Wind power industry set to get a shot in the arm

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: renewable energy law with renewable purchase obligation (RPO) would be a major tool in the hands of the government to promote renewable energy generation, Giri said. According to the information given by the minister of State for New and Renewable Energy (MNRE), Vilas Muttemwar, in the Rajya Sabha, between June 2004 and February 2008, 12 State Electricity Regulatory Commissions (SERC) have fixed annual RPO ranging from 2% to 10%.

The first SERC to fix RPO was Madhya Pradesh (10%), followed by Orissa (450 million units), Tamil Nadu (10%), Andhra Pradesh (5%), Uttar Pradesh (7.5%), West Bengal (3.8%), Kerala (5%), Gujarat (2%), Maharashtra (3%, annual increase of 1%), Rajasthan (7.5%), Haryana (3-10%) and Karnataka (minimum 10%).

However, IWTMA feels that there is much to be done. There is no national level policy for wind, no guidelines for determination of tariff for wind as in case of thermal and hydro, only half the states have an RPO and no state, except Maharashtra, has proper implementation or monitoring mechanism. There is also no accounting of renewable in case of transmission and distribution planning.

IWTMA suggests that states with inadequate renewable energy generation capacity should be allowed to purchase it from states with a surplus to meet their obligation. Similarly, utilities should be allowed to collect a surcharge for green power from the consumers.

Giri said a generation-based incentive (GBI) without any cap and revenue neutral to accelerated depreciation is the most essential policy initiative to attract FDI and IPPs. MNRE has initiated a GBI scheme just for 49 mw at 50p a unit. Only grid-connected projects set up in approved sites would be eligible for this.