Cook Islands Embrace Renewable Energy

Small efforts could make big difference. The digital flow of information has bridged geographical barriers. The lessons learnt in one country could be replicated in energy sector in India. The policy makers in India could take a leaf from Cook Islands to meet the energy requirements of rural communities living in remote locations in India.

Cook Islands’ Prime Minister Henry Puna announced sometime ago that the small Pacific island country would produce 50 percent of its electricity from renewable energy by 2015 and 100 percent by 2020. The location is far away. The size is small. But the initiative could become a replicable model. The micro generation of power could be an appropriate energy solution for small population with limited demand for energy.

Cook Islands consist of an archipelago of 15 volcanic islands with a land area of 240 sq km and a population of 19,000 people. It depends almost on imported fuels like most other Pacific countries. The policy shift in energy solutions is significant, even though the success so far has been modest. The important point to note is that the country has realised that fossil fuels make little sense when nature has given them abundance of sunshine and wind to meet their energy needs.

The demand for energy is obviously small. Plans are afoot to set up a two-MW solar plant at Aitutaki. It would serve the needs of a population of 2000 people. A two-MW wind power station would be erected at Rarotonga, where Cook’s majority of people live. The plant has received assistance from the Asian Development Bank. What’s interesting, they are not isolated cases. Similar renewable energy initiatives could be seen all over the Pacific.

In Solomon Islands, the electricity for over 300 people living on the island of Santa Ana is supplied by 50 solar home systems. A solar cum bio-fuel hybrid system meets the requirements of Guadalcanal’s only health centre in Aola. A year ago, Nauru introduced household solar lighting. The streetlights at its capital Yaren are powered by solar energy. New Caledonia has shifted to wind power. Solar cookers and LED are becoming increasingly popular at Kiribati.

The scenario at Fiji is equally inspiring. The Fiji government aims to meet 90 per cent of the country’s electricity needs from renewable energy sources by 2012. A wind farm, with 37 turbines, has been erected on the main island of Viti Levu, supplying 10 Mw of electricity through a power grid. In a bid to encourage more such initiatives, Fiji Development Bank has announced a lending programme for individuals and groups. To build a pool of skilled professionals, Fiji National University’s College of Engineering, Science and Technology offers a bachelor’s degree in renewable energy technologies.

India could see private initiatives soon. A Germany-based NRI scientist Amal Mukhopadhyay, chief of Hanseatic India Forum e.V. based in Hamburg, plans to set up three solar-powered health centres in Sunderbans in West Bengal with an estimated cost of 45,000 euros. "In remote villages in India, particularly in Sunderbans, many children, men and women die because of snake-bite and non-availability of anti-snake-venom serum. The solar-powered health centres will help store such life-saving medicines," says Mukhopadhyay.  The renewable energy is no longer a fad.

Infraline offers online knowledge shop on the energy sector

Infraline Energy is a comprehensive information and research service provider. The website offers several online resources and databases for the industry stakeholders. The section called products offers information on books and reports on the energy sector. The online bookstore gives the highlight of the books and reports by the organisation. One such report is CGD in India: Demystifying the opportunity, growth and investment potential which basically talks about the sector in India. The country is the new entrant in the natural gas market in comparison to the mature gas based economies of USA, UK, Korea and Japan amongst others. The share of natural gas in the energy basket of India stands at 10 percent in FY10 in comparison to the global average of 25 percent.

The report gives the basic idea of the sector and its evolution of CGD market in the domestic market. It also gives the overview of the regulatory framework impacting the CGD in India. Priced at Rs 50,000, the report will be released on October 31, 2011.

One of the market research books titled, Power Procurement in India: the need for smart planning, again to be released on October 31, 2011 reports on current power procurement in India analyses the regulatory dynamics of power procurement in the country. It also mentions the best strategies for power procurement in India and maps the business opportunities for stakeholders in the value chain. This research is also priced at Rs 50,000.

Interested industry stakeholders can buy books online from the online bookstore. These books and reports can be bought using MasterCard, Visa or American Express and the site accepts both credit card and debit card.

A significant section that would attract attention of the industry people is the events. The company organises several conferences and round table conferences periodically. The events section features the upcoming programmes along with the detailed description about the topic so that people who want to participate can apply online. The section also gives the participation cost for that particular conference.

InfralineEnergy is organising a conference on Renovation and Modernisation of Power Plants on October 19, 2011 at The Imperial Hotel in New Delhi. The conference will discuss the market potential and necessity of renovation and modernisation programmes in the context of ever-growing energy needs.

The conference will be addressed by Mr. U K Das, the Executive Director- SSBG & HERP Bharat Heavy Electricals Ltd; the Managing Director of Doosan Babcock Services, Mr Sarajit Sen; Mr. P K Sinha, the head of the Project Management of NTP-Alstom Power Services Pvt Ltd.;  Mr M Venkareshwara Rao, the Engineering Officer of CPRI and Mr Zdenek Mezera who heads the Turbine Retrofit & Modernisation at Skoda Power.

Another upcoming event featured in the section is the International Conference on R-LNG Market in India-Understanding the Centerpiece of India Emerging Energy Value Chain. The conference is scheduled to take place on November 8, 2011 at The Imperial Hotel in New Delhi. The conference will be attended by eminent personalities in the sector such as Shri Prosad Dasgupta, Former MD & CEO, Petronet LNG, Amulya Charan, MD, Tata Power Trading, Dr. S C Sharma, OSD-Petroleum, Planning Commission.

Then, there is a section called Knowledge base, where a subscriber who has bought the online access to the website can get the detailed information about power, coal or oil and gas sector. However, in this apart, there is a section called free download, where the consumer do not have to pay or buy online books to access the information but can download these reports as and when needed. These are also market research books but are available free. For example, there is a small report on Pooling Price for Coal - Challenges Ahead. The report highlights the methodology for pooled pricing of coal at different scenarios as proposed by planning commission. It also talks about the impact of pooled pricing on Indian power sector.

