Karnataka wind energy, Karnataka Wind policies, Karnataka wind projects, Wind energy incentives in Karnataka, Wind turbine manufacturers 

New WindPower project at Harapanahalli

WIND MILL

The Cabinet will allott 115 acres land to Sarjan Realties Ltd to set up a wind farm at Harapanahalli in Davangere district.

The land  is on a 30-year lease. 

The project, cleared by state energy department, is to produce 34 MW of power initially and later scale it up to 77.4 MW.

Lancos Wind Assets in Great Demand

Lanco Infratech has licenses to generate 5000MW using wind turbines and has acquired land stretching across Karnataka, A.P. and T.N.

Gamesa to become a big player in Wind

Gamesa will be investing 700 crores in wind energy annually.Has installed base of 563MW across states including, Andhra Pradesh, Gujarat, Karnataka, Maharashtra, Rajasthan, Tamil Nadu and Madhya Pradesh.

Infosys, India's second largest IT exporter, has a green mandate too. 

A clutch of energy experts - Rajendra Pachauri, Director-General of TERI, SL Rao, the former Chairman of the Central Electricity Regulatory Commission, Harish Hande, MD of sustainable energy company Selco and Kris Gopalakrishnan, executive chairman of Infosys - had gathered to talk about India's energy challenges at the Infosys   campus.

Gulbarga in N.Karnataka is to become the scene of action.

It is estimated that 2% of the solar radiation incident on Earth is converted to kinetic energy of wind. The energy content of solar radiation impacting the surface of Earth is believed to be 1000 watts per square metre. Thus the total solar energy impacting the state of Karnataka is 1920000 MW. Two percent of this energy, 38400 MW, is converted to kinetic energy of wind. Generation of electrical energy from this source requires land for building wind turbines. Such turbines can be built only on uninhabited lands or those that are not required for commercial purposes or residential purposes or for cultivation of crops. Assuming further that only 0.05% of the land area may fall in this category (lands unfit for any land-based productive activity) the gross potential in the State based on the land area can be 2000 MW. However, assessed potential is worked out to be 1662 MW.

There are many small wind farms in Karnataka, making it one of the states in India which has a high number of wind mill farms. Chitradurga, Gadag are some of the districts where there are a large number of Windmills. Chitradurga alone has over 20000 wind turbines.

The 13.2 MW Arasinagundi (ARA) and 16.5 MW Anaburu (ANA) wind farms are ACCIONA’S first in India. Located in the Davangere district (Karnataka State), they have a total installed capacity of 29.7 MW and comprise a total 18 Vestas 1.65MW wind turbines supplied by Vestas Wind Technology India Pvt. Ltd.

The ARA wind farm was commissioned in June 2008 and the ANA wind farm, in September 2008. Each facility has signed a 20-year Power Purchase Agreement (PPA) with Bangalore Electricity Supply Company (BESCOM) for off-take of 100% of the output. ARA and ANA are Acciona’s first wind farms eligible for CER credits under the Clean Development Mechanism (CDM).

ACCIONA is in talks with the World Bank for The Spanish Carbon Fund which is assessing participation in the project as buyer for CERs likely to arise between 2010 and 2012. An environmental and social assessment has been conducted as part of the procedure and related documents have been provided. These are included below, consistent with the requirement of the World Bank's disclosure policy

