High oil prices and concerns over the safety of nuclear power following the Fukushima crisis in Japan are reigniting interest in renewable energy, with wind power likely to be a major beneficiary, Tulsi Tanti, chairman of Suzlon Group, told CNBC.
“After the disaster of the situation of the nuclear, I think most of the political leaders focus have slightly moved from nuclear to more and more the on shore and off shore wind product,” Tanti said, “because it is giving a huge sustainability and creating green jobs.”
This is giving the industry a second wind after it faced hard times due to the financial crisis.
The industry was hit by the 2009/2010 crisis, but momentum is returning and banks are beginning to finance larger-scale projects, Tanti said.
Investors are beginning to identify wind as a reliable and profitable investment. Earlier this month, US private equity house Kohlberg Kravis Roberts announced a $339 million investment into a wind power joint venture with Sorgenia, its first investment in the sector in Europe.
“Wind power is extremely competitive in the power sector portfolio point of view,” according to Tanti. It is also an attractive option for emerging markets, he said.
“Today, India… is the fifth largest renewable energy producer in the world,” said Tanti, who believes the share of wind power in the Indian energy mix will rise from 3.5 percent today to 25 percent in three years, and eventually to 40 percent within five years.
“(The Indian) prime minister has set the very ambitious target of 15% by 2020, has to come from renewables, so that is giving a huge momentum,” he said.
Emerging markets need a nuclear base but it must be secured, Tanti added.