The Natural Energy Processing Company (NEPC) in the southern state of Tamil Nadu manufactures wind turbines on licence from Micon of Denmark. The company is planing an even closer co-operation with its Danish partner and is ready for modern wind turbine technology says Micon. Both the Tamil Nadu government and the state utility are strongly encouraging companies to become independent wind power producers. Tamil Nadu has now 40 individual companies producing their own power. NEPC, among other initiatives, has set up a joint venture with LM Glasfiber of Denmark to produce blades in order to be able to manufacture all components in India.

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Of the around 120 MW of wind power now operating in India nearly 70 MW has been developed using wind turbines supplied by the Natural Energy Processing Company (NEPC) in the southern state of Tamil Nadu. Built on licence from Micon of Denmark, orders for a further 55.4 MW, for delivery by March 1995, are currently on NEPC's books.

The company is also planning a 100 MW wind farm on 1500 acres of land already acquired in Tamil Nadu. Last month it floated a Euro Issue for $100 million to finance the scheme. Chairman Ravi Prakash Khemka says a further $15 million may be raised depending on the response of international investors. Work on the 100 MW project has started and a further 500 acres is being acquired. Khemka says the wind power project is "one of the biggest undertaken by any single company in the world." The bond issue is being managed by Jardine Fleming.

The regions earmarked for the 100 MW are Kethanur near Palladam in Coimbatore district and Muppandal in Kanyakumari district. Land prices in these areas have risen steeply as a result. In Muppandal an acre now fetches over INR 250,000. In Kethanur, where generation is reduced by 10-15%, an acre is fetching INR 30,000. The increase in land prices makes wind power popular with the local people, many of whom are becoming rich overnight.

With a generating capacity shortfall of 4000 MW in the state, Tamil Nadu Electricity Board (TNEB) recently hiked the buying price of electricity from INR 1.25/kWh to INR 2.0/kWh, maintaining its wheeling levy at 2%. It has also agreed to buy power from NEPC-Micon's 100 MW wind farm at the existing high tension rates, currently fixed at INR 2.10/kWh. "Any company that comes forward with more than 100 MW of wind power will be offered a tariff at high tension rates," says TNEB's S Narayanaswamy. According to Khemka NEPC-Micon's return on the 100 MW wind farm will be INR 500 million a year as profits from the venture are not liable for tax (see main story). "This is only likely to increase as the price of power is highly unlikely to come down," he adds.

There is no doubting NEPC's business acumen. Of the 70 MW of turbines supplied so far, some 30 MW of these have been sold to private companies -- a pioneering achievement by NEPC which has done much to prove the viability of wind as a commercial proposition and get the market moving in India. The remaining 40 MW has been developed as government or utility demonstration projects, including the original 10 MW supported by Danish aid organisation, Danida, which five years ago got wind energy going in Tamil Nadu.

In a state with a chronic power deficit the chance for a company to secure a steady supply of power by operating its own power plant is an attractive proposition. With both the state utility and the Tamil Nadu government encouraging companies to become independent wind power producers, wind energy development has proceeded at speed. Nearly 68 MW has been installed in the state, some 19 MW by TNEB and India's Ministry of Non Conventional Energy Sources. The remaining 48.455 MW has been installed by private companies. NEPC has supplied 31.2 MW of these turbines, Vestas 11.025 MW, Wind World 5.19 MW and TTG 1 MW. "Tamil Nadu is in an enviable position. Forty individual companies have installed wind turbines. We're now exploring new areas to set up wind farms. Rameshwaram and Ramawadi have shown promise of good wind potential," says TNEB's Narayanaswamy.

NEPC is a sprawling dynamic conglomerate with a wide range of industrial interests, including a newly purchased airline. Headquartered in Madras it was the company's younger generation who became fascinated by wind energy. A deal was struck with Micon and NEPC has been steadily producing 200 kW wind turbines since 1989.

The relationship with Micon is now entering a new era, according to the Danish company's director, Ole Bøgelund Nielsen. In the future, Micon will supply about 60% of the value of wind turbines made by NEPC. These will be a new design, the M700 225 kW. The turbine is a development of the 200 kW made by NEPC until now. According to Khemka, the 225 kW will be more effective in low wind regions such as in Andhra Pradesh and Gujarat. Micon is also setting up an Indian division to provide management services to NEPC. "NEPC has about 350 employees. That's five or six times the number we've got at Micon to do the same amount of work," explains Micon's Svend Enevoldsen. The Danish company will help NEPC streamline its production line. "The relationship between the two companies will be far more intimate," adds Bøgelund Nielsen.

Enevoldsen also points out that India is now ready for modern wind turbine technology. It cannot supply this without assistance from established wind turbine manufacturers. There are other reasons for the new co-operation, too. "The competition on the Indian market is suddenly getting tougher. It is a significant market benefit to strengthen the connection between NEPC and Micon," explains Enevoldsen.

Larger machines are not viewed with any great enthusiasm in India -- not only does their size pose installation problems, but also in the event of a major failure. "If a 600 kW suddenly stops delivering to the grid in India it is a catastrophe. If they have three machines delivering the power and one stops, that isn't such a problem," he explains. Micon says the quality of the wind turbines made in India is indistinguishable from those made in Denmark. "There is virtually no difference -- and they have learned that specialised parts have to come from Denmark," says Enevoldsen.

Blade manufacture

As part of NEPC's aim to make all wind turbine components, not just import them, the company has also set up a joint venture with Danish blade manufacturer, LM Glasfiber. The blade production unit first established is now being shifted from Madras to Bangalore because of technical problems coping with the humidity of Madras. Khemka says the NEPC blade unit will turn out 300 sets of blades per year. Financing for the factory will not be raised on the open market as is being done for the 100 MW project.

Other NEPC wind initiatives include the purchase of the Gujarat Wind Farms Ltd wind development at Mandvi. Khemka says that land has been identified in Gujarat "where a minimum of 300 kW can be installed" and NEPC will be looking to develop projects in the northern state, too.

Also being installed are ten, 400 kW Micon machines as part of NEPC's demonstration project at its Muppandal site where one of the two original DANIDA wind farms -- projects which created the first serious interest in the state -- is located. "We will watch their performance for three to six months. If they give optimum utilisation we will introduce them to our clients," says Madhu Sudan, director of NEPC-Micon. He expects the 400 kW will only become a more economic proposition than the 225 kW Micon when it is made entirely in India. "This is subject to agreement with our collaborators," he adds. In addition, five Micon 600 kW machines are planned for installation by NEPC by September 1995. Currently, Indian import duty on complete wind turbines is 25%, although only 20% duty is applicable for conventional power plants. But Khemka is not disturbed by this. "More incentives will ruin the industry," he shrewdly comments.

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