Investments in wind energy fall in Tamil Nadu

Tamil Nadu may soon get the wind knocked out of it. Swathi Narayanan of CNBC-TV18 reports that investments into wind energy in the state have fallen nearly 75 percent this fiscal. And the state's attempts to improve its power situation may scatter to the winds.

Tamil Nadu, a state that depends on wind energy for nearly 15 percent of its total power generation is in dire straits.
Last fiscal, wind power projects to generate 1,083 megawatts were installed in the state which is struggling with an acute power shortage but in the first half of this year, the installed capacity has dropped to a mere 150 megawatts.
Ramesh Kymal, CMD, Gamesa, chairman, IWTMA, says that compared to more than 1000 mw last yearr we have done only 150 mw in the first half. And I can assure you between now and March we will have another 50 mw.
So about 1100 mw, we are talking about Rs 7000 crore investment made in TN. This year only 200 mw is going to come which is only Rs 1300 crore.
For the Jayalalithaa government, this steep fall in investment also means a sharp drop in revenue potential.
Kameswara Rao, leader - energy, utilities, & mining, PwC, say that it is an immediate decline in capex in the state and the as well as loss of revenue that the state would have got by selling this power to other parts of the country. Experts blame this loss in investment interest on two factors.
First, from the 31st of March, the tax credits available to investments in the sector have been withdrawn, making it unattractive. Second, payments from the debt-ridden Tamil Nadu Electricity Board have dried up.
"The feed and tariff market that is selling to the utility is anyway more or less dead because the TNEB has not paid people supplying wind for the last year. For a little more than a year they have not paid anybody," says Kymal.
Add to this the poor infrastructure in the state, and wind energy players are increasingly looking at taking their money to states like Maharashtra and Gujarat.
Unless the state government acts fast to rectify some of these problems, chances are Tamil Nadu's power short fall of 4,000 megawatts will grow exponentially and this will leave the state literally powerless to fuel growth.