The Threads of Hope in Energy

Many, of certain vintage, would remember Winds of Change that Klaus Meine sang in 1990. The context was fall of Berlin wall, the end of communism and the subsequent integration of East Germany with its West brethren. Two decades after, the underlying spirit of the song, of the German heavy metal band Scorpions’ vocalist, finds relevance in energy sector in India. The mental blocks are dissolving; from it rising, the green shoots.

The doctrine of sustainable development is making sense to many of the captains of industry. The deployment of renewable energy is more than altruism; it is profitable too. For, the truth has dawned that the conventional energy solutions has almost run out of steam. Changing tack has become necessary—well, for the reason that businesses exist, to ensure long-term profitability.

Living symbiotically with nature, consequently, is gaining credence. The choice for green energy is growing.  Many of them feel that the investment in renewable energy such as solar and wind should increase quickly. The government’s role, according to the industry, is to create a policy framework that ensures solar photovoltaic cells and solar thermal cells become the norm. “The only sustainable path to staying in black is, in fact, to go green,” remarked Mukul Saxena, Head, corporate research and technologies, Siemens India, sometime back in a conclave organised by Mint.  

Hard facts too point a similar wave. The wind energy sector has attracted foreign direct investment of Rs 1,510 crore over the past three years. “In the renewable energy sector, wind energy has emerged the fastest growing category,” the Minister of New & Renewable Energy, Dr Farooq Abdullah, informed the Lok Sabha a week ago. The mantra of maximisation of profit has taken a new course. 

The twin currents that would drive the shift towards green energy are investment and innovation. There would be collaboration between large and small companies. “Large companies that will lead some innovation will have to collaborate with smaller ones to develop that kind of technology,” opines Venkatesh Valluri, chairman and president, Ingersoll Rand (India).

How do we spread new technology in renewable energy quickly to reach a critical mass? The option, interestingly, could be either top-down or bottom-up. “The husk power generation in Bihar is a business innovation. For big companies, it is not so much about changing the source of power but rather conserving the power they use. It is different for each section. If you reduce air conditioning in your office by one degree, it may reduce power consumption by 10-12 percent,” explains Girish Paranjpe, Managing Director, Bloom Energy.

For long, India’s policy makers couldn’t estimate India’s natural advantages.  For them, it was like the proverbial space beneath an oil lamp. “We have nine months of sunshine, while Germany, with six months of sunshine, is the solar technology leader,” analyses Niranjan Khatri, general manager, WelcomEnviron Initiatives, ITC WelcomGroup. The perception is changing. The intent to go green is now perceived as a business opportunity. The idea is catching up. One initiative is influencing the birth of the other.  A case in point is IBM smartgrid.

Raghunandan KS, Director, Integrated Technology Services, IBM India and South Asia, explains IBM smart grid, “It is a part of IBM smarter planet project. For sustainable cities, it will encompass multiple technologies starting from water management, power optimisation to having sustainable use of technology. There are stages to adoption.

The first stage is compliance to certain government norms. The second is social consciousness, a citizen phase. The third is the innovation phase, where you look at not just doing the right things but also look for financial opportunities—a business development opportunity in helping other companies and the society to become greener, while also making our own business greener.” 

The evolution of thought is evident in business model. The leading green companies wish to steer away from government largesse. “Just as subsidy is not a good idea, tax is also not a good idea. Green initiatives have an economic rationale by themselves,” asserts Raghunandan.

The private enterprises, interestingly, are catalysing the public policy in India’s energy landscape. The winds of change are real.

Reap the Captive Mines

Amidst the clamour for green energy, which though necessary; the truth is, there’s no respite from the old horse, coal. The reasons are obvious. For decades, the country’s primary energy resource has been coal. The contribution of coal to India’s primary energy supply pool is over 50 percent. Its share in the country’s electricity generation is about 70 percent. The fulcrum of the economy is so much intertwined with coal that switching to other forms of energy overnight is implausible.

But the state of the availability of coal is far from comfortable. The shortage of coal is rising. The power plants, which are dependent on coal, are in a grim situation. So are the industries like cement. Sadly, more than the resources, the cause is the inept policies of the government. The situation that exists today could have been avoided had the government not resorted to an opaque policy while awarding captive mines. As a result, out of the 215 blocks allocated during 1993-2011, only 26 have started production.

“Altogether the allocated captive blocks hold a reserve of about 50 BT, which being more than the total extractable coal reserves of Indonesia. Together, they hold an enormous potential for fuel security in India,” says InfralineEnergy’s report ‘Captive Coal Blocks in India-2011, Unveiling the Opportunities Beneath’. The advantage with captive coal mining is that it will help in producing low cost power and thereby, would induce tariff competitiveness in the market. 

Why then, the other coal blocks were not developed? The allegation is rife in the air that the majority of these blocks were awarded almost for free. “The free allocation might be the single big reason for that many privately owned captive blocks not being developed,” says the report. The Ministry of Coal in a bid to save its face has de-allocated 24 coal blocks from the laggard developers.

Apart from environment clearance, the biggest hurdle that captive coal mining faces is the lack of mining expertise. The private participation could accelerate the need for advanced technologies to spot the large coal reserves and extract coal with minimum damage to the surrounding environment. Acquisition of land for mine will be easier, if the profit from mining is shared with the affected population. Equipment financing and leasing which is now confined to construction equipment industry would be available like the developed countries as the sector gains momentum. It would reduce the financial burden on the developer.  To develop the captive blocks linked with the capacities coming up during XII Five-Year Plan, the total investment requirements have been projected to be INR 32000 crore.

With the increase in the price of imported coal, the hope lies in captive mines. The policy makers should pick up few cues from the success of natural gas in Gujarat.

Progress without Hiccups

The face of a society reflects the source of energy it uses. Accelerated pace of growth cannot be at the cost of the environment. As the wisdom to preserve nature finds importance in the ingredients of economic growth, the policy makers should catalyse the pace of natural gas usage. The advantage with natural gas is that it combines the best of both worlds. Its high thermal content and relatively clean combustion traits compare well with coal and crude oil derivatives.

