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Power Point | April 2016

Rural Electrification | A Dream that must come true

Over 300 million Indians are deprived of uninterrupted electricity supply more than 65 years after independence. In the Union Budget, the government has announced 2018 as the year by when all Indian villages will be fully electrified. While the electrification drive will take more than just willingness, the target is ambitious yet praiseworthy.

While India has progressed gradually since the economic liberalization in the last 25 years, there is much that needs to be done to bridge the inequity between its haves and have nots. Electrification of villages is directly related to the strength of a nation´s economy and economic equity. Electricity is the backbone of infrastructure and industrialization which create educational and economic opportunities which, in turn, bridge the existing inequity or at least reduce the widening gaps. But there are several reasons why Indian villages continue to remain alien to uninterrupted energy, a fundamental human need of our times.

Experience & challenge
The challenge of electrification is manifold. Thousands of Indian villages are located in diverse, remote and desolate terrains which are difficult to connect with the grid infrastructure. In challenging terrains like the deserts, the Himalayas and other hilly regions in the north eastern states, despite no major paucity of funds, setting up grids has been considered a feat. While the state governments in these regions have done a commendable job, the lack of support from nature itself has proved a dampener. The other major issue is the cost. The most marginalized rural families cannot afford electricity even at subsidized or cross subsidized rates of Rs 3-4 per unit of electricity. The number of farmers who have ended their lives due to crop failure or inability to pay the debt is alarming. Expecting these strata of the society to pay for electricity price is unreasonable. Farmers in the country´s most backward regions are indebted and are struggling to make a living out of their primary source of livelihood - agriculture - let alone the ability to pay electricity bills. Ironically, these are also the causes which have left the state distribution companies (SEBs) heavily indebted and a state of disarray.

Can Renewable Energy Help?
Rural India is hugely dependent on grid connectivity for access to electricity. A large number of rural Indians, regardless of grid connectivity, continue to rely upon diesel and other sources of fossil fuels for energy. This is neither economically nor ecologically sustainable. This, coupled with excessive expansion and usage of land for agricultural purpose is causing threat to ecology in the form of pollution, rapid desertification etc. It is therefore imperative that rural India is provided with cheap, clean and sustainable energy which offers a longer term solution to their woes. Unfortunately, India´s immense potential of generating power from solar panels mounted on rooftops remains largely underexplored. Given that India has over 300 sunny days in a year and abundant rooftop space, especially in the rural landscape, much of its potential remains untapped. Of the ambitious 100 GW solar power target set by the Jawaharlal Nehru National Solar Mission, India aims to achieve 40 GW through rooftop solar installations by 2022. The country currently has about 300 MW installed rooftop capacities a fraction of which are located in the hinterlands. Rural India is reportedly known to have seldom used renewable energy as a primary source of energy except in regions where small hydro projects and biogas are naturally advantageous. India is however adding rooftop capacities rapidly due to declining cost of technologies and batteries, encouragement from government and private sector and suitable policy measures. The opportunity to expand the country´s target of 175 GW of renewable energy can come from its rural heartlands.

Financial support & stability
The government, private and non government sectors have taken several noteworthy efforts in the past to ensure ceaseless electricity supply through small hydro, biogas and rooftop solar power projects. Under the government´s Deendayal Updhyay Gram Jyoti Yojana rural electrification drive is in full swing and till March 2016, 6493 villages have been electrified. The government aims to electrify the remaining 18,452 villages in next 1000 days, by May 2018. More than one third of the remaining villages are currently in geographically challenging regions and hence grid solutions here are out of reach. It is commendable that the government is providing funding to implement this scheme, is reviewing the progress on a monthly basis and monitoring the electrification process Gram Vidyuta Abhiyanta. Interestingly, the private sector and NGOs have also taken numerous initiatives to power homes in desolate Himalayan terrain using rooftop solar systems.

The way forward
Private developers, too, have several opportunities in electrifying rural India, especially since rooftop solar is proving to be a viable, long-term solution. In the last few years, banks and microfinance institutions have opened up significantly to fund rooftop solar projects in rural India. All that the villages need are training, quality developers and EPC contractors. Moreover, incentives on solar modules and cheaper storage solutions could fast-track the electrification process and deliver unprecedented economic opportunities that a vast section of our population has been deprived of for a long time. Robust net metering systems would help villagers sell the excess electricity in the state grid which will transform them into net producer from consumer of energy. This will invariably metamorphose rural India from a power deficit to power surplus stature. Above all, this ecosystem will provide the village folks a sustainable, long-term livelihood and create economic opportunities.

-Vineet Mittal, Vice Chairman, Welspun Renewables

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