Gone with the wind

When the wind energy sector was opened to private investors in 1993, there was a virtual boom. However, after the initial rush of activity, promoters and investors seem to be taking a breather now. The establishment of wind farms has fallen far short of the target. According to the International Energy Agency, India is among the five countries in the world accounting for more than 80 per cent of the global wind energy capacity. But, while wind energy development has been a major success in Western nations, particularly in Europe, it has been a dismal failure in India

Published: Wednesday 30 June 1999

Gone with the wind

-- tapping the potential of wind power is no longer difficult or expensive. Technology to harness this natural force is not only improving, but more nations are finding this alternative source of p ower more desirable because it is locally available, cheap to produce and does not dirty the environment. It is no wonder that wind power has already become the world's fastest growing renewable energy source ( see box: Why wind energy) .

Global wind generating capacity has expanded at an annual rate of 25.7 per cent during the 1990s, and now stands at more than 10,000 megawatt (mw). Denmark, Spain, Germany and usa have emerged as leaders in wind energy development. For Europe alone, the European Wind Energy Association has set a target of 40,000 mw by 2010 and 1,00,000 mw by 2020. With technological advances, the cost of generating wind power has continued to decline, and wind promises to become a major power source globally in the next millennium.

Within the developing world, the largest wind industry is in India. The Washington-based Worldwatch Institute ( wi) recognises India as a "Wind Superpower". In India, wind energy development boomed during the period 1993-97 and the country rose to become one of the world's fastest growing markets for wind energy; both in terms of potential and rate of installation. In terms of capacity installed, India is placed just behind Germany, Denmark and the United States ( see table: Where India stands ) .

Between 1993 and 1997, growth in wind energy sector represented approximately 6 per cent of new generating capacity installed in the country. And the government set an ambitious target of installing 3,000 mw generating capacity by 2003. But, today, the country is still far from achieving this. Out of the 20,000 mw wind energy potential in the country, only 1,025 mw had been tapped by March 1999.

When the government opened the field of wind energy development to the private sector in 1993, companies queued up in front of the ministry of non-conventional energy sources ( mnes ) office. The incentives proved too hard to resist. Small and large companies alike were keen to grab a piece of the cake. Under the garb of setting up wind farms, many companies acquired sunny seaside properties and availed of all the sops (see box: Free for all ).

The sites were chosen, windmills set up but power did not flow. Where they succeeded, investors did not find the returns from sale lucrative enough. There is no incentive to sell power. Private producers could only sell power to the grid, which, according to them, is not commercially viable. It is not surprising that the power sector has stopped being so lucrative an industry for private investors and investment in the wind sector has plummeted in the years after 1997 (see graph: Out of wind ).

The crores of rupees invested in the wind energy sector has largely gone to waste. Today, many wind farms are lying idle. And few that are working are falling far short of their generating capacities.

In their haste, both the promoters and their consultants seem to have forgotten a lot of things. They did not pay sufficient attention to selection of locations with the result that machines were erected at sub-optimal locations. "Their inexperience shows in the drafting of the purchase orders, wherein many relevant technical specifications were not mentioned," says K Phanindra Reddy and O Subamaniam in an article "Wind Power to Stay" in ireda News . "Hence the gap between estimation and the actual generation was only a logical consequence.

Kirit S Parikh, director, Indira Gandhi Institute of Development Research ( igidr ), Mumbai blames government policies that provide subsidies to set up plants, but do not encourage sale of power to the grid. "We started from the wrong end. The government should give subsidy to power producers on actual power generation and not capital subsidy," he says. Till 1997, some Rs 30 billion had been invested in the wind energy sector.

Some blame the halt in the expansion of the wind energy sector on the suspension of generous tax benefits. But C S Kamalanathan, former secretary of mnes , says, "The new policy was formulated to discourage small operators as they seemed more interested in availing tax benefits than producing wind power." Of the 1025 mw wind power generated in the country, commercial projects (private investor/developer) account for more than 90 per cent of the supply. But 70 per cent of the investors at present account for only 30 per cent of the power produced. "These companies are only interested in short-term gains (subsidies)," says R Suresh, research associate, wind energy, Tata Energy Research Institute ( teri ), New Delhi. It is the remaining 30 per cent of the investors who generate 70 per cent of the total wind power.

In terms of total installed capacity, India ranks fourth in the world

(in MW)
Germany 2,081 25.00
Denmark 1,116 223.00
United States 1,611 6
India 940 1.00
Spain 512 13.00
The Netherlands 329 22.00
United Kingdom 328 5.60
China 146 0.12
Sweden 122 13.00
Italy 103 1.80
Greece 29 2.90
Canada 25 0.86
Japan 18 0.14
France 13 0.22
Australia 11 0.60
Russia 5 0.03
Brazil 3 0.02
Source: Anon 1998, Denmark: Birthplace of Modern Wind Power, briefing paper(one-seven), Greenpeace International, Amsterdam, mimeo

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