Wind Energy Sector Requires Market-Led Incentives: IIM-Ahmedabad Research Report

IIM-Ahmedabad (IIM-A) has announced that a paper authored by the researchers recommended that wind energy in India has become market competitive and thus it should be pulled more by the market forces rather than being pushed by the government incentives.

A paper titled ‘Financial support vis-à-vis share of wind generation: Is there an inflection point?’ in journal Energy authored by Dipti Gupta, Abhiman Das and Amit Garg studied the financial support model of 15 countries and 10 states of the US between 2006 and 2017.

Prof Garg expressed that India is at the fourth position in the global ranking for installed wind capacity. “Annual growth rate of installed wind capacity in India is gaining pace over the recent years. This trend is expected to continue over the next decade especially with the government targets of reaching the 500GW renewable capacity by 2030,” he said.

The researchers believed that certain US states and countries such as Denmark have large wind generation share of total power generation owing primarily to the government policies, huge generation potential and ambitious wind targets. “Such countries have provided sufficient support for promoting the deployment of wind in the past through various means such as feed-in premiums, auctions, tax incentives or subsidies. However, overall the trend is shifting towards market-based incentives as wind technology has matured over the past decade. India is also shifting towards such mechanisms especially with the rising stress on Renewable Purchase Obligation (RPO) under the national tariff policy,” said Gupta.

Furthermore, the researchers said that the wind energy is not as profitable as solar owing to complexity of the technology involved. While solar panels are convenient to handle, wind involves huge turbines which are difficult to transport.