India’s Union Cabinet has approved the viability gap funding (VGF) scheme for offshore wind energy projects totaling Rs. 7453 crores (approximately EUR 833 million). This significant investment underscores India's commitment to expanding its renewable energy infrastructure.
Substantial Investment in Renewable Energy
The approved funding includes about EUR 765 million dedicated to the installation and commissioning of 1 GW of offshore wind projects, with 500 MW each off the coasts of Gujarat and Tamil Nadu. Additionally, approximately EUR 67 million has been allocated for upgrading two ports to meet the logistics requirements for these offshore wind energy projects.
The VGF support from the government is designed to lower the cost of power generated from offshore wind projects, making it viable for distribution companies to purchase.
Private Development and Public Infrastructure
The offshore wind projects will be developed by private companies selected through a transparent bidding process. However, the essential power infrastructure, including offshore substations, will be constructed by the Power Grid Corporation of India Ltd (PGCIL).
According to the government, the successful commissioning of these 1 GW offshore wind projects is expected to produce approximately 3.72 billion units of renewable electricity annually. This will result in an annual reduction of 2.98 million tonnes of CO2 equivalent emissions over the next 25 years.
Building an Offshore Wind Ecosystem
“This scheme will not only kick start the offshore wind energy development in India but also lead to the creation of the required ecosystem in the country to supplement its ocean-based economic activities. This ecosystem will support the development of an initial 37 GW of offshore wind energy at an investment of about Rs. 4,50,000 crore,” the government stated.
At the beginning of this year, India launched a tender for four blocks of 1 GW each on an open-access basis, aimed at developing offshore wind projects off the coast of Tamil Nadu. This initiative is part of India's broader strategy to enhance its renewable energy capacity and reduce reliance on fossil fuels.
Source: offshorewind.biz