Summary

The wind energy equipment industry is growing rapidly as wind energy is the fastest growing source of renewable energy in India. According to the analysts more than 90 percent of wind energy potential in India could be exploited by 2030. There are many local production facilities in India due to the vast demand for equipment by the wind power industry in the country. Incentives provided by the Central and State governments to the companies manufacturing wind energy equipment contribute to the growth in India’s wind energy equipment industry. There is a huge demand for wind turbines and windmill blades.

Market Overview

Energy security and sustainable development are high in India’s agenda. The reasons for this are volatile energy prices, high demand for energy, security and concerns over environmental sustainability and the global climate change. With proper incentives wind energy can meet over 24 percent of India’s energy needs by 2030 according to Global Wind Energy Council (GWEC) and the Indian Wind Turbines Manufacturers Association (IWTMA). The growth trends of wind power development in six Indian states (Andhra Pradesh, Gujarat, Kerala, Maharashtra, Rajasthan and Tamil Nadu) indicate that more than 90 percent of wind energy potential in India could be exploited by 2030. Need for installation of high powered wind turbines to replace old and lower capacity machines, development of offshore wind farms and development of hybrid turbines are some of the factors leading to the rapid growth of wind industry in India.

The short gestation period of installing wind turbines, and the increasing reliability and performance of wind energy machines has made wind power a favored  choice for capacity addition in India. India is currently the 4th largest generator of wind energy in the world with an installed capacity of 8698 MW even ahead of China’s 5899 MW as per research and projects investment database firm “Projects Today”. The wind power contributes 70 percent of the grid interactive renewable power installed in India. There are nearly 25 wind energy equipment manufacturers in India. India has a well developed manufacturing base, including global leader Suzlon, accounting for over half of the market. Some of the leading Indian and global companies in this industry are Vestas, Wind Tech, RRB, Enercon, Repower, Siemens, and LM Glasfiber and the new entrants such as ReGen Power Tech, WinWinD, Kenersys, and Global Wind Power

The robust growth in the country’s wind energy equipment manufacturing industry is largely driven by the incentives provided by the Central and State governments. Suzlon, an Indian company, emerged on the global scene in the past decade, and by 2006 had captured almost 8 percent of market share in global wind turbine sales. Suzlon is currently the leading manufacturer of wind turbines for the Indian market, holding some 52 percent of market share in India. Suzlon’s success has made India the developing leader in advance wind turbine technology. However, there is a huge demand for sophisticated equipment manufactured by International wind energy equipment manufacturers. A modern wind turbine consists of about 8000 unique components. Such components and related services are supplied by an estimated 25 to 30 highly specialized companies in India in addition to a large number of international suppliers. Most of the wind turbine manufacturers in India provide operation and maintenance support and also monitor the field performance of the wind turbines installed by them.

With better wind data and use of analytical tools and experience in existing wind farms, it is expected that the capacity factor for the new wind plants would exceed 20 percent. At present, wind energy equipment are manufactured in the country by several manufacturers, through (i) joint ventures, under licensed production (ii) subsidiaries of foreign companies, under licensed production and (iii) Indian companies with their own technology. An indigenization level of upto 70 percent has been achieved in machines of unit sizes up to 500 KW. The import content is higher in higher capacity machines.

The current annual production capacity of domestic wind turbines is about 2500 MW, which is expected to grow by 10,000 MW until 2010. For grid-interactive power, two types of wind turbines, namely stall regulated and pitch regulated, are deployed in the country. Both technologies have their own advantages and disadvantages. Wind turbines are also available with lattice, steel tubular, and concrete tubular towers. At present, the wind industry is market driven and competitive. Suppliers deliver a wide variety of products and services including electronic, mechanic and hydraulic systems, cooling systems, generators, gear boxes, oil and lubricants, wind battery charger and converters. There is also a huge demand for wind turbines and windmill blades, which generate cheap ecofriendly energy.

Best Prospects

India has one of the world’s largest programs for deployment of wind energy products and systems and U.S. companies can take advantage of this huge market. There are many opportunities available for U.S. companies to offer their expertise and equipment for wind energy. India imports wind turbines, windmill blades, wind battery charger, wind energy converters etc. Wind power has the greatest renewable energy generating potential in India. U.S. financial services providers can safely invest in this field with potential for a good profit margin. Opportunities also exist for component manufacturers to become suppliers to wind equipment manufacturers. There is a huge demand for wind turbines and windmill blades, which generate cheap eco-friendly energy. Foreign Direct Investment (FDI) is allowed in the fields of resource assessment, renovation and modernization of existing projects. U.S. companies have the opportunity to establish turbine-manufacturing facility by investing in joint ventures.

Market Issues & Obstacles

U.S. industries, exporters and businesses seeking opportunities in the wind energy equipment industry in India are advised to do some research before considering entry to the Indian market. While wind energy equipment industry in India is an exciting growth area with significant opportunities there are number of local and international competitors. U.S. companies face stiff competition from Germany, Netherlands, Belgium, Denmark and Spain. Obtaining up to date information on market dynamics is important, given the fast developing nature of the wind energy industry and the continuing introduction of new technologies. For those U.S. companies with well established products, finding an Indian distributor or sales agent may be the most economical strategy.

Extract from India: Wind Energy Equipment, US Commercial Service, October 2009. Full Report available on http://buyusainfo.net/