COMING WITH THE WIND

The stock market is optimistic, but it will take more than that for the surviving airbenders to regain the past glory of India's first green-energy sector

- SHREYA JAI

There has never been a dull year for wind energy in India, not in the last decade anyway. One of the earliest green energy solutions, which drew interest from film stars and cricketers, slowly lost its sheen. Foreign companies fled, local ones shut down, and the sector majors went back to the drawing board. In the middle of this, wind energy capacity addition fell to record lows. As the sector dusts itself and rises again, there are not many who have lived to tell the tale.

10 years of tempest

During the 2000s, the wind energy sector ran on a tax benefit scheme, Accelerated Depreciation (AD), which could be availed of by anyone who set up or invested in a wind farm, irrespective of the power generated. A portion of the project cost was paid back by the Centre. This scheme was solely responsible for the take-off of the sector and investment by high-net-worth individuals.

Between 2012 and 2016, tax benefits and incentive schemes for wind energy witnessed mercurial changes. The erstwhile United Progressive Alliance government announced generation-based incentive (GBI) in 2011 and retired the AD scheme. GBI provided wind power producers 50 paise per unit on the power generated.

In 2012, GBI was abolished, only to be reintroduced in 2013 for four years. During this period, the capacity addition fell to 1.7 gigawatts (Gw) - half of what was added the year before.

In 2017, the National Democratic Alliance government at the Centre introduced competitive bidding for awarding wind power projects. The sector till then worked under the 'feed-in-tariff' (FIT) regime, in which the power price would be in accordance with the project cost. The idea was to introduce more competition and reduce wind power cost.

In the first auction, wind power tariffs fell to ₹3.46 per unit from the prevailing ₹5-6 per unit.