Govt to pool wind energy bids to diversify projects

: The central government is working on a plan to pool wind power bids to diversify projects across states that have the scope for it, power minister RK Singh said, adding that his ministry is targeting bids of at least 8 GW per year of wind energy to boost the sector.

The move comes at a time when wind energy installations have slowed in the country, even as the government has set a target of setting up wind energy projects totalling 140 GW by 2030. Against this target, India has an installed capacity of about 40 GW of wind projects, data from the ministry of new and renewable energy showed.

“We are lagging behind in harnessing wind energy. What happened 3-4 years ago was that distribution companies (discoms) used to buy wind energy on the basis of feed-in tariff. Thereafter, discoms became reluctant to buy feed-in tariff as they shifted to more market-oriented methods,” Singh told HT.

“Now, in bids also, the cost of wind has stagnated at around ₹3 per unit, which they (discoms) find more expensive than the energy charge rate (ECR) of thermal power plants,” he explained. “Hence, wind energy has seen a downward trend.”

Land is another issue, Singh said. “The entire capacity addition is being done in some states and not in all states that have potential for wind energy,” he said.

To be sure, most of India’s potential (95%) to harness wind energy is in seven states — Gujarat, Rajasthan, Tamil Nadu, Maharashtra, Madhya Pradesh, Karnataka and Andhra Pradesh. Since land required for onshore wind farms are gradually becoming a constraint, with its cost increasing manifold due to concentration of wind potential in only certain pockets, the government is also going to push for offshore wind projects.

“Soon we will come up with a pooling system. We will call for bids in all windy states, then we will pool those bids and offer wind power at one rate,” the minister said. “The same I will do for solar as well.”

“The idea is that by and large everyone gets electricity at a particular rate. More importantly, the early mover will not lose out in this process which is currently happening now in all the competitive bids,” Singh said. “For five years, the rate will be a rolling average rate. My target is to have bids of at least 8 GW per year of wind.”

On July 22, the power ministry released its long-term growth trajectory of renewable purchase obligation (RPO) and energy storage obligation till financial year 2029-30. For 2022-23, the government has mandated that 24.61% of the total energy consumed in a discom’s area will have to be from renewable sources.

The RPO, for the first time, includes a mix of 0.81% wind power, making it mandatory for discoms to purchase wind energy. Earlier, wind power used to be included in the so-called others category, which made it optional for discoms to buy it. Other RPOs include 0.35% from hydropower and the remaining 23.44% from other renewable sources.

The government has worked out the parameters for bids for offshore energy and plans to keep the charges very low, Singh said.