An overview of Indian power sector &

Economics of Wind mill in Tamil Nadu

Chairman
Mr.K.Sekar
Members Presented by
Dr.T.R.Shanmugam G.V.Venkatesh
Dr.C.Chinnusamy
 Introduction
q Energy is a major input for overall socio-economic
development of any society.

q Development of a country is highly correlated to per capita

energy consumption.

q Increasing population, modern civilization and technological

advances contribute to increased consumption of energy.

q Most of our energy demands are met by burning fossil fuels,

which is accelerating global warming resulting to Increasing sea
levels, Floods, Droughts, Earthquakes, etc.
 Cont..
q The prices of the fossil fuels steeply increasing ,So renewable
energy are expected to play a key role.

q Wind energy is the fastest growing renewable energy.

q Wind turbines are up to the task of producing serious amounts of

electricity.

q Wind energy has started making meaningful contributions to the

overall power requirements of some States.

qTurbines vary in size from small 10 kW structures to large machines

rated at 2 MW or more.
 Objectives

• To study the world, India and Tamil Nadu wind

energy scenario.
• To identify the demand and supply of power
consumption in Tamil Nadu
• To evaluate the financial analysis of wind mill in
Tamil Nadu.

 Tools used for analysis

• Percentage analysis
• Financial investment analysis
Ø NPV
Ø B-C Ratio
Ø IRR
Ø Break-even analysis
 Worldwide Wind Power Installed
Capacity (As on 30th June 2010)
S . No Country Capacity(MW)
1 USA 36693
2 Germany 26386
3 China 25705
4 Spain 19824
5 India 11952
6 Others 45639
Total 166199

(Source : Wind Power Monthly, October’2010)

 Worldwide Wind Power Installed

Total Installed Capacity : 166199 MW

(Source : Wind Power Monthly, October’2010)
 Wind Power Density in India

(Source : MNRE)
 India State Wise Installed Capacity
as on 31.03.2010
S.No State Capacity in MW

1 Tamil Nadu 4906.74

2 Karnataka 1472.75
3 Maharashtra 2077.70
4 Rajasthan 1088.37
5 Andhra Pradesh 136.05
6 Madhya Pradesh 229.39
7 Kerala 27.75
8 Gujarat 1863.64
9 West Bengal 1.10
10 Others 3.20
Total 11806.69

(Source: indianwindpower.com)
 India State Wise Installed Capacity
as on 31.03.2010

17.6
15.8

12.5

41.6
9.2

Total Installed Capacity : 11806.69 MW

(Source: indianwindpower.com)
 Growth of Installed Capacity
as on 31.03.2010

17.6
15.8

12.5

41.6
9.2

(Source: indianwindpower.com)
 State-wise Unit Generation Data
(kWh) (As on
Sl. 31 st
StateMarch 2010)       
Year-wise Generation (Million Units) Cum

No. Up 2005-06 2006-07 2007-08 2008-09 2009-10 Generation

To 05 (MUs)

1 Andhra 721 79 111 101 333 106 1451

Pradesh
2 Gujarat 1332 286 455 851 2104 2988 8016
3 Karnataka 1409 935 1397 1840 1723 2687 9991
4 Kerala 47 0 0 0 0 63 110
5 Madhya 300 30 70 69 3 82 554
Pradesh
6 Maharashtra 2650 790 1714 1804 2207 2625 11790
7 Rajasthan 494 427 532 682 758 1045 3938
8 Tamil Nadu 11970 3444 5268 6066 6206 8146 41100
TOTAL 18923 5991 9547 11413 13334 17742 76950

(Source : MNRE)
Unit Generation Data (kWh)
       st
(As on 31 March 2010)

(Source : MNRE)
Tamil nadu Scenario
Wind generation is the fastest growing energy source in
this decade , expanding at 25% a year.
Tamil Nadu is a pioneer State among all the states in
India in promoting Wind Energy programme. Tamil
nadu contribution is around 42 % of the country’s
installed wind power capacity.
Tamil Nadu is blessed with conducive natural
meteorological and topographical settings for wind
power generation.
 Total Power Generation Capacity
(MW) (As on 31st March 2010)

