Budget 2017: Nothing for wind power sector

Arun Jaitley, finance minister of India, didn’t make any announcement for the rapidly growing wind energy sector in the country.

“We are not happy with the budget for 2017 as there is nothing concrete on the renewable energy sector, considering that it is one of the growing sectors in the country”, said Sarvesh Kumar, chairman of the Indian Turbine Manufacturers Association (IWTMA).

The Indian government has completely overlooked the wind energy division. The wind power sector is in a developing phase and needs attention from the government as we are facing various issues. Read more here.

Wind installations to cross 4000 MW

While the States of Andhra Pradesh, Gujarat, Rajasthan and Karnataka were the major contributors in the total wind installations in 2016 with their lion share of 3718.91 MW, the Indian Wind Turbine Manufacturers’ Association (IWTMA) is happy to note that in the financial year ending March 31 this year, the wind installations are expected to cross 4000 MW.

Noting that India had made significant commitment under the Paris Declaration and the CoP 21 to fight against the climate change, the IWTMA Chairman, Mr. Sarvesh Kumar, outlined that wind industry witnessed many path-breaking policies in 2016.

To name a few were the draft Wind-Solar-Hybrid policy, guidelines for development of Onshore wind projects and for prototype wind turbines, proposal for evaluation of small wind energy and hybrid projects, competitive bidding of 1000 MW of wind power and setting up of 1000 MW ISTS connected wind power projects.

While noting that the IWTMA had expressed its concern for the State Governments that needed to be incentivized by the Central Government to meet their RPO targets, Mr. Sarvesh Kumar, who is also the President and Chief Operating Officer of RRB Energy Limited, New Delhi, commended the Centre for waiving the Central Transmission Utility (CTU) charges in the competitive bidding up to 2019 besides announcing reduction in the duty structure.

Considering that 90 per cent of the investments came from the private sector in the wind sector, Mr.Kumar felt that the payment security “Must Run Status” and maintenance of RPO by wind States were vital.

Elaborating further that the National RPO and RPO by all the 29 States would bring about the much required traction for wind, Mr. Kumar wanted closer working of the industry with the Power Grid Corporation India Limited (PGCIL).

While admitting that competitive bidding will become the order of the day in the near future, Mr. Kumar said the open access and freedom to sell under the captive and group captive policy must be made available both for intra and inter-State transactions.

Outlining the key challenges ahead are the reduction in Accelerated Depreciation (AD) from 80 per cent to 40 per cent and possible withdrawal of Generation Based Incentive (GBI) would see some temporary slowdown in the wind industry, the IWTMA Vice-Chairman and President, SBD, Suzlon Energy Group, Mr. Chintan Shah, said the market was poised to settle around 6-7 GW per year from 2018 and beyond. Exports of around 2 GW per year from 2018 and beyond and wind-solar-hybrid and Repowering of 500 to 1000 MW each will help drive the industry in the next few years.

Mr. Shah outlined the outlook for the future of the wind industry including certain States not obligating the Purchase Power Agreement (PPA), delayed payment by certain DISCOMs, and 1000 MW bidding to be increased to about 5000 MW in the next two years. Mr.Shah noted that reduction of AD from 80 per cent to 40 per cent and non-continuation of GBI will also hamper the development of wind power. He also appealed to the Centre to favorably consider the recommendation made by the Union Ministry of Power for according zero rate tax for the Renewable Energy sector under the proposed GST regime.

Mr. Kumar said the IWTMA has partnered with the Global Wind Energy Council (GWEC) to organize a mega three-day exhibition and two-day international conference – “Windergy India 2017” from April 25 to April 27 at Hotel Ashok in New Delhi, where leaders from across the globe would deliberate and discuss the way forward and come out with solutions to tide over the key barriers faced by the wind energy sector.

Mr.D.V.Giri, Secretary General, IWTMA said Windergy India 2017 is a mega event by the industry and for the industry and the main theme of the event was “Wind Destination:India” and “Wind Power Forever”.

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