Cabinet recently approved Viability Gap Funding (VGF) scheme for implementation of Offshore Wind Energy Projects.
Features of the scheme
Nodal Ministry: Ministry of New and Renewable Energy
Aim: Installation and commissioning of 1 GW of offshore wind energy projects (500 MW each off the coast of Gujarat and Tamil Nadu)
Upgradation of two ports to meet logistics requirements for offshore wind energy projects.
Significance:
Help in realization of the aim of the National Offshore Wind Energy Policy (2015).
Reduce the cost of power from offshore wind projects by VGF and make them viable for purchase by DISCOMs.
Annual reduction of 2.98 million ton of CO2 equivalent emission for a period of 25 years.
About Viability Gap Funding
Viability Gap Funding (VGF) aims at supporting infrastructure projects that are economically justified but fall marginally short of financial viability.
Cabinet Committee on Economic Affairs (CCEA) in 2005 approved the Viability Gap Funding (VGF) Scheme (Scheme for Financial Support to PPPs in Infrastructure) as a Central Sector Scheme.
The scheme is administered by the Department of Economic Affairs, Ministry of Finance
Support under this scheme is available only for infrastructure projects where private sector sponsors are selected through a process of competitive bidding.
About Offshore Wind Energy
Offshore wind power refers to the use of wind turbines to generate electricityin bodies ofwater such as oceans or large lakes.
Offshore wind energy projects of more than 57 GW are installed in 18 different countries, of which leading countries are UK, China, Germany, Denmark and The Netherlands.
Potential in India:India has a coastline of about 7600 km, surrounded by water on three sides and has good prospects of harnessing offshore wind energy.
India’s gross wind power potential of 695.50 GW at 120 meter and 1163.9 GW at 150 meter above ground level.
Comparison of Offshore and Onshore wind energy projects
Offshore Wind Energy Projects
Onshore Wind Energy Projects
Offshore wind power refers to wind farms built on shallow bodies of water, usually in the ocean.
Onshore wind power refers to wind turbines constructed and situated on land.
Pros:
Generates more energy: Offshore turbines generate 1MW more energy than onshore turbines due to larger turbines.
Efficiency: winds at sea are stronger and blow in the same direction more often than winds on land.
Less intrusive: have fewer environmental impacts as they don’t affect how towns use their land or create noise pollution.
Land acquisition issue is absent.
Pros:
Cost-effective: cheaper compared to offshore with lower infrastructure and maintenance costs.
Quicker and cheaper installation
Boosts local economy due to land utilization.
Lower transmission losses: There is less voltage drop between the wind turbine and the consumer due to less distance.
Proven technology and reduced wear and tear (low erosion due to less moisture)
Cons:
Lack dependency and predictability.
Transmission and distribution process is tedious, time-taking and needs more infrastructure.
High maintenance costs due to corrosive effect of moisture of seawater and wear and tear from waves.
Cons:
Can cause discomfort to locals due to noise pollution.
Reduced efficiency due to unpredictable wind speeds and direction.
Land availability and landscape considerations limit onshore wind farms.
Way Forward
Wind Resource Assessment: Wind being an intermittent and site-specific resource of energy, extensive WRA is essential for the selection of potential sites.
Maritime Spatial Planning with expert opinion and demonstration projects can help ensuring the viability of projects.
Feed-in tariff (FiT): FiT is a price-driven policy for promoting RE expansion where the government offers a guaranteed purchasing price for electricity produced from RE sources for fixed periods of time.
Discoms can adopt FiT regulations and make offshore wind power procurement mandatory.
Government Initiatives
“National Offshore Wind Energy Policy – 2015”: The policy provides for offshore wind power development up to a seaward distance of 200 nautical miles from the baseline, i.e., up to the country’s EEZ.
Ministry of New & Renewable Energy (MNRE) is the Nodal Ministry, and the National Institute of Wind Energy (NIWE) is the Nodal Agency for the development of Offshore Wind Energy in India.
Long-term target for off-shore wind power capacity additions is 30 GW by 2030
Declaration of trajectory for Wind Renewable Purchase Obligation up to the year 2030.
Other related renewable energy mechanisms
Wind-Solar Hybrid Policy: Promotion of extensive grid-connected wind-solar PV hybrid systems for efficiently utilization of transmission infrastructure and land.
Addresses the intermittency challenge of one renewable source, achieving better grid stability through hybridization.
Ocean Energy: India is estimated to have a potential of around 54 GW of ocean energy.
Tidal energy: energy produced from the movement of ocean tides.
Estimated potential in India: 12.5 GW
Ocean Thermal Energy Conversion (OTEC) is a technology for generating renewable energy that uses the temperature differential between the deep cold and relatively warmer surface waters of the ocean to generate baseload electricity.
Other technologies: Ocean Salt Gradient Energy, Ocean Wave Energy and Ocean Current Energy