Wind Energy Potential in Karnataka

Target for Wind Energy in Karnataka

•  Wind Power capacity from the current installed capacity of 1120.685 MW to 3500 MW by 2012 (contributing about 8260 M.U./year) and 7500 MW by  2018 (contributing about 17700 M.U. /year).
• Wind power harnessing is area specific. Wind is the fastest-growing clean energy sector of the renewables. Much of the technology for wind power already exists. Advanced technologies like “Floating wind power plants” will be explored in the west coast.There is a potential of about 13000 MW for the development of wind power plants in the state. Wind potential areas in the state are Chitradurga, Gadag, Chikmaglur,Bellary, Davangere, Koppal, Bijapur, Bagalkot, Belgaum etc Districts.
• Wind resource assessment (WRA) is the primary requirement for wind power development. In this direction wind resource assessment study is an on-going activity of the state Govt (KREDL) in collaboration with C-WET (GOI).
• About 220 wind monitoring stations are necessary for the macro level assessment of wind resources. About 72 wind monitoring stations have already been established, and it is proposed to establish another 110 stations during 11th plan, and 182 stations during 12th plan period.
• The wind turbine generators manufacturers (WTGs) / Developers resorting to wind resource assessment studies at micro level, and they have obligation to share the data with  KREDL/MNRE.  
• To complement the wind potential areas, transmission network strengthening is identified as a key area for wind energy projects.
• Wind Power Project are mostly located in remote backward hilly areas, they contribute towards rural development of such areas apart from employment generation to local people.
• Issues related to the growth of wind energy in the state will be addressed by giving all necessary facilitation by establishing necessary “Single Window Clearance” system including land issues.

Government policies for wind power in karnataka

Incentives for RE projects in Karnataka

1.The various concession and incentives allowed by MNRE/GOI regarding DSI/DPR, GBI etc will ipso-facto continue to be passed on by the State Government to the project developer through KREDL.

2. RE power procurement by distribution companies will be at tariffs as determined by the KERC.

3. Government of Karnataka vide GO No EN 216   NCE 2006 dated 2.3.2007 accorded approval for the upper limit of the share of renewable energy in the total quantum of energy purchased by each ESCOMs enhanced to 20 %.

4. KERC in its notification No S/03/1 dated 23rd January 2008 issued amendment to KERC (power procurement from renewable energy sources by distribution licensee) Regulations 2004 fixing the minimum renewable energy to be procured by each distribution licensee between 7 to 10%.

5. Sale of electricity: On the electricity generated by the RE projects, the developers will be encouraged to sell power to the state grid on priority. Such purchases may be in whole or part as per the rules and regulations of KERC subject to the provisions of the Electricity Act 2003.

6. Wheeling and Banking of electricity: With Wheeling and Banking arrangements for RE projects, necessary co-operation and facilitation will be provided for executing Power purchase agreement (PPA) and evacuation clearance as per the Govt/KERC norms.

7. In case of Renewable Energy projects, if Government land (belonging to urban local bodies/panchayat) is available, the required land for setting up RE projects will be provided on lease basis as per rules and regulations of the Government, for a period of 30 years, subject to further renewal as determined by the Government.

8. The state Government will exempt octrio and entry tax on the RE equipments for erecting capacity sanctioned as per rules.

 Single window project clearance mechanism in Karnataka

1. Setting up of RE projects involves sanctions/ clearances from number of Government agencies/departments. The state Government will facilitate and provide requisite clearances through a “Single Window Clearance Mechanism”.
2. For this purpose a high level empowered committee at Government level will be constituted to accord necessary approvals/clearances.
3. Similarly “Single Window Clearance Mechanism” for execution of Power Purchase Agreement (PPA) and for payment to the private entrepreneurs for the electricity sold to the Distribution companies will be considered.

Capacity Allotment of RE Projects

1. Developers has to submit the details of RE project for capacity allotment in the prescribed application, after remitting application fees and processing fees to KREDL as fixed by the Government.
2. Allotment committee constituted by the state government shall decide on the application of capacity allotment by considering various aspects of the policy, as well as the various government orders issued from time to time, and cause to issue necessary Government Order.
3. The Allotment committee will be headed by the Principal Secretary, Energy Department, Government of Karnataka.
4. The Government of Karnataka reserves right to allot a RE project to a state enterprise.
5. Industrial units located in Karnataka and willing to establish RE projects for their captive use will have priority.
6. The prospecting IPP (Independent Power Producer) shall not claim any right on allotment for self identified RE projects.
7. Wherever more than one prospecting IPP is involved, if necessary, the self identified RE projects shall be considered for allotment on the basis of open competitive bidding.
8. The allotment committee and Government will have the right to decide on the number of RE projects that may be allotted to any given single IPP/developer.
9.  Enhancement of allotted capacity of the RE projects will be considered on merit, only after submission of detailed project report (DPR), justifying the enhancement.
10. Transfer/Sale of allotted RE capacity will be considered as per rules and regulations of the Government, only after submitting necessary justification.
11. Any sanctioned RE project that remains un-developed within the time limit as per the agreement, the state Government has a right to cancel and terminate the project and the same may be allotted through open competitive bidding. However the Government may consider giving necessary time extension on merit and justification after remitting extension fee to KREDL as fixed by Government.
12. From the date of agreement for the RE projects sanctioned, Royalty will be exempted up to 18 years, and from 19th year, Royalty to the Government on Renewable Energy, shall be collected @ 15 % of the energy generated.
13. The RE Projects, will be sanctioned for a total period of 30 years from the date of execution of the agreement. However, the Government may consider extending the project period after the expiry of the agreement based on merit and justification.

