Offshore wind energy in India is booming
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Over the next seven years, India plans to install as much as 140 Gigawatts (GW) of wind energy capacity to generate 50 percent of the country’s electricity capacity from non-fossil fuels by 2030. This presents huge opportunities for foreign investors, says wind energy expert Alok Kumar, director at consultancy DNV GL in India.
India’s first offshore wind tender
India’s Ministry of Energy (MNRE) recently announced that India’s first tender for leasing offshore wind power sites will be issued in July 2023. The tender covers four sites in the Gulf of Mannar, off the coast of India’s Tamil Nadu province. Each of the four sites will have space for 1 GW of wind turbines. If a utility wins the tender, it will be allowed to study the seabed, set up a wind farm and sell the electricity directly to customers. India has so far focused primarily on onshore wind projects, as regulatory changes in various Indian states have had to be made to allow offshore projects. As a result, India has been slow to develop offshore wind projects, despite having 7,600 km of coastline and significant potential to develop offshore wind projects.
India is ambitious in the field of green energy
While India currently generates 39.2 GW with onshore wind turbines and wants to double that capacity in the next four years, the development of offshore wind energy is only starting to take off this year. “The government is strongly committed to the development of wind energy,” says Alok Kumar, country manager in India for DNV GL on the phone. “In collaboration with the EU, India has drawn up a roadmap for the development of offshore wind farms on the coastlines of the states of Gujarat and Tamil Nadu over the past five years through the Facilitating Offshore Wind in India (FOWIND) consortium. This collaboration has created great interest in the knowledge and expertise of European companies.”
Government support for wind energy
Since offshore wind energy in India is four times more expensive than onshore wind energy, the central government in New Delhi will subsidize the development of offshore wind. For onshore wind energy, the Indian government changed the policy in 2017. To this end, the Indian government signed a contract with an energy supplier to purchase electricity at a fixed rate for a certain period (Power Purchase Agreement). Now, parties must register for a tender for the construction of a wind energy park and the party that offers electricity at the lowest price wins. This policy change initially caused turmoil in the market, stagnation of new projects and the disappearance of small market parties. “But the madness is now over,” says Kumar. “The development of new wind energy parks on land is picking up again and the price of electricity has now stabilized at 75 percent of the original price level.”
Know-how from Europe
Due to the collaboration with the EU, the offshore wind energy parks in India will be designed according to the European model, according to Kumar. “The production of wind turbines will take place entirely in India, but the know-how will have to come from Europe. So there are many opportunities for European parties that are active in the supply chain. Some European parties have been aware of this for a long time. Take Fugro, for example. In the preparatory phase, they have mapped the Indian seabed to determine where wind turbines can be safely placed. But not all parties are taking the Indian market seriously yet. I expect that to change very soon.”