Natural gas is also benign to the environment. The emissions of CO produced during combustion of natural gas are 80 percent less compared to coal. The contribution of natural gas in emission of SOX and particulates is almost negligible when compared with other fuels. “The adoption of natural gas as an energy source, as a result, will not only decrease the emission level, but also increase the plant efficiency due to clean burning characteristics. Higher the efficiency means greater the conservation of energy and thus lesser environmental impacts,” says InfralineEnergy’s report “Natural Gas Market in Gujarat: Assessing the Progress and Prospects”. The report analyses the entire gas value chain within Gujarat in a bid to help businesses understand the underlying dynamics of a thriving gas market.

Gujarat is the only state, which has operational state level gas grid in India with natural gas pipeline network spanning 2300 kms. The state also has four city gas distribution (CGD) companies supplying compressed natural gas (CNG) and piped natural gas (PNG) to over 12 cities across the state. Besides this, Gujarat remains the only state in India which has successfully implemented gas distribution business at the village level.

The use of natural gas brings an additional source of revenue from protecting the environment. It has been estimated that Gujarat’s gas grid has reduced approximately 17 million tonnes of carbon emissions, which accounts for nearly 42 percent of total Certified Emission Reductions (CER) generated in India. The state is producing around 25 million CERs per year with a potential to grow up to 50 million CERs per year in the next few years.

The tangible benefits are also visible. Energy consumption accounts for nearly 30-35 percent of the total manufacturing costs of a ceramic unit. The ceramic industry depends on grid electricity, natural gas, charcoal, lignite and diesel. The supply of natural gas by GSPC Gas has revived the ceramic business in the Morbi region. Over 40 percent of the ceramic units in Morbi region use natural gas as a clean fuel while the rest continue with coal and bio-waste. Though the price of natural gas is more than coal, the natural gas has found favour with a number of SMEs such as ceramic and textiles industries within Gujarat. The reason, the return on investment is high. The natural gas provides high thermal value and less emission, which results in good quality of products.

The availability of natural gas in the villages of Gujarat has recharged the rural economy. Charotar Gas Sahakari Mandal Limited (CGSML), India’s sole village gas distribution company, supplies natural gas to 11 villages in Anand district. Founded in 1999 as a cooperative sector initiative, it distributes gas to villages which would not be covered by other city gas distribution companies operating within the city’s municipal limits. CGSML distributes piped gas to 11,000 domestic customers, about 100 industrial and 250 commercial customers. One of its biggest customers is Gujarat Co-operative Milk Marketing Federation Ltd., more known, by its brand Amul.

The future of natural gas seems bright with the discovery of shale gas. The major basins in the country have been identified as shale rich. However, the inadequacy of technology to drill and to extract the gas hampers its growth. “The use of natural gas has the potential to reduce the country’s oil import bill and save the environment too,” says an energy expert.

Renewable Energy Salvation for Rural India

“If at first the idea is not absurd, then there is no hope for it,” said Albert Einstein. Selling solar lighting systems to villagers seemed absurd to many educated Indians in the early 1990s. Though the liberalization of economy had started, it was yet to sweep clean the old mindsets. But Harish Hande, who was then in late 20’s, could see light in renewable energy, when others couldn’t think beyond kerosene lanterns in village huts. 

With a seed capital of Rs 1000, SELCO, the company, was founded with Neville Williams in 1995. Since its inception, the company has sold, serviced and financed over 125,000 solar systems to households in rural pockets of Karnataka, parts of Gujarat and parts of Kerala. He opted for an open source model for the energy solutions and has refused to hold the Intellectual Property for his solar powered lights—in the hope that the products, while copied, would be improvised further. The ripples of his initiative, as a result, would reach wider courting new followers.

Hande, who has been given this year’s Ramon Magsaysay Award, has crushed the myth that poor people cannot afford renewable energy technologies; poor people cannot maintain sustainable technologies and social ventures cannot be run as commercial entities. His model of small-scale standalone solar installations is hope for some 500 million people in India, who don’t have access to grid at all. As a result, the electricity produced, where it needs to be consumed becomes important. A bit of imagination and change in mindset could help in deploying such energy solutions in some segments of urban India.

The inspiration came to Hande while on a weekend trip to Dominican Republic, a leader in energy initiatives in the Caribbean. But he could understand it well as he was associated with energy research for a while. At that time, he was engaged in doctorate in energy engineering (solar specialty) at the University of Massachusetts (Lowell). 

An undergraduate in Energy Engineering from the IIT, Kharagpur, Hande could figure out how to bridge the finance to make the solar lighting a success. SELCO empowers its customer by providing a complete package of product, service and consumer financing through grameena banks, cooperative societies, commercial banks and micro-finance institutions.

Though it may sound absurd, but there are many pockets in urban India where solar lighting could replace the grid connected ones. The street lights and those used outside the residences could go for solar. Even the parks could opt for such an energy solution. Some of the hoardings in New Delhi are using it. Apart from reducing the pressure on the grid, the increasing use of solar would reduce carbon emissions to the environment. It would also reduce the government’s import bill on kerosene.

What’s needed is a push from the government. It is more of a management issue than technology. Hande’s success story needs to be replicated in urban India. One hopes, someone like Hande emerges in urban India—soon.

Save Every Drop of Power

Even though, it may sound weird, in a mass production era, supply not always adjusts to demand. Over the past decade, the Indian power sector has almost doubled its installed generation capacity, from about 96 GW in 2000 to 170 GW in 2011. Yet, the demand for electricity continues to surpass supply. The Central Electricity Authority has estimated an energy shortfall of 10.3 percent and a peak shortage of 12.9 percent in the country during 2011-12. Adding capacity further would be a challenge, as the land to build new thermal, nuclear or hydro plants and the fuel to run them wouldn’t come easy. The price for capacity addition would be so steep that it would make more sense, if policy makers pay heed to reducing consumption as well.

