NITI Aayog proposes a minimum 60% local sourcing requirement by value for wind energy plants

NITI Aayog has proposed tweaking of guidelines for setting up wind energy plants in India proposing a minimum requirement of local content of 60% by value mandatorily sourced from India besides compulsory certification of foreign software and hardware sourced into the country, a move aimed at addressing critical challenges of cyber security.

In its report, submitted to the ministry of new and renewable energy, the Aayog has raised alarm over cyber security issues due to import (specially from China) of the wind sector components by wind turbine original equipment manufacturers (OEMs).

“The main issues are OEMs data collection servers which are situated outside of the country, vulnerabilities in data and power system network operations due to updating operating software’s of wind plant devices by OEMs without any permission from grid-operator and MNRE,” it said in the report.

“The Grid Controller of India (POSOCO) must obtain all relevant certificates and IPRs, software and device/hardware from the OEMs of foreign origin especially from neighboring countries and send them for certification and approval by Central Electricity Authority of India (CEA), ministry of electronics and information technology (MeitY) and Standardization Testing and Quality Certification (STQC) as per applicable rules/guidelines,” it said in its report.

“Clearances from the above three organizations or any other relevant organizations as deemed fit, need to be made mandatory prior to permission of connectivity to the national or state grid,” it added.

As per the report, the Revised List of Models & Manufacturers (RLMM) needs to be revised to ensure approval is only given when major equipment like Nacelle (gear box, generator etc.), blades, tower, hub and controller are manufactured in India.

“The power plant controller (PPC) software is of critical importance and associated with risk used in the device which connects the wind farm directly to the national and state grid,” it said, suggesting the need to examine PPC OEMs of foreign origin especially neighboring countries.

According to the Aayog, issues such as the lack of availability of non-standard sizes, quality concerns, and inconsistent demand have resulted in a significant reliance on imports, hindering the growth of domestic manufacturing capacity.

“All the OEMs of the wind sector need to locate and re-locate their data centre and research and development centre inside the country failing which OEMs should be debarred from participating in the tenders and supplying the items in the country,” the Aayog said.

Besides, it has urged the government to explore institutionalization of artificial intelligence (AI) or machine learning (ML) based threat detection systems along with vulnerability management modules to build a cyber-resilient environment in the country for the wind energy sector.

The government has put in place a system of Revised List of Models and Manufacturers, and only equipment manufactured by manufacturers in the list is allowed to be used for Wind Energy Projects. It also mandates that the Hub and Nacelle assembly / manufacturing facility shall be in India.

According to the Global Wind Report, 2023, the top five countries with respect to installed wind power were China (333 GW), followed by the EU (225 GW), the US (144 GW), Germany (58 GW) and India (44.73 GW).

The government is of the view that despite significant potential in the wind energy sector, only 6% of the assessed capacity has been realized, signaling room for substantial growth amidst rising competition with China which has 61% share of global wind turbine assembly capacity.