AES plans turbine-making unit in India

NEW DELHI: The production of power equipment in the country may receive a boost with US power major AES exploring the possibility of locating its first wind energy turbine manufacturing unit in India. The company has initiated evaluation of the Indian market.

If the AES project comes through, it would be the second major recent investment by a power company in the equipment business. French power major Alstom has indicated that it would set up a manufacturing unit for hydro electric projects.

As wind energy is one of the fastest growing sectors, AES wants to enter into turbine manufacturing as well. “We are looking at a low-cost destination and India fits into this category,” AES’ executive VP and president Asia and Middle East Mark E Woodruff told ET. However, a final decision will be taken only after studying other low-cost markets as well, he said.

He, however, added that company’s global strategy of foraying into equipment manufacturing is still being worked out and a decision to locate the new plant in India may be taken only after studying other markets and undertaking a cost benefit analysis. “No decision has yet been taken on the investment requirements for our wind energy equipment foray,” he said.

AES is already a big player in wind energy, with over 600 MW of wind facilities in US, another 200 MW under construction and an additional 3,000 MW projects in various stages of development in several growing markets. “We would also pursue wind opportunities in India, where the company has been present since 1992,” said Mr Woodruff.

The company first plans to expand its coal based power operations in the country before looking at renewables. It plans to invest over $ 1 billion in the country over the next five years to increase its installed capacity to 5000 - 6000 MW.

A large part of this investment would go into setting a 1000 MW pit head coal project in Chhattisgarh. The company is already producing 420 MW of power from OPGC (Orissa power Generation Company) where it owns 49% stake. The capacity of OPGC is proposed to be expanded by an additional 1000 MW. Besides, the company is also exploring greenfield opportunities in West Bengal and Maharashtra.