Oversupply of a commodity often builds inefficiency and leads to wastage. A judicious use, therefore, stretches every drop of its utilisation. The ways to save energy has resulted in the evolution of Negawatt management, which is primarily, based on the old adage, “A penny saved is a penny earned.”A Megawatt, which is not produced or, an avoided Megawatt, is classified as a Negawatt. If 100 MW of energy is saved, it means 100 MW of clean energy is produced and that too, without polluting the environment. Increasing the use of solar heaters and compact fluorescent lamps though are simplest options to implement, but they aren’t enough. In addition to these initiatives, adopting telecom operators’ strategy of charging less for call rates at off-peak hours, that was vogue in India a decade ago, would help in the evolution of a smart grid for power transmission and distribution.

A traditional grid is a mechanical device, which allows sufficient power to flow safely through the system. But it has outgrown its role with the rise in complexity of users and sources of power. Blending from different sources of power such as thermal and renewal has become a necessity to ensure consistency in power supply. The problem with solar, wind and biomass generated power is that they are incapable of producing electricity all through the year. They need to be supplemented by thermal and hydro.

An artificial intelligence system, therefore, is needed. Using information technologies, it, a smart grid, could manage the demands of varied users. A smart grid is a dynamic system built around the principles of Negawatt management. It would encourage the consumers to use less energy during peak hours and shift the time of energy use from peak to off-peak hours such as night or weekends.

Though a commodity, electricity can’t be stored for long. The utility company can, however, use smart grid to reduce demand by direct control on equipment used by the consumer or through a tariff clause, whereby, a consumer reduces his load at certain hours of the day. As a result, during the peak hours, the consumers would receive less, but not so meager, that they have to resort to diesel gen sets or battery back-ups.

A smart grid in the long run can even offer users like schools and hospitals to have more power, even during peak hours, by paying more. The long-term possibilities are enormous. It would save the environment from avoidable emissions. The policy makers should make it happen. Sooner, the better it is.

Time is Ripe for India Model Energy

For too long, the country relied on a centralized model borrowed from the West. In tandem were the policy makers in India, who couldn’t think beyond one-size-fit-for-all solutions. They couldn’t understand that a society is not an amorphous mound, but comprises different segments of people; each with distinct culture and with varying degrees of aspiration. The energy requirement for each segments, therefore, are different. The solutions are to be weaved around the needs of people, their culture and the communities they belong to.
   
The rising demand-supply gap in energy reaffirms that the past model has outgrown its role. Increasing the generation of electricity through building a new thermal, nuclear plant or a large dam is going to be tough. The availability of land wouldn’t be easy. The policy of coercive method of acquisition of land for such projects wouldn’t work as it is against the basic tenet of market economy that professes ownership of individual property. In addition, despite illiteracy, the voice of the disadvantaged has become louder. Saving the forest cover has become a necessity. Without the forests, there wouldn’t be adequate rains and rivers would be extinct. The linear thinking of pushing for energy at the cost of water, and by extension, food security would be too foolish.

On the top of it, India’s domestic coal production is grossly insufficient to fuel the thermal power plants. Importing coal too has become expensive. The declining productions of natural gas from Krishna-Godavari basin have ruined the hopes of a North Sea-style oil-and gas-powered growth of the economy. Since the Fukushima disaster in Japan, the nuclear power has lost its sheen as a source of clean energy. Its credibility is in doubt, not only in the US, but in other countries as well. Italy has imposed a one-year moratorium on its plants for a long-term nuclear energy programme. Germany’s 17 nuclear reactors are in pause. China has suspended all its nuclear project approvals despite its earlier plan to quadruple its nuclear energy capacity by 2020.

The viable option left for the government of India is to push for renewable energy. Depending on the location and the community’s requirement, the renewable source could be solar, wind, biomass and micro-hydel. The electricity could be drawn from a grid. The off-grid applications are suitable for small requirements and locations, which are remote. Replacing diesel generated power in rural areas would serve two purposes. The country would save from importing diesel and the environment would be saved from diesel’s emissions. 

The biggest hurdle continues to be the mindset of policy makers. The irritants in the renewal’s journey are more of management issues. The solutions could be found with a bit of imagination, but with a high dose of intent. “Renewal Energy can power the world and the road block is not money but enabling policy,” says Intergovernmental Panel for Climate Change's study, “it can do so at a more cost competitive and faster rate than conventional energy sources.”

A KPMG report, authored by its executive director, Santosh Kamath, states that solar will equal cost of coal power by 2017 in India. With limited choice, the momentum is likely to pick up soon. “Renewable is no longer ‘alternative energy’, it is pretty much as mainstream as it gets,’’ asserts Anish De, chief executive, Mercados EMI Asia. The circumstances will push for an energy model that is intrinsically Indian, and inclusive.

Green thy Fund

The Industrial Revolution reinvented the wheels of progress. It began in the United Kingdom in the 18th century and slowly spread to other parts of the world. The world’s per capita income in the next two centuries went up by 10 times and the global population by six times. Nobel laureate Robert E. Lucas, Jr. had remarked “For the first time in history, the living standards of the masses of ordinary people have begun to undergo sustained growth.”

The production of goods through machines made goods more affordable. It killed manual production, but raised human productivity. Consequently, the consumption of energy too went up. Even in those heydays of the revolution, English poet and painter William Blake had cautioned through his poem dark satanic mills that the fumes coming out of the machines would destroy the environment. Blake’s observation is prophetic. 

The progress initiated by the Industrial Revolution has completed its circle. The threat on the earth is real. But throwing the baby with the bathwater is not a solution. Thankfully, the human mind too has evolved with fresh thinking and new impetus. One of the finest developments has been the reward to pollute less. Emitting toxins less into the air is an incentive, a revenue stream, to improve the overall profitability of the venture. It has challenged the mind to develop new technologies that are more efficient than those existed before.

