Breakthrough! Gujarat Finally Relents, Central Wind Energy Projects to Move

After months of uncertainty, the Gujarat government has finally budged, agreeing to making land available for Wind Energy projects bid out by SECI, the ‘central’ agency responsible for them.

The news of Gujarat’s change in stance will be welcomed by SECI and developers alike, because the situation was threatening to get completely out of hand. Clearly, wiser minds have prevailed to settle this issue finally.

We had reported earlier on February 6 on how almost 4000 MW of wind energy projects were stuck because developers who had bid with plans to set up in Gujarat ran into a wall when it came to land allotments. The Gujarat government, it seems , ‘realised’ that with such aggressive bidding from SECI, their own state agency, Gujarat Urja Vikas Nigam Limited (GUVNL) might not have enough ‘quality sites’ to offer for their own auctions.

The state therefore started ignoring the central auction winners, mostly from SECI’s Tranche 1 to 6 auctions, claiming that new land allotment rules would apply henceforth. The new rules incidentally, will still need to be managed by the central winners, as they stipulate that there will be no sub-leasing of land, as was done earlier.  It was estimated by SECI that almost  4000 MW of wind projects were stuck due to the change.

With allotments to be made directly, bidders will have to do away  with land aggregating agencies that used to ‘pool’ the land for them and sub lease it. The new rules specify that winners who have a letter from Gujarat Energy Development agency will be considered for allotments, directly. On top of that is the issue of locations, as rather than ‘ideal’ locations based on wind speeds, the state government had also expressed a desire to use land that was uncultivable or as close to being a waste land as possible. Whether this condition remains, vis a vis appropriateness for a Wind Turbine installation, remains to be seen.

For SECI, which was forced to extend at least one project deadline, and consider two more, the decision must be a huge relief, even as the solution is possibly not ideal still. Developers might yet change their minds based on the land allotments they get, which will eventually  affect SECI’s own targets for the year.