Indian Wind Industry Gets … uhm … Second Wind
6 September 2012 @ 9:46 pm
As of April 2012, the accelerated depreciation benefit for wind energy projects in India was discontinued. This was expected to hit the industry hard. This fear seemed real enough until some developers recently figured out that they didn’t have to depend on turnkey solutions from wind turbine manufacturers anymore. How did this happen?
For many years, the major reason for the growth of the wind energy sector in India was the accelerated depreciation benefit. Captive consumers, as industrial electricity consumers are referred to, were the majority of the wind project owners. For industries such as the cotton spinning mills, investing in an electricity producing asset depreciating its value at 80% annually was an extremely attractive option. Since they didn’t seek to build large wind farms but just erect one or two turbines, their needs didn’t quite make an attractive proposition for wind energy developers. So wind turbine manufacturers such as Suzlon, Vestas and, in the past, NEPC stepped in to offer turnkey wind solutions to the mill owners. They would take care of land acquisition, permitting and grid interconnection, and obviously the turbine manufacturing and installation.
Since the primary incentive was the accelerated depreciation benefit, neither the mill owner nor the turbine manufacturer cared if the turbine generated any electricity or if the grid had capacity to evacuate that power. To counter this perverse incentive, generation based incentives were introduced. The power producer would get paid Rs. 0.50 (US $0.01) for every kWh of electricity generated. While this increased the number of entrants interested in more than accelerated depreciation to about 30% of new projects, it still did not incentivise the utility companies (now transmission companies) to provide the necessary infrastructure to evacuate the power.
To counter this, the government introduced Renewable Purchase Obligations (RPO) mandating that a certain percentage of electricity purchased by each utility be from renewable sources. After this, the government also decided to remove the accelerated depreciation benefit and the feed-in tariff and instead introduced a Renewable Energy Credit trading exchange.
While everyone feared it might sound the death knell for the wind industry in India, especially with solar energy getting a boost through the National Solar Mission and individual state solar missions, wind energy developers realised that they could take advantage of the drop in turbine prices worldwide. A few developers, like Green Infra, Greenko Group and Mytrah Energy, decided to discontinue the existing model and instead develop the projects (acquire the land, take care of permitting and interconnection) themselves and turn to the manufacturers to just order the turbines.
As the Bloomberg article points out, companies like Vestas, Gamesa and Suzlon, were still charging high prices for projects despite the fall in turbine prices, citing high development costs. Breaking the vertical integration by decoupling turbine manufacturing from development, these developers are now able to realise the monetary benefits from falling turbine prices by ordering from manufacturers like GE and developing the projects themselves.
With turbine prices falling and coal prices still rising, many more wind developers might do what these three developers did. From this case, it seems like the New and Renewable Energy Ministry hasn’t yet been infected by the policy paralysis that the other ministries seem to be caught in. Having the right kind of incentives in place and letting the private sector figure the best path ahead seems to have worked here.
And oh, pardon the lame pun in the title. I haven’t been blogging lately and the rustiness wears off really slowly!
An Open Letter to Markandeya Katju - Part 1
30 January 2012 @ 5:55 am
Dear Sir,
I want to congratulate you on your not-so-recent appointment as the Chairman of the Press Council of India. Since taking over, you’ve done some amazing things, some of them so amazing that I cannot help but resort to hyperbole while describing your achievements. So please excuse me if this letter seems a little sycophantic. I really mean this, every word of it. Just like you did, last year.
Also, I write this in several parts because I admire you greatly and have a lot to write to you about, and could not possibly write the whole letter in one sitting.
Hardly a few days after you took over the Chairmanship of the PCI, your dynamic and bold nature was on display in your op-ed. You hit the nail on the head with your three-point summary of the problems with the media in India.
Your first point particularly resonates with me. The media focus (or focuses, if I were to consider media to be a singular noun, like you do) on trivial things. I share your pain when you say :
“To give an example, I switched on the T.V. yesterday and what did I see? Lady Gaga has come to India, Kareena Kapoor standing next to her statue in Madame Tussand’s, tourism award being given to a business house, Formula one car race etc. etc. What has all this to do with the problems of the people?”
I too have, on several occasions, turned on the TV, skipped past Doordarshan and Discovery Channel to go to Star Cricket, NDTV, CNN-IBN and other such trashy electronic media and been depressed by their focus on trivial content. I am sure millions of other Indians who watch these channels agree with you that they had no choice but to watch the trash on air and let the media think that’s the content they wanted. If only they had the choice to turn off the television.
You hit another nail on the same head when you lament about the importance given to astrology in the media. You say:
“Many T.V. channels show astrology. Astrology is not to be confused with astronomy. While astronomy is a science, astrology is pure superstition and humbug. “
What is most appreciable here is that you not just state obvious facts, but you also state the impeccable logic behind that statement.
” No doubt most people in our country believe in astrology, but that is because their mental level is very low.”
I couldn’t agree more with you. Most people in India indeed have a very low “mental level”.
Where you differ from armchair critics (By the way, I think you should address and lambast them in a separate article) is that you provide solutions and demonstrate their efficacy with brilliant statistics.