Total Generation Capacity :15800.315 MW

(Source : TNEB)
Peak Demand Met and Unrestricted Demand
(MW)
Duration - Peak Unrestricted Short Short
Quarter Demand Demand (%)
Met
Apr-jun 9730.00 10089.67 359.67 3.56
2009

Jul-sep 9386.67 9498.33 111.67 1.18

2009

Oct-dec 9133.67 9402.67 269.00 2.86

2009

Jan-mar 9851.67 10320.00 468.33 4.54

2010
( Source : SRLDC )
Energy availability &Requirement(MU)
Duration Energy met Require Short Short
- Avg/Day ment (%)
Quarter Avg/Day

Apr-jun 196.39 207.38 10.99 5.30

2009

Jul-sep 200.33 211.61 11.28 5.33

2009

Oct-dec 201.83 218.00 16.17 7.42

2009

Jan-mar 206.00 221.19 15.19 6.87

2010
( Source : SRLDC )
Wind Resource in Tamil nadu

(Source: CWET)
 Potential in Tamil nadu
S. Location Tentative Harnessed
No. Gross up to
Potential 31.03.2009
MW
I (Muppandal area) Kanyakumari / 2100 1623
Tirunelveli Districts

II (Kayathar area) Tirunelveli, 1300 880

Thoothukudi Districts

III (Kethanur area) Coimbatore District 1650 1524

IV Coastal area near Chennai and 450 260
Rameswaram in Ramanathapuram
District and other areas (Theni, Palani
areas)

Total 5500 4287

(Source : TEDA)
Year-wise Installed Capacity Addition (MW)

(Source : TEDA)
 Cost Calculation
Project Size 0.60MW
Capacity of WEG 600KW
Project Cost Rs 310 Lakhs*
Plant Load Factor 26.64%
Generation 14 Lacs KWh/Annum
O&M Rate (first 3 years) Nil
From 4th year RS 5 Lacs /Annum + 5% escalation
Depreciation Rate 5.28%
Term Loan ( 75% ) Rs 232.5 Lacs
Investors Equity (25%) Rs77.5Lacs
Interest Rate 10.00% / Annum
Repayment period 5 Years
MAT Rate 11.22% MAT/IT on Return On Equity
IT Rate 33.99%
* Inclusives of Taxes &
Duties
Result & Discussion
Incentives by MNRE, GOI
q80% Accelerated depreciation on wind electric
generators for income tax calculations subject to a
minimum utilization for 6 months in the year in which
deduction is claimed.
q
qImport of wind electric generator is permitted under
Open General License.
q
qCustoms duty concessions on wind electric generators
and certain essential spares.
q
q10 years Tax holiday in respect of profits / gains from
private wind electric generators.
q
qGeneration Based Incentive(GBI) @ 50 paise/ Kwhr
Benefits of wind energy
üCheapest source.

üFastest payback period.

ü
üLowest gestation period; and a modular concept.
ü
üOperation and Maintenance (O&M) costs are low.
ü
üNo marketing risks.
ü
üFuel source is free, abundant and inexhaustible.
ü
Socio-Economic Benefits
üCreation of local employment opportunities.
ü
üImprovement of power transmission networks.
ü
üReduction of transmission cost.
ü
üImprovement in quality of power.
ü
üLong term energy security.
ü
üOverall development of the area.
Government Policies Incentives
qCentral & State Government Policy Highlights:
ü80% accelerated depreciation.
üExcise duty/import tariff concessions.
üTax holiday for power generation.
üFeed-in tariffs.
üWind energy quota.
üProvision of banking, wheeling and third
party sale of power.
üOther financial incentives/subsidies in
certain states.
Foreign Investment Policy:
Automatic approval for foreign investors to enter
into Joint Venture with an Indian partner for financial
and/or technical collaboration/setting up of RE based
power
projects (100% equity permissible)
Limitations of Wind Energy
ØCan be located only where strong and dependable
winds are available.

ØWind is intermittent and hence infirm power.

