Sops to keep the wind blowing

But the current wave of economic meltdown threatens to have an adverse impact on the wind energy sector in the state. This may bring down the electricity generated by the private wind farm projects by at least 100 MW in the current financial year.

The state government, apparently concerned over the adverse impact of the meltdown on wind power generation, is seriously considering to provide some special incentives to private players to maintain the momentum in the sector.

Highly-placed sources in the state Energy Department told Newsline on Friday that one of the major sops it proposes to dole out to the wind farm owners was increasing the power purchase rates from the existing Rs 3.37 per unit to Rs 4.50 or a little more.

The department is also considering relief in the Value Added Tax (VAT) being levied on the generation cost and in the purchase of wasteland for setting up new wind farms or expanding the existing ones, the sources said.

“There are other states, including neighbouring Maharashtra, that already offer higher power purchase rates to encourage private firms to generate more wind electricity. Keeping in view the current financial downturn, we have no other option but to provide some incentives, including a hike in the power purchase rates, to the private companies,” said a senior Energy Department official. The official added that the department would soon forward a proposal in this regard to the government.

Under the existing wind power policy announced by the state government last year, the wind turbine generators (WTGs) installed and commissioned during the five-year period (2007-12) are eligible for the incentives for a period of 20 years from the date of commissioning. Besides, the wheeling of electricity generated from the WTGs is allowed at a wheeling charge of four per cent of the energy fed to the grid as per the Gujarat Electricity Regulatory Commission (GERC)’s order.

In 2006-07, Gujarat had registered wind power production of just 284 MW, lagging far behind Tamil Nadu and Maharashtra that had recorded a generation of 577 MW and 485 MW respectively. But in 2007-08, Gujarat overtook both states with an energy production as high as 616.04 MW.

“In the current fiscal year, the wind power production in Gujarat is expected to go down by 100 MW due to the economic crisis. Hence, we propose to dole out some incentives to private firms to keep up the momentum of power generation,” said the official.

The Gujarat Energy Development Agency (GEDA), which is the state’s nodal agency engaged in the promotion and popularisation of renewable energy in the state, has set a target of about 4,000 MW of wind power generation by 2012.