Financial Year 2017-18 (FY18) has been a watershed year for the renewable energysector. The overall wind industry installations plummeted from 5400 MW in FY17 to 1766MW in FY18 (32% of FY17 installations) due to transition from FiT (Feed in Tariff) regimeto auction-based price discovery. It is indeed heartening to see that amidst the businesspaucities resultant of the reformed market dynamics Suzlon continues to remain the marketleader. This fact is reflected in Suzlon gaining a market share of 35% in FY18 which isthe largest by any Original Equipment Manufacturer (OEM) in India. Suzlon's achievementthis fiscal year comes in the backdrop of a paradigm shift in the way wind business isconducted in India with the advent of competitive bidding. Our agility to adapt quicklyand efficiently to the changing market dynamics combined with technologically advancedproducts project execution capabilities vertically integrated operations superiorO&M services pan-India presence across all customer segments has helped us lead withhighest installations in FY18.
RENEWABLES GLOBAL OUTLOOK
Whilst developing countries witness economic overhauls; such a heavy impetus onindustrialization does have an ensuing effect on our ecosystem. To mitigate theill-effects of climate change several countries have already adopted or are in theprocess of adopting strategies that combat climate change. These include carbon neutralitygoals reducing emission of greenhouse gases optimum utilisation of natural resourcesconserving forest covers bringing in total energy efficiency and harnessing renewableenergy among others. Moreover there have been record investments through public as wellas private investors in the renewable energy industry primarily due to reduced capitalcosts in setting up both solar and wind power plants and year-on-year increased focus onclean energy solutions by governments through policy regimes and competitive bidding. Theinvestments in clean energy solutions in Calendar Year (CY) 17 stood at $330 billion thisis about 3% higher than CY16. A 3% rise in investments fuelled a growth rate of 8%increase in clean energy capacity addition. This is a clear indication of the reducedproject capital costs and tariffs for both solar and wind projects and this trend isexpected to continue in the years to come. Similarly more than 60% of the new investmentsin the global power sector have been in renewables and this momentum will continue forthe next five to ten years in India too. Wind energy across the globe has achieved gridparity and is now being seen as a commercial source of energy and no more an alternatesource subsidized through schemes supported by the government. This gradual perceptionshift has helped the industry as a whole to become mainstream relevant and commerciallyviable.
RENEWABLES INDIA OUTLOOK
The future for clean energy in India is promising; as evinced in the last three yearswith the installation of renewable energy capacity being doubled from 32 GW to 63 GW. Thegovernment's target of 175 GW has now been revised to 227 GW by 2022 including 67 GW windenergy. This target is closer to becoming a reality propelled by technology and conducivepolicy environment for renewables; thereby helping the nation achieve energy security in asustainable affordable and environmentally friendly way. Further the Ministry of New andRenewable Energy (MNRE) has also announced target of 30 GW offshore by 2030. Wind industryis supporting the Government's vision and policy of Make in India'. Today more than4000 SME units in our country are producing wind turbine components across the valuechain and providing large scale employment. There is an immense potential for the countryto become a global manufacturing hub for wind energy which is visible as a number ofglobal companies have set up their manufacturing units in India. This gives us a hugeleverage to start a robust export network from our nation to other countries.Additionally the market visibility is improving and the government is deeply committed topushing resources at the highest priority to exponentially grow the wind sector over thenext few years. The wind industry is poised to grow at around 12 to 15 GW every year fromFY20 facilitated by state and central bidding along with captive projects. India will add60 to 75 GW in the next five years.
The renewable sector is already contributing around 20% of India's total installedpower capacity which is mainly driven by over 34 GW of wind power. Renewables will play acritical role in India's energy basket in order to ensure long-term energy security of thecountry and optimum utilization of existing grid infrastructure enabled by rapidlyevolving technology. There is a good visibility of volume for the next five years and weare fully equipped to capitalize on it.
TECHNOLOGY AND INNOVATION SETTING THE STANDARD
Over the years we have successfully overcome challenges to keep pace withtechnology-driven changes that have ensuing effects on our business and society. Suzlon'sbest-in-class in-house technology and robust experience in the wind sector enables us tohave a very strong and diverse customer base making us the preferred partner of choice.The high share of orders from the bidding volumes is a testament to our loyal customerbase as well as our attractiveness to new customers. We are well equipped with the latesttechnology and innovative next-generation turbines that enable the most competitive
Levelised Cost of Energy (LCoE) and our vertically integrated manufacturing base givesus a huge cost advantage.
