Modi's Green-Energy Push Faces a Literal Roadblockby
Transport expenses add 8% to cost of making a wind farm
Wind developers say they must build roads in rural areas
India’s patchy and incomplete road network is proving a challenge for the nation’s developers of wind farms, threatening Prime Minister Narendra Modi’s targets for green energy.
Even under the best conditions, moving the enormous towers and blades found in wind farms requires intricate planning and expense. Individual blades on even modest turbines can exceed more than 100 feet each, while transporting the equipment and cranes needed for assembly can sometimes mean roads must be widened or straightened.
The literal roadblock in India is affecting companies such as Suzlon Energy Ltd., one of India’s biggest turbine makers. Suzlon, over two decades of operations, has located manufacturing facilities in each of the seven windiest states in the country, according to Chairman Tulsi Tanti.
“I’m still not able to access 40 percent of the area irrespective of my plant being in that state when I’m transporting, say, a 128-meter rotor," Tanti said in an interview.
Tanti’s experience reflects the challenge faced by many wind energy developers in India, a $2 trillion economy in which only 60 percent of roads are paved, according to Bloomberg Intelligence. By comparison, wind developers in China have a much easier task, with almost 90 percent of that nation’s roads paved.
Transportation adds nearly 8 percent to a project’s cost in India, according to the Wind Independent Power Producers Association. The cost per installation of 1 megawatt of wind is nearly 70 million rupees ($1 million), Bloomberg New Energy Finance estimates.
“Right-of-way cost has gone up so tremendously that one spends 5 million rupees per megawatt just for the transport of equipment," said Sunil Jain, the wind association’s president said.
Most wind turbines are typically comprised of a tower, two or three blades and a nacelle, which holds the turbine machinery. The blades and towers come in a variety of sizes, though most in use on land today generally range from 2 megawatts to 3 megawatts. Blade lengths can be anywhere from 40 meters to as much as 57 meters, or slightly longer than an Olympic-sized swimming pool. The blades on the biggest wind turbines, which are built for offshore floating farms, can be as long as 80 meters.
In India, developers have been opting for 2-megawatt turbines with rotor diameters ranging from 80 meters to 114 meters. As a whole, India currently has more than 27 gigawatts of installed wind capacity, according to government data.
The logistics of transporting turbines is a “nightmare,” said Rahul Munjal, chairman and managing director at Hero Future Energies Pvt., which has 320 megawatts of wind capacity installed in the country.
Transport trucks, sometimes requiring a 25-meter turning radius, can often find themselves stuck on highways or squeezing through small towns marked by residential areas on either side of narrow roads, according to Munjal.
“God help you if there’s a temple or a mosque on either side because then you can’t make it at all," he said.
Every project faces extra costs to fix roads, build bridges or make turns easier to navigate, said Ramesh Kymal, chief executive for the India operations of Spain’s Gamesa Corp Tecnologica SA.
“If we have good access to our project site, we can see a reduction of nearly five percent in the total project cost, leading to lower tariffs," Kymal said in an interview.
India’s road infrastructure ranked 61st in the World Economic Forum’s global competitiveness report for 2015-2016. By comparison, Malaysia ranked 15 while Chile came in at 35. In a recent interview, Nitin Gadkari, India’s roads minister, said he plans to double the national highway system to 200,000 kilometers (124,000 miles), though no timeframe was provided.
More intervention is needed in a rural roads program known as the Pradhan Mantri Gram Sadak Yojana, the wind association’s Jain said.
ReNew Power Ventures Pvt., an independent power producer with a portfolio of wind projects in India across several states, has built close to 1,000 kilometers of roads in rural areas since its inception in 2012, the company’s founder, Sumant Sinha, said in an interview.
"There are no roads from the highway to the remote site so one has to construct a huge amount of local roads in those places," he said.
Over the next six years India is seeking $200 billion to fund Modi’s renewable-energy target of 175 gigawatts of green power. The nation has almost 45 gigawatts at present, according to government statistics.