India may start leasing out sea floor for offshore wind projects: Report

In a bid to achieve India's net zero emissions by 2070, the central government is leasing out the ocean floor around Tamil Nadu to offshore wind farms. The base rate has been fixed at Rs 1,00,000 per square km, according to a report in Mint. 

India does not have any offshore energy projects, despite having a 7,600 km-long coastline. These energy plants reduce the burden of energy generation on thermal plants. 

The plan involves inviting bids for two wind power projects in Tamil Nadu and Gujarat, with a capacity of 2GW each.

In Tamil Nadu, the ocean floor along its 1,076-km coastline may be bid out, while in Gujarat, the wind farm projects will be floated on the viability gap funding (VGF) route, where the government gives capital support for financially unviable projects.

"There are two bids we have decided. One bid is in offshore Gujarat. We have carried out all surveys, and we have got all the clearances. That bid will be a plain and simple bid on VGF. We will fix a tariff at, let’s say Rs 4 per unit...Now you bid on the VGF. There are two states which are willing to take it at Rs 4, Gujarat and Tamil Nadu," Union minister for new and renewable energy Raj Kumar Singh was quoted as saying by Mint. 

The Centre will also most likely set up a carbon market after the Energy Conservation (Amendment) Bill, 2022. It was cleared in  Lok Sabha and the Rajya Sabha during the monsoon session. 

Singh added that the power would be transmitted for free to the national grid under renewable power projects. The developers are also allowed to sell it to any company in India. 

The ministry of new and renewable energy has set a target of 30 GW of offshore wind installations by 2030.