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Gamesa Gets $2 Billion Order from Caparo Energy for India Wind Project

Gamesa Wind Turbines Pvt. Ltd., the Indian subsidiary of Gamesa, a global leader in wind turbine manufacturing and in wind farm development, today announced the signing of an order with Caparo Energy India Limited (CEIL), India’s fastest growing independent power producer for the supply, erection and commissioning of 2,000 MW of turbine capacity for wind power projects to be set up in India.

The deal is the largest of its kind in India and one of the largest in the world.

Speaking on the occasion, Mr. Ramesh Kymal, Chairman & Managing Director of Gamesa in India said, “We are very pleased to be the partner of choice for Caparo. I am confident that this will be a successful long term partnership. This order underlines the acceptance of wind energy as a viable and profitable solution to meet the increasing appetite among corporate for reducing their carbon footprint and meeting energy needs through sustainable energy sources. Gamesa is glad to bring to India its vast experience in the wind energy space and thus playing a major role in defining the country’s energy future.”

This contract entails supply, erection and commissioning of turbines (Gamesa G58-850 kW and Gamesa G97- 2.0MW) for 2,000 MW over the next six years, starting with around 150 MW in the first phase of the agreement commencing in 2012. The agreement is part of Caparo Energy’s long term strategy to secure its supply of turbines at a preferential pricing. Deliveries, under this agreement, are expected to be completed by 2016.

 This agreement will be serviced from Gamesa’s new capacities that are coming up in India where  2.0 MW turbines and blades will be manufactured.  

 Caparo Energy believes that this deal marks a shift in the Indian wind energy market. This is another step forward in the rapid growth of the wind energy sector in India, a market that installed 2.5 GW of new installations in 2010 and is expected to install 5 GW per annum of new installations by 2015. The country’s cumulative installed capacity is expected to reach 64 GW by 2020.

 Says Mr. Ravi Kailas, Chief Executive Officer, Caparo Energy India Limited, “This is an important relationship with a strong and committed partner that will help us move into the next phase of our wind farm development and roll out in India. This agreement with Gamesa will be a significant step in meeting the long term development goals of our company.”

In India, Gamesa has announced Capex of over 60 million euro through 2012 in setting up a blade plant in Gujarat in 2011 with initial capacity of up to 300 MW and installing new plants to manufacture nacelles and towers (joint venture) in the states of Gujarat and Tamil Nadu. Technology centres were opened in Virginia, India and Singapore (advanced materials) with plans to open 2 more technology centres later in 2011, creating a network of 10 R&D offices worldwide.
According to IWTMA (Indian Wind Turbine Manufacturers Association), Gamesa has attained a market share of 10%, just after 18 months of operation in India, hence placing itself in the 3rd position based on the capacity added during 2010-2011.

The wind sector in India has been growing at 30 to 40% per annum in the past five years and the growth rate is expected to increase significantly in the coming years.

Also, the future market will predominantly have more IPPs developing wind farms where the key drivers for the growth are higher IRR and tax incentives.

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