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Cheaper & better: refurbished turbines charge wind energy market

Your two-year-old computer is lagging the market. What do you do? Put in a new motherboard, some more RAM and a new microchip, and there you are, revving to go. Himani Chandna Gurtoo reports.

business Updated: Feb 16, 2012 21:24 IST
Himani Chandna Gurtoo

Your two-year-old computer is lagging the market. What do you do? Put in a new motherboard, some more RAM and a new microchip, and there you are, revving to go.

This is precisely what is happening - in the wind energy market.

Refurbished wind turbines are stirring the winds, and with two to four times the efficiency of new turbines, to boot. With a 20% cost economy advantage over new turbines, the refurbishment market has never had it better.

Look at the figures: a repowering project may cost Rs 6.5-7 crore per MW. For a new project, it is more in the range of Rs 9 crore or more - depending on existing infrastructure, logistical challenges and how the old turbines are disposed of.

Experts suggest that with economies improving, wind-power generation units may double to generate 220 lakh units a year from the present 104 lakh units. Many global companies are riding the refurbishment wave to aggressively woo India's windpower market.

According to Gamesa Wind Turbines, the subsidiary of the euro 3.6 billion Gamesa Group, Spain, the repowering trend in India could translate into the sales of over $3.8 billion (Rs 19,000 crore) for repowering companies.

"Progressive investors are keen on playing those 'depreciation machines' as economics is very much back on the throne," said Ramesh Kymal, managing director, Gamesa India

More than 60% of Indian wind farms work with first or second generation bungling turbines that are being upgraded by wind producers such as Suzlon, Vestas, Kenersys and Gamesa. "In our latest projects, the generation capacity has increased by upto 98%. The trend is an overwhelming game changer," said Kymal. Gamsa India has commissioned two projects, LMW near Coimbatore and Fenner India near Nagercoil.

"At all prime locations, Tamil Nadu, Gujarat, Maharshtra and Rajasthan, generators are inefficient. Since each standing windmill is a maintenance headache, fewer machines mean less trouble," said Chintan Shah, head, Suzlon Energy.

Independent power producers are also flocking in, which is likely to fuel growth. "A number of wind IPPs (independent power producers) are in the process of buying old wind farms at attractive valuations, keeping in mind the land and existing evacuation infrastructure," said V Raghu, director, Indian Wind Turbine Manufacturers' Association (IWTMA).