The forest of white windmills that make up Asia’s largest wind farm can be seen from miles away. Dotted across 2,000km2 of hills and villages on a basalt plateau in western India sit more than 800 turbines — generating more than 1,000 megawatts of electricity.
The towering machines, which stand 80m tall, cast shadows across fields tilled by man and buffalo — a stark juxtaposition of ancient and modern India. For one man, however, the windmill farm in Dhule is a fitting riposte to the critics who derided his dream to build a global green energy business from a country plagued by crippling power cuts.
In little more than a decade, Tulsi Tanti has made Suzlon Energy into the world’s fifth-largest producer of wind turbines — selling its turbines at a couple of million dollars apiece. Company turnover last year increased 29 percent to US$1.8 billion. About 90 percent of Suzlon’s order book is from markets outside India, largely the US, South America and China.
Despite the success, last year was an annus horribilis for the company. While Suzlon should have been reaping the benefits of a world hungry for clean energy, it has been hit by a triple whammy: The credit crunch sent its stock plummeting; cracks appeared in its rotor blades used by US customers, raising doubts over its technology; and the US$1.6 billion acquisition of Germany’s Repower, a turbine maker that produces giant offshore rigs, stalled.
The turbulence has hit the company hard. Suzlon’s stock price has crashed 90 percent since January last year to end up trading at just 56 rupees (US$1.20) last month — valuing the Tanti family’s 66 percent stake at US$1.6 billion.
Tanti brushes aside these episodes, seeing opportunities where others see crisis. In an interview from his Mumbai office, the 51-year-old concedes his paper fortune has been blown away by the economic storm but says the forecast for the company remains good.
Wind power producers can’t keep pace with demand at a time when concern about global warming is driving governments to promote greener electricity, he said.
“Our final product is electricity and that is sold at a fixed price. Demand is growing at 5 percent a year globally and you need [wind power] to prevent climate change and for energy security. It’s the only industry that is going to grow,” he said.
Tanti’s rationale is about demand and supply. He says that by 2020, the US, Europe, China and India will want to have 20 percent of their power supply from renewables. The issue is about making wind power “cost competitive” with carbon sources, especially coal, which fuels 65 percent of India’s electricity and costs at least a quarter less.
“Today wind power is just 1 percent of supply. It can grow to 7 percent by 2020. That is the maximum because industry has to find resources, material and execute projects. With greater volumes the price [of wind power] will drop ... and [governments] will ask what is the cost for pollution from carbon fuels. You will need a carbon tax,” he said.
More worrying perhaps were the questions raised about Suzlon’s key technologies. In June, Edison International, one of Suzlon’s biggest customers in the US, canceled an order for 150 turbines after cracks appeared in the rotor blades. Many began to fret — and were only reassured when the Indian company shipped out new turbines made of reinforced plastic.