Saving the environment too is no longer a fad, but a serious business. As the lifeline of any business is funds, a number of funds have come up that support companies which are reducing their emissions that causes global warming. The arrival of Green Mutual Funds (GMF) is a reflection of the maturity of the financial markets.  Like a conventional mutual fund, the GMF is a managed collective investment scheme, which pools money from many investors to invest in short-term and long-term instruments in various environmental markets—carbon, markets, renewable energy, market and energy efficiency markets.

Boston-based Winslow Green Mutual Funds are excellent global examples of green mutual funds. The Winslow Green Growth Fund is a growth equity fund. Though it invests in companies of any size capitalisation, the fund’s focus is to invest a significant portion of its assets in domestic small capitalisation companies with a market capitalisation of below $2 billion. It targets companies with clean and efficient business practices that seek to minimise their environmental impact and those enterprises, whose products or services offer solutions to environmental problems. Though the fund is industry agnostic, it prefers sectors such as clean energy, water management, resource efficiency, sustainable living, environmental services, green transportation and green building products.

GMF engage integration of financial and environmental analysis in existing and emerging markets’ trends and policies and, identify the prospects for development of a comprehensive investment portfolio. Investing in green funds, however, does not necessarily bring higher or lower returns than the average mutual fund. In fact, these funds may not be suitable for short-term returns, as they are prone to price fluctuations throughout the trading period. The inherent volatility in the carbon prices makes these funds unsuitable for buy and hold strategy. “For risk-averse investors, GMF would prove beneficial under long-term investment objective,” says a report from an energy consulting firm.

Since the investments required are large, the GMF may be suitable for high net worth clients like large corporations, industries, foundations, endowments, and insurance and pension funds. The retail customers may find it difficult to invest in GMF, at least in the short to mid-term, owing to the large investment needs of the GMF and tertiary role of individuals in the green or carbon markets. But the good thing is, a journey has been made. The interests of business and environment have converged. It augurs well for the society.

The Benign Power of Water

Small is beautiful. But small could also be effective. Time is ripe to focus on small hydro power units to bridge the gap in the country’s demand-supply of energy. It is prudent as the domestic gas availability from the once glorified Krishna-Godavari basin diminishes and price of imported coal rises from Australia to Indonesia. The benefits of using micro hydro power plant in India are many. It is economical, non-polluting and environmentally benign. They have the potential to provide energy in remote and hilly areas, where extension of grid system is not commercially viable. On the top of it, the gestation period for such installations is very short and cost maintenance is minimal.

The history of micro hydro power units is not only fascinating, but offer insight even today. Since 100 BC, analysts observe, the water wheels existed to grind wheat into flour. They were slowly replaced by water turbine by the end of 19th century as Industrial revolution progressed across the world. The basics are simple. The electricity is produced when water falls on the turbine and the blade rotates. However, what varies is the amount of electricity generated. “The quantity of electricity that a hydropower setup produces depends on the amount of water that passes through the turbine, or, the height from which the water falls. The greater the flow and higher the height; the more electricity is produced,” says a report on Indian power sector analysis.

Micro hydro power plant in India existed since the beginning of 20th century. The first installation, a 130 kW plant, was set up at Darjeeling in 1897, some 15 years after the world’s first micro hydro power plant was started at Appleton in the US. The success of Darjeeling led to the set up of a two-MW plant in 1902 at Shivasundaram in Mysore. It was followed by a three-MW unit in 1907 at Galgoi in Mussoorie, a 1.75-MW in 1914 at Chaba and a 50-kW at Jubbal in 1930 near Shimla. Analysts observe that between 1930 and 1950, such units came up on a number of canals on the Ganga. However, the major hindrance in those days was the lack of development of high voltage transmission lines. It resulted in heavy losses during transmission of electricity over long distances. But times have changed and technology has evolved to ferry electricity across places with minimum losses.

As a comparison with China is the flavour of the season, let me delve a bit on China’s record in this sphere. China has built a total of 43,000 small hydro projects with an installed capacity of over 35,000 MW supplying electricity to over  300 millions residing in China’s mountainous areas. It has not exhausted all its water resources, but has utilized only about 29 percent.

India’s geography favours use of hydropower. The small hydro power projects also complement other renewables such as solar, wind, tidal and biomass. Together they can do more than a few coal-based mega-projects. Though the government has taken initiatives in the past decade, time has come for a big push for small hydro projects. How else it is going to add 100,000 Mw to India’s power-generation capacity during the 12th Plan (2012-2017)?

Old Source, Old Trick, But new Fervour

Hope invariably comes from fresh thoughts. Twenty summers ago, India had no choice other than to reform its economic policies. What began as a crisis, it eventually created new opportunities almost in every sector of India’s economy and raised the aspiration of people.  Driven by renewed hope, the economy graduated to a new orbit of growth leaving behind its past—pathetic GDP growth rate of 3.5 percent forever.

The effervescence of new energy reflected in the variety of products that swarmed the market. It satisfied the new generation of consumers and thereby created new segments of market. However, with the rise in population and increase in production of goods, the consumption of energy too went up. The threat of global warming and its consequence—climate change loomed large on the horizon.

While the economy continued to grow, paradoxically, the existing systems of energy production, primarily from coal and gas, showed the inevitable—the law of diminishing returns. Exploring new reserves of coal became a hurdle, as the mining of coal cannot be at the cost of the environment. Importing of coal from Australia and Indonesia would not be viable for long, as these countries would raise the price of coal for export.  Like all good things in life, the party can’t go on forever.

But the rising demand-supply gap of energy that the country faces could turn out to be a blessing in disguise. The alternative could be exploring and seeding green power. “The old wisdom of generating power from water with minimum annoyance to the surrounding areas is all set to be back,” says an enthusiastic analyst working with an energy consulting services company.

A report on Indian power sector analysis suggests that India is rated as one of the top three countries for renewable energy investment. Apart from Solar, Wind and Biomass, the writing on the wall is in favour of Hydro power. The reasons are obvious. It is clean, which means it has the potential to reduce carbon foot print. On the top of it, hydro power is cheap, requires minimum maintenance and would give the much needed comfort of energy security. In Canada, there are examples of hydro power which have been running for more than 70 years.

