Economy

Facing a glut of tools, wind energy sector wants govt to push exports

V Rishi Kumar Hyderabad | Updated on May 27, 2019 Published on May 27, 2019

The wind energy sector, which has an installed capacity of about 36 gigawatt as of March, 2019, is passing through an odd phase of equipment glut. The sector has the equipment capacity of about 10,000 MW, but only 1,500MW has been installed as of 2017-2018. The rest is partly exported or not fully utilised.

The renewable energy sector contributed over 70 per cent to power capacity addition last year, but the wind sector’s contribution was low. The new government needs to bring in some policy tweaks to accelerate growth.

“Efficient wind energy equipment manufacturing capacity in the country has made it extremely cost-competitive. In fact, it is now cheaper to make wind energy equipment in India as against China,” said Ramesh Kymal, CEO, Siemens Gemesa,while pointing out that exports can address the problem of equipment glut.

“The difference between India and China manufacturing and why the latter gets more competitive is due to lower freight charges. To encourage exports, the government could consider lowering freight charges,” Kymal told BusinessLine.

Kymal said the country’s wind energy installations have crossed 36 GW as of March, 2019. In spite of a drop in prices in the past few years, incremental growth has been slow.

The government has set a target of achieving 60 GW of wind power by 2022. “The lowest tariff of ₹2.42 per unit was recorded a couple of years ago. But that cannot become the benchmark for pricing today since there was a equipment glut and the demand was lower at that time,” he said.

Pricing could be about ₹3 a unit, which is still lower by about ₹2 a unit procured by various States.

Kymal said, “The country is a promising market for hybrid projects as we have many States rich in both wind and solar energy resources. Optimal utilisation of resources and complimentary nature of wind and solar outputs is the main driver. If these are coupled with energy storage, hybrids can become a source of firm power.”

Kymal said there is a need to ensure wind and solar projects do not get concentrated in some pockets of the country.

Published on May 27, 2019
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