Government Mulls Higher Offshore Wind Subsidy
ECONOMY & POLICY

Government Mulls Higher Offshore Wind Subsidy

The government is considering higher incentives for offshore wind and has asked the World Bank (WB) and KPMG (KPMG) to review options for increasing viability gap funding. Officials view the review as a step to accelerate deployment of large offshore wind projects and to make them more bankable for domestic and international investors. The exercise will examine financial structures, tariff support mechanisms and enhancements to existing subsidy frameworks to lower upfront capital costs and improve project viability.

Raising incentives is intended to bridge the cost differential between offshore and onshore generation and to attract long term capital into the sector. The review will consider how viability funding might be structured to reduce revenue risk for developers while protecting taxpayer value. Analysts expect that alignment with national net zero and renewable energy targets will guide recommendations and that careful calibration will be necessary to avoid market distortions.

Industry participants are likely to engage with the WB and KPMG to provide data on cost curves, supply chain constraints and grid integration challenges. Developers will outline financing needs and timelines while financiers may present views on credit enhancement and long term offtake arrangements. Officials may also assess the role of domestic manufacturing incentives, port infrastructure upgrades and workforce development in lowering costs over time.

Final recommendations are expected to inform policy decisions and budgetary allocations and to set out a roadmap for scaling up offshore wind capacity in alignment with national energy goals. The timeline for completion of the review was not specified but officials indicated that findings will be used to shape forthcoming tender rounds and viability funding windows. Stakeholders will monitor the process for signals on how the government intends to balance fiscal prudence with the need to mobilise investment in clean energy. The outcome may influence investor sentiment and the pace of project execution across coastal regions.

"Join industry leaders at RAHSTA Expo, India's premier platform for roads, highways and traffic infrastructure. Register now to explore innovations, network with experts and shape the future of mobility."

The government is considering higher incentives for offshore wind and has asked the World Bank (WB) and KPMG (KPMG) to review options for increasing viability gap funding. Officials view the review as a step to accelerate deployment of large offshore wind projects and to make them more bankable for domestic and international investors. The exercise will examine financial structures, tariff support mechanisms and enhancements to existing subsidy frameworks to lower upfront capital costs and improve project viability. Raising incentives is intended to bridge the cost differential between offshore and onshore generation and to attract long term capital into the sector. The review will consider how viability funding might be structured to reduce revenue risk for developers while protecting taxpayer value. Analysts expect that alignment with national net zero and renewable energy targets will guide recommendations and that careful calibration will be necessary to avoid market distortions. Industry participants are likely to engage with the WB and KPMG to provide data on cost curves, supply chain constraints and grid integration challenges. Developers will outline financing needs and timelines while financiers may present views on credit enhancement and long term offtake arrangements. Officials may also assess the role of domestic manufacturing incentives, port infrastructure upgrades and workforce development in lowering costs over time. Final recommendations are expected to inform policy decisions and budgetary allocations and to set out a roadmap for scaling up offshore wind capacity in alignment with national energy goals. The timeline for completion of the review was not specified but officials indicated that findings will be used to shape forthcoming tender rounds and viability funding windows. Stakeholders will monitor the process for signals on how the government intends to balance fiscal prudence with the need to mobilise investment in clean energy. The outcome may influence investor sentiment and the pace of project execution across coastal regions.

Next Story
Real Estate

Pecan Realty Completes Rs 1.5 Billion Transactions

Pecan Realty has recently completed four institutional transactions worth over Rs 1.5 billion over the past two years, strengthening its position as an execution-led real estate platform. The deals include resolution-led acquisitions, structured finance transactions and capital partnerships across its development portfolio.The transactions covered acquisitions through the National Company Law Tribunal process and helped provide repayment or exits to both private and public sector lenders. The company said the deals demonstrate its ability to resolve complex project situations, work with instit..

Next Story
Real Estate

SNN Estates Expands North Bengaluru Housing Project

SNN Estates has announced an expansion of its SNN Estates Felicity residential project in North Bengaluru following strong buyer demand, with 75 per cent of the first-phase inventory sold within three days of launch.The developer will add 76 apartments in the new phase, taking the project's estimated revenue potential to around Rs 1,000 crore upon completion of Phase 2.Spread across 6.5 acres in Rachenahalli, near Manyata Tech Park, the project comprises 604 apartments in 1.5, 2, 2.5, 3 and 4 BHK configurations. The development includes a 50,000-sq-ft clubhouse with amenities such as sports co..

Next Story
Infrastructure Urban

SCG Drives ASEAN Industrial Transformation Strategy

SCG is strengthening its focus on ASEAN as a key growth region by advancing industrial transformation, enhancing competitiveness and building resilient regional value chains. Thammasak Sethaudom, President and Chief Executive Officer, SCG, highlighted the need for industries to continuously develop capabilities, strengthen resilience and deepen regional cooperation to achieve sustainable long-term growth.SCG views ASEAN as an important growth engine alongside China, supported by favourable demographics, trade connectivity and investment flows. With ASEAN’s GDP projected to grow by around 4.7..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement