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A 1GW offshore wind farm might be up for auction in the first 100 days of the incoming government

29 Apr 2024

India could bid out 1 GW of offshore wind capacity under the viability gap funding (VGF) scheme and issue guidelines to implement the PM-Surya Ghar Muft Bijli  Yojana within 100 days of the next government taking charge, people familiar with the matter said. Financial assistance for 1 GW offshore wind energy projects  was announced in the union budget for FY25.The PM-Surya Ghar Muft Bijli Yojana, with an outlay of ?75,021 crore, was launched on February 13 with an aim to solarise  10 million households. Currently, draft guidelines for the rooftop solar programme have been circulated for stakeholders' views, one of the people said. An offshore wind capacity of about 37 GW is planned to be auctioned till 2030 under VGF and non-VGF schemes, according to the Ministry of New and Renewable Energy's  document stating the planned bidding trajectory. The scheme supports infrastructure projects that are economically justified but fall marginally short of financial  viability.An Initial assessment of the offshore wind energy potential showed an estimated 70 GW capacity off the coast of Gujarat and Tamil Nadu, according to  government data. Currently, eight zones each in Gujarat and Tamil Nadu have been identified for exploring the offshore wind energy potential, as per a report from  the National Institute of Wind Energy.With an emphasis on harnessing the potential of a long coastline, the government has already proposed to issue tenders for seven  seabed sites or blocks off the Tamil Nadu coast. These tenders are, however, for non-VGF projects.Under the exploration model, a developer can bid for sites to survey  and assess it for physical and commercial viability. The estimated capacity under exploration model is around 7.2 GW.Under the PM-Surya Ghar Muft Bijli Yojana,  the government has already seen registrations from more than 10 million households. The scheme offers a subsidy of 60% of cost for systems up to 2 kW capacity and  40% of cost for systems between 2 kW and 3 kW.The subsidy is capped at 3 kW capacity. This means, if a household's capacity exceeds 3 kW, it will not get financial  support for additional capacity. At current benchmark prices, the subsidy translates to ?30,000 for 1 kW, ? 60,000 for 2 kW and ?78,000 for 3 kW systems or higher.

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