There are two votaries of hydro power: one in favour of big dams, which play a multi-purpose role and the other, is run-of-the-mills projects. Despite the shining example of Bhakra Nangal in Punjab, which play multi-purpose role from storing water, generating power and irrigation, the big dams are notorious in submerging huge tracts of land, displacing large local population and disrupting fragile ecosystem endangering rare species of flora and fauna. The track record of rehabilitation of the displaced is equally bad.

The flavour, therefore, has shifted to the no-frills, which in essence are single purpose projects. Called run-of-the-mill projects, they would only generate electricity and are carried out in regions with a lot of slopes. Water from a stream running through a mountain is made to fall on a turbine and the water is put back into the river. As a result, the original flow of water is maintained and the surroundings are not disturbed. The displacement of population is significantly less. “Not more than 100 families are displaced in this kind of projects,” says an analyst working with an energy consulting services company. A typical run-of-the-mill mini hydro power plant could be anything between 90MW and 100MW. But it could also be as low as two to three MW and go up to as high as India’s largest plant currently under construction at Teesta, which is expected to generate 1,200MW. What’s interesting, the run-of-the-mill is an old thought in a new era, which would help the economy to grow without driving the displaced population to penury and damaging the ecosystem.

The history of micro hydro power plant in India is more than a century old. The first hydropower station was a small hydro power station of 130 KW commissioned in 1897 at Sidrapong near Darjeeling in West Bengal. The old wisdom is back—with a new hope and fervour.

Renewable Hope for Power

Necessity, as they say, is the mother of all inventions. A silent revolution is brewing up to find new energy solutions. The use of renewable energy is no more confined to cookers, geysers and lanterns—or, lighting a house by fixing solar panels on the building’s roof top.

The human mind has explored the unthinkable and pushed the renewable energy research to the next orbit.  Bertrand Piccard has demonstrated that the solar energy could be used to power a plane, which has four 10 HP electric engines similar to a scooter and weighing not more than 1600 kg like a small sports car. The solar plane’s founder says that the idea came after his first non-stop round-the-world trip in a balloon some ten years ago, when he was shocked by the large amounts of fossil fuel it consumed. What he learnt in the process of developing a solar plane is equally profound. “We are not trying to create an aviation revolution but a change in the mindset of the way people think about clean energy solutions and how it can be used in society," he added.  The plane is made of composite materials and has over 11,000 silicon cells covering the wing.

Italian Renaissance’s master Leonardo da Vinci’s stroke of ingenuity is also visible in some pockets of excellence. Like Vinci, who observed nature to create master pieces from paintings to design of a helicopter, Daniel Nocera, a professor of chemistry and energy, and his team at Massachusetts Institute of Technology has observed the process of photosynthesis in plants for years—how the plants breathe and produce power. They are now trying to replicate that model artificially to produce enough electricity from a bottle-and-half of water, however dirty, to power a small home. Tata Group has signed with Nocera to market the technology, when it would be ready. The initiative, if it succeeds, could reinvent rural electricity supply and provide a viable energy solution to about three billion people worldwide who don’t have it—and yet generate enough profit to sustain it.

The humble biomass may not be in that league of sophistication, but many are harnessing the rustic natural resource to generate green electricity—marrying profit with saving the environment. A lot action is happening in biomass, as the Energy consulting firm InfralineEnergy’s comprehensive report “Evaluating the Attractiveness of Business Opportunity in Biomass Power in India”, says “The opportunity could be gauged from the fact that India is a country blessed with abundant natural resources. The biomass among them is the most promising resource which does not have the inherited precincts as the solar energy—dependent on light days; and wind energy, which has site specific restrictions.”

Apart from showcasing the opportunities and best practices in the sector on the basis of economic analysis and forecasting, the report from the energy consulting firm predicts, “the total biomass power installed capacity by the end of 2013 is expected to be 2395 MW. By 2015 under the BAU, total installed capacity expected to be 4643 MW and in optimistic scenario, 5584 MW. Total bagasse cogeneration power generation capacity by the end of 2013 is expected to be 4576 MW. At the end of 2015 under the BAU and optimistic scenario, total installed capacity for bagasse are expected to be 5290 MW and 5464 MW, respectively. The return on equity could be above 26 percent for the investors.” The challenges, always offer, new opportunities for the fertile minds.  

Hope for Coal Outside

India’s economy requires energy to drive and sustain its high trajectory growth. Though the country has huge reserves of coal, much of it can’t be extracted because of the reserves’ intricate location. According to an energy market research report, the government-owned Coal India Ltd, which controls 18 billion tonnes of coal reserves—much of it is proven, is responsible for production of the country’s 80 percent of the coal. The demand-supply gap from coal power production, however, is increasing. The electricity generation, steel production, cement manufacturing and other industrial processes requires more coal than before to run their operations—and meet the needs of their consumers.

Analysts observe that beneath the excitement circling around new and renewable sources of energy, the age-old coal industry is anticipated to contribute more than 50 percent of the primary commercial energy requirements of India till 2032 and beyond. Even though the domestic coal reserves are vast, the demand-supply deficit of coal is estimated to grow at a CAGR of 17.2 percent till FY 2017. The domestic coal industry’s challenges such as exploration, technical, environmental, high-ash in domestic coal and logistical issues have compelled India to import 11 percent of total coal consumption, which is expected to rise to 15 percent for power sector alone by FY 2017. India’s planned investments of more than INR 2 lakh crore over the entire coal value chain may not be sufficient to secure future coal requirements, points an energy market research report.

