Generation Based Incentive is back; Ministry to get Rs.800-crore
One of the major gainers of the Union budget is the wind energy sector, with Finance Minister P. Chidambaram announcing the reintroduction of the Generation Based Incentive (GBI). A sum of Rs. 800 crore is to be provided to the Ministry of New and Renewable Energy (MNRE) for this purpose.
“The non-conventional wind energy sector deserves incentives,” he said.
The announcement has brought cheers to the players in the sector. They had been demanding this ever since the GBI was withdrawn on April 1 last year. Sources said there was a fall in new installations in the last 10 months. The approximate investment for one MW is Rs. 6 crore and the country lost about Rs. 10,000 crore in wind turbine installations this year.
At a budget meeting in Chennai, Indian Wind Turbine Manufacturers’ Association (IWTMA) chairman Ramesh Kymal said: “We are very relieved… the industry was bleeding and about to die… this will be an encouragement.”
Describing the reintroduction of GBI as a timely intervention, he said it would rejuvenate the sector with more investments. It assumed greater significance as an ambitious capacity-addition plan was being pursued in the current Plan period.
According to the sources, new wind energy installations in the country so far this fiscal contributed just 1,200 MW, against 3,200 MW the previous year. By March-end, another 200 MW may be added.
Mr. Kymal, who is chairman and managing director of Gamesa Wind Turbines Pvt. Ltd., and Indian Wind Power Association chairman K. Kasthoorirangaian sought reintroduction of the accelerated depreciation too.
Mr. Kymal welcomed the budgetary announcement to provide low-interest loans for renewable energy projects. Mr. Chidambaram had said the government would provide funds from the National Clean Energy Fund to the Indian Renewable Energy Development Agency to on-lend to viable renewable energy projects. The scheme would have a life span of five years.
“It should announce the modalities of the schemes at the earliest and these benefits should be available even to those who invested in one wind-mill,” Mr. Kasthoorirangaian said.
D.V. Giri, secretary-general, IWTMA, said that once there was clarity on the modalities of the GBI scheme, the response from the independent power project segment would be positive.