In FY18 three new Wind Turbine Generators (WTGs) were launched. The S111-140m (metres)is expected to deliver 5-6% higher generation than S111-120m the S120-140m is expected todeliver 6-7% higher generation than S111 and the S128-140 the largest wind turbinegenerator in the country is available in the 2.6 2.8 MW platform and is expected todeliver 20-22% higher generation than S120. These next-generation turbines are wellequipped to improve energy yield and support competitive tariff environment in India whileprotecting customers return on investment (ROI). We achieved another important milestone;Suzlon is the first private sector player to install and commission an operationalOffshore LiDAR based Met Station with a remote monitoring system in the Arabian Seasouth-west of Jakhau port in Kutch Gujarat. From designing and producing India's longestblade to collaborating with our logistics partner for its transportation; from innovationin carbon fibre blades to digitalisation initiatives such usurping innovation intechnology and research at the organisational front it requires us to constantlyinnovate and integrate the best technology available in our products and services. Wepride ourselves on being an innovative company and I am of the firm opinion thatinnovation is indispensable to any business especially in today's ever-evolving market.We continue to focus on developing state-of-the-art business models with the aim ofoffering repowering and wind-solar hybrid solutions.
DIGITALISATION IN THE WIND INDUSTRY
Digitalisation of services innovation in tower and blade technologies aimed towardsmaking unviable wind sites viable ensuring better yield and increasing turbineutilisation will be the key focus areas. The industry will collaborate further forimproving the supply chain enabling grid integration and leveraging digital technologies.
Predictive/Prognostics Analytics based Maintenance Condition Monitoring System (CMS)and Inventory optimisation enable us to maximise turbine efficiency and availability byleveraging the big data technologies. These digitalisation initiatives not only increaseenergy production at lower lifecycle cost but also ensure greater transparency ofperformance parameters at all levels. Further digitalisation is a win-win situation forcustomers and wind farm operators since it assists in enhancing revenue and reducesoperations and maintenance cost.
SUZLON CSR A DECADE OF DIFFERENCE
We have completed 10 glorious years of making a difference in innumerable lives throughour Suzlon Foundation. A journey that began with a small village in Maharashtra has nowreached to more than 800 villages across the country. The foundation empowers VillageDevelopment Committees (VDC) and engages them in community development activities thatlead to an increased well-being of the community members. Among the many ground-breakingactivities initiated by the foundation are two such initiatives Zero Cataract BlindnessProgram and Zero Darkness Program that have tangibly lit up many lives around the country.While one is an endeavour to eliminate darkness from the villages and the other from theirlives. In the last 10 years Suzlon Foundation has improved livelihoods of 183308families across the country restored eye-sight of 5654 cataract patients and lit uphomes with more than 8047 solar lighting systems. As a renewable energy solutionsprovider we endeavour that no home remains dark even though they may be off the grid.Our focus has always been on the overall sustainability and balanced growth of communitiesin and around our area of operations.
THE FUTURE IS BRIGHT
The government's commitment to Renewable Energy remains intact and we strongly believethat the long-term fundamentals of the wind industry are sound. With the newly discoveredtariff wind energy is competitive with respect to other sources of energy and has emergedas a mainstream energy source. Going forward we are well positioned to capitalize on themarket opportunities with our superior technology project execution experience spanningover two decades new generation turbines offering higher energy yield presence acrossthe entire value chain vertically integrated operations and best-in-class servicecapabilities. It is through technological innovation and the pursuit of sustainablesocial economic and ecological development that we can chart the country's path toprogress and power a greener tomorrow.
I firmly believe that technology and innovation will remain the catalyst in thisendeavour. India's shift to renewable energy as a priority has laid the foundation tounlock 300 GW wind energy potential in the country. There is a good visibility of volumefor the next five years and we are fully equipped for that. With government's thrust thecountry is experiencing positive winds of change in the energy sector particularly inrenewables. Indeed India has the potential and capability to lead the global transitionto renewable energy sources and become the renewable energy technology hub to the world.
I take this opportunity to thank all our stakeholders who are associated with Suzlon inwhatever capacity for the unrelenting support and trust you all have bestowed on Suzlonwithout which this journey towards creating a greener tomorrow would not be possible. Letus continue to take this momentum forward!