Wind energy will continue to the backbone of India's renewable energy pursuits. With an average net wind power capacity addition of 1.7 GW per year over the past five years, the focus on wind energy appears to be getting only sharper. A key enabler to India's wind energy pursuits will be a sound manufacturing base for towers, turbines and related components. This special study by Venugopal Pillai brings you closer to recent developments in the Indian wind power equipment industry, and attempts to present the key challenges in store.

The wind turbine industry in India is fast evolving as it gears up to meet the huge growth in wind energy installations. In recent times there has been significant interest in global wind turbine manufacturers setting up shop in India, some on their own and others in collaboration with Indian partners. There is also an upcoming breed of domestic companies that are raring to go solo in the manufacture of low-rating wind turbines.

Average size of WTG installations
(kW)
	2004	2005	2006	2007	2008	2009
China	771	897	931	1,079	1,220	1,360
Denmark	2,225	1,381	1,875	850	2,277	2,368
Germany	1,715	1,634	1,848	1,879	1,916	1,977
India	767	780	926	986	999	1,117
Spain	1,123	1,105	1,469	1,648	1,837	1,897
Sweden	1,336	1,126	1,138	1,670	1,738	1,974
UK	1,695	2,172	1,953	2,049	2,256	2,251
USA	1,309	1,466	1,466	1,669	1,677	1,731
Source: GWEC

It is estimated that the total annual capacity of WTG (wind turbine generators) in India is currently anywhere between 3,000 mw and 4,000 mw. Precise numbers are difficult as several players are new and production has yet to stabilize. It is encouraging to note that over the next 2-3 years, India's WTG manufacturing capacity could be augmented by at least 1,000 mw, given the ambitious plans of existing and new players.

The Indian manufacturing base is projected to serve both the domestic and international markets. According to Indian government estimates, exports of indigenously made wind turbine generators amounted to $600 million (around 2,800 crore) during 2009-10, destined to countries like Australia, China, Brazil, USA, Portugal and Spain. Exports of WTG components and blades were valued at another $6 million in that year.

Currently, there are around 20 manufacturers that make turbines of 250kW or higher. There are of course small local manufacturers that make turbines of lower rating but their market share is declining as such equipment is fast getting obsolete. Wind turbine installations in India are currently of 600KW or higher.

The WTG manufacturing base in India is quite sound with practically all leading global names like Enercon, Vestas, Siemens, Vensys, AMSC, Gamesa, etc already present in the subcontinent. In fact, domestic company Sulzon is amongst the global wind energy giants, both as an equipment manufacturer and power producer.

IFC makes first exposure to Indian WTG industry

International Finance Corporation, part of the World Bank Group, recently made its first investment in an Indian wind turbine manufacturer. IFC has decided to provide €11 million loan to Gamesa Wind Turbines Pvt Ltd that is building a wind turbine assembly unit in Chennai, Tamil Nadu. IFC's loan will support Gamesa's plans to scale up its assembly capacity in India over the next two years. "Our project with Gamesa represents IFC's first investment in a wind-turbine manufacturer in India, and we are committed to supporting energy generation from renewable sources to reduce greenhouse-gas emissions," said Sergio Pimenta, IFC Director for Manufacturing in Asia. "The investment will help address India's energy deficit and sustain its forecasted trajectory of economic growth," he added. With 11 GW of installed wind capacity, India is the fifth-largest wind market in world. Since 2005, the country has seen a steady increase in installations, a statement by IFC noted.

Over the past year, there has been a spurt in the plans of multinationals planning to set up manufacturing facilities for WTGs. It is not only about growth in the number of players, it is more about the elevation in technology standards. For instance, the average size of WTG installations, measure in terms of turbine capacity is poised to increase substantially from the current 1.12 mw (see table). India might soon have direct-drive turbines that can harness electrical energy even from low-velocity winds.

The following is a summary, over the past one year or so, of prominent names that have announced their plans of entering or furthering their presence in the Indian WTG and components market.

Siemens: This German engineering giant recently announced plans of producing its SWT-2.3-113 (Direct Drive) wind turbine in India. This 2.3-mw WTG with a direct drive is specially designed for low-velocity conditions. Siemens will manufacture this and other turbines at Vadodara, Gujarat. The production at Vadodara is slated to commence in 2013 with an annual capacity of 250 mw which will be scaled up to 500 mw by 2015 to meet market demand. The company is additionally investing in an R&D technology center at Vadodara. Late last year, Siemens announced its plans of entering the renewable energy business in India. Apart from wind energy, Siemens will also pursue opportunities in solar power equipment.

