In this study. In India wind development started in 1990’s but in recent years it grew at a faster pace after 2005(Kyoto Protocol came into force).927 MW (GWEC). One of the major barriers in wind development is high investment on its equipments. wind power installed capacity of India is more than but at the end of 2009. There are more than 1500 projects in the CDM pipeline out of which 418 projects are of wind energy. The cumulative installed capacity of wind power project is far below their gross potential. India is perceived to be one of the most attractive Non-Annex I countries for Clean Development Mechanism (CDM) project development. .Abstract: One of the alternative form of energy is being considered today is wind power. The total potential for wind power in India was first estimated by the Centre for Wind Energy Technology (CWET) at around 48 GW. The wind power installed capacity of India in year 2000 is 1075.7 MW (indiastat. Wind power projects would of interest under CDM because it directly displaces the GHG emissions. The main objective of the present study is to analyze the factors cheering Wind Power Project of CDM in India. an attempt has been made to analyze and review the development of wind energy in India and how CDM made impact on wind power industry in India.

2 % from the level of 1990 over the five year period 2008-2012. This is known as Kyoto Protocol and was entered into force on 16 February. Eighteen years later the UN General Assembly launched United Nation Framework Convention on Climate Change (UNFCCC). and receive credits for doing so. PFC. The estimation shows that India has vast potential of CO2 mitigation by using wind energy. The reason is that these countries are principally responsible for the current high level of GHG emissions in the atmosphere as a result of more than 150 years of industrial activity. CDM allows developing countries to generate CER (Certified Emissions Reduction) and sale of CER helps to accelerate development of wind energy in India. After this conference the progress has been reviewed every year. HFC. small hydro electric and biomass energy resources. 2005. N2O. SF6). The Conference of Parties held at Kyoto. the signatories in Kyoto committed to reduce their emissions by 5.Introduction At the UN Conference for Human Environment in Stockholm in 1972 pollution was the main theme of the agenda. which they may apply towards meeting mandatory limits on their own emissions . The major feature of the Kyoto Protocol is that it sets binding targets for 37 industrialized countries and the European community for reducing greenhouse gas (GHG) emissions. Japan on 11 December. CH4. . One of the provisions of the Kyoto protocol. In 1992 during the UN Conference on Environment and Development the UNFCCC was opened for signature and 189 parties make an agreement for reducing emission of Green House Gases (CO2. 1997 was the landmark. known as Clean Development Mechanism allows developed countries to finance GHG emissions avoiding projects in developing countries. The meeting drew attention to the fact that something dramatic was happening to environment and that the parties present should find out about the effects and causes and take voluntary steps towards reducing pollution. responsible for Global Warming. wind. This opportunity will help the Indian industry to make profits by investing in less pollutant and clean renewable projects based solar.

which starts in May-June. dry air moves towards the ocean.Wind Condition in India Wind in India is influenced by the strong south-west summer monsoon. Figure: Wind power potential in India (Source: Centre for Wind Energy Technology (C-WET). humid air moves towards the land. when cool. when cool. except the eastern peninsular coast. though higher winds are available during a part of the period on the Tamil Nadu coastline. Government of India) . Wind speed during the period November to March are relatively weak. The weak north-east winter monsoon. starts in October. the winds are uniformly strong over the whole Indian Peninsula. During the period March to August. This feature of India has been of interest amongst private investors in setting up commercial wind power projects in India.

The CDM allows Annex I parties to implement wind project in India to reduce GHG emissions. The main objective of Kyoto Protocol is to stabilize GHG concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system.Wind Power and CDM The CDM project development process in India picked up in early 2002. The steps in project registration of CDM are: . Invests in a In Annex I countries CDM Projects Non-Annex I countries CDM stimulate investments from Annex I countries in wind power and assist developing countries like India to achieve sustainable development with lower GHG emissions. it has to go through the clearly defined process to ensure real emission reduction. To qualify a wind power project as a CDM project. On the one hand CDM allows Annex I countries to achieve their commitments in cost-effective manner and on the other hand it helps Non Annex I countries to achieve sustainable development. The income earned by CERs increases the total income of a project and improves the competitiveness of wind power against fossil power generators.

it would add up to 7. The wind power industries are rushing to get carbon credits from CDM but are facing difficulty on its convoluted rules and processes. 30%) are wind power projects. or are in the process of doing the same. If all projects in the pipeline get registered.170 MW.Effectiveness of CDM in India The wind energy sector in India has a sustainable development since more than a decade. CDM plays a vital role in financing wind power projects in India. This can be seen by increasing number of wind projects in CDM pipeline till March 2010. Of the 1578 CDM projects from India. about 418 (approx. The statistics of total number of large and small scale Indian wind energy projects in the CDM Pipeline are shown as: . More than 80 projects have been registered in CDM till 2010. One major hurdle in the development of wind projects in India is certainly the lack of financing. Wind energy is seen by Indian governments and business developers as one of the best solutions to provide clean and affordable electricity. Most wind power installations have already applied for CDM. contributing 20% of total wind power projects registered globally. for which CDM was created as a solution. roughly 72 percent of the installed capacity.

