Suzlon Group has a strong presence across the globe having nearly 20,000 MW of wind energy capacity installed in 30 countries. "Our first priority is to focus on emerging economies like India, South Africa, Mexico and Brazil. These markets offer us better margins, and with our extensive emerging market experience, we are well placed to compete strongly in their complex market landscape. Our second key area of focus is technology wherein are investing in R&D to unlock margins by reducing the life cycle cost of wind energy. Suzlon's provides turnkey services ranging from complex front-end engineering design, construction, installation and commissioning to long-term operations and maintenance; meeting customer requirements across the wind energy value chain," says Mr. Tulsi Tanti, Chairman, Suzlon Group, in an interview with Maria R.
Could you please tell us about Suzlon Group since its inception to present stature? What are its milestone achievements and evolutions?
Suzlon was conceived as a solution to the energy problems faced by many Indian entrepre- neurs in the late eighties. Traditional power supply was expensive, unpredic- table, and costs were constantly on the rise. Today, Suzlon Group is the world's fifth largest wind turbine supplier with operations across 33 countries. In a short span of 17 years, Suzlon has not only witnessed immense commercial success but also built reputation as a socially responsible enterprise with sustainable development at the core of the business.
Please tell us about its global presence, various manufacturing facilities and products range.
Suzlon Group's global spread extends across Asia, Australia, Europe, Africa and North and South America. We have nearly 20,000 MW of wind energy capacity installed in 30 countries, and has a workforce of over 13,000. We offer one of the most comprehensive product portfolios: ranging from sub-megawatt on-shore turbines at 600 Kilowatts (KW) to the world's largest commercial, 6.15 MW offshore tur- bines. Our new technology launches include the S8X and S111 wind turbines for low wind speed sites.
Today, there are many players in wind turbine market; please brief us about your products technological edge and also key differentiators in the present competitive environment.
Suzlon is focused on developing products customized to local geography, wind regimes and the individual needs of customers. Every market has unique needs, and Suzlon has innovated to meet those needs and deliver superior performance. Suzlon records uptime in excess of 97%, exceeding global availability standards.
As technology is the key enabler for a company to become a market leader. Could you please shed light on your R&D activities as it plays an important role?
Technology is critical to the Group's success. By feeding field-based learning back into the R&D and manufacturing processes, we ensure our products and services evolve and continually improve. We have research and development facilities in Germany, Denmark, the Netherlands, and India, which focus both on product's development and also fundamental, game-changing technology. Today, Suzlon is the only global wind power company that comes from an emerging market - arguably because we provide technology at par with any developed country.
A word about your tie-up with REpower.
REpower is a leader in wind turbine technology, particularly offshore, and produces the 6M – the world's largest commercially available wind turbine. With 2,500 employees worldwide, it is headquartered in Hamburg and has around 3,000 wind turbines operating around the world. Suzlon completed "squeeze-out" proceedings in November 2011, making REpower a wholly-owned subsidiary of the Group.
What are your company's distribution networks? Does your company manufacture the products keeping the climatic conditions of the countries in view where its products are being exported?
Suzlon has nearly 20,000 MW of wind energy capacity installed in 30 countries. We pay close attention to the climatic conditions where our customers seek wind installations, and recommend products depending upon geographic study and wind mapping.
As the wind energy sector is completely a new area of growth in India; there is a big dearth of trained professional at every level. Does your company provide turnkey solutions?
Suzlon's turnkey services range from complex front-end engineering design, construction, installation and commissioning to long-term operations and maintenance; meeting customer requirements across the wind energy value chain. Our key differentiator is having both strong front-end engineering and the benefit of local experience, interface management and construction know how.
We have very robust training modules for our engineers. A critical component is the ‘Knowledge Centre' at Satara established in 2009. This knowledge centre is complete with a model 1250 kW wind turbine generator, and a simulation room, which replicate actual work situations in a secure environment.
What are the company's short - and long-term strategies for its developments?
Our first priority is to focus on emerging economies like India, South Africa, Mexico and Brazil. These markets offer us better margins, and with our extensive emerging market experience, we are well placed to compete strongly in their complex market landscape.
Our second key area of focus is technology. We are investing in R&D to unlock margins by reducing the life cycle cost of wind energy.
And finally, looking ahead, the offshore market in Europe presents an enormous opportunity that we are focused to take the lead on.
What is your overview of the global demand scenario of green & renewable energy especially the wind energy? What market share do you expect in the next two - three years?
According to a WWF estimate, the clean tech industry will be one of the world's main industries by 2020. The energy efficiency and renewable energy segments will grow by 2.5 per cent and 9 per cent per year to EUR 790 billion and 275 billion, respectively, in 2020. The Indian Ministry of New and Renewable Energy (MNRE) estimates a renewable energy potential of around 90,000 MW for India, including 48,561 MW of wind power.
Wind energy has already become a highly cost competitive sector: technological advances, sophisticated materials, electronics, and aerodynamics, have reduced costs and made wind turbines 100 times more powerful as compared with the 1980s. The Indian Wind Turbine Manufacturers Association (IWTMA) estimates wind potential to be around 65-70 GW. After China and USA, India is the third largest wind market in the world today with immense scope for further growth.
What is your take on the business of repowering of wind turbine and the potential of such projects in India?
Considering the fact that the oldest wind energy projects in India are on the best wind resource area, repowering, would lead to deployment of latest higher hub height, multi mega watt sized wind turbines with higher yield per unit area of land. Since most of the existing projects (more than 10 years) would have depreciated by now, the challenge would be to evolve a commercial model to encourage moving to repowering. One such option would be to increase the GBI incentives of the MNRE for repowering older wind energy projects, which would incentivize customers to invest into better technologies.
What sort of policies and regulatory changes you are looking for wherein the Indian Government should help to boost this sector?
Infrastructure (land, power evacuation and logistics) has the most room for improvement. Increasing private participation in infrastructure development will help India reach its target of raising the share of renewables to 15% by 2020, under the Prime Minister's National Action Plan for Climate Change (NAPCC). Suzlon has so far successfully demonstrated this by commissioning 73 sub-stations with cumulative capacity of over 5600 MVA and laid transmission lines of nearly 1,100 kms to facilitate development of wind power projects in various states of India.
How do you find the budget 2012-13 for the power sector especially green and renewable energy sector?
This year's budget demonstrates the Government's unwavering support to building a low carbon economy. For the first time, the budget accorded importance to the National Action Plan on Climate Change, by allocating resources to missions created under the NAPCC and giving a strong mention to initiatives on renewable energy.
The allowance of ECB and improvement in tax free bonds for infrastructure funding, have paved the way to lower cost of fund, making projects more viable for investors. The extension of Section 80 IA, a very important fiscal instrument to attract investments into infrastructure projects, offers a huge relief to all investors financing pending projects.
The budget has several other elements of forward reforms such as developments on the direct tax code and goods and services tax.