INOX Wind aims to lower cost of generating electricity

INOX Wind aims to lower cost of generating electricity“Our aim is to become the preferred supplier of wind power solutions and cater to the majority of wind IPPs, corporate and distribution utilities,” emphasises Devansh Jain, Director, INOX Wind Ltd.INOX Wind, a fully integrated player in the wind energy market, is one of the largest wind turbine manufacturers in the country. INOX Wind has manufacturing plants for key components like blades, towers, hubs and nacelles which ensure high quality, most advanced technology, reliability and cost competitiveness. Devansh Jain talks about its strategy in becoming the preferred wind power solutions provider.INOX as a group has a presence across diverse businesses, including industrial gases, refrigerants, chemicals, carbon credits, cryogenic engineering and entertainment. What encouraged you to venture in to wind power business?In 2006, unlike today, the wind energy industry in India was not that attractive. Way back then, developed countries in Europe and USA had announced mandatory renewable purchase obligation (RPO) targets. At that time, our group company, Gujarat Fluorochemicals Ltd., became one of the world’s first projects to generate carbon credits. The company was closely associated with the United Nations Framework Convention on Climate Change (UNFCCC), the Climate Change Task Force and a lot of other global bodies in climate change.Although on a per-capita, India was not very polluting, but as a country it was one of the most polluting countries globally. The INOX Group saw the writing on the wall that renewable energy would have to play a key role in the future. That is when we decided to diversify into the wind energy business.GFL mandated McKinsey & Company to carry out a diversification study and jointly developed an implementation plan for the sector. INOX Wind was formed to manufacture turbines in India, and INOX Renewables Ltd. was formed to invest in renewable energy as an IPP.Brief us about the services and solutions you provide in the wind power sector.INOX Wind is a fully integrated player in the wind energy market. By last year, it was the 4th largest wind turbine manufacturer in the country. INOX Wind has manufacturing plants for key components like blades, towers, hubs and nacelles which ensure high quality, most advanced technology, reliability and cost competitiveness. INOX Wind WTGs are equipped with DFIG (Double Fed Induction Generator) technology and have one of the largest rotor diameters (93 m) in its class, and the turbines are Type III which are suitable for Indian climatic conditions and low wind sites.INOX Wind offers turnkey solutions for the entire wind power project from concept to commissioning. These include wind assessment, arrangement of land and power evacuation (sub stations and power lines), infrastructure development, all statutory approvals, supply of WTGs, civil works, erection and commissioning, and long-term operation and maintenance of wind farms.INOX Wind aims to be a ‘fully integrated wind energy player in India’. Could you explain about your current operations and future expansion plans? INOX Wind has two manufacturing facilities: an 800 MW plant in Himachal Pradesh for nacelles and hubs, and a 500 MW unit in Gujarat for rotor blades and towers. These units are spread across 17 acres and 32 acres of land respectively and were commissioned in 2010 at a combined investment of more than Rs. 2 billion. The company plans to enhance its blade and tower manufacturing capacity to 800 MW. This, however, is subject to the right policies impetus being provided for the growth for the wind sector.What are your short- and long-term strategies in achieving this goal?Our aim is to become the preferred supplier of wind power solutions and cater to the majority of wind IPPs, corporate and distribution utilities. Our short-term strategy in achieving this goal is to offer wind projects in states preferred by customers, based on conducive state polices and remunerative tariffs. Our long-term strategy is to lower the cost of generating electricity by manufacturing more efficient turbines. We also aim to spread our wings across a larger number of states.

Our long-term strategy is to lower the cost of generating electricity by manufacturing more efficient turbines. We also aim to spread our wings across a larger number of states.Being an Indian WTGs manufacturer, what are the challenges you face?The biggest challenge faced by wind energy sector is policy uncertainty. The industry has seen a huge setback due to the withdrawal of AD and GBI. Competitive bidding in states is another challenge. Besides regulatory issues, there are hurdles in land acquisition and lack of adequate transmission facilities. In the high-wind season, wind turbines operate at 70 per cent availability in some states. Investors cannot make profits in absence of proper grid infrastructure. There is also a need for a strong mechanism with penal provisions to enforce RPO obligations across states.Furthermore, there is no separate loan quota for renewables in the financial sector as renewable energy is clubbed into power quota. The cost of one big thermal power project of 1,000 MW capacities is around ` 5,000- 6,000 crore. The entire quota gets ceased if one such company takes a loan. Renewable energy investors do not get funding at the right time, at the right cost. Renewable energy projects are smaller in size and should have their own quotas.What are the strategies you have adopted to keep abreast with the international players?In terms of technology, we offer extremely modern, advanced wind turbines in the country, incorporating advanced features such as active pitch control, double fed induction generator (DFIG) and one of the largest rotor diameters. As the wind market is extensively tracked by analysts and research reports, we are always aware of what is happening in the wind industry. Also, our technology partner AMSC Windtec is one of the leading technology providers globally. Through a host of other market intelligence mechanisms, we keep ourselves abreast with what is happening in the domestic market as well as the international market.Clarity on GBI and AD are the much-awaited announcements for wind-power sector. What is your take on these? How are they going to make industry more investor friendly?FY 2012-13 was a catastrophic year for the wind industry due to various policies being discontinued. While GBI has been restored in the budget, there is still no clarity on AD. The number of manufacturers that installed wind turbines dropped to 11 in 2012-13 with the top five controlling about 90 per cent of the market.If policy measures are reintroduced and state tariffs are remunerative enough, India’s wind sector will see vibrant growth. Many IPPs have emerged recently who are backed by foreign investors and private equity funds that are ready to implement projects subject to reasonable returns.Are you also looking to export and global expansion?Once we consolidate our position as the preferred wind solutions provider in the Indian market to increase our volumes, we would look at exports and global expansion.What is your current order booking and what is your target for the current fiscal?We have a target of achieving 500 MW this year. We have a robust order book and with policy clarity expected in the near future, we hope to bag more orders.

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