the finance from CDM in India has to be suitably geared up.7 961.1 18 1337.Projects in CDM Pipeline State Gujrat Andhara Pradesh Karnataka Maharashtra Madhya Pradesh Kerala Rajasthan Tamil Nadu Total Total Large Scale capacity 646.225 441.8 705.2 55.625 667.8 204. .55 1927. In order that a large number of high-quality CDM projects are developed in India and result in Certified Emission Reductions as specified by the international CDM Executive Board.6 5171.9 0 500.3 Source: CDM Pipeline (as seen on 31 March 2010) The CDM has a unique role in making projects viable for companies in India.25 12.35 0 1070.15 12.25 Total Small Scale capacity 332.2 1999.8 7170.05 Total 979.35 120.75 18 267.175 2594.925 1402.15 64.

By 2005 India was fourth largest in the global wind market and now ranks fifth in total installed capacity. At the moment. there is no coherent national renewable energy policy to drive the development of wind energy. World capacity reached 159. including policy measures such as renewable portfolio standards and feed-in-tariffs. The positive development of wind energy in India has mainly been driven by progressive state level legislation.925 MW.Wind Power Industry in India The Indian Wind Industry became a global player in past few years. The total installed wind power capacity in India from 1991 to 2009 can be seen from the chart . The progress of wind energy generation in India makes the country one among the top rankers in the world. The installed capacity of top ten countries in 2008 and 2009 is given as: Source: World Wind Energy Report 2009 India is playing an important role in the world’s wind energy market.213 MW (World Wind Energy Report 2009) out of which India has contributed 10.

12 5 3. The major contribution made by different states till 2009 can be seen in the chart.000 2. 84 5 9. contributing 41. 43 0 6. Other states like Maharashtra. 07 7 1.9 26 39 39 79 57 6 18 5 94 0 82 0 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 (Data Source: Earth Policy Institute .000 4. 00 0 4. Gujarat.Eco-Economy Indicator) Wind power in India is concentrated especially in southern state Tamil Nadu and it is the state having largest wind power with 4. State wise Installed Wind Power in MW till 2009 Gujarat 16% Tamil Nadu 42% Karnataka 13% Rajasthan Madhya 8% Pradesh 2% Maharashtra 19% . 45 6 1.000 0 1.000 [MW] 10.000 6. 22 0 1.Cumulative Installed Wind Power Capacity in MW from 1991-2009 12.9% of total installed wind power in India. 65 5 10 . Madhya Pradesh and Karnataka are also the major player in this field.57 GW installed at the end of 2009. 01 5 1.000 8. 27 0 7. 70 2 2.

6 79.7 31.8 20.March-.indiastats.5 37.7 MW.1 0 22.3 2 45.5 0.1 50.1 11.3 March 1993 March 1994 March 1995 March 1996 March 1997 March 1998 March 1999 March 2000 Total installed capacity 166.6 4.March-March 1993 1994 1995 1996 1997 1998 1999 2000 1992 . States Up to March 1992 14.8 0 14.March-. Although India has started wind power development in 1990s.1 10.8 0 119.5 0 190.3 0 0 281.6 Source: www.2 23.2 2 6.9 51.6 0 0 0 0 50.3 22.March-.6 0.2 0 31.March-.Development of wind power projects in some States of India before and after 2000 At the end of March 2010 National CDM authority of India has approved 418 wind projects.7 0 0 1.3 2.March-.8 Gujarat Karnataka Madhya Pradesh Maharashtra Rajasthan Tamil Nadu 1.2 2 770.7 2. the CDM projects have picked up in August 2002 after signing and ratifying Kyoto Protocol.8 34.6 6.1 3.6 1.March-. We can see the total installed wind capacity in different states of India from 1992 to 2000 is 1075.3 0 17.6 0 0 0 0 Installed Capacity by Region before year 2000 Yearwise Growth of wind power (Capacity in MW)-1992-2000 400 350 300 250 200 150 100 50 0 Upto March-.7 0.2 2.1 0 2.

1 189.8 44.7 1924.4 111. State March 2001 0 10.December-2008 2009 From above two tables and graph.4 Installed Capacity by Region after year 2000 Yearwise Growth of wind power (Capacity in MW)-2001-2009 2500 2000 1500 1000 500 0 March -2001 March -2002 March -2003 March -2004 March -2005 March -2006 March -2007 March -.5 201.2 130.8 Gujarat Karnataka Maharashtra Madhya Pradesh Rajasthan Tamil Nadu Total installed capacity 1530. CDM plays a certain role in financing of wind farms in India.3 268. so that number of CDM projects in wind energy increases continuously every year after 2000 as the statistics says.5 48.6 143.indiastats.3 Source: www.3 675.2 0 117.7 December 2009 458.8 March 2004 28. the wind power development geared up and the possibility to register projects under CDM has provided a further incentive to develop wind energy in India.As Kyoto Protocol came into force in 2005.5 March 2006 84.8 545.9 March 2008 616.3 41. it is clear that most wind power projects are developed after 2005 .3 106.2 March 2005 51. From the graph shown above.4 0 8.1 317.8 577. The necessary condition for a project to be registered in CDM is that it should be developed after year 2000.9 84.2 248.8 371.5 25.4 110.6 2 0 44.9 6.6 132.5 722.3 857.3 16.4 190.6 March 2007 284 266 485.4 69 380.1 11.5 1355.2 55.9 March 2003 6.9 March 2002 0 24 209. we are able to see the growth of wind projects in CDM pipeline.6 0 5.9 379.4 3805.8 6.6 854.

