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India and China catch the wind  

Dilip Pantosh Patil uses an ox-drawn wooden plow to till the same land as his father, grandfather and great-grandfather. But now he has a new neighbor: a shiny white wind turbine taller than a 20-story building, generating electricity at the edge of his bean field.

Wind power may still have an image as something of a plaything of environmentalists more concerned with clean energy than saving money. But it is quickly emerging as a serious alternative not just in affluent areas of the world but in fast-growing, energy-starved countries like India and China. And leading the charge here in west-central India and elsewhere is an unlikely champion, Suzlon Energy, a homegrown Indian company.

Suzlon dominates the Indian market and is expanding rapidly abroad, having just erected factories in locations as far away as Pipestone, Minnesota, and Tianjin, China. Four- fifths of Suzlon’s soaring order book now comes from outside India.

Not even on the list of the world’s top 10 wind turbine manufacturers as recently as 2002, Suzlon passed Siemens of Germany last year to become the fifth-largest producer in terms of installed megawatts of capacity. Suzlon still trails the market leader, Vestas of Denmark, as well as General Electric of the United States, Entercon of Germany and Gamesa of Spain.

Suzlon’s past shows how a company can prosper by tackling the special needs of a developing country. Suzlon’s present suggests a way of serving expanding energy needs without relying quite so much on coal, the fastest-growing fossil fuel right now but also the most polluting. And Suzlon’s future is likely to be a case study of how a manufacturer copes with China, both in capturing sales there and in confronting competition from Chinese companies.

The company is a product in many ways of India’s dysfunctional power distribution system. Electricity boards owned by state governments charge more than twice as much per kilowatt-hour for industrial users as in the United States – and still suffer blackouts almost every day, especially in northern India.

Subject to political pressures, the boards are often slow to collect payments from residential consumers and well-connected businesses, especially before elections. As a result, they often lack the money to invest in new equipment.

To stay open and prevent crucial industrial or computer processes from stopping, everyone from auto parts factories to outsourcing giants in India relies on even more costly diesel generators.

With natural gas prices climbing as well, wind turbines have become attractive to a wide range of businesses in India. Essar Group of Mumbai, a big industrial conglomerate active in shipping, steel and construction, is working on plans for a wind farm near Chennai, formerly Madras, after concluding that regulatory changes in India have made it financially attractive.

“The mechanisms didn’t used to be there; now they are,” said Jose Numpeli, vice president for operations at Essar Power. The electricity boards, he said, “know how to cost it, they know how to pay for it.”

Wind will remain competitive as long as oil stays above $40 a barrel, said Tulsi Tanti, Suzlon’s chairman and managing director; the price has recently dropped to around $60 a barrel. Below $40 a barrel, wind energy may require subsidies to remain cost-effective, or possibly environment-based taxes on oil and other fossil fuels.

Tanti and his three younger brothers were running a textile business in Gujarat in northwestern India when they purchased a German wind turbine, only to find they could not keep it running. So they decided to build and maintain wind turbines themselves, starting Suzlon in 1995 and later leaving the textile business.

To minimize land costs, wind farms are typically in rural areas, chosen for the strength of their winds as well as low land prices. That can cause culture shock.

“There were no big changes until the turbines came,” Patil said, pausing from plowing here with his father in this remote, tribal area of central India where oxen remain at the center of farm life and motorized vehicles are uncommon.

The new Suzlon Energy wind farm here in Khori is a subject of national pride. More than 300 giant wind turbines, with 33-meter, or 110-foot, blades, generate electricity from the air. But it has also struggled with the sporadic lawlessness that has long bedeviled India.

S. Mohammed Farook, the installation manager, was far from happy on a recent afternoon. At least 63 new turbines, worth $1.3 million apiece and each capable of lighting several thousand homes when the wind blows, could not be put into service because thieves had stolen their copper power cables and aluminum service ladders for sale as scrap.

The copper or aluminum fetches as little as $1 from black market scrap dealers. But each repair costs thousands of dollars in parts and staff time, in a country that is desperately short of electricity and technicians alike.

“I am crying inside,” Farook said.

Despite such problems, Suzlon has expanded rapidly as global demand for wind energy has taken off. Suzlon’s sales and earnings tripled in the quarter through June 30, as the company earned the equivalent of $41.6 million on sales of $202.4 million.

Demand for wind turbines has particularly accelerated in India, where installations rose nearly 48 percent last year, and in China, where installations climbed 65 percent last year, although from a lower base.

Coal is the main alternative in India and China, and it is causing acid rain and respiratory ailments while contributing to global warming. China accounted for 79 percent of the world’s growth in coal consumption last year while India represented another 7 percent, according to BP statistics.

China has imposed a requirement that power companies generate a fifth of their electricity from renewable sources by 2020. China’s target calls for expanding wind power almost as much as nuclear energy over the next 15 years.

India already leads China in wind power and is quickly building more wind turbines.

Chinese and Indian officials are optimistic about relying much more heavily on wind.

“I believe we may break through these targets – if not, we should at least have no problem reaching them,” said Zhang Yuan, vice general manager of China Longyuan Electric Power Group, the renewable energy arm of one of China’s five state-owned electric utilities, China Guodian.

Kamal Nath, India’s minister of commerce and industry, was even more enthusiastic.

“India is ideally suited for wind energy,” he said. “The cost of it works well, and we have the manufacturing capability.”

By Keith Bradsher The New York Times

iht.com

This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

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