Ø
ØWind towers and blades subject to damage from very
high wind and lightning.
Ø
ØElectricity produced by wind sometimes fluctuate in
voltage and power factor
 Carbon Finance
ØEligible for carbon credit benefits under the Kyoto Protocol for a
decade from 2002.
Ø
ØEstimate drawn up by the Infrastructure Development Finance
Corporation (IDFC), each unit of electricity produced by wind power,
could earn 15 paise worth of carbon credits.
Ø
ØAs per a rough calculation, a 600/750 KW turbine can earn its O&M
cost per year.
Ø
ØThe ‘Prototype carbon fund’ of the World Bank encourages investor
to fund renewable energy projects. Investors are given pro-rata share of
the CERs produced from their investment.
Ø
ØIndia contributes 11.5% to the volume of CER’s from registered
projects Carbon trading is an important market driver; a recent alert
spoke of India standing to gain $5 billion from carbon credit in next 6-7
years
Small aero generator (Mini-wind mills)
Stand alone type generator used to produce electricity
for captive purposes.
Installed in place wind speed is more than 15 kmph.
41 places have been identified in 8 districts from 67 sites
surveyed which are suitable for installing aero generators.
Consists of smaller capacity wind electric generator, (up
to 30 kW) a tower, a battery bank with an inverter and
electronic control system.
 Scope
Lighting & other electrical uses in Office /
Industries factory buildings, Guest houses,
residential quarters, street lighting etc.

Local bodies/ Office buildings, guest houses, tourist

Institutions home, hostels, remote buildings in remote
locations, street lighting etc.

Individuals Farm houses, gardens, campus lights

 Economics (Tentative)
Cost of system - Rs.2.50 - 3.00 lakhs / kW.

MNRE Subsidy for the system for 2007-08, up to

50% of Ex-works cost for individuals and 75% for
community users subject to a maximum limit. (subject
to change)

Saves around 2500 kWh per kW per annum depending

on wind speed and duration.
Policy
 Conclusion
§Wind energy is pollution free and nature friendly
§Wind energy has very good potential and it is the fastest
growing energy source
§The future looks bright for wind energy because
technology is becoming more advanced and windmills
are becoming more efficient
§
 Beaufort Scale
Force Strength km/h Effect

0 Calm 0-1 Smoke rises vertically

1 Light air 1-5 Smoke drifts slowly

2 Light breeze 6-11 Wind felt on face; leaves rustle

3 Gentle breeze 12-19 Twigs move; light flag unfurls

4 Moderate breeze 20-29 Dust and paper blown about; small branches move

5 Fresh breeze 30-39 Wavelets on inland water; small trees move

6 Strong breeze 40-50 Large branches sway; umbrellas turn inside out

7 Near gale 51-61 Whole trees sway; difficult to walk against wind

8 Gale 62-74 Twigs break off trees; walking very hard

9 Strong gale 75-87 Chimney pots, roof tiles and branches blown down

10 Storm 88-101 Widespread damage to buildings

11 Violent Storm 102-117 Widespread damage to buildings

12 Hurricane Over 119 Devastation

Inside the Wind Turbine
 Wind Mill Water pump
Ideally suited for pumping water for drinking
purposes and / for minor irrigation.
The wind speed is about 18 kmph.
Gear-type wind mills are also available which can
operate at a speed of 9 kmph.
Types
1. Gear type and
2. Gearless type.
 Potential for use
Industries Drinking water supply, gardening,
especially with
drip irrigation

Local bodies / Micro irrigation / drinking water

Institutions supply, horticulture farms especially
with drip irrigation, community
parks etc.

Individuals Micro irrigation / drinking water ,

horticulture farms with drip
irrigation
 Economics (Tentative)
Cost of system - Rs.1.50 to 2 lakhs.

MNRE subsidy available for 2007 - 08 Rs.30,000/-

per pump for Gear type and Rs.45,000/- per pump for
AV55 Type (subject to change)

Saves around 1500 kWh per annum depending on wind

speed and duration.
 Overall Cost Distribution
cost distribution Percentage
wind turbine 64
civil work 13
electrical infrastructure 8
grid connection 6
project management 1
Installation 1
Insurance 1
legal cost 2
bank fees 1
interest during construction 2
development fee 1