Leitwind Shriram Manufacturing Ltd has secured a Rs 346-crore order from Neyveli Lignite Corporation for supply and erection of a 51 MW wind farm.
Leitwind is a joint venture between Shriram Group and Windfin BV (formerly Leitwind BV), which is into design, manufacture, installation and maintenance of wind electric generators.
The wind farm will come up at Kaluneerkulam, near Tirunelveli, Tamil Nadu.
The contract is for procuring land, supply and commissioning, besides operation and maintenance of the wind farm. The wind power project is scheduled for completion in 10 months.
P. Ashok, Managing Director, Leitwind Shriram, said, “This order follows the completion of a project in Andhra Pradesh for Orient Green Power Company and is indicative of the steady improvement in order momentum. The prospects of the sector are looking up once more with the resumption of regulatory incentives.”
Rupee slump threatens growth of $1.6b wind power industry
The rupee’s biggest plunge in 20 years is endangering the recovery of India’s $1.6 billion wind power industry as higher finance and import costs negate benefits from a government subsidy restored last month.
The currency’s 17 per cent slide against the dollar this year has stalled new investment plans, said Mahesh Makhija, director of renewables at the Indian unit of CLP Holdings, the largest owner of farms in India. Turbine makers such as Suzlon Energy and Gamesa Tecnologica, who count India among their top three markets, may raise prices, he said.
After a record 42 per cent drop in installations in the 12 months through March, the industry is set to beat the US for the first time this year after the government reintroduced a cash incentive in August. India, which is fighting to reduce blackouts that hold back economic growth, is seeking to cut dependence on imported fossil fuels and double clean energy capacity to about 57 GW by 2017.
“A rapidly falling rupee affects investor confidence in the Indian economy and is likely to impact our expansion plans,” Makhija said. “Manufacturers who aren’t hedged in the short-term could take the increased costs to customers over the next three to six months. Developers are also likely to be affected by growing inflation.”
The local currency dropped as much as 20 per cent this year when it touched an all-time low of 68.845 a dollar on August 28. Its 8.1 per cent slide in August was the biggest monthly decline since March 1992, according to data compiled by Bloomberg.
The depreciation may hurt the industry at a time India is forecast to put up 2,050 MW of wind capacity in 2013, compared with 2,000 MW expected in the US, pipping the North American country for the first time, according to estimates from Bloomberg New Energy Finance. In 2014, that may rise to 2,300 MW, signalling a rebound.
“If the rupee doesn’t recover in the next couple of months, it will start impacting everything from turbine prices to interest rates, and thus project profitability,” said Shantanu Jaiswal, a New Delhi-based BNEF wind analyst.