How can the budget unlock India’s future as an offshore wind powerhouse
India’s 7,600 km-long coastline presents an enormous opportunity to ramp up the country’s offshore wind power capacity, thereby increasing clean electricity supply for the country’s growing economy, and creating sustainable jobs. The government last month approved a ₹7,453 crore (~USD 900 million) offshore wind funding scheme, a welcome move to kickstart the industry —but a considerably larger financial support will be required to ensure the sector’s sustainable growth and promote manufacturing of offshore wind turbines.
Despite its enormous potential, India has thus far lagged behind its global peers with no installed offshore wind capacity in the country despite the international market size reaching close to 75 GW. In India, just two of the nine coastal states – Gujarat and Tamil Nadu – have a combined offshore wind potential of 71 GW.
India aims to install more than half of this capacity (37 GW) by 2030, as part of its overall non-fossil-fuel goal of 500 GW.
The government’s new funding scheme helps address this early inertia by including INR 6,853 crores (US$ 800 million) of viability gap funding (VGF) to incentivise the development of India’s first offshore wind energy projects, with the remaining amount allocated towards upgrading ports to manage the logistical requirements of these projects. This scheme not only marks the launch of offshore wind in India but is also expected to bring much needed private investment to a sector which developers have shown little interest in so far, due to operational challenges and offtake concerns due to high generation prices.