” These will […] be […] informal get-togethers where we will discuss issues relating to the media and try to resolve them in the democratic way, that is, by discussion, consultation and dialogue. I believe 90% problems can be resolved in this way.”
My belief is that 80 per cent people who are doing wrong things can be made good people by patient persuasion, pointing out their errors, and gently leading them to the honourable path which the print media in Europe in the Age of Enlightenment was following.
Admirably, you even back up your personal beliefs with statistics. How many people in India can do that? Very few, since we know that most Indians’ mental level is very low.
Yours Sincerely,
Arvind Balachander
End of Part 1.
Coming up: Your penchant for facts. And your rightful sense of outrage. And your belief in democracy.
First World Iyer Problems
12 October 2011 @ 3:09 am
Whattey Bulb!
2 October 2011 @ 2:15 pm
800 Million Indians ready to pay more for renewable energy?
27 September 2011 @ 4:55 pm
Yes! Apparently, that’s how popular renewable energy is in India, if you go by articles like this that are reporting on a survey by Mercom Capital titled the Indian Renewable Energy Awareness Survey.
Sounds incredible, right? Right! If, by incredible, you mean not credible. Let’s dig into your report a little.
There seem to be two major claims in this statement.
- Claim 1: 71% of Indian consumers are ready to pay more for renewable energy.
Proof:
So, 39% said yes, 32% said maybe and you think with education, we could convert the maybe’s to yeses? That makes total sense. I buy your 71% number now completely, Mercom. - Claim 2: 71% of Indian consumers are ready to pay more for renewable energy.
Proof: Now that you have convinced me about the 71% number, tell me more about these Indian consumers. They’re from all over the country, right? A representative sample, right?
Absolutely right!
Perfect! From around Bangalore and Mysore. For those without an idea of where these places are:
Image source: World GeographicsThat clearly is very representative of the whole nation! Well done, Mercom!
Oh wait, you said 71% of Indian consumers. How many did you survey?
A total of 509 respondents were interviewed for this survey.
You managed to survey 509 out of 1.1 billion. That’s about one half of one hundredth of a percentage point (0.000045%). Can’t get any more comprehensive than that!
To break it down, 198 of the 509 people said “Yes, we’ll pay more for renewable energy”. 163 people said “Maybe…”. Wow!
361 = 800 Million. Hence Proved!
Julley!
18 August 2011 @ 6:03 am
That’s Ladakhi for Hello. That’s what they speak in Leh. That’s where I am right now. 12,000 feet above Mean Sea Level.Day 1 : August 14, 2011 : Chennai
6.00 PM : We set off on a trip on time. How did that happen? Right, we forgot to print our return tickets. Dhristi Pariharam - Check!
See a VW Beetle on the way to the airport.
6.25 PM : No traffic jams. Reach the airport in just 25 minutes. Of course, there’s the idiot who’s late and demands to be allowed to bypass the security queue. Of course, he’s allowed to.
6.35 PM : Check in all our naphthalene-ball-scented winter clothes and get our boarding pass to “Lee”. “No oxygen there!”, I am informed. Oh no! “No problem, just hold your breath and save the oxygen in your lungs”, comes the solution. Humour from the airport staff, thanks to the lack of crowds.
6.50 PM : Dinner! Packed idlis and molagai podi. See a couple of people buy idli and sambar for exorbitant prices at the airport. Ha!
8.20 PM : Plane takes off at the scheduled time. What’s happening? Amma finally gets the window seat. To our surprise, dinner’s part of the package in the plane. Dang! If only it weren’t Gayatri Japam!
Day 1 : August 14, 2011 : New Delhi
11.10 PM : Plane lands in Delhi on time. What’s happening, really?! Terminal 3 - seems posh and big. Really big. Thankfully we get a ride on the airport vehicle. All of you who pushed past me in the plane to get out and still got to the exit after we did - SUCK IT!
11.25 PM : After a bit of searching, we find the transfer section. Delhi Airport Recycles (atleast Terminal 3 does), but unfortunately I don’t get to use it. :|
The departure are is pretty sweet! There are even long reclining seats meant for the overnight stopover at the airport. Atleast, we decided that it was.
We even had pigeons for company!
Day 2 : August 15, 2011 : New Delhi
1.00 AM : Unfortunately some airport staff decide that the seats next to the ones we’re sleeping on are meant for midnight airline gossip. “Happy Independence Day”, I wish them as we relocate to another spot in the airport to try to get some sleep somehow. These recliners are even more fancy. Curved to comfortably fit your back or your big backside.
2.30 AM : Paavi pora edam paadhalam - Some other airport staff decide to load and unload some cartons very noisily a couple of feet from where we are still trying to sleep. “Happy Independence Day”, one of those guys wishes me.
4.00 AM : Brushing my teeth in the restroom. Some Caucasian-looking dude walks by, gives me a dirty look and tut-tuts in disgust. Oh really? It’s on!
“Yes? Did you say something?”
“Huh? What?”
“You said something?”
“Er… I don’t think this … is the place … for brushing…”
“You have a problem? YOU HAVE A PROBLEM? “
“No… No… No… Sorry!”