Nodal Agency: Karnataka Renewable Energy Development Limited (KREDL) will be the nodal agency for the implementation of the RE Policy. KREDL will be responsible for laying down the procedure for inviting of proposals from Independent Power Producers (IPP’s), DPR, evaluation of project proposals, project approvals, project implementation, operation & monitoring.

Revenue Land: If Government/local Body/Gram Panchayat land is available, the required land for setting up RE projects will be leased to the RE developer as per Government rules and regulations for a period of 30 years subject to further renewal on mutually agreed terms and conditions.

Land on canal banks: Wherever Irrigation land on canal banks is available beyond their requirement, Karnataka Irrigation Department (KID) will leaser such land to the RE developer as per Government rules and regulations  

Private Land: NA conversion will be exempted for renewable energy projects for purchase of private/agricultural land since they are environmentally friendly and result in zero carbon emission.

Forest Land:  Wherever Forest land is involved in the RE project  the same will be processed and considered by the Karnataka Forest Department under the provisions of the Forest Conservation Act (1980) since they are environment friendly and result in zero carbon emission

Renewable Energy Special Economic Zone (SEZ): A separate RE SEZ will be established in the backward areas of Karnataka to promote and develop RE projects especially solar thermal/PV grid connected power projects. Renewable Energy Sources like wind and solar require large tracts of land for setting up power plants and also for manufacturing units of Solar PV and wind Turbine etc. These sources are area specific. Potential for development of wind and solar power plants exists in northern parts of the states in Districts like Gulbarga, Bijapur, Bidar, Bellary, Raichur, Chitradurga, Koppal Gadag, Belgaum etc. Approximately 2 hectares of land is required to establish unit of 1MW solar plant. In view of this, a “Special Economic Zone (SEZ)” of 150-250 Hectares of suitable waste land/non productive agricultural land will be identified to be developed as SEZ under the provisions of the Industrial Policy of the state to establish RE projects including setting up of solar manufacturing units and other RE projects allied manufacturing units.

Capacity Allotment of RE Projects

• The developer shall submit application for allotment of power capacity in prescribed application form to the KREDL remitting application fee and processing fee as prescribed by the KREDL/Government the KREDL will recommend the application to Government for further consideration within 30 from the date of submission to KREDL.
• The Government of Karnataka reserves right to allot a RE project to a state enterprise.
• Industrial units located in Karnataka and willing to establish RE projects for their captive use will have priority.
• The prospecting RE power Developer/IPP (Independent Power Producer) shall not claim any right on allotment for self identified RE projects.
• Wherever more than one prospecting RE power Developer/ IPP is involved, if necessary, the self identified RE projects shall be considered for allotment on the basis of open competitive bidding.
• The allotment committee and Government will have the right to decide on the number of RE projects that may be allotted to any given single IPP/developer.
• Enhancement of allotted capacity of the RE projects will be considered on merit, only after submission of detailed project report (DPR), justifying the enhancement.
• Transfer/Sale of allotted RE capacity will be considered as per rules and regulations of the Government, only after submitting necessary justification.
• Any sanctioned RE project that remains un-developed within the time limit as per the agreement, the state Government has a right to cancel and terminate the project and the same may be allotted through open competitive bidding. However the Government may consider giving necessary time extension on merit and justification after remitting extension fee to KREDL as fixed by Government.
• The RE Projects, will be sanctioned for a total period of 30 years from the date of execution of the agreement. However, the Government may consider extending the project period after the expiry of the agreement based on merit and justification

