The ‘Indian wind energy outlook, 2009’ prepared jointly by the Global Wind Energy Council (GWEC) and the Indian Wind Turbine Manufacturers Association (IWTMA) considers that wind energy can provide up to 24% of the country’s power needs by 2030. It can also attract Rs 47,500 crore investment every year and create over 2.13 lakh green collar jobs and reduce 550 crore tonne of carbon. The GWEC secretary-general Steve Sawyer believes that though India is already an established force in the global wind energy markets, it has the potential to achieve so much more. Sawyer who was recently in India, spoke to FE?s Joseph Vackayil about the various aspects of wind power development and the problems that stand in its way in India. Excerpts:
India has opened up wind industry for foreign direct investment, still the response has been restricted to forming joint ventures or setting up subsidiaries for turbine/component manufacture, wind farm developers seem to be shying off, what would be the reasons?
From the perspective of an outsider, I think the main reason is that so far there has not been much space in the Indian market for independent power producers, but that seems to be changing. There is also the currency risk and the lack of a clear prospect of the government?s intentions in terms of opening up the market, plus the fact that the system is governed by individual states, makes it fragmented. However, the foreign manufacturers do in fact run projects themselves. I know that for Vestas, India is the only country in the world where they do run wind farms themselves. Also, the difficulties with land tenure would set off alarm bells for foreign developers looking to invest. Having said that, many of the major manufacturers are already in India.
What more do you think the Centre and industry should do to attract FDI to wind farm development sector?
I think the move to a generation-based incentive along with the tariffs that are now agreed in different states will help. But a clear statement of intention, a policy statement, from the Central government to make wind a significant part of India’s energy future (as it has done for solar) would be attractive to developers.
In the global context, what does GWEC expect from the Copenhagen climate summit?
GWEC has submitted its proposals already. The most important among them are; deep emissions reductions by industrialised nations by 25-40% below 1990 levels by 2020 and to drive private investment in the right direction, expanded carbon market mechanisms, particularly along the lines of a sectoral crediting mechanism for the electricity sector and public finance which facilitates private investment, spent on capacity building, regulatory and fiscal measures, etc.
Will GWEC take the lead in creating a fund in the World Bank or Asian Development Bank to facilitate sectoral credit mechanism to de-carbonise economy in the developing countries?
We will support such efforts, but this is an intergovernmental agreement governing the use of public finance, and therefore we won’t be ?leading? in that sense. However, I am one of the (two) private sector advisors to the Clean Investment Funds (specifically, to the Clean Technology Investment Fund) which were set up last year and which are being administered by the World Bank. This programme shows some positive elements, and it seems that at least this fund has some promise.
Any system to make the wind turbine manufacturers accountable for the partial or non-performance of the machines they deliver?
All reputed turbine manufacturers sell their machine with warranties, which guarantee the performance in terms of the power curve; and most have service warranties that are at minimum one year but usually at least two years, and it is not unusual to have agreements of three years or more. Of course, nobody can guarantee the wind, but the power curve guarantee is something fundamental.