alternative energy solution and rural electrification for india

7/30/2019 Alternative energy solution and Rural Electrification for India

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Alternative Energy Solution for India

Sudhir Singh Patel Sanjeev Kumar Nikhil Bhatt

Presentation @ MDI, Gurgaon

10thDec12


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Contents

1. Facts About India

2. Alternative solutions

3. Barriers on implementation

4. Eradicating poverty by implementing renewable

5. Recommendations


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Facts

Over 40% of population without access to electricity.

Roughly 70% households use traditional biomass for cooking

More than 70% of our crude requirement is being met through importimpacting Indias energy security

78,198 cr. On petroleum products subsidy in 2011

Sixty-five years after Independence, only nine states - Andhra

Pradesh, Gujarat, Karnataka, Goa, Delhi, Haryana, Kerala, Punjab andTamil Nadu - of 28 have been officially declared totally electrified.

India needs 8%+ GDP growth for lifting the bottom 40% of thepopulation to an acceptable standard of living


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Alternatives : present status and Potential

Resources Unit Present Potential

Hydro power MW 30936 1,50,000

Biomass

Wood Mtoe/year 140 480

Biogas Mtoe/year 0.1 15

Bio Fuels

Bio-diesel Mtoe/year - 60

Ethanol Mtoe/year


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Alternatives : present status and Potential

ResourcePotential(MW)

Present status(MW)

Wind 49,000 17,352 (35%)

Small Hydro 20,000 3,395 (16%)

Bio power 23,000 3,225 (14%)

Solar>100,00030-50 MW/ sq. km

941 (1%)

Total >1,94,880 24,914

Source : MNRE


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Barriers on implementation

Wind

Barriers: Low PLF, noise and visual pollution, poor accessibility to thesite

SolarBarriers: High installation costs, low conversion efficiency, huge landrequirement, silicon ingot energy intensive, Chinese dumping of SPV

Bio-mass

Barriers: land requirement, byproduct, waste disposal,-Large scale deforestation of mature trees

- Adds to water pollution through agricultural drainage

Finance, Inconsistent SEBs policy and Lack of Trained Work-force

are a common problem for all RE projects


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Eradicating poverty by implementingrenewable

A life changing example

Impact ofrenewable

Remark

Social Poverty reduction gender equality

environmental sustainability

reduction of child mortality

Improve productivity, women

dont need to spend time on

basic survival activity

Economical New Job opportunity

Saving foreign exchange

Development of livelihood

activity beyond day light

hours.


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Subsidies

Subsidies are one of the most powerful policy tools in the hands ofthe government

India has historically subsidized energy with the objective ofprotecting its consumers from international price volatility and

providing energy access for its citizens, especially the poor.

Since poor households typically spend a larger share oftheir income on energy needs, changes in fuel prices

affect them much more than the rich.

Is it achieving its intended objective efficiently


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Subsidies

Subsidies are one of the most powerful policy tools in the hands ofthe government

India has historically subsidized energy with the objective ofprotecting its consumers from international price volatility and

providing energy access for its citizens, especially the poor.

Since poor households typically spend a larger share of their incomeon energy needs, changes in fuel prices affect them much more than

the rich.

Is it achieving its intended objective efficiently ?


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Subsidies

Do Poor People Benefits from Subsidies ?

Distribution of Households by Primary source of energy for Lighting in rural and

Urban India (20072008)

kerosene is an inefficient and more expensive source of lighting when

compared with electricity and causes indoor air pollution

Others1%

Electricity94%

Kerosene

39%

Others1%

Kerose

ne5%

Electricity60%

RURALURBAN

Source : NSSO 2010


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Subsidies

Quantum of subsidies and Under-recoveries (201011)

Source : Teri Report

1.07 per cent of GDP was

paid in under recoveries in 2011

Total expenditures of bothcentral and state governments

on health and education were

1.27 per cent and 2.98 per cent

of GDP respectively

In Remote village dieselgenerators are used for other

then lighting such as to

charge battery for T.V and

mobile on chargeable basis

adding to extra burden on

diesel subsidy

78,190(17,154)


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Subsidies

Breakdown of Per Unit Under-

recovery on diesel, PDS Kerosene

and domestic LPG

Maximum % of under recoverygiven to kerosene

Source : Teri Report


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Do We have any solution to betterutilization of kerosene subsidy


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39% of rural households and 5% of urban households uses keroseneprimary source of energy for lighting.

The JNNSM envisions to have 200 MW capacity of off-grid solar

applications installed by 2013 , 1000 MW by 2013-17and overall a2,000 MW capacity by 2022.

Solar Lantern program was launched and 911,000 solar lanterns havebeen installed by Mar12.

India have 75 million off-grid households but only 4-5 % penetration oflanterns have been achieved.

Consumer preferences and needs for solar off-grid lighting are highlylocalized.

Current annual market size for solar lanterns could range between300,000 and 500,000 units per annum.