Kenersys: Kenersys India, part of the Kalyani (Bharat Forge) Group, very recently launched its new K100 2.5-mw turbine. Equipped with Kenersys' "Synerdrive" technology, the turbine will be manufactured at the newly-inaugurated Baramati plant in Maharashtra. The turbine was launched in the global market in 2007 and is being used by Vattenfall, considered as amongst the largest wind power utility globally. The Baramati plant is set up over an area of 35 acres and a built up area of 5,600 sqm. Apart from the K100 turbine, the production facility will also manufacture the K82 2.2-mw turbine.
 

WTG Manufacturers in India*
Company	WTG Ratings
(KW)
Elecon Engineering	600
Enercon India	800
Essar Wind	1500
Emergya Wind Technologies	750, 900, 2000
Gamesa	850, 2000
GE Wind	1500, 1600
Ghodawat Energy	1650
Global Wind Power	750, 2500
Inox Wind	2000
Kenersys India	2000
Leitner-Shriram	1350, 1500
Pioneer Wincon	750
ReGen Powertech	1500
RRB Energy	600, 1800
RK Wind	600
Siemens	2300
Suzlon	600, 1250, 1500, 2100
Vestas India	1650, 1800
WinWinD	1000
Xyron Technologies	1000
*List is not exhaustive; excludes makers of low-rating WTGs
Source: GWEC

Gamesa: In March this year, Gamesa, the Spanish wind energy company announced that it would invest in a new blade and nacelle factory and a tower factory (in joint venture) in India. It also launched its R&D Centre at Sholinganallur in Chennai. Gamesa had launched its operations in India in February 2010 with setting up of an Indian subsidiary, Gamesa Wind Turbines Pvt Ltd. The Indian venture of Gamesa has notched up an impressive turnover of about 1,000 crore in its first year in India and has exciting plans for the coming years. Gamesa India is pioneering the Re-Powering initiative which aims at using the existing wind energy resources on site more efficiently, with technically advanced and high performance turbines. (Re-powering is discussed separately in this story.)

Powergear & Gestamp JV: In March this year, Chennaibased Powergear Ltd formed a 60:40 joint venture with Gestamp of Spain. The joint venture will invest 150 crore to set up a facility for the manufacture of wind towers. The plant of Gestamp Powergear Windsteel is coming up on 20 acres in the Sri City industrial estate, some 60 km north of Chennai. Gestamp is a €5 billion company that is into a variety of businesses, but mainly in the supply of cut and pressed sheet metal forms to the automotive industry. Powergear is a 140-crore company that makes electrical equipment, such as busducts, and has among its customers, big names such as GE, Mitsubishi Electric, Siemens, ABB and Alstom. The upcoming plant at Sri City, expected to be operational by December, can produce 400 towers a year, with an estimated market value of 500 crore.


RRB Energy: RRB Energy has planned to start manufacture of 1.8-mw capacity wind turbines. The company is also in the process of expanding its range of blades required for WTGs with the inclusion of the 13m length blade for the 225KW turbine, in its existing portfolio. The company's second phase of expansion at its existing manufacturing site at Poonamallee, Chennai is in an advanced stage of completion. This expansion involves an investment outlay of around 100 crore, which is likely to be completed this year. On completion, the company expects to achieve an overall production capacity of 700 mw during FY12.

RE-POWERING
The gradual increase in India's WTG capacity is explained by the huge wind power potential that the country is endowed with. Official estimates suggest that India's gross wind power potential is an astounding 45 GW of which only 13.065 GW was harnessed as of end-December 2010. Hence around 70 per cent of the potential yet remains untapped. Over the past 5-7 years, the average annual addition of new wind power capacity has been in the range of 1.3 GW to 2.2 GW. However in the years to come, the average annual growth in capacity is likely to be much more and this would warrant the need for matching WTG manufacturing capacity.

