India offshore wind in 2026: the ₹7,453 crore push to finally break ground

In 50 words: India has an estimated 70 GW of offshore wind potential off Gujarat and Tamil Nadu but not a single megawatt built. A ₹7,453 crore viability gap funding scheme, cleared in September 2024, targets a first 1 GW — 500 MW off each state — with SECI running the auction and the debut tender expected off Tamil Nadu in 2026.

India built more than 48 GW of onshore wind and crossed 100 GW of solar, yet in one part of the wind map it has achieved exactly nothing: the sea. Despite a coastline studied for more than a decade and an estimated 70 GW of offshore wind potential, India has zero installed offshore capacity as of 2026 — while the United Kingdom, China and Denmark have built tens of gigawatts. The government's answer is a large viability gap funding (VGF) package designed to de-risk a first, deliberately small 1 GW so that a domestic supply chain, port infrastructure and grid connection can be proven before the sector scales. This analysis walks through the ₹7,453 crore scheme, the auction design, the site economics off Gujarat and Tamil Nadu, and why offshore wind in India has been perpetually five years away.

The state of play: a decade of studies, zero turbines
The ₹7,453 crore VGF scheme, decoded
How the auction works and who runs it
Why offshore has stalled: the cost gap
The strategic case: firm evening power and port jobs
The 2026 tender and the road to 30 GW
Frequently asked questions
What to watch next

1. The state of play: a decade of studies, zero turbines

India's offshore ambitions are not new. The National Offshore Wind Energy Policy was notified in October 2015, naming the National Institute of Wind Energy (NIWE) as the nodal agency and kicking off resource assessment. Through the FOWIND ("Facilitating Offshore Wind in India") programme, NIWE identified eight potential development zones each off the coasts of Gujarat and Tamil Nadu. MNRE assessments put the combined potential at roughly 70 GW, split broadly between the two states.

The targets that followed were aggressive on paper and unmet in practice. An early goal of 5 GW by 2022 lapsed with nothing built, and a 30 GW-by-2030 target announced later now looks arithmetically out of reach. The blunt summary from the sector is that India has spent ten years measuring wind speeds and drafting policy while its first foundation has yet to touch the seabed. The gap between potential and delivery is the single most important fact about Indian offshore wind — and it is exactly what the new funding scheme is built to close.

2. The ₹7,453 crore VGF scheme, decoded

The centrepiece is a VGF scheme approved by the Union Cabinet on 14 September 2024, with a total outlay of ₹7,453 crore. The money is split into two distinct buckets:

| Allocation | Amount | Purpose | |---|---|---| | Viability gap funding | ₹6,853 crore | Direct support for installing 1,000 MW (1 GW) of offshore wind capacity | | Port infrastructure | ₹600 crore | Upgrading two ports to handle the heavy logistics of offshore construction |

The 1 GW is divided 500 MW off Gujarat and 500 MW off Tamil Nadu, with a provision to add a small tranche (about 50 MW) if bidders request less VGF than budgeted. Scheme support runs until the financial year 2031-32, and selected projects must be commissioned within 48 months of signing their power purchase agreement.

The logic of VGF matters here. Offshore wind cannot yet compete with onshore wind or solar-plus-storage on price in India, so a straight reverse auction on tariff would either attract no bids or produce an unaffordable one. VGF flips the design: the tariff is effectively capped at a level a distribution company can absorb, and developers instead compete on how little upfront capital subsidy they need to make the project bankable. The lowest VGF ask wins. That structure is the same tool India used to seed its solar-park and battery-storage markets, adapted to a far more capital-intensive technology.

3. How the auction works and who runs it

The institutional split follows India's now-standard renewable model. MNRE owns the scheme and policy; the Solar Energy Corporation of India (SECI) is the implementing agency, responsible for the application process, running the competitive bid, awarding capacity, disbursing VGF and reporting quarterly on progress.

Selection is through international competitive bidding via an e-reverse auction. Bidders are pre-qualified on technical and financial strength — offshore wind is not a market open to first-time developers — and then bid down the VGF they require. Where financial bids tie, the lowest VGF request breaks the tie. Because foundations, turbines and installation vessels for offshore projects are dominated by a handful of global players (in Europe and China), the winning consortia are likely to pair an experienced international offshore developer or original equipment manufacturer with an Indian sponsor that brings land, grid and political access.

4. Why offshore has stalled: the cost gap

Offshore wind in India has stalled for reasons that VGF addresses only partly. The core problem is cost. Building in the sea means monopile or jacket foundations driven into the seabed, marine cabling to shore, specialised installation vessels that India does not own, and operations-and-maintenance access in monsoon seas. The all-in capital cost per megawatt runs several times that of onshore wind. Layered on top are country-specific frictions: a shallow domestic supply chain, ports not built for turbine components that are longer than a cricket pitch, grid connection at the coast, and long environmental and defence clearances for projects that sit in busy shipping and fishing waters.

