July 10, 2013
India

India’s first wind auction stalled by Mytrah court case

By Natalie Obiko Pearson - 2013-07-10 | Bloomberg | www.bloomberg.com

India’s first auction of wind-farm licenses stalled after an industry lobby and a developer backed by Henderson Global Investors Ltd. filed injunctions, saying it would accelerate a 47 percent plunge in turbine installations.

Rajasthan state, India’s biggest market for new wind farms last year, withdrew a tender for as much as 1,200 megawatts over three years after the Indian Wind Energy Association and Mytrah Energy Ltd. (MYT) filed petitions, B.K. Makhija, Rajasthan Renewable Energy Corp.’s technical director, said in a phone interview.

Mytrah Chairman Ravi Kailas declined to comment in an e-mailed reply to questions. The lobby’s Chairman V. Subramaniam declined to elaborate beyond confirming its court filing.

Asia’s second-biggest wind market plans auctions after the rates paid to solar producers fell 39 percent since 2010 with the introduction of bidding. Lobbies representing developers and turbine suppliers such as Suzlon Energy Ltd. (SUEL) and Gamesa Corp Tecnologica SA (GAM) say auctions would further depress a market that has slumped by half since two state incentives ended last year.

The auctions won’t lead to the reductions in charges seen in the solar industry because project costs in India of about 65 million rupees ($1 million) a megawatt are already among the lowest in the world, according to Mahesh Makhija, director of renewables at CLP India Pvt., India’s largest wind developer.

Generation costs in India’s two-decade-old wind industry are established, making it harder to boost efficiency than for solar, Tata Power Co. (TPWR) head of renewables Rahul Shah said in May.
Maximum Tariff

Rajasthan and Maharashtra, making up 53 percent of the 1.7 gigawatt of wind capacity India installed last year, planned to set a maximum tariff and award licenses to developers offering the biggest discount. Maharashtra’s state distributor, a buyer of power from wind farms, submitted a petition to the regulator in May seeking competitive bidding in the year starting April.

Maharashtra State Electricity Distribution Co. argued the industry was approaching maturity after installing more than 17 gigawatts and was ready for competitive bidding. India’s 2003 Electricity Act had also envisioned introducing auctions into the renewable-energy industry, the distributor said.

Currently, wind power is mostly sold at fixed rates set by state regulators based on discussions with producers and buyers.

The cases are Mytrah Energy (India) Ltd. v. State & Ors., CMS 14130/2103, and Indian Wind Energy Asso. v. Raj. Renewable Energy Corp. Ltd. & Ors., CMS 14160/2013, Rajasthan High Court in Jodhpur.

URL to article:  https://www.wind-watch.org/news/2013/07/10/indias-first-wind-auction-stalled-by-mytrah-court-case/