and no marketing challenges. The recent announcement of the Prime Minister of India during the Clean Energy Ministerial in New Delhi to double the renewable energy in the next five years would attract an investment of over 4000 MW per annum.
The country would require over 7000 MW per annum to achieve 15% by all renewable by year 2020 under the National Action Plan for Climate Change.
The Government commitment to promotional tariff, incentivizing generation, plans to revitalize the REC market through RPO obligation will certainly make this market vibrant and self sustaining.