Indian Wind Industry

The bad news has finally come in, that the Indian wind energy market halved in 2012, compared to the previous year. Only 1700 MW wind turbines were sold in this year compared to around ~3500 MW solar in 2011. The reason for the sharp decline was the removal of the accelerated depreciation and GBI incentives. We had already flagged the problem much earlier that wind farm developers were reluctant to invest given the lower returns. Note the wind market globally has been under pressure due to decrease in incentives. The US market has cooled considerably after a hot 2012 (due to pending expiry of FTC). The Chinese market is saturated while Europe is declining.

Read more about Wind Energy Companies in India.

The only silver lining is that local the Indian wind turbine producers managed to increase their market share with Regen at the No.3 position and Inox gaining the No.3 positions. Suzlon lost its top slot to German wind turbine maker Enercon, though both saw their absolute sales crash. GE also gained market share through sales of its low wind speed turbines. 2013 should be a better year for the companies with the federal government re-introducing the generation based incentive (GBI).

GBI to be Reintroduced in India

Problems Faced by the Indian Wind Industry

The Indian Wind Industry has been facing problems and installations have fallen off sharply as two of the most popular subsidies have been taken away by the Government in March 2012. This coupled with local factors particularly in the biggest market of Tamil Nadu has taken the sheen of the wind energy industry.

Wind Companies are also facing capital escalation of costs with the prices of materials like steel and cement showing a sharp appreciation leading to a 30-40% increase in the cost of wind farms. The rise in costs with a fall in electricity tariffs are squeezing the wind energy developers. Wind energy installations in Tamil Nadu which accounts for almost 40% of the wind capacity in India, has already dropped. With the industrial conditions getting worse it is expected that the trend will continue and wind capacity could drop to just 1000 MW from 3000 MW last year. This would have a devastating effect across the wind equipment supply chain.

Hindu Business Line

Wind turbine manufacturers Enercon and Suzlon have fared better than others in the tepid market of 2012-13, when the total capacity installed during the year fell to 1,700 MW. It was 3,164 MW the previous year. Enercon led the market in 2012-13 with installations of 453.60 MW, followed by Suzlon at 414.75 MW. The previous year, Suzlon was the leader with 1,148 MW and Enercon No.2 with 767 MW. Inox and GE gained, while Spanish wind power major Gamesa lost ground.

The surprise this year was Gamesa, which was No. 4 in 2011-12, with installations of 312.35 MW. Last year, the company was edged out of the ‘top five’ club, to position No. 6. Installations during the year were 99.70 MW, including 10.20 MW sold abroad.The Government has since brought back the generation-based incentive and the industry hopes that the current year will be much better.