India’s current installed wind power capacity stands at 41,930 MW as of December 2022. Unlike the solar power segment, which is growing by leaps and bounds, wind power capacity additions have witnessed significant slowdown over the past five years or so. This year as well, only 1,572 MW of new wind power capacity was deployed during April-December 2022. This is despite the fact that wind power is a more mature segment than solar power, with more than three decades of history in India.
Many wind industry experts believe that the lull in capacity deployments in the wind power segment began after the expiry of the feed-in-tariff (FiT) regime to make way for competitive bidding. The FiT mechanism promised much higher tariffs than auctions. Meanwhile, the dearth of state-specific bids has limited capacity deployment pipelines. Land acquisition issues, grid curtailment and transmission unavailability concerns have further put a dent in the industry’s growth plans.
The government has made efforts to promote wind power deployment through innovative blending and hybrid schemes, which have only helped marginally. After repeated requests from the wind industry to urgently take action, the Ministry of New and Renewable Energy had formed a committee to assess the issues in the wind power segment and give recommendations to accelerate capacity deployment. Consequently, the government finally issued an order regarding the auction process in the wind power space in January 2023, bringing some respite to the industry.
According to this notification, 8 GW of total wind power capacity will be bid each year from January 2023 to 2030. Further, these bids will have state-specific sub-bids so that wind power capacity can be deployed in all windy states and not be restricted to just two or three states. This state-specific wind power capacity will be offered at a pooled tariff to offtakers. The Solar Energy Corporation of India will be responsible for issuing bids for a total of 8 GW till 2030.
This announcement is expected to give some visibility to the wind industry regarding future capacity deployments, and boost investor confidence in this space. Amendments to the competitive bidding guidelines are also expected soon, which will further help alleviate the industry concerns and hopefully lead to the revival of wind power growth in the country.