Essar may drop plan to set up wind-turbine JV

Ruias-controlled Essar group may drop a proposed joint venture with REpower Systems to manufacture wind turbines in Gujarat after the German company was bought over by Suzlon Energy, an executive close to the development said.

“At present, the joint venture seems to be impractical as Suzlon is pursuing various such projects on its own in the country. Essar may independently relook into it in the future if the business in wind turbine making proves to be promising. The group has no plans to find another partner and pursue the project as of now,” said sources.

Confirming the development, a source in Suzlon said, “We believe that Essar has not followed the contractual obligations, resultantly the agreement with REpower signed in 2006 has no legal validity. Thus, we think that REpower’s project with Essar is off.”

However, the Essar spokesperson said, “We are exploring opportunity in the manufacturing of complete wind turbines for which we have a valid licence from REpower.” When contacted, a Suzlon spokesperson declined to comment.

In September 2006, Essar had zeroed in on Hazira and Bhuj in Gujarat for its foray into wind turbines manufacturing. Essar Wind Power had signed a licensing agreement with REpower for the design and manufacture of 1.5-2 MW wind turbines in India.