Tamil Nadu’s wind energy policy tweaks aim to lower power costs and improve competitiveness of the state’s textile and apparel sector.
Tamil Nadu’s revised wind power policy is expected to ease cost pressures on the state’s textile and garment industry, with industry body Southern Indian Mills’ Association (SIMA) welcoming the amendments as a timely move to strengthen sector competitiveness.
In a press statement, SIMA said the incentives and policy corrections would support greater adoption of green energy by textile manufacturers while helping the industry navigate stress arising from recent global developments. SIMA chairman Durai Palanisamy noted that access to renewable energy has become critical for the power-intensive textile sector amid volatile export markets and rising compliance costs.
Tamil Nadu, India’s second-largest state economy, accounts for nearly one-third of the country’s textile business size. The state contributes around 28 per cent of total textile employment, 45 per cent of national spinning capacity, 22 per cent of power loom capacity, and holds a leading position in cotton yarn production and exports. It also houses over 70 per cent of India’s cotton knitted garment manufacturing capacity. The textile sector is a key pillar in Tamil Nadu’s ambition to achieve a $1 trillion economy by 2030.
However, the industry is currently facing strong headwinds from multiple international factors, including tariff actions by the United States, the European Union’s gradual shift away from fast fashion, and geopolitical uncertainties impacting textile trade flows, including developments in Bangladesh.
Tamil Nadu has been a pioneer in wind energy investment since the 1990s, driven by supportive government policies. A significant number of captive windmills used by textile units are now over 20 years old. Industry concerns had intensified after the 2025 wind repowering policy denied banking facilities and evacuation support, posing challenges for power-intensive sectors such as textiles that rely heavily on captive wind power. SIMA had repeatedly urged the state government to extend banking facilities for older windmills and allow operational life extensions of up to 40 years.
Welcoming the amendments notified through the latest government order, Palanisamy highlighted that the retention of the annual banking system, the sharp reduction in Infrastructure Development Charges from the earlier proposal of ₹30 lakh per MW for five years to ₹50,000 per MW per annum for life extension or refurbishment, and the simplification of procedures for obtaining life-extension certificates from chartered engineers are key industry-friendly measures.
According to SIMA, these amendments will enhance Tamil Nadu’s competitiveness vis-à-vis other textile-producing states while reinforcing its leadership in renewable energy adoption. Palanisamy also welcomed the continuation of Power Purchase Agreements and the option to opt for energy wheeling agreements.
He expressed hope that the state government would further consider extending banking facilities to captive windmills installed after 2018, a move that could help power-intensive textile units remain competitive and attract fresh investment into the state.
News Courtesy : Fibre2Fashion