Govt fumbles for 145;power146; as wind energy is left untapped

The scenario appears all the more hazy in the state of Gujarat that has about 1252.9 MW of installed wind power as per March 2008 figures. It may be mentioned here that the Gujarat government had announced its Wind Power Policy on June 13, 2007 with an intention to promote clean and green energy to reduce carbon dioxide emissions. But the wind farm energy experience has not been pleasant so far.

The fiscal and financial incentives provided by the Ministry of New and Renewable Energy MNRE, Government of India, which include concessions such as 80 per cent accelerated depreciation in the first year, concessions in custom duty on specified items, excise duty exemption, sales tax exemption and income tax holiday for 10 years are already attracting investors. Also, the Gujarat government8217;s policy has virtually made entry into the wind energy business a lucrative affair, as within one year of its commissioning the power plant can become free of cost.

The Wind Power Policy 2007 of Gujarat includes incentives for Wind Turbine Generators for a period of 20 years, provision for wheeling of electricity at a 4 per cent charge, provision to sell power to any entity at higher prices i.e. third party sale, exemption from electricity duty and demand cut to the extent of 30 per cent and even raising the rate of sale of power to GUVNL to Rs 3.37 per unit.

Although MNRE introduced a scheme recently with provisions to give Rs 0.50 per unit of wind power generated, in addition to the tariffs fixed by the state electricity boards, all the above listed incentives, both at the Central and state levels are being offered on the capital investment done and not on the real power generated.

Another important point to be noted is that these sops and tax bonanzas do not differentiate between different plant load factors PLF, which is a measure of average capacity utilisation of a power plant. As per the data supplied by MNRE, the PLF in Gujarat is 7.8 per cent, way below the national average of 15 per cent and far too low than the global average of 25 per cent. No substantial effort to increase the efficiency of wind power plants adds to the notion that investment and not generation is the focus in wind energy business.

Even the Renewable Portfolio Standard, which means obligation on the electricity suppliers to produce a specified fraction of their electricity from renewable energy sources, is as low as 2 per cent in Gujarat. This has virtually restricted the green energy growth in the state. Also, the major increase in installed wind energy can be directly linked to the provisions of Kyoto Protocol.