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Will Indian Wind Turbine Makers Fold Up With Changing Competitive Pricing

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Fate of Wind Industry in India

The Indian wind turbine industry has been a big success story in the area of renewable energy manufacturing with Suzlon occupying the space of one of the top five global wind turbine players for a long time. There are also a number of other turbine manufacturers that have made a mark with Inox Wind being another big company.

Wind Eenrgy

However, the only bright spot in an otherwise sorry RE (renewable energy) manufacturing industry seems also to be going the dark way with the Indian government introducing competitive wind project pricing through reverse auctions which have drastically reduced the price of wind power in India. This has put a massive squeeze on margins across the supply chain with the wind turbine makers hit the worst! With safe and secure feed in tariffs becoming history, wind turbine players can no longer use it to make high profits. The days of 20% plus gross margin seem to be disappearing for the industry. Also, competition in terms of new large foreign players entering has also made the industry appear on the wobbly ground.

Suzlon which for many years of debt issues was looking to recover has seen its profits and orders plummet. Smaller player Inox Wind which does not have the technological or manufacturing prowess of Suzlon is in a worse shape. The company has already sold off its wind farm portfolio and may even sell off its wind turbine manufacturing facilities to Russian company Rosatom.

Also, read about Suzlon’s Solar strategy.

Russia’s Rosatom State Atomic Energy Corp. is exploring an investment in Inox Group’s wind turbine manufacturing business, said two people aware of the development.The Russian government company’s interest in India’s second largest wind-turbine maker by market share stems from its strategy to gain control over the supply chain, which in turn will help towards reining in costs and offer competitive tariffs in the country’s wind power space.

Source: LiveMint

The industry faces a severe test in 2017 after a record breaking 5.4 GW of wind installations in the last fiscal year which saw all players making handsome profits. This year the installations may not even reach 1.5 GW as the industry is totally dependent on the central government auctions since the states have refused to sign PPAs for even already constructed wind farms. With the nation facing a situation of surplus power and with solar energy reaching almost 10 GW annually, wind power faces a dull future. Unlike other countries, solar energy in India is cheaper than wind energy (INR 2.44/kWh vs INr 3.46/kWh).

Foreign companies which face saturated markets at home have further made it difficult for the Indian wind turbine players with increased competition.

Suzlon Energy Ltd. reported its lowest quarterly profit in a year as India’s support for auction mechanism to build wind energy projects slowed orders.The profit of 490.8 million rupees ($7.65 million) during the usually quiet fiscal first quarter compared with a loss of 2.6 billion rupees in the year-ago period, according to a filing to the Indian stock exchange late Friday. The previous three quarters each provided profit over 2 billion rupees.

Source: Bloomberg


Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to

2 Responses so far | Have Your Say!

  1. Vartika Agarwal

    This is a serious issue which needs to be addressed by the Govt. The world has been talking about Green Energy for quite some time and just the India market was warming up to the idea, there is a spanner of Reverse Auction. The experts need to resolve the issue with a win-win proposition, and fast.

  2. priybrat

    With at least six to seven hours of average sunlight, India has abundant potential for solar& thanks to new PV cell which requires less maintenance , Solar energy has edge over wind energy in India. Now al RE companies based in India have to change their technologies, policies to save their profitable margin.