CLIMATE CHANGE AND ROLE OF RENEWABLE ENERGY - WIND PRESENTATION BY D .V. Giri CHAIRMAN, INDIAN WIND TURBINE MANUFACTUE

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2. 2 SNEAK PREVIEW About IWTMA Background India Scenario New Technologies to face climate change Role of Wind Energy � Reliable source of renewable energy Wind Sector � Policies Growth requires �Clarity and Support� on The Paradigm Shift Energy Sources Availability Comparison- A Different basis Why are we afraid of incentives ? Cost of wind Energy Impact of wind projects � Social and Industry Issues of Concern Major Risk � If we do not act Quotes Wish List Conclusion

3. 3 ABOUT IWTMA Founded in 1997 to bridge the gap between demand and supply of power and to compliment other forms of energy Voice of the industry and the Umbrella body of Wind Turbine Manufacturers of India Presently represented by ten members Elecon, Enercon, GE Energy, LM Glassfiber, Pioneer RRB Energy Ltd, Shriram EPC, Southern Wind Farms, Suzlon, Vestas Wind Technology & Wincon. Founder member of Global Wind Energy Council (GWEC), one amongst the seven associations in the world, European Wind Energy Association, American Wind Association etc. Member Governing Council of Centre for Wind Energy Technology (CWET)

4. 4 BACKGROUND Wind installed capacity 8748 MW Members are able to bring to the table, state-of-the-art technology of stall, pitch and variable speed Declared policy in 10 States, commercial WTG operation in eight states Range from 250 KW to 1650 KW Turnkey solutions to customers� needs � one stop shop Effective operation and maintenance to build customer�s confidence Some manufacturers are into export of WTG components as well as WTG exports Privately installed metmast to study larger and new areas of wind farm development Private participation in bringing sub-stations

5. 5 INDIA � SCENARIO Proud to have the 4th position in the world � slowly slipping away from our hands. The role of MNES, now MNRE, IREDA (Finance Promotion Agency) yeoman work of Tamil Nadu Electricity Board (TNEB), wind mapping by Indian Institute of Tropical Meteorology (IITM) and the birth of Centre for Wind Energy Technology (C-WET) are standing monumental examples for Indian wind energy. Potential of 45,000 MW � a Re-assessment, which can go up to 100,000 MW.

6. 6 NEW TECHNOLOGIES TO FACE CLIMATE CHANGE Re-naming of MNES (Ministry of Non- conventional Energy Sources) as MNRE (Ministry of New and Renewable Energy) - The right answer in the right direction. The world is thankful to the fossil fuel - oil and coal are providing energy. It also contributed to pollution � climate change and global warming is on everybody�s lips. Oil and coal are called fossil fuel � they are fossilled and need to be put aside. Future is renewable energy - An un-exhaustible gift of nature.

7. 7 ROLE OF WIND ENERGY � RELIABLE SOURCE OF RENEWABLE ENERGY Holding the fourth position in the world. Almost 90% has come from private investment � therefore, less cost to the exchequer Pollution free ecologically friendly � This is the power of the future Typical example, wind power in Tamil Nadu � plays a vital role of wind energy complementing other power sources It has contributed to direct and indirect employment and has visibly changed the lifestyles in rural hamlets of Coimbatore District, Kanyakumari and Tenkasi Wind energy contribution to climate change � threat that is challenging the universe

8. 8 WIND SECTOR - POLICIES Policy certainty (Clear Term) Tariff certainty (Fixed Term) Operational certainty (Must Run Status) Wheeling and Banking (W & B) Renewable Purchase Obligation (RPO) / Renewable Purchase Specifications (RPS) Transmission and distribution sector support Flexible and progressive norms for installations of Wind Mast/ Mills

9. 9 Regulatory Issues RPS related Tariff related Wheeling & Banking related Land Acquisition Issues Forest Land related Private Land related Revenue / Tribal / Trust lands related. Evacuation of Generated Power Over all conducive environment for Wind Power Development Support from the Ministry

10. 10 THE PARADIGM SHIFT RESULT: Attract Generation based incentive without cap and make revenue neutral to accelerate depreciation FDIs/ IPPs Land Alienation from agricultural and non- agricultural lands to be exempted from wind energy project RESULT: Make wind energy projects on a faster track Long term bankable policy RESULT: No cash outflow Wheeling and banking in all States without UI charges RESULT: No cash outflow to utilities and distribution companies RPO or penetration into grid to be made higher RESULT: Wind and other renewables are now and in the future will become the main stay

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12. 12 COMPARISON - A DIFFERENT BASIS

13. 13 WHY ARE WE AFRAID OF  INCENTIVES ? If there is no alternative (TINA Factor), why are we shying away to attract private investment by special incentive and to some extent control drain on national exchequer. WISE has made a report on the subsidies on fossil fuel � why not subsidies for clean and new renewable energy A natural resource to prevent climate change and global warming. Some initiatives that the Government can look for every new multinational company (MNC) to perform obligation of renewable energy as a part of their contribution � be it wind, solar and other renewable energy.

14. 14 Profit making Navratnas or Mini-ratnas which include NTPC, NHPC have shown some interest in renewable energy sources must make it mandatory in their future energy policy. Let us take the example of Indian Railways, the only Ministry to have a separate Budget � either pollute by diesel smoke or guzzle electric power transporting men and materials across the country - Let�s give a clarion call for Indian Railways to put up wind turbines wherever there is wind.

15. 15 New initiatives taken by MNRE. The Industry welcomes Pilot Project of generation based incentive to attract FDIs / IPPs � Our our wish list is to remove the cap of 49 MW and give all of us a challenge in the running race of the Asian countries, of India and China. Government of Maharashtra initiative on a cess on fossil fuel users to promote wind energy � Can the Government make it an Act covering the entire country.

