Institutional barriers to commercialisation of wind power in India: The case of Gujarat

Abstract

Institutional support for encouraging renewable energy technologies in India, is strong at the state, the national and international levels. Within Gujarat a range of underlying drivers and more explicit policies and incentives have encouraged private investment in wind power. The Gujarat Electricity Board is financially and operationally weak. Constrained by a range of factors they are unable to meet increasing demand for power and future supply is likely to come from private power producers, increasing the overall cost of power. Inadequate investment within the transmission and distribution system further reduces the reliability and quality of supply to consumers. Industrial consumers must subsidise agricultural consumption, yet suffer an increasingly poor service as a result. Therefore an increasing number of industries are investing in self-generation including wind power thereby further reducing the GEBs revenue.

The performance of wind power projects installed within Gujarat has so far been disappointing, and objectives for reducing the cost/kWh of wind power not realised. Initial problems relating to manufacturing; operation and maintenance of wind turbines have been reduced as experience has been gained. Yet a number of factors continue to constrain the commercialisation of the wind power industry in India, this paper argues that primarily these are institutional in character.