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Project Profile- New

Setting up Wind Power Plant

Product Code Quality and Standards Month & Year of preparation Prepared By : : As per Customers Requirement : March, 2010 : Micro, Small & Medium Enterprises- DI Baiss Goddam Industrial Estate Jaipur- 302006

A. INTRODUCTION
The Project profile envisages to setup turnkey Wind Power plant (1 No. WTG of 600 KWCapacity). Wind power is today a mature technology, which at windy sites is economic and competitive with conventional power generation technologies, in particular when taking into account the environmental impact. At the end of 2004 there were more than 73,800 wind turbines installed world wide corresponding to about 47,900 MW accumulated capacity Wind turbines can be setup in farms or ranches, thus benefiting the economy in rural areas, where most of the best wind sites are found. Farmers and ranchers can continue to work the land because the wind turbines use only a fraction of the land. Eligible Investor:Investments made in Wind Farm Projects by Corporate or Non-Corporate Entrepreneurs, by way of installation of WEGs would be eligible investments, if such investment satisfies following conditions: (i) If such investment is made in Wind Farm Projects approved by authority administering Wind Energy Development Fund. (ii) The WEGs installed are new machines. (iii) Minimum capacity of WEGs proposed for installation is 225 Kw. Eligible producers will be treated as an eligible industry under the Incentive Scheme administered by Industry Department and Sales Tax Schemes administered by Finance Department and Incentives available to new industrial units under any of the Scheme in operation shall also be available to eligible producers for establishing Wind Farms or making eligible Investments in WEGs. Concessions given to industrial units in backward areas will also be available to such eligible producers, if the wind farm is located in a backward area.

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Long-term benefits of a Wind power project:

Cost of power generation is very low and becomes negligible after pay back period. Wind power projects give Return on investment to the extent of 18-20% per annum. No recurring cost of fuel and thus a very low O&M cost. As an investment opportunity there is assured market for the product i.e. electrical energy, which can be sold SEB or captive use of power within state. e) 80% depreciation in very first year is allowed thus saving on account of income tax liability in your present business. f) Loans from financial institutions/Banks are available for Wind Power Projects with a repayment of 7 to 10 yrs. period. g) Income generated from wind power is exempted from IT for continuous 10 years in block of initial 15 years from the date of commissioning under section 80 (I) A a) b) c) d)

B. Market Potential
The Wind power programme in India was initiated towards the end of the Sixth Plan, in 1983-84. A market-oriented strategy was adopted from inception, which has led to the successful commercial development of the technology. The broad based National programme includes wind resource assessment activities; research and development support; implementation of demonstration projects to create awareness and opening up of new sites; involvement of utilities and industry; development of infrastructure capability and capacity for manufacture, installation, operation and maintenance of wind electric generators; and policy support. The programme aims at catalyzing commercialisation of wind power generation in the country. The Wind Resources Assessment Programme is being implemented through the State Nodal Agencies, Field Research Unit of Indian Institute of Tropical Meteorology (IITM-FRU) and Center for Wind Energy Technology (C-WET). 1.The Government of Rajasthan adopted a new policy for promoting generation of power through Nonconventional Energy Sources vide Order of Energy Department dated March 11, 1999. This policy is currently applicable for new capacity creation for generation of power through all Non-conventional Energy Sources including wind. in view of immense potential of power generation through exploitation of wind resources in Rajasthan and special incentives required because of special nature of wind as resource, it has been felt necessary to adopt a specific promotion policy for generation of power by use of wind resources. 2 There has been encouraging growth in development of wind power projects in the State in the recent past, primarily due to prevailing incentives and benefits offered in the afore-mentioned Policies. 3 Developers, manufacturers, investors alike have been calling for formulation of a new Policy well before the expiry of the existing Policy so that the momentum gained is maintained. As a demonstration of their continued commitment to setting up of wind energy generation capacity in the State of Rajasthan, developers have shown willingness and registered their applications with RREC for setting up wind power projects of additional capacity of 200-250 MW. 4 The level of tariff protection with guaranteed escalation and wheeling charges provided in the 2000 Policy, in accordance with MNES guidelines, is no longer affordable to RVPN as it imposes a heavy financial burden on it. Moreover, the identification of more potential sites, improvement in conversion efficiency, reduction in lending rates by the financial institutions, availability of large size machines on commercial scale and downtrend in capital costs, have all necessitated a review of the incentives and benefits in the existing Policies. A revised Policy is therefore proposed. However the existing Policy dated 4.2.2000 shall continue to be applicable to those Wind Power Projects, upto the cap of 100 MW, for which RREC has given specific approval.

-35. A total of 45000 MW gross wind potential has been assessed in the country. 6. IITM has so far identified following potential sites in the various districts of Rajasthan specifying average wind speed, wind density profile and power potential per square meter.

