A US small business will use political risk insurance from Opic to install a wind turbine in Tamil Nadu State in India, Opic president and CEO Robert Mosbacher, has announced.
Opic will provide US$1.1mn in insurance to Southern Energy Partners of Memphis, Tennessee for the installation of a 250kW wind turbine on a wind farm in Tamil Nadu State in India. The investment will be made through Southern’s local subsidiary, SEP Energy India. Electricity generated by the turbine will be sold to the Tamil Nadu Electricity Board (TNEB) through a power purchase agreement with SEP Energy India.
In addition, SEP Energy India will install and operate future wind turbines to produce electricity in India for which OPIC will also provide insurance coverage.
The project supports efforts by the Indian government, both federal and state, to encourage private investment in electricity generation and distribution, especially from non-conventional sources, including wind. Renewable energy already represents about 40% of the totalled installed capacity in the country, a figure that is expected to increase.
Tamil Nadu State in particular obtains a significant proportion of its power from renewable sources: wind power contributes 2GW, or more than 20%, of the state’s supply of electricity – the highest in the country.
As of 2005, Tamil Nadu was one of the few Indian states with surplus electric power, enabling TNEB to sell excess generation to neighbouring states. The 30 square mile area around the projects site already has approximately 1,000 wind turbines.
“India is committed to developing its renewable energy sources, particularly by encouraging private sector investment in projects such as this one. By helping a US small business invest in India, Opic is supporting both the environment and the growth of India’s energy infrastructure,” Mosbacher says.