Leading Wind Energy Nations
Rank	Country	Capacity* (MW)	% chg	% share
1	China	44,733	73.4	22.7
2	USA	40,180	14.5	20.4
3	Germany	27,214	5.6	13.8
4	Spain	20,676	7.9	10.5
5	India	13,065	19.6	6.6
6	Italy	5,797	19.6	2.9
7	France	5,660	23.7	2.9
8	UK	5,204	22.6	2.6
9	Canada	4,009	20.8	2.0
10	Portugal	3,898	10.3	2.0
11	Denmark	3,752	8.3	1.9
12	Japan	2,304	10.5	1.2
13	Netherlands	2,237	1.0	1.1
14	Sweden	2,163	38.7	1.1
15	Australia	1,880	9.8	1.0
	Grand Total	197,039	24.0	100.0
*Capacity and % share as of December 2010 % chg is with respect to December 2009

One of the most interesting aspects of wind energy development has been the evolving phenomenon of "repowering". Most of India's wind power capacity during the early years of development was through low-rating turbines of 500 kW or lower. This was in keeping with the technology available then. It is estimated that 46 per cent of the total WTGs installed in India, as of March 2010, were of 500 kW or lower. The aggregate capacity of these turbines, estimated at 2,331 mw, was around 18 per of the total capacity as of given date.

Secondly, developers built wind farms for the sake of tax concessions. Hence, in the minds of the developer, the efficiency of the installation reduced to secondary importance. It is also felt that India's gross assessed wind power potential of 45 GW was made under the assumption of low-rating turbines (those of height up to 60m). Matters are very different now, and experts feel that India's wind power potential, if assessed now, could be even twice of the said figure.

Advancement in technology has led to a phenomenon of "repowering", which means that old low-rating turbines are being replaced by high-rating turbines. Re-powering offers the unrivalled advantage of increasing the installed capacity of a wind farm without any expansion in geographical footprint and, in many cases, without much change to the associated power transmission infrastructure.

Global Wind Energy Council (GWEC) has estimated that as of March 2009, Tamil Nadu had the highest re-powering potential of 800 mw followed by states like Gujarat, Maharashtra, Andhra Pradesh and Karnataka. Although repowering is a strong technical possibility, there could be some difficulties in its execution, GWEC feels. Firstly, repowering could lead to a reduction in number of turbines since there will not always be a "one-for-one" replacement. The issue of ownership needs to be dealt with carefully, more so if the land has multiple owners. Power utilities that have signed long-term power purchase agreements may not be interested in revising the agreements. De-commissioning of the old turbines and their disposal would involve a cost that needs to be assessed carefully, GWEC feels. The most important aspect here is that there is currently no government policy for re-powering of old wind turbines. A suitable policy addressing all the aforementioned issues could expedite the re-powering endeavour.

CHALLENGES
As earlier discussed, wind energy will make the biggest contribution to India's renewable pursuits. In the ongoing XI Plan period, a total of 24,000 mw of renewable energy capacity is targeted for addition. Out of this, wind energy is expected to contribute 10,500 mw representing 75 per cent of the target. Going by the performance so far, wind energy is expected to even exceed its target. From an average of 2 GW of new capacity additions per year now, wind energy is likely to contribute over 3 GW in the coming years. Thus, creation of domestic manufacturing capacity is inevitable. Besides, India is also being seen as a hub to export sophisticated turbines to the developed markets.

While India is fast magnetizing private capital in wind turbine industry, inasmuch as it is doing in the area of wind power development, there are challenges that must be met. Some challenges are inherent to the manufacture of equipment while others relate to supply chain management and logistics-related issues that could impinge on the pace of wind power capacity creation.

With respect to manufacturing of equipment, there are concerns in the form of very volatile and rising prices of key inputs-steel and copper. The domestic market has limited availability of specialized material like cold-rolled steel and high-tensile structural steel, industry experts say. This Installation of high-rating turbines warrants the need for heavy-duty cranes results in heavy dependence on imports. The Indian foundry industry also needs to modernize to facilitate the casting of heavy and large components related to megawatt-sized turbines, experts feel. Wind turbine manufacturing is a fabrication-oriented industry. While India has adequate vendors for fabrication of steel components, there are issues regarding timely delivery and consistency in quality. Experts also suggest that India currently has limited number of manufacturers of precision components like gearboxes, bearings and brakes. Growth in domestic capacity in these critical areas could prove beneficial to the industry.