purchase. The grid infrastructure problems are getting more pressing as installed capacity grows. The Indian government’s stated target is for renewable energy to contribute 10% of total power generation capacity and have a 4-5% renewable share in the electricity mix by 2012. accounting for around 20% of the total added capacity planned in the 2008. wheeling and banking of electricity generated by wind power projects. banking and third party sales. The ministry for new and renewable energy (MNRE) issued guidelines to all state governments to create an attractive environment for the export.Facilities provided by Government of India to Influence Wind Projects in India The promotion of renewable energy in India is mainly driven by state governments. National Policies The Indian government has envisaged a capacity addition of more than 70.2012 timeframe. Some of these factors are discussed here. as decided by the state electricity regulator by way of power purchase agreements • Reduced wheeling charges as compared to conventional energy land policies: . ranging from Rs 3-4 per kWh. with a national average of around Rs 3. There are so many factors supports Indian and outside bodies to deploy wind power projects in India internally as well as externally. buy-back facility by states Guarantee market through a specified renewable portfolio standard in some states.50 per kWh • • Wheeling. The support for wind power in India includes the following measures: Fiscal and financial incentives • • • • • Concession on import duty on specified wind turbine parts 80% accelerated depreciation over one or two years 10 year income tax holiday for wind power generation projects Excise duty relief on certain components Some states have also announced special tariffs.000 MW by 2012. This means that renewable energy would grow at a faster rate than traditional power generation.

Thus. Thus. Thus. Wind resource assessment The government set up the Centre for Wind Energy technology (C-Wet) to map wind energy potentials The C-WET has set up more than 1. in such a case.• The Ministry of Environment and Forests has issued guidelines for diversion of forest lands for non-forest purposes. CDM helps them to get financed from banks or financial institutions that encourage private sector involvement in global GHG reductions. particularly for demonstration and private sector projects. CDM has certainly accelerated and promoted the Wind Power Projects in India. Financial assistance Indian Renewable Energy Development agency (IREDA) is the premier finance agency of the government of India that provides loans for renewable energy projects. Some further benefits to participate in CDM can be seen as: Financial coordination The foremost important aspect here which IREDA cannot control is the span of Return of Investment for the business to reach the destined Break-Even point. The project developer gets CER for reducing GHG and meet Kyoto target in cost effective manner. . the CDM makes the business a very high profit making prospect which was earlier a very long span of investment which discouraged the projects in India. Why go for CDM? CDM is supposed to be “Win-Win” condition in India.000 wind monitoring and wind mapping centers across 25 states Wind mapping at 50 meters (C-WET) and 60-80 meters height (private companies). particularly to enable wind generation • Clearance of leasing and forest land for up to a period of 30 years for wind developers. the CDM comes into picture and thereby the projects on deployment are subjected to financial aids that are covered in CDM.

it will create employment through manufacture.As a source of Foreign Currency There are many Forms of Foreign Capital Flowing into India such as banking and NRI deposits. CO2 Reduction The most important benefit of wind power generation is the reduction in the level of Carbon dioxide into the environment. Employment As the wind energy market grows in India. wind farm development. CO2 is responsible for GHG effects and distorts the climate. CDM funded Wind Power Projects are one of them which is another attractive opportunity. installation and also the indirect employment. which in its turn has given a major boost to the Indian economy and is profitable proposition for the country. Development Through CDM. The various Forms of Foreign Capital Flowing into India has helped to bring in huge amounts of Foreign Direct Investment (FDI) into the country. CDM encourage the project participant for investing in wind power projects and in this way it helps in CO2 reduction from global environment. component supply. India has been supported to run on a sustainable development track without compromising their ability to meet future GHG reduction commitments while annex 1 countries are able to meet their commitments at a lower cost. .

. The arguments presented here. shows the growth of wind power projects after CDM came into picture. are launched under CDM. The above graph and figures shows that there is very vast potential of CO2 mitigation through wind energy. The clean development mechanism has contributed to the deployment of wind projects in India.Conclusion The Kyoto Protocol’s efforts to mitigate climate change have resulted in an international carbon market in India that has grown tremendously since the entry into force of the Protocol in 2005. A very wide category of renewable energy projects mainly wind energy projects. India has about 48 MW wind potential and CDM could help to achieve the maximum utilization of wind potential as compared to the current diffusion trend if supportive policies are introduced. The CDM has potential to attract investors for deployment of wind power projects in India. Thus all in all with out CDM aid such growth of wind energy in India is not possible.

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