Wind Site

Mast District Chittorgarh Chittorgarh Sikar Jaisalmer Udaipur Barmer Jaisalmer Jodhpur

Annual Mean Wind Speed KMPH Extraplated at 30 M at 20/25 M 18.8 19.88 20.62 17.8 18.9 17 15.5 17.4 19.5 21.38 22.6 19.5 19.4 18.5 17.5 19.2

Annual Mean Wind Power Density (W/M2) at 20/25 M 149 151 206 159 142 135 117 142 Extraplated at 30 M 163 186 277 202 152 170 161 185

Dhamotar Devgarh Harshnath Jaisalmer Jaswantgarh Khodal Mohangarh Phalodi

Against the total wind power capacity of 1639 MW achieved in India(Tamilnadu 895 MW, Maharashtra - 399 MW, Gujarat 166 MW,A.P.- 92.6 MW, Karnataka 93.00 MW,
Rajasthan 60 MW) a gross potential of 5400 MW and technical potential of 845 MW has so far been assessed in Rajasthan
The break-up of projects implemented in prominent wind potential states (as on March 31, 2009) is as given below State-wise Wind Power Installed Capacity In India Gross Potential (MW)
8968

State

Total Capacity (MW) till 31.03.09

Andhra Pradesh
Gujarat

122.5 1566.5 1327.4 27.0 212.8 1938.9

10,645 11,531 1171

Karnataka Kerala Madhya Pradesh

1019

Maharashtra 4584

-4Orissa 255 4858

738.4 1.1

Rajasthan West Bengal Tamil Nadu Others Total (All India)

5530

4304.5 3.2

48,561

10242.3

*Recently revised by state Government to 5200 MW

Wind power potential has been assessed assuming 1% of land availability for wind farms requiring @12 ha/MW in sites having wind power density in excess of 200 W/sq.m. at 50 m hub-height.

C. BASIS AND PRESUMPTIOS:This project is beneficial for the energy intensive unit. As per the order from Gov. of Rajasthan, it is allowed to calculate depreciation as 80 % in first 2 years. Due to this, the unit can get the benefit of tex shield @ 33.0 % of Rs. 50.29 lakhs saved from the tax per year. Interest on Loan considering 5% interest Subsidy Repayment Period (Years) Moratorium Period (Year)

6.50% 9 1

In state of Rajasthan as per new wind power policy for installation at Jaisalmer, Jodhpur, Barmer . RVPN / DISCOMS would pay a rate of Rs. 4.28 per unit As the plants estimated life Period is 20 year, the dep. has been calculated @ 5% for plant & machinery.

D. IMPLEMENTATION SCHEDULE
The major activities and the time required for competition of each activity and their implementation are illustrated below:

Sl. No. 1 2 3 4 5 6

Activity Selection of Site Preparation of Project Report Provisional Registration Financial Arrangements Procurement of Machinery Developing linkage with State Electricity Board

Months 1 3 3 1

Weeks 2 2 -

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7 8

Installation, Electrification and commissioning of Machinery Trial and Commercial Production Total

2 1 12

E. TECHNICAL ASPECTS
Wind is a form of solar energy. Winds are caused by the uneven heating of the atmosphere by the sun, the irregularities of the earth's surface, and rotation of the earth. Wind flow patterns are modified by the earth's terrain, bodies of water, and vegetation. Humans use this wind flow, or motion energy, for many purposes: sailing, flying a kite, and even generating electricity. The terms wind energy or wind power describe the process by which the wind is used to generate mechanical power or electricity. Wind turbines convert the kinetic energy in the wind into mechanical power. This mechanical power can be used for specific tasks (such as grinding grain or pumping water) or a generator can convert this mechanical power into electricity. This aerial view of a wind power plant shows how a group of wind turbines can make electricity for the utility grid. The electricity is sent through transmission and distribution lines to homes, businesses, schools, and so on.

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Inside the Wind Turbine

Anemometer: Measures the wind speed and transmits wind speed data to the controller. Blades: Most turbines have either two or three blades. Wind blowing over the blades causes the blades to "lift" and rotate. Brake: A disc brake, which can be applied mechanically, electrically, or hydraulically to stop the rotor in emergencies. Controller: The controller starts up the machine at wind speeds of about 8 to 16 miles per hour (mph) and shuts off the machine at about 55 mph. Turbines do not operate at wind speeds above about 55 mph because they might be damaged by the high winds. Gear box: Gears connect the low-speed shaft to the high-speed shaft and increase the rotational speeds from about 30 to 60 rotations per minute (rpm) to about 1000 to 1800 rpm, the rotational speed required by most generators to produce electricity. The gear box is a costly (and heavy) part of the wind turbine and engineers are exploring "direct-drive" generators that operate at lower rotational speeds and don't need gear boxes. Generator: Usually an off-the-shelf induction generator that produces 60-cycle AC electricity. High-speed shaft: Drives the generator. Low-speed shaft

F. Quality Control and Standards

-Better pitch controlled for maximum Power harnessing with minimal loss - Low weight to sweep ratio results in Higher Outputs -Well balanced blade for higher quality of power with minimal loss

G. Production Capacity (per annum)

13 lakh unit Electricity per Annum Plant cap. 0.60 MW (1 no. WTG of 600 KW capacity, Model S 52) with 75.0 meter Lattice Tower.