Allotment Committee: A committee under the Chairmanship of Principal Secretary, Energy Department shall consider for allotment of capacity of the renewable energy projects to the private entrepreneurs within 90 days from the date of submission of application to KREDL

Clearance of RE Projects: “Single Window Clearance” Empowered Committee will review the RE projects. RE projects involve sanctions/clearances from a number of Government Agencies/Departments. The developer shall submit application to the concerned Government department/organization for necessary clearances and approvals. The concerned department shall give necessary approval and clearance within 45 days once the application submitted by the developers. If there is any delay by any Government department/organization the Empowered Committee shall provide the clearances in a time bound manner through a single window mechanism within a period of 30 days from the date review and Empowered Committee shall meet & review RE projects in the month of January, September and December of every year.

Evacuation system:  The evacuation system for purchase of energy shall be provided by the KPTCL/distribution licensee through its main grids.

Grid interfacing: Grid interfacing including installation of Transformers, panels, kiosks, protection & metering on HT side of generating station and its subsequent maintenance will be undertaken by the power producer/ plant owner.

Installed capacity of wind energy in Karnataka:

Year wise capacity addition in Karnataka:

Year wise installed capacity addition (MW):

Government Incentives for Wind Power

Fiscal and financial incentives

• Concession on import duty on specified wind turbine parts
• 80% accelerated depreciation over one or two years
• 10 year income tax holiday for wind power generation projects
• Excise duty relief on certain components

Land policies

• The Ministry of Environment and Forests has issued guidelines for diversion of forest lands for non-forest purposes, particularly to enable wind generation
• Clearance of leasing and forest land for up to a period of 30 years for wind developers

National Feed-in-Tariff

• In June 2008, the MNRE announced a national generation-based incentive scheme for grid connected wind power projects under 49 MW, providing an incentive of 0.5 rupees per KWh in addition to the existing state incentives.

• Investors cannot draw any benefit from accelerated depreciation under the Income Tax Act can opt for this alternative incentive instead.

Incentives for Wind Energy –Direct Tax

• 10 year tax holiday in a block of 15 years for:
• Generation or generation and distribution of power
• Transmission or distribution of power by laying new distribution lines
• Tax holiday available to an “undertaking” which begins to generate power or starts transmission or distribution by laying a network of new transmission / distribution lines before March 31, 2011
• Accelerated depreciation (80 to 100 percent) on Written Down Value (WDV) basis for energy saving and renewable energy devices such as wind mills, solar cookers etc
• Additional depreciation of 20 percent
• One time election to power generating companies to claim depreciation on straight-line basis (SLM) available

Incentives for Wind Energy –Indirect Tax

• Thrust of fiscal incentives for mega power projects (includes hydro power projects of specified capacities); eligible for complete customs and excise duty exemptions
• Power projects, renewable or otherwise, not qualifying as mega power projects eligible for concessional rate of customs duty at 18.62 percent (as against 21.52 percent)
• Concessional rates for excise (Nil rate of duty as against 8 percent) and customs duty (Nil to 5 percent of BCD as against 7.5 percent / 10 percent) available for specific renewable sources of energy like wind, solar, biomass etc
• Renewable energy devices typically attract a lower VAT rate of 4 percent
• Deemed export benefits available; input side costs reduced by availing deemed export benefits like Advance Authorization or Deemed Export Drawback

GBI

• GBI for grid connected wind power projects which are certified by concerned utility announced by Ministry of New and Renewable Energy (MNRE)
• GBI of Rs 0.50 per unit(kwh) for a period of 10 years to the eligible project promoters
• Scheme applicable to wind power projects commissioned for sale of power to the grid; not applicable for capacities set up for captive consumption, third party sale etc
• Projects notto claim benefit of accelerated depreciationunder the Income tax Act (IT Act)
• Projects to have minimum installed capacity of 5 MW and to be installed at project sites approved by the Center for Wind Energy Technology (C-WET)
• GBI to encourage actual energy generationrather than capacity addition only, resulting in optimum utilization of wind resource.