Wind turbine components

Acomplete wind turbine has the following components: blades, controller, gearbox, generator, nacelle, rotor and tower. Most turbines have three blades, although there are two-blade turbine models. Blades are generally 30m to 50m in length, with the most common size being 40m. There is a controller in the nacelle and one at the base of the turbine. The controller monitors the condition of the turbine and monitors the movement. Many turbines have a gearbox that enhances the rotational speed of the shaft. A low-speed shaft feeds into the gearbox and a high-speed shaft feeds out from the gearbox into the generator. Some turbines use direct-drive generators that can produce electricity at lower speeds. Such turbines do not need a gearbox. A generator converts mechanical energy produced by the rotation of the turbine into electrical energy. The nacelle houses the main components of the wind turbine such as the controller, generator, gearbox and shafts. The rotor includes all the blades and the hub (that part to which the blades are attached). Towers are strong steel tubes, usually 60m to 80m in height, on which the nacelle and rotor stand. Some towers have two or three sections to facilitate transportation and installation.

Serious challenges also exist in execution of wind power projects. This can adversely affect the capacity utilization of the domestic WTG industry. Amongst the biggest challenges that wind power projects face is inadequate logistics support and paucity of construction equipment. Experts maintain that even if India's wind power potential is to the tune of 45 GW, its realization depends on the ease and pace at which projects can be executed. In this respect, some potential will continue to remain "technical" in nature. In the coming years, India will see widespread deployment of multi-megawatt turbines, even those up to 2.5-mw. Transportation of such heavy equipment to project sites can be quite a challenge. The assembly for a single turbine could be up to 60 tonnes, creating complexities in logistics. It is even learnt that there are not many crane suppliers for super heavy lifts causing a demand-supply mismatch resulting in an inordinately high pricing regime.

CHINESE SWEEP
Till around four years ago, China was nowhere in the reckoning when it came to wind power. Today, China has the largest installed wind power capacity in the world, upsetting the positions of erstwhile leaders like USA, Germany, Spain and even India. Let us take a close look at the numbers. As of December 2010, China had 44.7 GW of wind power installations, accounting for over a fifth of the global capacity. Over 95 per cent of China's present wind power capacity was added in the last four years alone. In 2010 (January to December), the country added as much as 18.9 GW of new capacity—comparable to what the rest of the world did collectively during the period. By 2015, experts feel that China's total wind power installations could cross 129 GW, which means an annual growth of over 22 per cent.

World's leading WTG companies
Company	Headquarters	Market share (%)
Vestas	Denmark	12
Sinovel	China	11
GE	USA	10
Goldwind	China	10
Enercon	Germany	7
Gamesa	Spain	7
Donfang DEC	China	7
Suzlon	India	6
Siemens	Germany	5
United Power	China	4
Source: Various reports

Having made a mark in wind energy installations, China is also seen slowly penetrating the global WTG market and India is no exception. Reliable reports suggest that China today has four of its manufacturers in the world's top ten makers of wind turbines. Sinovel of China is the world's second-largest manufacturer of WTG with a 11 per cent market share, closely following world leader Vestas of Denmark that has 12 per cent. Chinese equipment has even entered developed markets like USA and UK, apart from emerging markets like Ethiopia, Cuba and Pakistan.

China received a big boost in India very recently when KSK Energy placed a large order of 125 turbines of 2-mw each on Shanghai Electric Company. For the Chinese company, it was a significant penetration of global markets, considering that before this, it had sold only five turbines outside its home country. In late 2010, the same developer KSK Energy decided to source 66 units of 1.5-mw direct drive turbines from Chinese player Donfang Electric Corporation.

China's role in India's thermal power generation has been a subject of big debate, and in the coming years, one may witness wind energy toeing the line.

CONCLUSION
The Indian WTG manufacturing industry is seen maturing. Smaller players-those that made turbines of 250kW or lower-are disappearing, making space for global names. With India expecting to add around 2 GW of new wind power capacity per year, the WTG industry needs to keep pace. Most of the international giants have had a long presence in India, and those who did not, are following fast. Given India's wind power potential, there is tremendous scope for domestic WTG capacity. This apart, there is also great export potential, particularly of sophisticated wind turbines for offshore applications.

The biggest hurdle that one needs to encounter is the absence of a robust supply chain and weak logistical support. In fact, these are the very issues are impinge upon India's efforts to build capacity in the manufacturing sector, even generally speaking.


The issues in creation of WTG capacity is reminiscent of what is happening in the thermal power equipment spaceemergence of new players, progressive growth in technology and a growing "interest" from China. India's Sino neighbour has created tremendous WTG manufacturing capacity given that it has commissioned 40 GW of wind farms over the past four years, largely with domestic equipment. India's approach to Chinese wind turbines, amidst the growing number of domestic options available, would be worth observing.