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Home News Power Sector News Tamil Nadu hikes wind power tariff to attract private investors

Tamil Nadu hikes wind power tariff to attract private investors

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Wind EnergyIn order to attract investment in wind energy sector, Tamil Nadu Electricity Regulatory Commission (TNERC) has proposed to raise the tariff of wind energy from Rs 2.90 per unit to Rs 3.40 per unit.The commission will pass a final order on December 28 after it receives a feedback from the state advisory committee.Wind turbine manufacturers, wind energy developers and wind energy generators have periodically made representations to the TNERC urging it to refix the tariff in view of input costs such as capital costs, interest rates and maintenance costs increasing in the last two years.

Despite being a significant wind power producer, Tamil Nadu has been showing a declining trend when it comes to augmenting its wind energy sources. In fact, there is fear that investments have been shifting from Tamil Nadu to other states like Gujarat, Maharashtra and Karnataka which offer a more competitive price.

Tamil Nadu's wind power mills are situated in three major passes in the western ghats -- the Aralvaimozhi, Sencotta and Palghat passes.

Installed capacity of wind power as on date in the state was 4,100 MW, which accounts for 43 per cent of the country's capacity This trend witnessed reversal during 2007-08 owing to the perceived adverse factors such as constraints on "evacuation of wind energy and frequent load shedding and unattractive tariff for wind energy, which was fixed at Rs 2.90 per unit in May 2006."

The revision of tariff is expected to bring in more players and investments to the tune of Rs 2,000 crore. "With the demand-supply gap standing at 2000 MW, we need more power plants. It is unfair to put the entire burden on the government. Though Tamil Nadu has an edge over States like Gujrat and Karnataka which contribute only 11 % to the national windpower generation, the tariff remained a stumbling block," said the official.

Meanwhile, industrialists foresee a better investment scenario if the tariff is revised. Raj Kumar Khemka, vice chairman of NEPC said that the decision would encourage more investments. He said more independent power projects would come up even in areas with low wind velocity.

Said Ramani, the task force member of the Indian Wind Turbine Manufacturers Association: "The size of our business is about 600 MW throughout the state. Though there will be a slight fall in investments due to the economic meltdown, we are sure of good growth during the financial year 2009-2010."
Courtsey- Times of India


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