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H. Motive Power
The electric Motive power required initially for this project would be around 2 KWH. However once the production started the self generated power will be utilized.

I. Pollution Control
Wind turbines produce energy without pollution, eventually leading to a reduction in the emission of carbon dioxide, nitrogen oxide and sulphur dioxide. The use of wind energy may therefore contribute to reduce global climate change, acid rain and other serious environmental problems. Although the environmental impact of wind energy obviously is lower than that of conventional energy sources, there are some potentially negative effects on the environment, especially when it comes to establishing large wind farms of several hundred large wind turbines. Over the years the main environmental concerns when constructing wind farms have been visual impact, noise and the risk of bird-collisions. Today noise is dealt with in the planning phase and normally it possesses little problems to build wind turbines close to human settlements. The visual effects of wind turbine may, however, create some controversy, as some people believe they are having a severe negative visual impact of the landscape, while others find them beautiful.

J. Energy Conservation
Well balanced blade and pitch control will results in high power generation with minimal loss.

K. Financial Aspects
1.Fixed Capital Land and Building- on lease
Land Sublease Charges Rs. 9.00 Lakh

2.. Machinery and EquipmentsWind power plant 0.60 MW

Rs. 381 Lakh (1 no. WTG of 600 KW capacity, Model S 52 with 75.0 meter Lattice Tower)

3. Total

fixed investment

Rs. 390 lakhs

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4. Working Capital (per Month)

I. Personnel
S. No 1 2 3 4 5 Designation Works Manager Peon/Watchman Skilled workers Helpers Office Clerk/ Store Keeper Add perquisites @15% of salary No. 1 1 2 1 1 Salary (in Rs.) 10,000 3,000 5,000 2,500 3,500 Total Amount (In Rs.) 10,000 3,000 10,000 2,500 3,500 29000 4500 Rs. 33, 500

II. Raw Materials and Consumables (per month)

S. No. 1 Description Misc. Maintenance hardware items i.e. Nuts, bolts, Washer, belts etc. Indigenous/ Imported Indigenous Qty. (Nos.) LS Total Amount (In Rs.) 5000 Rs. 5,000

III. water & Power Utilities Rs. 500/IV. Other contingent Expenses (per month) (Rs.)
1 2 3 4 5 6 Insurance Transportation and Handling Repairs And Maintenance Stationary , Postage and telephone Advertisement/ Sales Promotion Miscellaneous Expenditure like cotton waste, coating materials etc. 4,000 1, 000 5,000 1,500 1,000 1,000

Total

Rs. 13,500

V. Total Recurring Expenditure (per month (IN Rs.)

1 2 3 4 Personnel Raw Material Utilities Other Expenses Total 33,500 6500 500 13500 54,000 Rs. 54000

Working capital for 1 month

= Rs. 54,000

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VI. Working capital for 3 months

5. Total Capital Investment a) Fixed Capital b) Working capital for 3 months Total
6. Means of Finance IREDA / BANK
Bank Finance / Govt. of India Grant under Cluster programme Company's Equity Total Expenses 70% 30% 100.00%

= Rs. 1,62,000
= Rs. 390 lakh = Rs. 1.62 Lakh = Rs.391.62 Lakh
Rs Lacs 273.00 118.62

391.62

L. Financial Analysis:(1) Cost of Production (per Annum)

A B C Recurring Exp. As per govt. Incentive scheme, There is a Tax Shield benefit on 80 % depreciation hence Depreciation on Machinery and Equipments may be treated as nil. Interest on Total Capital Investment @ 6.5% Total

Rs. In Lakh
6.48 0

26 32.48

(2)

Sales Proceeds (per Annum)

= 55.4 lakh = 3.25 lakh Total = 58.89 Lakhs

a. The annual estimated generation is 13.00 Lac units per WTG per year at WTG Controller at 100% grid availability @4.28 per unit

b.
(4)

Payment from CDM @ 0.25 Rs. Per unit

Profit (per year)

Sales- Cost of Production = Rs. 26.41 Lakh

(5)Net profit Ratio on Sales

Profit (per Year) = 26.41
109.18 X 100

= 44.85 %

(6) Rate of Return

Profit (per Year) = 26.41 X100 Total Capital Inv. 391.74 = 6.74%

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(7) Break even Point

1 Insurance 2 Interest on capital Investment 3 Depreciation on Machinery, furnace, Office equipments, instruments, tools etc. 0.48
26

1.608 0.024 0.456 28.568

4 40% of salaries and wages 5 40% utilities 6 40% of other expenses (excluding rent) Total fixed Cost

B.E.P = Fixed Cost X 100 Fixed Cost + Profit =

28.568 28.568 + 26.41

X 100

Break Even Point = 51.96%

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Addresses of Machinery and Equipment Suppliers

1.