InfralineEnergy’s “Global Coal Acquisitions and Imports: Opportunities and Sustainability Assessment for India” report suggests that coal import is bound to rise. The analysis is based on the recent Central Electricity Authority’s notification to design boilers with a 70:30 coal blending ratio (indigenous vs. import). The report states that apart from blending requirements and superior quality parameters, the coal industry is likely to see converging price trends of imported and domestic coal. Consequently, Indian companies would rely more on imports. The inclination for global hunt for coal has started. Indian companies have acquired overseas coal assets at lucrative locations such as Mozambique, Indonesia and Australia.

As for the future, the report advises that the efforts require a planned politico-economic strategy to effectively counteract aggressive players such as China and de-risking from the rising coal prices and escalating price tag of overseas coal deposits. Australian floods and Japan earthquake have resulted in structural changes in global coal industry’s trade pattern, along with disruptions from pirate attacks to coal vessels which has resulted in a loss of around $ three billion in global seaborne trade in 2010.

The report details new frontiers such as New Zealand and Kazakhastan, which require proactive approach to reap the early mover advantage. Certain nations have been identified which offer a favourable prospect for clinching long-term import deals without owning the coal mines and there are others which require infrastructural development to encourage foreign investment.

The rising import of coal would attract investment in infrastructure related to coal logistics. The port sector in India needs a complete overhaul with fluctuating global freight rates and growing need for panamax and supramax vessels to manage the rising coal imports. A lot of action is waiting to happen.

Market Solar as Luxury

There’s no dearth of construction of new residential buildings. In some places, the rise of the new structures is vertical and in some pockets, it’s horizontal. You don’t have to go there to know how they would look like and what all would be there once they are ready. Anyone living in Delhi and surrounding areas is swarmed with SMSes telling their flashy names and their unique features. A little query would inform that these buildings have everything, excepting powered by renewable energy.

When these buildings would be occupied, each of them would use almost all the gadgets available in the market. There is no harm in it. What remains unsaid is that these devices would draw power from the grid. Inevitably, the surrounding low and middle-income colonies would have to satisfy with inadequate supply of energy from the same grid. Even those living in the newly constructed ‘luxury homes’ would use diesel operated generators to meet the shortfall of electricity supply, and contribute, thereby, to pollution and global warming.

What surprises that none of the builders thought of using renewable energy to power these homes. There’s enough scope on the rooftop for fixing solar panels. The lighting of the building could also be managed with solar energy. A renewable energy research report says that the process is smooth, if the generated electricity from solar is consumed within the building. The problem arises if the surplus energy is put into the grid. It requires bi-metering, unlike today’s meter which works only in one direction—one is charged for the amount of electricity one uses. In the West, if the electricity generated from the rooftop is put into grid, then it’s measured and surplus energy is put into opposite direction to be utilised by other people.

The argument that solar energy is too expensive hardly holds water, when the buyers of these homes can afford all the luxuries. What’s more important is the intent. Affordability is always relative. Luxury is always for the upper crust of society. If this category of people can afford Merc, BMW, Harley Davidson, why wouldn’t they pay for a house designed in such a way that the energy requirement is supplied by tapping intelligently solar energy, the most readily available renewable energy.

If one goes by the price tag of the ‘luxury homes’, the profile of the potential buyer is those who prefer to eat high priced organic food, spent the weekends in natural surroundings and have a second home in the hills. Why wouldn’t they pay more to make a green lifestyle statement?

Power the Malls with Solar Energy

Last weekend, I was wandering in a swanky mall situated at South Delhi. Actually, it’s not one, but a cluster of three malls. There’s no clutter outside. The facade is majestic. Once inside, the cool ambience was a respite from the outer hot and sultry weather. There’s enough space for parking in the basement. The toilets are easy to locate and are clean, and the fittings in it are on the side of opulence. The mall owners and the architects have taken care to make the shopping experience comfortable. However, what the shopping complex lacks is the vision and services of a solar energy consultant and application of solar energy.

The majority of the crowd appeared to have come from the posh localities of South Delhi. I had no purpose other than walk in slow pace, and observe the brands and their interaction with the potential buyers. I could see the presence of almost all the brands in apparel and lifestyle categories, which one shopped on an overseas trip two decades ago. But I am not sure buying from these malls would carry the same snob value as shopping them in London. The stores are not only well lit but designed too—drawing power from the grid. The interesting bit was that the behaviours of the shoppers were similar in many respects as Paco Underhill has described of American shoppers in his best-selling books Why We Buy: The Science of Shopping and Call of the Mall.

The architecture and beneath it—the understanding of malls—have evolved in Delhi NCR in the past five years. The new malls are big in all aspects so that the exclusive stores have more space. There’s abundance of space for shoppers to move around comfortably without rubbing anyone’s shoulders. What remains invisible is the consumption of energy. The promoters and architects have adopted all aspects of malls as they exist in the developed countries. What they have missed out is in the use of solar energy.

It may sound utopian. But there are malls powered by solar energy. In Japan, the Aeon shopping mall near Yonago uses solar panels on its exterior to meet all its power requirements. The Oasis21 mall in Nagoya city has mini water pools on its roof, which control the environment in the shopping plaza and shopping center. Apart from saving energy, these innovative architectural designs help to reduce Japan’s carbon footprint.

Similar initiatives are taking place in the far away USA. At Jersey Gardens mall in New Jersey, which is about 1.3 million square foot in size, a single-roof solar system would soon be installed. The mall houses brands like Gap, H&M, Lord & Taylor Outlet, Neiman Marcus, Last Call, Nike and Saks Fifth Avenue. Thanks to solar energy consultants there, the mall’s roof would generate 4.8 MW of electricity, which is enough to offset 11 per cent of its electric consumption.

Why can’t our architects and developers think of solar, when we have so much benevolence of Sun?

Mine Coal Reserves, Mind the Environment

Even if you are convinced, switching to green economy is a long drawn path. Protecting the plants and animals is necessary to preserve the fragile ecosystem and more so, for the sake of future generations. But to live in the present, to feed a billion population; it’s equally necessary to exploit the natural resources—when you have abundance of coal reserves. The problem is, while doing so, without any intention of causing harm; the process may emit green house gases and contribute silently to global warming.

