Uncharted waters: India’s offshore wind energy has high potential but remains low on implementation

A press release issued by the Union Cabinet on June 14, 2024 highlighted the advantages of offshore wind energy: “Offshore wind is a source of renewable energy that offers several advantages over onshore wind and solar projects, such as higher adequacy and reliability, lower storage requirement and higher employment potential.”

The Union Ministry of New and Renewable Energy (MNRE) has also acknowledged the importance of offshore wind power when addressing the Parliamentary Standing Committee in the past. 

“Mainly, there are three reasons why we should develop offshore wind power — first: Our targets are so high that we will need every source of energy, including offshore wind power. Second: One of the advantages of developing offshore wind energy would be that the manufacturing of offshore wind turbines will be encouraged in the country. Third: due to certain characteristics of offshore wind energy such as seasonality, etc, the contribution of offshore wind power will be higher,” MNRE secretary told the Standing Committee.

This clearly indicates that the Indian government recognises the significance of offshore wind energy. However, the progress report shows that, while the government emphasises its importance, there has been little action.

Policy and stalled progress

India introduced its National Offshore Wind Energy Policy in 2015. By that time, global offshore wind capacity had already surpassed 8.7 gigawatt (GW), with countries like the United Kingdom (4,494 megawatt or MW), Denmark (1,271 MW), Germany (1,049 MW), and Belgium (712 MW) leading the way.

In 2017, potential zones were identified near the Gujarat and Tamil Nadu coastlines. The first LiDAR (a wind resource data collection device) was installed off the Gujarat coast.

MNRE then invited expressions of interest (EoI) for India’s first 1 GW offshore wind project in 2018. The press release stated it received a “keen response from the industry, both global and Indian”.

Additionally, medium and long-term targets were set for offshore wind capacity additions: 5 GW by 2022 and 30 GW by 2030.

However, a stark reality emerged in the Parliamentary Standing Committee report of July 2023: “No offshore wind project has been established in the country till date.” The initial estimated potential off the coasts of Gujarat and Tamil Nadu was around 70 GW, yet no projects have materialised.

The 2018 EoI for the 1 GW project garnered strong interest, but four years later, there are still no operational projects.

Addressing viability gaps

In June 2024, the Cabinet approved a viability gap funding (VGF) scheme for offshore wind projects with a total outlay of Rs 7,453 crore. This included Rs 6,853 crore for installing and commissioning 1 GW of capacity (500 MW each off Gujarat and Tamil Nadu).

However, a disconnect is evident. In 2022, the MNRE informed the Parliamentary Standing Committee that Rs 14,212 crore was estimated for a 3 GW VGF scheme. The July 2023 report mentioned a concept note for a Rs 15,608.65 crore VGF scheme for 3 GW sent to the Department of Expenditure for approval.

The MNRE proposed a Rs 15,608.65 crore scheme for 3 GW, but the Cabinet only approved Rs 6,853 crore for 1 GW. This falls short of the ambitious targets of 5 GW by 2022 and 30 GW by 2030.

Challenges and the road ahead

Offshore wind projects face greater hurdles than onshore ones. These include higher initial costs, technological complexities and the need for turbines to withstand harsh sea conditions. Stringent environmental regulations and complex logistics involving specialised vessels and equipment for maintenance further complicate matters. 

Integrating these projects into the grid necessitates expensive undersea cabling. Additionally, securing financing is challenging due to higher risks and longer payback periods.

India has set a lofty goal of achieving 500 GW of renewable energy capacity by 2030, with 140 GW specifically from wind power. As the MNRE secretary acknowledgd, harnessing all available green energy sources is crucial to meet this target. Unfortunately, progress on offshore wind project development in India remains sluggish.

While the government recognises the potential of offshore wind, translating policy into action appears to be a significant challenge. Addressing financial viability and navigating complex logistical and regulatory hurdles will be critical to propelling India’s offshore wind sector forward.

Suchak Patel is an independent journalist

Views expressed are the author’s own and don’t necessarily reflect those of Down To Earth