BOOYAH!
4.45 AM : Boarding starts, 20 minutes before schedule. We could get used to things happening according to plan! Friendly Caucasian dude is one row ahead of me. Doesn’t turn back for the entire duration of the flight. Ha!
5.45 AM : Plane takes off. Of course, on the dot!
Day 2 : August 15, 2011 : Leh, Ladakh, Jammu and Kashmir
6.45 AM : Beautiful views of the Ladakhi landscape - dry sandy plateaus, rocky/andy mountains, some snow-capped peaks and green valleys - as the plane descends. Plane lands, ahead of time! Waits ten minutes to get a gate position. 13 C! Brrrr!!! And oh, yes, the checked in baggage comes out on time in good shape. The guy from Hotel Cho Palace is waiting for us with a placard. The hotel is just 5 minutes from the airport. Looks great on entry. “Hayya! Apples!” - Amma is clearly excited! Room’s perfect too. Running up the stairs in the Himalayas is not a good idea. We’re all terribly out of breath by the time we come to our room.
7.45 AM : Bathe in cold water. Refreshing!
9.00 AM : Breakfast - corn flakes, oatmeal, sliced bread with jam and butter and finally the local dish - aloo paratha. Still don’t understand how people can have stuffed parathas for breakfast. Masala Chai is excellent, almost as good as mine!
10.00 AM : Crash! Finally shut our eyes to sleep. Dreamless slumber.
1.00 PM : Wake up and get ready for lunch.
2.30 PM : Done with lunch. Excellent - hot, tasty and super fast service.
3.00 PM : Meet Singchey Wangchuk - the guy we spoke to over the phone for reservations. Knowledgeable, polite and honest. Make travel arrangements for tomorrow. Repeatedly advises us to not do stupid things like going for a walk on our first day in such high altitudes. For some reason, the lack of oxygen reminded me of Michelle Bachmann’s love for CO2.
3.30 PM : Another cup of excellent masala chai.
4.00 PM : Appa and I ignore Singchey’s advice. Set out on a walk towards the airport. Get past crazy furry cows and crazy furry dogs. Turns out my fear of dogs has not been conquered. Damn! Interesting architecture - stone compound walls for every single plot of land. People store water in drums that are locked. Clearly, oxygen isn’t the only thing in short supply - serious water and trust deficit.
6.00 PM : YET ANOTHER cup of still excellent masala chai to celebrate the completion of our long walk.
8.00 PM : Hungry and waiting for the dining hall to open for dinner. Finish typing out the Day 1 and Day 2 report.
Of people, glass houses and stones
12 August 2011 @ 11:44 pm
Really, America? You want to play this game? What if the headlines tomorrow read :
No? Not to your liking? You get to do business with totalitarian regimes that crush popular dissent with force, but we can’t? These kind of double standards don’t work anymore. Maybe if you were a country with a AAA credit rating…
Coming Home
10 August 2011 @ 7:14 pm
That’s what it is to come back home after 2 years! (© Bill Watterson)
Transformation
8 August 2011 @ 11:22 pm
How dramatically things can change!
“Welcome back to a different India, one that is less respectful of privacy” screamed the headlines on Friday the 5th of August. The Economic Times (ET) ran a front page story with the header, “The Woman Who Runs India is Unwell & India Doesn’t Know”. The next day’s editorial demanded transparency. The article went on to say:
The sort of secrecy that the Congress has resorted to over Mrs Gandhi’s health is reminiscent of practices behind the Iron Curtain during the Cold War. When doddering, old leaders of ruling communist parties ailed, were hospitalised and died, their countrymen were kept in the dark. Only those vying to succeed and those mediating those power struggles got to know until the dust had settled and the victor had been wiped clean of signs of the battles he had survived, in preparation for public anointment. India, happily, is in a different part of the world ,by geography, time and political system.
Let’s breakdown ET’s analogy.
“When […] leaders of ruling […] parties” - okay, you got that one right, ET
“ailed, were hospitalised” - spot on, there too
“and died,” - nope, the last I heard, she’s still kicking, but what’s an analogy if you don’t make a straw man argument
“their countrymen were kept in the dark” - surely now, that’s not true.
- Were we told that Sonia Gandhi was ill? Yes.
- Were we told that she’s been hospitalised? Yes.
- Were we told that she was to undergo surgery? Yes.
- Were we told who was in charge of her duties while she was away? Yes.
All that was not told were the specifics of the illness, which is a private matter about which an individual has a right to withhold information from the public. And what was that about power struggles, victors and anointments?
And so, I went to bed lamenting the rapid deterioration of ethics in the Indian print media.
“Welcome back to a different India, where the Times of India preaches journalistic ethics!” screamed the editorial when I woke up. I was pleasantly surprised - no, that’s too mild a word, shocked, stunned, startled, awestruck… you get the idea - to find this editorial in the Times of India (ToI), a sister publication of the Economic Times. A case of the right hand not knowing what the left hand is doing?
Which one’s the tabloid? (Photo: Arvind B.)
In any case, the several-year-long hunt for a replacement for The Hindu is now over - Welcome ToI!