The environmentalists might argue that eschew everything that causes any damage to the environment. After all, the damage you inflict on nature would return to you affecting your health—and raise your medical bills unnecessarily. It could be true in some cases, as many diseases are caused by pollution and destruction of environment. But then there’s also a generation, who grew up aspiring a Western mode of life style. They would prefer to live in a high energy consumption society and face all the consequences arising from it. How can they throw all the gadgets and live a life of happiness—perhaps, by embracing renewable energy.

The wheels of our lives are driven not by fate. The evolution of human mind and its corollary—science and technology—has made us believe that a major part of our lives run on electricity. Many would aver there’s no dearth of such a commodity. Only the source and perhaps, the ways to tap energy need to be changed. The green activists would point to a World Bank report, which says switching to renewable energy could be a solution to meet India’s rising demand-supply gap in power. It says India utilizes about 10 percent of its potential and close to 150 giga watt could further be harnessed from it.

But why dump coal when India has large coal reserves too. The commercial coal mining began some 220 years ago by Sumner and Heatly of East India Company in the Raniganj coalfield along the western bank of river Damodar. It is located now in West Bengal. The coal extracted from the mines fueled steam engines of the railways. The population at that time was less. So there was literally no noise when the people living in the area were displaced as the new regions in the belt were mined.

But times have changed. The population has grown many-fold times. The open cast mining method causes irreversible damage to the adjoining vegetation and makes the soil unsuitable for cultivation. It snatches not only the livelihoods of the local people, but their culture—and everything that they accumulated over the generations. The proponents of the green economy observe that a mine producing 40 million tonnes of coal in its lifetime of 15 years degrades close to 25 kms of the neighbouring vegetation.

The renewable energy is not only expensive, but also is not free from glitches, say the analysts. Till it refines its production and distribution, and wins the trust of consumers as a reliable source of energy, it can be an add-on source of energy. Meanwhile, the coal which feeds thermal power plants could be extracted through underground coal gasification (UCG) method. It is not only environment-friendly, but also suitable for high moisture content Indian coal. Infraline Energy Research & Information Services’ report—Underground Coal Gassification in India: An alternative and viable option—discusses how it could be implemented in India. “UCG is re-evolving across the globe as a technology to replace the conventional mining methods. The process reduces the emission of greenhouse gases, and leaves residual-ash and rock inside. In addition, it is the only method to exploit the un-mineable coal reserves in the country.”

Indian Power Sector needs a shot in the arm

The spot light is on Indian power sector. The reasons are obvious. Without power, the wheels of Indian economy wouldn’t move. With expectation from every quarter rising—both national and international, the economy has to run faster. The news of India’s potential growth in the decade has attracted many multinational giants to set up their manufacturing units across the country. Each such unit requires electricity as a major input to run their machines efficiently.

The high expectation is a challenge as well as an opportunity. “Those companies engaged in the manufacture of power equipments, production and distribution of electricity with a vision and strategy could become global giants by the end of the decade,” says Yogesh Garg, CEO, Infraline Energy Research & Information Services. A number of power consultants feel that the small companies through creating technologies or innovative business models could disrupt the existing standards in the market. There’s a chance for incremental growth as well as disruptive for them.

India has a natural advantage of sunshine almost nine months in a year. Some of the Indian states are suitable for wind energy. On the top of it, there are thermal power plants powered by coal and hydro-electricity by efficient use of country’s rivers. However, the natural resources can’t be exploited beyond a point, as it may cause irreversible damage to the environment. 

Is there a way to raise the available pool of electricity without setting up new thermal or hydro power units? Possibly yes. If we improve the existing processes, the wastage would come down naturally in India’s power sector. Two pain points are the huge distribution loss and high consumption of electricity by the equipments that generate electricity.

The amount of electricity lost during the course of distribution from the centre of production is significant. It is as high as 40 per cent. A reduction in this sphere would improve the supply of electricity. The equipments used in power generation too consume electricity. Improving the quality of such equipments would also raise the share of available electricity. 

Our one-size-fit-for-all approach is an outdated strategy. We have to get away from the linear thinking that all the electricity to run our home or business should come from a centralized source called grid. We need to adopt hybrid mode of access to electricity, something similar to a city dweller traveling some distance by personal vehicle and the rest by a public transport. Many power consultants have helped big hotels and manufacturing companies to use solar as well as electricity from the grid to meet their requirement, without causing any damage to the environment.

India needs to raise its Coal Production

India has the largest reserves of coal in the world. It is estimated to be around 257 billion tonnes. Little wonder, generations of Indians have grown reading in school that coal is black diamond. After all, it feeds thermal power plants across the country, the major source of electricity for industry and individual homes.

Despite the growth of hydro, solar and wind, the dominance of coal continues. India’s appetite is mounting. It is the third largest consumer of coal in the world. About 60 percent of energy in India comes from coal production. Close to 530 million tonnes is mined annually in the country. Over 83 percent is obtained through the procedure called opencast mining. A number of power sector analysts believe that the dependency on the natural substance is likely to continue for the next two decades.

The demand for power has gone up with the rise in population and rapid urbanization in all the states. In addition, India’s growth story is attracting global giants to set up manufacturing bases in various parts of the country. It is obvious the requirement for electricity is growing exponentially. But the coal production is much less than what is required. The thermal power plants based on indigenous coal needed 434 Million Tonnes (MT) during 2010-11. But close to 388 MT was available. About 35 MT were imported to bridge the gap.

What could surprise is the scarcity amidst plenty. According to India’s premium body, Geological Survey of India, of the total reserves about 98 billion tonnes are fit for coal production. The lignite reserves are estimated to be around 38 billion tonnes. However, only about 4.2 billion tonnes could be mined.

The imported coal has one distinct advantage. The ash content in it is much low than those mined in India. However, due to limitations of boiler design in India’s thermal power plants, about 10-15 percent of imported stuff is blended with the local ones. The blending is a complimentary activity to raise the raw feed to a uniform quality.