16. 16 COST OF WIND ENERGY Everyone complains for the wind energy equipment are expensive and they are meant for the rich. We manufacturers (almost most of us) outsource components and assemble together where our contribution is only technology. Therefore the value addition in assembly, site related project work are almost minimal. The global shortage situation of renewable energy equipment and components needs to be seen as a positive factor to fight climate change issue and not as a seller�s market where the demand outstrips supply. The cost effectiveness and new technology is a byword everywhere. Energy security is about cost at least now.

17. 17 IMPACT OF WIND PROJECTS SOCIAL IMPACT Higher value for not-so-good land of agriculture � Rs.30,000 to Rs.3,00,000 Job opportunity for unskilled / semiskilled labour � rural areas � direct employment of 5 persons / MW. Indirect employment of 20 persons in Operation and Maintenance and � short term employment of 50 persons during construction phase. Self employment or contractors for civil, electrical and overhead lines, crane, etc. Some contractors are today owners of wind turbines. Simply it is prosperity. Contd..

18. 18 IMPACT OF WIND PROJECTS IMPACT ON INDUSTRY Government has set up C-WET in Chennai, Tamilnadu. Considering the quorum of this sector under Danida Aid � Test Station in Kanyakumari, South Tamilnadu. We have over six WTGs manufacturers in Tamilnadu. Outside the wind areas, large engineering companies have come up for manufacture of gearbox, generators, transformers, mainshaft castings, towers, etc. As easy access both for procurement and transportation. Standard of living have gone up � infrastructure development of housing, roads, hospitals and shopping areas, etc.

19. 19 ISSUES OF CONCERN No National level policy for wind (Renewable Energy Law) No guidelines for determination of tariff for wind (as in case of Thermal and Hydro) No order on RPO/RPS by most of the State Commissions Improper RPO/RPS implementation and Monitoring Mechanism (except Maharashtra) Must Run Status (a clear order is necessary) No accounting of renewable in case of Transmission and Distribution System Planning

20. 20 MAJOR RISK � IF WE DO NOT ACT Regulatory Risk : Pressure from customers and trade partners could force law makers to enforce mandatory energy efficiency levels, carbon taxes, higher prices on fossil fuels and pollution caps. This will reduce profit margins, particularly for organisations that have not already switched low � carbon technologies. Reputational Risk : Industrialist Anand Mahindra believes climate change could be a major consumer issue by 2010. This is one reason why he wants his company to be a progressive force on the issue. CO2 emission labels are already mandatory for cars in countries such as the US. It is likely they may follow here. Particularly, since the society of Indian Automobiles Manufacturers supports such a move.

21. 21 MAJOR RISK � IF WE DO NOT ACT (Contd.) Litigation Risk : Consumers and State Governments have already filed law-suits in the US asking carbon emitters to be penalised. For example, a British Court cleared six �green peace� activists of criminal charges after they damaged property worth 35,000 Pounds at Kingsnorth Power Station to prevent even greater damage from climate change. The jury felt global warming is such a threat that the activists� actions were justified. Physical Risk : Climate will increase the severity and frequency of storms, droughts, floods, forests and heat waves. Companies located at places where such weather-related events are common could see their physical assets damaged or destroyed by these events. The cost of insuring physical assets could also rise as insurance companies face more and more payouts for hurricanes or cyclone strikes.

22. 22 QUOTES We would require 1 Million MW of power by year 2030, compared to 160,000 MW at present. To meet the demand in the future, they can be met by Hydel, wind and coal based energy projects. However, coal reserves would not last for more than 45 years. - Kirit S Parikh - Member � Planning Commission.

23. 23 QUOTES Warming of the climate system is unequivocal as is now evident from observations of increases in average air and ocean temperatures, widespread melting of snow and ice and rising average sea level. Also much stronger and sharper is the finding related to the human influence on climate change as conveyed in the statement �Most of the observed increase in temperatures since the mid-20th century is very likely due to the increase in anthropogenic GHG concentrations. - Dr.R K Pachauri � Chairman, Tata Energy Research Institute (TERI).

24. 24 QUOTES John Doerr � �fighting climate change is the largest economic opportunity of the next century� � But he adds, �I still do not think that we are going to make it�.

25. 25 QUOTE And enough wind power blows through the Midwest corridor every day to also meet 100 percent of U.S. electricity demand. Geothermal energy, similarly, is capable of providing enormous supplies of electricity for America. The quickest, cheapest and best way to start using all this renewable energy is in the production of electricity. In fact, we can start right now using solar power, wind power and geothermal power to make electricity for our homes and businesses. But to make this exciting potential a reality, and truly solve our nation's problems, we need a new start. - Al Gore

26. 26 WISH LIST Hybrids in wind and Bio fuel Development of Off � Shore Repowering and intercropping for maximum exploitation of land which is a finite source. Special interest subsidies as demonstrated in TUF (Textile Upgradation Fund) and to encompass power intensive sectors to attract private investment. All of us need to join together to make wind energy and other renewable energy source investor-friendly for attractive return and viable option � investor in the country as other alternatives.

27. 27 CONCLUSION Quote from Jufeng Li, Secretary General, China Renewable Energy Industries Association �China is witnessing the start of a golden age of wind power development, and the magnitude of growth has caught even policymakers off guard� It is widely believed that wind power will be able to compete with coal generation by as early as 2015. That will be the turning point in China, which by then will be the world�s largest energy consumer.� (IS ANYONE LISTENING?)

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