Indian Government Announces Policy and Regulatory Measures to Boost Renewable Power Generation

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Researched by Industrial Info Resources (Sugar Land, Texas)--The Indian government has taken policy and regulatory measures to assist the production of renewable energy in the country. During the second week of March, Dr. Farooq Abdullah, the minister for New and Renewable Energy, made the announcement while replying to a question in the Lok Sabha. In addition to providing renewable energy statistics on both installed capacity and future targets, the minister briefly outlined the policies and measures being implemented to provide an impetus to renewable power.

Click on image at right for details of India's renewable energy targets during the Eleventh Five-Year Plan.

Clean energy ventures in the country will be entitled to financial and fiscal support, such as subsidies on capital and interest; accelerated depreciation; and concessional and zero customs or excise duties.

Based on the National Electricity Policy 2005 and National Tariff Policy 2006, grid-interactive renewable power projects in most potential states will be entitled to preferential tariff.

States have been directed to fix a minimum purchase percentage of power from renewable power ventures under the Electricity Act 2003, after considering local conditions.

The Generation Based Incentive (GBI) Scheme for wind energy ventures is another option provided to Independent Power Producers (IPP) who do not wish to avail the benefits of accelerated depreciation. A GBI of $0.01 per unit of power uploaded to the grid, subject to a cap of $136,250 per megawatt (MW) is the current offer, which is applicable to wind projects with an installed capacity of up to 4,000 MW. For the first four years of operation, total disbursements a year are limited to $34,062 per MW.

On the solar power front, the recently launched Jawaharlal Nehru National Solar Mission is aimed at increasing the deployment of both Solar Thermal and Solar Photovoltaic energy systems. The first phase of the mission will last until March 2013, during which time 1,100 MW of grid connected solar plants and 200 MW of off-grid installations will be established as per target. Solar energy will be harnessed from an area encompassing 7 million square meters.

The renewable energy target for the 11th Five-Year Plan (2007-12) has been set as 12,300 MW, against which about 5,531 MW of grid-linked installations have been completed as of January 2010.

In tune with the government's initiatives, private players like Tata Power Company Limited (BSE:500400) (Mumbai), have ramped up their clean energy targets. Although Tata Power's primary clean energy source has been water, the company has set itself a wind power target of 2,000 MW by the year 2017. The company is looking for suitable wind farm sites in Gujarat, Tamil Nadu, Karnataka, and Maharashtra to set up fresh capacity. A 100-MW wind energy project is under way in Gujarat, while the farm at Visapur in Maharashtra, comprising 50 windmills each driving a 2-MW turbine, remains the largest installation in the country.

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