Owing to changes in Indian Wind Power regulatory policy, Siemens Gamesa Renewable Energy, the second-largest wind turbine maker in the world, will stay away from bidding for Indian wind power projects.
The company, however, is looking at a strong engineering procurement and construction (EPC) market in the country as the demand for cost-efficient wind turbine generators grows.
India is a key market which accounted for 30 per cent of Siemens Gamesa revenue (Mw equivalent) till last year. As there was a freeze in the Indian market after bidding was introduced. The company, in its results for the quarter ended June 2017, said its revenues were down 7 per cent to €2,693 million owing to a “temporary downturn in the Indian market”.
It also reported a 25 per cent decline in sales and 21 per cent decline in y-o-y EBIT (earnings before interest and taxation).
Last year Government of India retired the 25-year-old feed-in tariffs (FiT) mechanism to award wind projects and introduced competitive bidding.
This transition resulted in a freeze in the Indian market as the wind energy industry is known to have FiT as a mechanism in young market. Bidding supports a mature market so the players were taken by surprise and thus a freeze.