Wind Power in India Reasons for Slowdown Ways to enhance Growth

1. by Mr. Madhusudan Khemka -Managing Director Regen Powertech Private Limited Wind Power in IndiaReasons for Slowdown&Ways to enhance Growth

2. Renewable energy in India: History Government of India recognized the enormous potential of Renewable Energy for national development and created the following organizations: Commission for Additional Sources of Energy (CASE) was established as early as 1981. Ministry of New and Renewable Energy Sources (MNRES) established in 1992 with special focus on Non conventional Energy sources. Each state has its own set up to support activities like GEDA, MEDA, KREDAL, etc. India is the first country which has set up separate ministry for New and Renewable Energy Sources

3. Historical Perspective Market was mainly fiscal incentives driven till 1996 � No specific focus on generation During 1996 � 1999, Market experienced extremely low installations in view of uncertainty of fiscal benefits. & general industrial slowdown in the country Shift in market perception and private sector considered wind energy as source of power generation since 2000. Major growth is being experienced since 2003.

4. Down turn After a period of explosive growth that made India the third largest producer of wind power in the world, investments fell sharply from1996 onwards. The following reasons attributed to this downturn: Decrease in benefits accruing out of tax-credit due to introduction of the MAT (minimum alternate tax); and reduction in corporate income tax by the Government of India in 1995/96 and 1996/97 respectively. Low capacity factor achieved by the wind farms on account of sub-optimal site selection and poor quality turbines. . General industrial slow-down in the country

5. Paradigm Shift�.. A positive fall out of the downturn has ensured only serious investors remained, leaving out those investors whose prime interest was to take benefit of tax credits. Investors focus on technologically superior turbines better utilization of the capacity minimize dependence on the fiscal incentives Shift in market perception and private sector considered wind energy as source of power generation since 2000. Major growth is being experienced since 2003.

6. Turnaround The scenario started looking up in 2003 and the upswing is still continuing. The main factors that contributed to this positive growth are: Technological maturity and introduction of machines, suitable for the Indian conditions (e.g. wind turbines designed for low wind regimes) resulted in overall higher capacity utilization. Introduction of higher capacity and more cost-effective wind turbines Better site selection due to more sophisticated and rigorous wind resource assessment and micro siting Conducive policy regime introduced by some states (Maharashtra was one such state that came out with an investor friendly policy, including attractive power purchase prices).

7. Growth A booming economy and the attractive policies provided the impetus for accelerated growth of the wind power sector