×
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT

'Renewable energy target is quite ambitious'

Last Updated 06 March 2016, 18:32 IST
India is a land richly bestowed with bountiful natural conditions, such as year-round sunshine, water resources, a long coastline, and also ideal windy conditions — all best suited for the generation of clean, renewable energy. While the country has been less ambitious in the realm of renewable energy, several companies have bet big on the opportunities that are aplenty here. In an interaction with Benny Antony of Deccan Herald, Suzlon Group Chairman and Managing Director Tulsi Tanti shares the wind energy giant’s way forward in not only towards the country’s renewable energy push, but also in helping build India’s manufacturing strengths.


What are your view about the ‘Make in india’ campaign, and have you committed any investments?

It is a very good central government initiative to give high focus on manufacturing capacity, because our economy is currently heavily dependent on the services sector and agriculture, and we are not doing much progress in manufacturing, like what China has done. Now, globally, strategically, it is the right time and position for India to focus more aggressively on manufacturing to create long-term sustainable jobs, which is important for our country, as we have a huge young population, and we have to provide them jobs, and manufacturing companies will only be able to satisfy it.

As far as Suzlon is concerned, we are Make in India. We have 20 manufacturing facilities in different states, and our largest manufacturing facility is in Bangalore in the special economic zone. We have turbine manufacturing capability, mainly for the export market. We have the full value chain in wind turbine technology, and we are exporting this product and technology to more than 20 countries. By these initiatives, I see that renewable energy targets set by the government of 175 gW is quite ambitious, and because of that we see a lot more of manufacturing capacity coming in the renewable energy space. Because of this scale and volumes, when our domestic industry becomes mature, I see a lot of exports starting from India. Compared with China, India will be very strong in renewable energy capacity once we can achieve this scale.

Any additional investments that Suzlon has committed?

We are putting up three extra manufacturing capacities. We have a capacity in Gujarat, Maharashtra, Karnataka and Tamil Nadu. We are adding new rotor blade capacity in three states: Rajashthan, Madhya Pradesh and Andhra Pradesh. Within next 6-9 months, that production capacity will be ready.

Solar power rates have been falling. Do you see that as a threat to the wind power industry ?
I do not see it as a threat. It may be a threat to coal power, not for wind power, as we need our own energy as much as possible for energy security.

So wind and solar are complimentary energy. And if we harvest both, then we will be able to add more and more capacity. If we go only one way, it will not be sustainable for the grid. So from a grid perspective, it is very important technically that both grow hand-in-hand.

The benefits of accelerated depreciation (AD) and generation-based incentive (GBI) is only till 2017. Is it likely to be renewed?

I strongly recommend to our Finance Ministry that we have a very high priority for the renewable energy sector, and there is an ambitious target of 175 gW by 2020. So whether it is accelerated depreciation or GBI, or whether it is any other fiscal benefit for renewable energy what is available today, it should be continued till 2020. Otherwise, the current momentum will break

What are your targets from a wind power installation perspective for this fiscal, and perhaps the next couple of fiscals?

This year, the industry will do 3,000-3,200 mW in the current year. Next year, we are expecting another 20% growth, so it will be 3,600-3,800 mW.

From a company perspective, what are the volumes that you are targetting for the next couple of fiscals ?

The Indian market will continue at over 20% growth for the next three years in the wind sector, and our growth will be higher than the market growth.

What is your position in terms of order book ?

Our order book position is quite good and healthy. Today, we have almost 1,200 mW order book on hand, and nearly 1,000 mW order is under negotiations in the pipeline. So we are comfortable as far as our order book position is concerned. The only challenge for the industry is how much we can install and commission on the ground.

What is your position as far as market share is concerned, and any particular market share that you are targetting ?

Compared with last year, our market share will increase in the current year. We are targetting 35% market share in the current fiscal (by March 2016). It was around 25% last year.

You had recently raised additional working capital. Can you throw some light on what exactly are your plans from that?

We are in a growth phase, and this is a high working capital-intensive industry, and because of that if we need to increase volumes, we need additional working capital. The Rs 2,300 crore additional working capital will help us grow faster than the industry next year. It is not for debt reduction or capital expenditure.
ADVERTISEMENT
(Published 06 March 2016, 17:10 IST)

Follow us on

ADVERTISEMENT
ADVERTISEMENT