The counterweight is the resource itself. Offshore sites off Gujarat and Tamil Nadu are reported to offer capacity utilisation factors in the region of 45–50% — well above the roughly 25–30% typical of Indian onshore wind. A higher, steadier capacity factor means each installed megawatt delivers far more energy, and critically, offshore wind off Tamil Nadu tends to blow hardest during the summer evening and monsoon months when solar fades and the grid is most stressed. That complementary profile is the strategic prize the cost gap has so far kept out of reach.

5. The strategic case: firm evening power and port jobs

Why spend ₹7,453 crore on 1 GW when the same money could buy several gigawatts of solar? Three arguments underpin the decision.

Grid diversity and timing. Offshore wind's evening and monsoon-season output partially offsets the "duck curve" problem that solar deepens, reducing the storage India must otherwise build to cover the post-sunset peak.
Industrial and port development. The ₹600 crore port carve-out is deliberate. Offshore wind demands heavy-lift quays, assembly yards and vessels; building that capability seeds a manufacturing and logistics ecosystem along the coast, with employment that onshore projects do not create.
Learning curve. Every offshore market — the UK, Germany, China — started expensive and fell dramatically down a cost curve once a domestic supply chain and financing template existed. India is buying that first, expensive lesson deliberately, at a controlled 1 GW scale, rather than waiting for costs to fall on their own.

The Council on Energy, Environment and Water (CEEW) and other analysts have argued that offshore wind's value to the power system in 2030 lies less in cheap bulk energy and more in this firmness and diversity — which is precisely why a tariff-only auction would undervalue it and a VGF-backed one is the right instrument.

6. The 2026 tender and the road to 30 GW

The near-term milestone is the first auction. MNRE has signalled that the debut offshore wind tender — reported to be for the Tamil Nadu coast, expected around February 2026 with award finalisation in the following months — will be the real test of developer appetite. Separately, MNRE has moved to issue draft offshore wind lease rules to govern how developers secure seabed rights, closing a regulatory gap that has held back financing.

Set against the long-stated 30 GW-by-2030 target, a first 1 GW auctioning in 2026 and commissioning up to four years later makes the headline goal effectively unreachable this decade. The realistic read is that 2026-2030 is a demonstration phase: prove one gigawatt, build the ports, localise part of the supply chain, and let the discovered VGF and tariff numbers tell India whether offshore scales in the 2030s. The honest benchmark for success is not 30 GW by 2030 — it is a single steel foundation in the water and a turbine spinning off Gujarat or Tamil Nadu before the decade ends.

7. Frequently asked questions

How much offshore wind does India have installed?

As of 2026, zero. Despite a 2015 policy, NIWE resource studies and roughly 70 GW of assessed potential, no offshore wind turbine has been commissioned in Indian waters.

What is the ₹7,453 crore offshore wind scheme?

It is a viability gap funding package approved in September 2024. Of the total, ₹6,853 crore supports installing 1,000 MW of offshore capacity and ₹600 crore upgrades two ports. The aim is to make a first 1 GW bankable at a tariff discoms can afford.

Where will the first projects be built?

Off Gujarat and Tamil Nadu, split 500 MW each. These two states hold the bulk of India's assessed offshore wind resource, identified through the FOWIND zone studies.

Who runs the auction?

MNRE owns the scheme; SECI is the implementing agency that runs the international competitive e-reverse auction, awards capacity and disburses the VGF. Developers compete on the lowest VGF requirement rather than on tariff alone.

Why is offshore wind so much more expensive than onshore in India?

Marine foundations, subsea cabling, specialised installation vessels India lacks, port upgrades and a thin domestic supply chain push capital costs to several times onshore levels. VGF exists precisely to bridge that gap for a first demonstration.

When will India's first offshore turbine actually generate power?

Projects must commission within 48 months of signing their PPA. With the first tender expected in 2026, first generation realistically falls in the late 2020s, not before.

8. What to watch next

Three signals will show whether this attempt is different from the last decade of missed targets. First, the debut tender's response — whether the Tamil Nadu auction attracts serious, pre-qualified consortia or, as with earlier attempts, developers stay cautious and demand more support. Second, the discovered VGF and tariff numbers, which will reveal the true cost of Indian offshore wind and whether the ₹6,853 crore envelope is enough for a full gigawatt. Third, port and lease execution — whether the ₹600 crore port upgrades and the new lease rules actually clear the logistics and seabed-rights bottlenecks that have kept India's offshore ambition on paper. If those three line up, India's first offshore foundation could go into the water within this scheme's window. If they do not, offshore wind will remain, as it has been for ten years, a resource India can measure but cannot yet build.

This analysis was researched and drafted with AI assistance and edited by a named member of the Earth Energy Log editorial team. Figures are attributed to the primary and trade sources listed above; the offshore wind scheme allocations reflect the September 2024 Cabinet approval, while tender timing, capacity-factor estimates and the 30 GW target are drawn from government statements and press reporting and may change as the first auction proceeds. See our editorial standards and AI disclosure. Explore more on wind, policy and finance, and see our coverage of India in the regions hub.

Table of contents