Tamil Nadu continues to be by far India's leading wind state -- more than half of the capacity added in the first nine months of 2005, some 675 MW, went up there to bring its cumulative total to 2432 MW. Maharashtra, the state closest to Tamil Nadu for wind capacity, added just 48.8 MW in the same period and was put to shame by the state of Karnataka which saw over 200 MW installed and Rajasthan with 106 MW (table).
Among turbine suppliers, India's Suzlon, Denmark's Vestas and Germany's Enercon remain the big three in that order, easily accounting for more than half of all the capacity installed to date, with NEPC India close behind them in fourth position. All have bulging order books for the coming year, as does the Indian division of Danish rotor blade manufacturer LM Glasfiber.
While a long way to go before catching up with Tamil Nadu, Karnataka is emerging as another industry hub. LM Glasfiber is establishing a new blade production facility in the Karnataka town of Dobespet to make blades of 34 metres or more for multi-megawatt wind turbines. The factory, to be operational in the second half of 2006, will have an annual production capacity of around 400 MW. Production of smaller blades will continue at LM Glasfiber's existing facility in Hosakote near Bangalore.
Another turbine manufacturer is about to the hit the Indian market too. BeWind Power is a joint venture between EU Wind, a subsidiary of the UK's EU Energy, and leading Indian wind developer Indowind. EU Energy bought DeWind, a one time German turbine manufacturer, from the British FKI group. Initially BeWind is scheduled to supply 300 MW of EU Wind's DeWind D6 and D8 turbines, although they will rebranded as BeWind turbines, to developer Indowind for delivery from 2007 to 2009.
With India near to meeting its existing national wind target, the industry has stepped up calls for a dedicated national renewable energy policy accompanied by a regulatory framework incorporating legally binding new targets for renewables. Without a clear commitment to the long term, the industry fears investment could slow. Better grid infrastructure and system management is needed, along with improved grid regulation and grid codes sympathetic to the characteristics of renewable energy technologies, particularly in leading wind states such as Tamil Nadu. "While the potential in Tamil Nadu remains good the grid is saturated," says Sarvesh Kumar of turbine supplier Vestas RRB. "It cannot cope with further additions to capacity." With potential for another 2000 MW of wind, further extension to the Tamil Nadu grid is planned and is expected to be ready within six months.
Indeed, the national government and many states appear to be listening to the industry's pleas. Indowind's Rangarajan Balajee is confident. "The hallmark of any policy lies in its stability and consistency. States such as Tamil Nadu have shown this strength," he says. "With this, India has already climbed to fourth spot in the world market, although there is a big gap between the third and fourth place. I am sure the government is watching closely and I will not be surprised if major sops are introduced in the coming union finance budget."
Plans drawn up
Balajee may well be right. In August, India's president, Dr APJ Abdul Kalam called for "a comprehensive renewable energy policy" to be in place within one year to ensure India can become energy independent by 2030. Moreover, at a seminar on options for a possible renewables law, Vilas Muttemar of MNES confirmed a plan is being drawn up to enable India to add around 100,000 MW of new capacity by 2012, 10% of which would come from renewables -- half of this, 5000 MW, is expected to come from wind power.
To achieve these goals, new policies are on the way. While the details are still to be thrashed out and translated into state policies, the government just published new tariff policy guidelines and revised grid codes. State Electricity Regulatory Commissions (SERC) are being told to set percentage targets for the purchase of electricity from renewable sources, which is to be done via a competitive tendering process. The targets must come into effect by April 2006, says the ministry.
"It will take some time before non-conventional technologies can compete with conventional sources in terms of cost of electricity. Therefore, procurement by distribution companies shall be done at preferential tariffs determined by the appropriate commission," it adds. Moreover, the Central Electricity Regulatory Commission is directed to set guidelines for the pricing of power from renewables plant such as wind to be followed when procurement of new capacity is not through competitive bidding.
Wind map expands
States which have yet to create markets for wind power investment are beginning to act. In Orissa, the electricity regulatory commission issued an order in May 2005 directing Gridco and other electricity distribution licensees and trading companies in the state to compulsorily purchase 200 GWh from renewable energy for the financial year 2006-2007, equivalent to the output of 100 MW of generating capacity. The order came in response to a Public Interest Petition filed by Greenpeace India to consider introducing a regulation ensuring 10% of the state's power come from renewables.
"A demand for 200 million units is certainly a small first step," acknowledges Greenpeace's Shailendra Yashwant. "We invite the RE industry to take the next step and ensure that the supply is met." The Orissa Renewable Energy Development Authority must take the initiative to create the right business climate for investments, adds Greenpeace.
Kerala, which has the highest wind speeds in India at Ramakkalmedu in Idukki and an estimated potential for 875 MW is also a state of unfulfilled promise, with just 2 MW of wind so far. The Centre for Wind Energy Technology has identified 11 sites in the state for an initial 82 MW. Meanwhile, Uttar Pradesh Electricity Regulatory Commission has declared its tariff order for renewables, based on MNES guidelines, which provides for a power purchase price of INR 2.53/kWh, with an escalation of 5% per year from a base year set at 2001/02. Developers, however, are reluctant to risk wind exploitation in the mountainous north east region where civil unrest continues.
Whether all SERCs act in time for the April deadline and whether the preferential tariffs will motivate the so far reluctant electricity companies to co-operate, or enough to make wind projects viable, remains to be seen. No state government have yet introduced financial penalties for failing to meet percentage targets for renewables. But the political will to keep the wind market moving seems to be present in abundance.