GBI Reinstatement Signals Indian Wind Market Momentum But Challenges Remain

The Indian Generation-Based Incentive (GBI) scheme for wind power has been formally reinstated with minor changes, and reinstatement of Accelerated Depreciation (AD) of wind power investments remains undecided, but is currently under discussion. Both are potential means to re-stimulate growth in the Indian wind market. Challenges to reach government installation target however remain unsolved.

India’s Union Cabinet of Ministers officially announced the reinstatement of the generation based incentive (GBI) on August 13. With the announcement, the Indian wind industry will be relieved as details of the new GBI have been clarified. In addition to the GBI, new financing support measures and the establishment of a national offshore wind authority indicate the government is intent on giving more support to wind. However, the level of GBI support may not be sufficient to support ambitious government targets and there are still major challenges confronting the industry as well as new technical requirements for wind power plants.

The Flash Note examines the new GBI and supporting policy measures to spur wind development, as well as the status of the accelerated depreciation (AD) program. MAKE analyses the implications of reinstating the GBI scheme for the Indian wind market and also identifies the main challenges that will pose a barrier for future market growth.

Press release, September 04, 2013