Solar Lantern to replace kerosene use for lighting

Solar Lantern In India


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Comparison of Kerosene and Solar Lantern

Source: Solar lanterns for domestic lighting in India: Viability of central charging station modelA.Chaurey , T.C.Kandpal Elsevier(2009)

Characteristic Kerosene Lantern Solar lantern

Capital cost Low High

Cost of fuel Depends on usage Nil

Replacement cost Low High

Availability andreparability

Very good, even in remote

locations

Poor, due to limited sale and

servicing outlets

Flexibility to reduceillumination

Possible by lowering the wick No options for dimming the

illumination in CFL- based

lantern, possible in LED based

lanterns

Lumen Output Low 4-5 Times higher

Safety aspects Fire and health hazards due tosmoke

Safe to use

Subsidy burdenRecurring burden of fuel subsidy One time burden of capital

subsidy(if Provided)


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IndianAvailable Model

Source: Solar lanterns for domestic lighting in India: Viability of central charging station modelA.Chaurey , T.C.Kandpal Elsevier(2009)

Characteristic ModelOwnership Free For Service /Rental

Initial cost burden

User Owns the lantern by paying full cost of

it.

User does not own the lantern,

but rents its by paying a fee as

and when required.

O&M cost

User has to pay for O&M of the lantern

throughout its useful life, and hence is

careful while using it thereby ensuring thelongevity of lantern and its components.

User usually does not bear any

cost towards O&M and tends to

misuse or mishandle it whileusing, often resulting into

reduced life of its components.

Spatial and temporalflexibility to use

User can use the lantern anywhere and at

any time.

User can use the lantern only

after procuring it from the

charging station.

Recharging of battery

User has to recharge the lantern by keepingthe PV module outside in the sun daily, by

ensuring proper orientation.

User does not have to worryabout recharging the lantern,

except for delivering the lantern

to the charging station.

SafetyUser is responsible for the safety of PV

module.

User is not responsible for the

safety of the module.


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Central Charging Stations

Flexibility to rent or recharge the lantern only when required.

Maintenance and servicing issues are not faced by the customer.

TERI has also adopted this model.

Pay-as-you-go loan repayment over mobile Increasing mobile penetration in rural areas has led to a vast mobile

airtime distributor network the model aims to leverage this network

for its operations.

Customer can make payments at his/her convenience based on his/her

usage requirements- this advantage puts the model on par withkerosene.

Lender can better manage bad debt/non-payments, through increased

leverage through the ability to turn off the solar system remotely.

SELCO implemented in the state of Karnataka.

IndianAvailable Model


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Success story of Bangladesh

90% of off-grid households in Bangladesh are in ruralareas.

Penetration is more than 4% and aimed to reach 4Million SHS installations by 2014.

Target Annual Growth rate of SHS is 114%.

Best Micro Finance Model in South Asia.

Introduced less Wp models for low income groups


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An overview of the solar off-grid lighting market

In Bangladesh

Credit terms to consumer:15% down payment

Loan tenor varies from 1 year

to 5 years generally it is 3 years

Interest rate varies from 4 to

6% per annum

Repayment frequency ismonthly

Better financing facilities and easily available credits are the success

drivers


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Individual systems- ranging from 40 watts to 1 kw

A typical system comprises a 100 watt panel to power 2 -3 CFL lights and amobile charging point

Larger systems can support fans, television viewing too

Incentivized through a capital subsidy of 40% and loan for the remainder ofthe cost

Some banks insist on a small margin money by the user

A strong retail network and good after-sales-service important criterion

Nearly half a million systems installed so far


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The decentralization advantage.Cost

Cost of grid extension to 12 km and beyond is broadly comparable with solar

power

For villages beyond 3 km from the grid (hills) and 7 km(plains) solar is a

cheaper option on NPV basisNo transmission losses-lower costs

Reliable

Demand driven and tailored to local needs-Scalable as per local requirements

Fast Implementation periods

Local employment and enterprise opportunities


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14.3 KW Solar system with battery bank

Designed for140 CFLs, 75 Fans, 15 TVs- allfor 8 hours daily

Actual usage- 60 households 70 lights, 15fans and 1 TV

Excess energy used to draw water from4 HP pumps for 4 hours daily, solvingthe water problem in the area.

Local Ownership

Established local Leadership Council

Volunteer Leader for every 10Households to collect dues, protectsystem, resolve Issues

Private initiative

Seeks to access federal support

Company CSR funding

Expansion plans

Community Hall with a rooftop solar power plant

Household

connections

Pole mountedmeters


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The beautiful forest 10,000 sq km. of forest and saltwater swamp

Ideal candidate for renewable decentralised systems

Geographically isolated islands No grid-connectivity

Unreliable and very expensive diesel supply grid

15 solar PV mini-grids (900 KW), 3 biomass gasifier basedmini-grids (1500 KW), 6 wind solar hybrids (24 KWp)

installed

Nearly 70% as grant; 30% user charges to cover opex andmaintenance

Strong community participation through Panchayats

Supplementary support via stand alone HLS and PV based


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Conclusion

Energy market in India is highly distorted due to populist measures,open- ended subsidy , cross- subsidy etc ..

Solar and bio mass can help India uplift poverty

India abundantly endowed with renewable, a consolidated focus isrequired to exploit it.

Immediate focus on rural electrification required

Involvement of govt., social activist and rural representative candrive to achieve goals.

Govt. should promote solar lantern and should reduce subsidy onkerosene step wise , direct cash transfer can help to achieve target


25/25Thank you

alternative energy solution and rural electrification for india

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