Council on Energy, Environment and Water Integrated | International | Independent

Assessing the Value of Offshore Wind for India’s Power System in 2030

Ashwani Arora, Disha Agarwal
October 2023 | Power Markets

Suggested citation: Arora, Ashwani, Disha Agarwal. 2023. Assessing the Value of Offshore Wind for India’s Power System in 2030. New Delhi: Council on Energy, Environment and Water.



This first-of-its-kind analysis examines the case for India to promote offshore wind development by assessing the contribution it can make in managing power system operations in future. It examines the implications of adding offshore wind in the state of Gujarat for power system adequacy and reliability, requirement of operational reserves, ramping capabilities of the system, and grid balancing requirements.

India plans to deploy offshore wind projects along Gujarat and Tamil Nadu coasts. Although the technology is commercially advanced, the cost of generation is high compared to other mainstream renewable energy (RE) options. To reduce costs, India’s efforts are currently focused on creating a bidding pipeline, introducing appropriate business models, augmenting infrastructure, building implementation capacities, and creating willing buyers. However, it is equally important to understand if the technology has the capability to lower the overall cost of system operations in the future. Such assessments can help inform system planning and operational strategies to achieve a decarbonised electricity system.

Key Highlights

  • Gujarat experiences high offshore wind speeds during May to August
    • Peak wind speed reaches 20.76 m/s with an average of 7.61 m/s
    • The capacity utilisation factor (CUF) of offshore wind goes beyond 50 per cent during these months. In July, this reaches nearly 70 per cent.
  • Keeping the overall share of RE constant, the study compared two pools, Pool A (onshore wind and solar PV) and Pool B (onshore wind, solar PV and offshore wind), to assess the impact of offshore wind on system operations in Gujarat and India, in 2030. We find that:
    • Pool B has a higher capacity value than Pool A during peak load hours. For India, the Pool B has an improved capacity value throughout the year, whereas, for Gujarat, the improvement is observed during monsoon months.
    • For the majority of the days, Pool B lowers the daily variance during solar as well as non-solar hours, indicating reduced daily reserve requirement to meet the RE uncertainty. The reduction in variance is more in non-solar hours.
    • Introducing offshore wind in the RE mix does not increase the number of steep ramps in Gujarat’s net load.
    • Savings of INR 708 crore and INR 65 crore can accrue at national and state-level respectively, by tapping Pool B during peak price periods at the power exchange. However, if power is purchased during peak demand hours, there will be additional cost implications. At the same time, some other states in the northern region could still make savings by procuring from Pool B during peak load hours.
    • Assuming a must-run status for RE, pool B has lower over-generation compared to Pool A, indicating less likelihood of RE curtailment. The extent of likely reduction in RE curtailment is significantly greater for India than for Gujarat.

Key Takeaways

Introduction of offshore wind could enable cost-effective and reliable system operations by:

  • Aiding system adequacy and meeting reliability requirements during peak load hours.
  • Lowering the reserve requirement to handle the uncertainty and variability in the system.
  • Resulting in savings on the cost of short-term power procurement, thus contributing to affordability of supply for consumers.
  • Lowering the likelihood of RE curtailment at the national level because of its availability to meet the system demand when it arises.



  • What is an offshore wind energy system? How does an offshore wind farm operate?

    An offshore wind farm comprises several large-sized turbines (of 5 to 10 MW each), typically anchored to a foundation structure located on the seabed. These turbines utilise the kinetic energy of high-speed winds blowing over the sea waters to produce electrical energy. The electricity thus generated is transmitted through undersea cables to an offshore sub-station, from where it is further evacuated to an onshore pooling sub-station.

  • Why is offshore wind useful?

    Offshore wind technology can generate the highest amount of energy per unit of installed capacity when compared with onshore wind and solar photovoltaics. It helps address the emerging land constraints for large-scale RE deployment. Further, harnessing high-speed and better quality offshore wind resources can also contribute to ensuring energy security.

  • Does India have offshore wind energy?

    The National Institute of Wind Energy has identified a potential of about 70 GW that is spread across 16 offshore zones of Tamil Nadu and Gujarat coasts. As of now, India does not have any active offshore wind projects. However, it aims to bid out 37 GW worth of capacity by 2030.

  • What are the challenges of offshore wind energy projects in India?

    High capital cost of the technology, lack of domestic supply chains and turbine models suited to Indian wind regimes, non-availability of resource related datasets, and complexities in securing approvals and clearances are key challenges impacting adoption of offshore wind in India.

“Strategies that can help lower the cost of offshore wind power will be critical to unlock the massive potential that the technology offers. At the same time, it will be important to examine its contribution in ensuring cost-effective management of the future power system.”

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