I BELIEVE IN ‘COOPERATIVE COMPETITION’ – THE MAJORITY OF MARKETS WHERE WE OPERATE ARE STILL IN GROWTH PHASE, SO THERE’S BUSINESS FOR EVERYONE.
–Tulsi Tanti, Founder, Director and Chairman, Suzlon
Suzlon was born as a solution to the challenges of energy security. A strong values base has emerged as the company has grown and expanded internationally to realize the social benefits of renewable energy, however success has come from a canny approach to building the company’s competitive advantage, both through vertical integration to offer a full service as producer, maintainer and operator of turbines, and also through international acquisitions to leverage expertise developed in European markets like Denmark and Germany. Systems thinking has been a strong trait in the company to this end, particularly in its acquisition of key suppliers to the wind market, RePower and Hansen Transmissions.
Suzlon has held the number-one spot in the wind industry in India for 11 consecutive years with a 50% share of the market for the past ten years. In terms of installed capacity, it is the third largest in Asia and fifth worldwide. The Suzlon Group has a combined global market share of 8.4%. Its presence can be found across 32 countries with over 17 GW installed.
Established in Gujurat, Suzlon has its global headquarters powered 100% by renewable energy in Pune in Maharashtra state. As a vertically integrated wind company, Suzlon manufactures and maintains turbines as well as operating its own wind farms. The firm has transformed from a start-up in 1995 to a major multinational, employing 13,000 people and operating facilities in North and South America, Asia, Australia, Europe and Africa. Eighty percent of the business’s sales are outside India, although close to 60% of Suzlon’s installed generating capacity remains in the country (see Suzlon's installed base graph).
India is notorious for an inadequate power supply. Over 500 million of its population has no access to electricity. For the grid-connected public and business, supply is also regularly interrupted, particularly in the summer. As a result of chronic under-investment in distribution, a heavy reliance has evolved on expensive back-up generators running on diesel fuel. Grid-electricity prices are unusually high for commercial customers – twice the rate paid in countries like the US. At a national level, 45% of export earnings are spent on energy imports, mostly on fossil fuels. The International Energy Agency suggests that Indian coal imports could increase sevenfold by 2030, putting energy security high on the agenda.
Suzlon grew its business in India against this backdrop, offering reliable electricity supply to commercial customers at relatively low cost and taking advantage of a range of incentives for wind generation. But its innovative approach to growing its business has been central to its success.