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Renewable Energies As Big Business Opportunities?

Updated: December 25, 2010 10:31 am

Biomass and biogas are the cheap, decentralised renewable energies to choose for India. But the ministry of renewable energies—and the technocrats and entrepreneurs surrounding it—appear to favour hi-tech solutions such as grid solar power, with only a few exceptions such as the project to produce power from rice husk in 10,000 villages in eastern India

 India has always had an on-off attitude when it comes to the promotion of renewable sources of energy, rather like the family planning campaign. In its avatar years, the department (as against ministry) was called ‘non-conventional sources of energy’. This was a misnomer, if ever there was one. Even today, 600 million Indians—a little over half the population—do not use any form of energy that they pay for. In other words, they forage twigs and other forms of biomass from the forests and farms; they cannot afford to buy fuel from the market. Many slum-dwellers in cities, whose numbers would add up to 50 million or more, are in the same boat. So, in all fairness, it’s the ministries of petroleum and coal that ought to be renamed ‘non-conventional’ energy sources because only a minority in the country can afford them!

                The department is now a full-fledged Ministry of New and Renewable Sources of Energy (MNRES), headed by a passionate and articulate politician, Farooq Abdullah. At the end of October, the ministry organised DIREC—the Delhi International Renewable Energy Conference, with two huge exhibitions of renewable energy devices from India and around the world—in Noida. To this columnist’s surprise, the subject did not just attract the usual suspects—khadi-clad, jhola-toting votaries of this alternative source of power—but as many as 9,000 participants, including around a third from abroad, 90 per cent of both genders wearing suits (yes, the women too!).

                MNRES Secretary Deepak Gupta was gung-ho about India’s switch from polluting fossil fuels to clean energy. In the next 12 years, India’s need for electricity will rise 12-fold, and electricity shortfall is estimated at 25-35 gigawatt (GW). India imports 80 per cent of its oil and petroleum. This is largely diesel, which goes towards fuelling trucks and cars, farm pumps, factories, etc. Besides, as many as 400 million people do without electricity, which is why demands by OECD countries that “emerging markets” (as President Obama called them in an address last month) reduce their emissions are problematic. Certainly, the elite in India should be penalised for their pollution, but not the poor who cause hardly any pollution at all.

                The generation of all forms of renewables—which include wind, sun, biomass, tidal, small hydroelectric and others—has gone up five-fold in the last five years. One per cent of total energy use comes from renewables. The piece de resistance, of course, is the National Solar Mission (Minister Abdullah’s pet project) that plans to spend Rs 20,000 crore in the next decade or so. MNRES hopes to reduce the use of diesel and kerosene by 1 billion litres a year, after six years. By 2020, it hopes to “energise” 20 million rural households. Some 150,000 telecom towers are to undergo “solarisation”. Since they don’t consume that much power, solar photovoltaics are the ideal solution; 1,000 have already been converted to this form. The goal is to draw one-tenth of electricity supply from renewables by 2022.

                In eastern India, farmers use diesel for pumps to irrigate their rice fields, which is a huge employment of polluting and imported fuel. In this region, MNRES is targeting 10,000 villages and hamlets, where per capita use of commercial fuel is the lowest in the country, which is why they are considered ‘backward’. Rice husk is used to generate gas, which can then be used for pumps. This is being done entirely by the private sector, and 150 villages have already been covered. The ministry intends to achieve its target by 2015—coincidentally, the deadline that the UN has laid down to meet several Millennium Development Goals.

                While such technologies—biomass and biogas– may indeed be “the power to choose” because they are cheap, decentralised and rely on local resources, the ministry appears to be taking the other route and going in for hi-tech solutions. For instance, it is targeting the generation of “grid solar power”—the contribution of solar energy to the electricity grid—including rooftop panels upto 1,000 MW by 2013. Off-grid solar applications, which include rural solar lamps, contributing 100 MW, and solar collectors, should span 7 million square metres, both by this deadline. However, while solar power is indeed an exciting prospect, particularly in a country that has more hours of sunlight than anywhere in the West, caution is needed on its cost and effectiveness.

                The well-known climate sceptic Bjorn Lomborg, who is an adjunct professor at the Copenhagen Business School, writes: “Germany led the world in putting up solar panels, funded by 47 billion euros in subsidies. The lasting legacy is a massive bill, and lots of inefficient solar technology sitting on rooftops through a cloudy country, delivering a trivial 0.1 per cent of its total energy supply.” Even allowing for his iconoclasm when it comes to anything to do with climate—earlier, including the very fact of it itself!—Lomborg has a point.

                The government wants to bring solar power to a critical mass, which will reduce costs and then see rapid scale-up. This requires a regulatory framework, support to utility-scale power generation, expansion of off-grid application, accelerating research and development and enhancing the domestic manufacturing base.

                A typical company is Synergy Renewable Energy Pvt Ltd, based in Kolkata, which is “a 100 per cent export-oriented unit for manufacturing crystalline silicon-based solar photovoltaic modules”. These modules have been sold in Europe and Australia.

                Similarly, Sujana Energy Ltd in Hyderabad believes in “harnessing solar power at an affordable cost”. It develops energy solutions using more sophisticated technology than panels or modules. These include concentrated generation by using parabolic troughs, compound parabolic concentrator panels as well as hybrid biomass/solar power plants. “Our unique approach is to provide affordable solutions from 0.5 kW to 5 MW,” the company says. “We are set up to provide system solutions that include water heating, water purification and refrigeration and air conditioning beyond traditional energy generation. Our systems are flexible enough to incorporate other renewable sources such as biomass, in an integrated fashion and in a cost-effective manner. The necessary technologies for implementing these solutions are developed internally.”

