After a weak FY18, the outlook for the wind sector has brightened in the ongoing fiscal, with capacity addition expected to increase 42% y-o-y to 2,500 MW in FY19. However, this would still be short of the 4,000-MW target set by the government for FY19, as part of the goal of building 60,000 MW wind capacity by 2022. At 34,293 MW on June 30 this year, India\u2019s wind capacity is the fourth highest in the world. The growth in capacity addition in FY19 would happen on the back of recent project awards. Projects of 10,000 MW capacity have been awarded by the Solar Energy Corporation of India (SECI) and NTPC, as well as state distribution utilities, between February, 2017 and September, 2018. Yet, the last couple of years have seen a loss of momentum in capacity addition \u2014 wind energy capacity addition had peaked at 5,500 MW in FY17 \u2014 especially since the government announced competitive bidding for projects, replacing the earlier feed-in-tariff (FiT) regime with a market-driven one. The drop in tariffs to below Rs 3\/kWh levels has also been considered unviable by project developers, with projects being cancelled even after the end of the award process. In what is being seen as a positive, bid tariffs discovered in September-October auctions inched up to Rs 2.77 per unit from the low of Rs 2.43 per unit reached in December, 2017. It was on account of tariff lows that a mere 1,700 MW capacity was added in FY18, as against the target of 4,000 MW. The tariffs stood at Rs 4.16 per unit just a couple of years ago. Experts believe such low tariffs put a question mark on the viability of wind power projects in the long term. In August, a 2,000-MW wind power tender had to be cancelled owing to lack of interest from developers. Low tariffs have also led to cancellation of orders with wind turbine makers. Suzlon Energy, one of the world\u2019s top wind-turbine makers, saw its net earnings plunge from Rs 48 crore in Q1FY18 to a loss of Rs 575 crore in Q1FY19. The company withdrew its revenue guidance for the year, citing \u201cnear-term market uncertainties\u201d. Inox Wind, another local equipment maker, reported a lower net profit of Rs 10.37 crore in the June quarter compared to Rs 11.81 crore in Q1FY18. Animesh Damani, founder and CEO of Artha Energy, an advisory firm, highlights three challenges being faced by the sector. First, while the current benchmark price of Rs 2.73 per unit is viable for re-powering of around 4,000 MW of low-intensity wind turbines set up in the 1990s, the upgrade of substations and evacuation infrastructure poses a challenge, he says. Second, low tariffs are not good as far as maintaining the quality of wind turbines being used for projects is concerned. Third, severe deficit on the front of evacuation infrastructure in remote locations is leading to cancellation of auctions, leaving developers cold. \u201cThe government will have to address these issues if it wants ready participation from developers in wind auctions,\u201d he says. D. V. Giri, secretary general of the Wind Turbine Manufacturers\u2019 Association, is more optimistic of the sector\u2019s prospects. \u201cThe drop in capacity addition is primarily on account of the change in procurement method from feed in tariff (FiT) to competitive bidding. While it is true that some wind states have stopped procuring wind power, this is a transitory phase which will pass, not being a constraint in manufacturing or the appetite of developers,\u201d he says.