Market to Watch: Offshore Wind in India – Key policy advances can lead to rapid gains for the sector

2020 and beyond: Time to accelerate growth

While it is highly unlikely that India will meet its 5 GW offshore wind target by 2022, the 30 GW by 2030 target is feasible if rapid deployment takes place. So far, the first 1 GW offshore wind tender in Gujarat has been delayed and the government has underestimated the resource that would be required to set up a clear, stable tender and permitting process to attract investors to the market.

During the RE-Invest 2020 conference that was held last week, the MNRE Joint Secretary announced that the Indian government is looking into setting up structures for power purchase agreements as well as offshore wind auctions. As the Ministry of New and Renewable Energy (MNRE) continues to investigate a large project tender, the government is currently seeking feasible cost interventions from stakeholders for the first project. Approval of Viability Gap Funding (VGF) of €800 million will be essential to lower costs of this first project, and pave the way for many more projects to come.

Additionally, further offshore wind resource data and analysis will be needed to identify bankable project sites and revive industry appetite for this market which holds such high potential. NIWE’s plans to install five LiDARs would gather precise bankable data that would be critical to the realisation of offshore wind projects. These LiDARs would total 7.4 GW of indicative installable capacity, with two off the Gujarat coast and three off the Tamil Nadu coast. NIWE has also been allocated 75 acres of land, where they plan to establish the first National Offshore Research & Testing Facility 2019-29 in Tamil Nadu.

Ultimately, while it hasn’t been a smooth ride for the offshore wind industry in India so far, GWEC believes that India has a lot to offer when it comes to offshore wind and can become an important market for the industry moving forward. Now is the time to combine the technical preparation work that the Indian government has already done with clear and stable policies to provide long-term visibility and renew investor confidence.

GWEC India, a new local industry platform established by GWEC, is working to bring together relevant stakeholders and share best practices learnt in other emerging offshore wind markets. This will be important to address crucial issues for the offshore wind industry in India such as: articulating clear objectives towards cost reduction; sustained security over off-taker risks; transparent bidding and permitting process; and regular stakeholder engagement.

Through GWEC India and the support of all stakeholders, we can work to tap into India’s massive offshore wind potential to support the rapid decarbonisation of the country’s energy system, power the country’s growing energy demand and help maximise the environmental, socioeconomic and health benefits of offshore wind.

If you would like to find out more about GWEC India, you can visit the website here. If you would like more information on how to get involved GWEC India or to become a member, please get in touch at [email protected].