                Of course, compared to China, Indian renewable energy companies are minnows. China’s success has been nothing short of dramatic in becoming the world’s leader in several of these fields. In 2008, the use of renewables in that country totalled some 250 million tce (tonnes of coal equivalent), excluding biomass energy. It accounted for 9 per cent of the country’s primary energy use that year, up from 7.5 per cent in 2005. Hydropower dominated China’s renewable use, according to ‘Renewable Energy and Energy Efficiency in China: Current Status and Prospects for 2020’, published by the Worldwatch Institute in Washington DC, and distributed at DIREC.

                Hydropower and wind power accounted for the bulk of China’s total installed capacity in 2009, reaching 197 GW and 26 GW respectively. Cumulative wind installations more than doubled that year; so did new wind installations allowing China to surpass the US to become the largest market for wind power, comprising nearly one-third of the world’s total installed capacity in 2009. Total installation of solar PV (photovoltaics) reached 310 MW in 2009, more than double the 150 MW in 2008, but leaving China with still only 2 per cent of global installed capacity. It installed 42 million square metres of solar water heaters in 2009, and increased the total installed capacity by 31 per cent, with the central government providing strong incentives for rural installations. China has accounted for 70-80 per cent of the global market for hot water systems in recent years.

                India, by contrast, has a more modest plan. It hopes to save/reduce the use of kerosene by rural solar lighting in 5 million rural households by 2015. Every day, if a fifth of a litre of kerosene is saved per day in these homes, it will result in 35 million litres saved per year by 2015. If 150,000 telecom towers are ‘solarised’, there will be 450 million litres of diesel saved annually. There can also be daytime mitigation of diesel consumption through solar applications (typically, for irrigation water pumps): 1,000 MW of avoided diesel power capacity saves 400 million litres of diesel per year. And if 2,000 plants generate power using rice husk as fuel, it will result in 100 million litres of diesel saved.

                As a non-expert attending DIREC, and speaking at a panel on India’s renewable energy, chaired by former Environment Minister Suresh Prabhu (Abdullah gave the keynote address), one could not but be discomfited by the suited-and-booted fraternity which almost overwhelmed the conference. In other words, everyone saw it as a big business opportunity, rather than a chance to examine the economic, health, social and environmental benefits of these technologies.

                It does seem, for instance, that solar PV is prohibitively expensive and cannot work without huge subsidies. As we saw, if Germany hasn’t taken off in this field—and it is no slouch when it comes to cutting-edge technological prowess—one can well imagine what progress a country like Indian can achieve.

                Solar thermal, however, would be the power to choose. For one thing, it can literally make the difference between life and death if, in remote and mountainous regions where access to doctors and incubators is difficult, the use of SPV to heat a room in which newborn and premature babies are kept in cold seasons can help save lives. As is only too well recorded, India suffers from one of the worst rates of infant mortality in the world; this could mitigate that at least to some extent. SPV can also pre-heat water in factories or dairies, cutting down on the use of boiler fuel or oil.

                The one example that Gupta referred to in his presentation of a down-to-earth technology was biomass gasification through the use of rice husk, in eastern India. The plan is to electrify 10,000 villages through such gasification and solar technologies, by 2022. The rice husk programme will have to be implemented in predominantly rice-growing areas, hence the location in eastern India.

                However, hardly any speaker referred to the two most basic technologies that will make a difference in this county. The first is the introduction of new cook stoves that reduce pollutants in rural and slum colonies in urban areas when housewives use wood to cook with. Some three decades ago, Dr Kirk R Smith from the East West Centre in Hawaii worked out how much carcinogens a typical housewife inhaled while using these smoky chulhas. Astonishingly, it worked out to inhaling the equivalent of a few packets of cigarettes a day!

                It was estimated that about 4-6 lakh premature deaths could be attributed annually to the use of biomass fuel in India, according to a WHO report which based its findings on Dr Smith’s study ‘National Burden of Disease in India From Indoor Air Pollution’ in 2000, along with its own research, in 2007. Based on extrapolation of the health effects of indoor air pollution in developed countries, the WHO has estimated that, globally, about 2.8 million premature deaths are caused by indoor air pollution, and that the highest number of deaths will occur in India. The Ministry of Environment and Forests introduced the new National Ambient Air Quality Standards (NAAQS) in 2009 for the extended list of 12 pollutants that are closely related to health.

                The MNRES has taken various steps to control and prevent indoor air pollution, through the National Programme on Biogas Development, to provide alternatives to burning firewood, agricultural residue, cattle dung and coal as fuel. A National Programme on Improved Chulhas has been taken up to promote thermally efficient and low-smoke stoves/smokeless chulhas. Information, education and communication activities through electronic and print media have been undertaken to give publicity to the programmes. Women’s education programmes are also organised in villages to generate awareness about the hazards of burning firewood, agricultural waste and cattle dung in traditional chulhas,and the benefits of biogas technology, etc.

                However, since no one breathed a word (pardon the pun) about this at DIREC, could it be that there is no money to be made from such technologies? The men in their suits were only interested in selling and buying technologies that are far more expensive, and do not have immediate rural application—with certain exceptions like rice husk gasification. In the 1970s, the government launched a huge biogas programme. The advantages: low cost, use of locally available material like cowdung and farm waste, and decentralised. The disadvantages: no money on commissions given by the Khadi and Village Industries Commission or others of its ilk.

                The most telling comment at DIREC came from Sunita Narain of CSE. “There are too many suits here,” she underlined, “and too few souls.”


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