MNRE's draft sub-group report on wind energy-II: Unpredictability making it difficult for states to add capacity

The wind power sector in India is prone to several issues and challenges. Wind power, by its very making, being highly unpredictable, has made it difficult for states to add capacity without any linkages from load demand and power evacuation planning, along with a host of other issues, a few of which are elaborated below:

• The bane of wind capacity generation, according to MNRE, is skewed incentives which has shifted the focus from power generation to capacity addition. This is because benefits are linked with the installation cost on which depreciation is derived. This has lead to a situation where producers have been reduced to a perfunctory state of capacity addition rather than focusing on the functioning of the systems, resulting in inadequate performance and grid disturbances.
• Further the sub group has indicated that the industry lacks any long term (10 years or more) perspective, something which has resulted in high uncertainty. In addition, there is no prevalent conception of the market size and volumes which has added to the ambiguity surrounding the sector.
• Also, the existing duty regime in the country does not support indigenized production since it is much cheaper to import the finished product and assemble it than to manufacture in the country. The distortionary regime has, therefore, so far made it impossible to nurture the growth of Indigenous technology.
• Finally, the substantial offshore potential which the country offers, is yet to be put to good use. No systematic assessment of the same has yet commenced, even as MNRE has taken some initial steps, the process still is at the stage of firming the potential.