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India Reconsiders Wind Forecasting on Inaccurate Results

March 7 (Bloomberg) -- An Indian rule requiring wind farms to predict output or face fines has been temporarily suspended as the regulator reconsiders the best way to ensure stability of the grid, which suffered the world’s biggest outage in 2012.

“The mechanism has been put on hold,” said Sunil Jain, chief executive officer at Hero Future Energies Pvt. and president of the Wind Independent Power Producers Association.

The Central Electricity Regulatory Commission last year said it would penalize wind farms that failed to predict their day-ahead generation within a 30 percent band. Developers including Tata Power Co. and Goldman Sachs Group Inc.’s ReNew Wind Power Pvt. protested the directive, saying it was impossible to comply with and that fines would wipe out profits in an industry that has drawn about $10 billion of investment since 2011.

“Not a single project has been able to produce data within the margins,” Jain said in an interview in New Delhi this week. “It defeats the purpose. It’s too inaccurate.”

Regulator’s Position

Based on feedback from the industry, the Central Electricity Regulatory Commision decided the mechanism needed review and suspended the commercial portion, the commission said in an e-mailed response to questions today. Wind farms still have to submit estimates, it said.

Forecasting of wind generation, an intermittent energy source, is carried out to help stabilize the grid in some parts of the U.S. and Europe, where surging wind output has driven wholesale electricity prices below zero and forced utilities to pay consumers to take power as supply exceeded demand. In India, scheduling would allow wind power to be sold across states and help authorities prepare network upgrades to accept more clean energy in the future.

The industry is asking for the rules to be modified so that a centralized, state-level load dispatcher can compile more accurate, region-wide predictions, which is how scheduling is done in Europe, Jain said.

In 2012, grid collapses caused by a mismanagement of power sales left nearly 360 million people in the dark for days.

Hero Future Energies, a unit of Hero Group which owns India’s biggest motorcycle maker, plans to build 1,000 megawatts of renewable energy capacity by 2017. It will complete 111 megawatts of wind farms by March and won licenses to build 30 megawatts of solar plants in a national auction last month.

To contact the reporter on this story: Natalie Obiko Pearson in New Delhi at npearson7@bloomberg.net

To contact the editors responsible for this story: Reed Landberg at landberg@bloomberg.net Abhay Singh

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