Cabinet approves Viability Gap Funding scheme for implementation of Offshore Wind Energy Projects

The Scheme aims to set up first-ever offshore wind energy projects in India.

Cabinet approves Viability Gap Funding scheme for implementation of Offshore Wind Energy Projects

The Union Cabinet, chaired by Prime Minister Shri Narendra Modi, approved the Viability Gap Funding (VGF) scheme for offshore wind energy projects at a total outlay of Rs.7453 crore, including an outlay of Rs.6853 crore for installation and commissioning of 1 GW of offshore wind energy projects (500 MW each off the coast of Gujarat and Tamil Nadu), and grant of Rs.600 crore for upgradation of two ports to meet logistics requirements for offshore wind energy projects.

The successful commissioning of 1 GW offshore wind projects will produce renewable electricity of about 3.72 billion units annually, which will result in annual reduction of 2.98 million ton of CO2 equivalent emission for a period of 25 years.


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Further, this scheme will not only unleash the offshore wind energy development in India but also lead to the creation of the required ecosystem in the country to supplement its ocean-based economic activities. This ecosystem will support the development of initial 37 GW of offshore wind energy at an investment of about Rs.4,50,000 crore.

The VGF scheme is a major step towards implementation of the National Offshore Wind Energy Policy notified in 2015 with an aim to exploit the vast offshore wind energy potential that exists within the exclusive economic zone of India.  The VGF support from the Government will reduce the cost of power from offshore wind projects and make them viable for purchase by DISCOMs.


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While the projects will be undertaken by private developers selected through a transparent bidding process, Power Grid Corporation of India Ltd (PGCIL) will construct the power excavation infrastructure, including the offshore substations.

Ministry of New and Renewable Energy, as the nodal ministry, will coordinate with various Ministries and Departments to ensure the successful implementation of the scheme, as per official sources.

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