Home / Politics / Policy /  Cabinet clears policy for offshore wind farms

New Delhi: The Union cabinet on Wednesday approved the National Offshore Wind Energy Policy, aiming to harness wind power along India’s 7,600 km coastline.

The decision paves the way for offshore wind energy development, including projects and research and development activities up to a seaward distance of 200 nautical miles, which constitutes the exclusive economic zone (EEZ) of the country.

The move was panned by experts who said India should instead first achieve the full potential of the onshore wind power.

The cabinet also approved increasing dearness allowance (DA) and dearness relief by 6% each, benefiting about 5 million central government employees and 5.6 million pensioners.

The decision would cost the exchequer 6,655 crore a year and 4,436 crore in the current year. The 6% increase is over the existing rate of 113% of the basic pay or pension, to compensate for price rises.

It also approved 100% foreign direct investment (FDI) under the automatic route for non-bank entities that operate cash machines, subject to certain conditions, in a bid to boost financial inclusion in the country. The aim is to widen the ATM network in semi-urban and rural areas.

WLA operators in the country include Tata Communications Payment Solutions, a unit of Tata Communications Ltd, Prizm Payment Services and Muthoot Finance.

In a press conference after the cabinet meeting, minister of state (independent charge) for power, coal and new & renewable energy Piyush Goyal called the offshore wind policy a pioneering step.

“The Cabinet today fixed policy guidelines for offshore wind energy in the coming days. Under the policy, there will be wind energy mapping of the country and locations with high potential will be identified. Government will get all approvals for these areas from departments such as defence, shipping and space and offer them under bidding. This is a pioneering step in renewable energy," said Goyal.

The minister said preliminary estimates showed the Gujarat coastline has the potential to generate around 106,000 megawatts (MW) of offshore wind energy and Tamil Nadu about 60,000 MW. Worldwide installed capacity of offshore wind projects is around 8,500 MW and of that, around 4,500 MW is in the UK alone.

The government said the move would help India as it moves towards attaining energy security and achieve targets under the National Action Plan for Climate Change.

However, experts said the potential of onshore wind energy should be exploited first.

The government recently estimated onshore wind power potential at 302 GW in a country where generation is a little over 23 GW, said Karthik Ganesan, who is senior research associate at the Council on Energy, Environment and Water (CEEW), a policy research institute.

“So it is a long way to go in onshore wind power itself. Offshore wind power in the long run will certainly become a good option and a necessary component of our renewable power, as it would be cheaper and consistent. But right now we need to give investors confidence in onshore wind power," Ganesan said.

Wind energy is considered one of the most developed, cost-effective and proven renewable energy technologies to meet energy demands in a sustainable manner.

India is an important player in the wind power segment and has had significant success in onshore wind power development.

Of India’s 36,642 MW of installed renewable power capacity, around 23,864 MW is onshore wind energy alone.

The cabinet also gave ex-post-facto approval to the capital infusion made in the Export Import Bank of India (EXIM) of 800 crore and cleared an amendment to the First Schedule of Industries (Development and Regulation) Act, 1951, to transfer the authority to regulate alcohol that is fit for human consumption to state governments, as recommended by the Law Commission.

The amendment would end confusion about jurisdiction of the central and state government on potable alcohol and industrial alcohol.

The Cabinet Committee on Economic Affairs approved the revised cost estimates of 2,136 crore and 2,168 crore, respectively, for the four-laning of national highways from Udhampur to Ramban and Ramban to Banihal.

Implementation of these projects would provide all-weather connectivity from Jammu to the Kashmir valley.

With inputs from Saurabh Kumar.

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