Financing may be challenge under offshore wind policy:Ind-Ra

Projects to be rolled out under the offshore wind policy may face challenges in achieving financial closure unless backed by the public sector, India Ratings and Research (Ind-Ra) said today.
The government, last month, approved National Offshore Wind Energy Policy which will pave way for the development of this renewable source of energy, including setting up of projects and research in the area.
Ind-Ra further said that the policy guidelines have proposed offshore wind generation capacities through public private partnerships.
Ind-Ra further said that a rollout through engineering, procurement, construction (EPC) route in the initial phase will be a viable option to attract private participation, given the inherent complexities of these projects and the uncertainties around an unexplored area of offshore wind generation.

The policy, if implemented well, will provide an impetus to the falling wind capacity additions as offshore wind generation involves limited use of land, and lack of land has been a major impediment to its growth, it said.
The policy could also help the country achieve the national installed wind capacity target of 60GW by 2022, it added.

Offshore wind projects could be attractive propositions from a return perspective (18 per cent), given the risk return profile, it said.
However, these are contingent on timely executions which could face challenges in the initial phase, it said.
While globally offshore wind power generation has been in existence across Europe and China, the total capacity set up till date is only 11GW.

Given the limited experience, the sector may witness entry of international players with technical expertise to bid individually or in collaboration with Indian EPC players to gain an early mover advantage, it added.