A whole new market segment is emerging in the Indian renewable energy sector– Dev K Dutta

devkduttaConventional review of renewable energy potential in India usually draws a direct comparison with traditional power from thermal and large hydel plants. This comparison is not fair as generation of renewable energy is not backed by the subsidies and support infrastructure that traditional power generation gets. So it was always the one time cost of installation of renewable energy equipment against the subsidized power tariff of traditional power utilities. Today however, advances in technology have made the comparison quite even as renewable power generation involves the lowest common denominator – the individual household.

For instance, if you invest Rs. 50,000/- for installing a solar power generating system at home, you are likely to weigh it against the usual monthly grid power cost of around Rs. 1,000/- which is a ballpark figure. So you have to divide 50,000 by 1,000 and figure out the break even at some point in the near future. Today however, with improved evacuation technology easily available in India, the prospect of transferring excess renewable power generated by solar units in individual households, to the grids in return for redeemable energy ‘credits’ has become a reality.

This means that you now have a real chance of bringing down your power consumption cost drastically without compromising on the quantum of power you use. However, the excess renewable power that you will generate and sell to the grid would have to be integrated to a process that the utility managing the grid, sets up. Since it will run into thousands of such sellers spread across different localities, in a particular city, it will require mass participation of stake holders bridging the gap between the renewable energy seller and the grid.

After the recent notification of guidelines for renewable power generation and supply by individual households in Delhi by the DERC (Delhi Electricity Regulatory Commission), enquiries for more details have begun to pour in. Utilities like Tata Power and BSES have reported that they are receiving enquiries from interested individuals who want to know about the procedures. The enquiries haven’t really flooded in for obvious reasons – this vital initiative hasn’t been marketed well beyond the customary press notification.

While it’s not rocket science to install, generate and then sell a renewable energy resource like solar power, it can be intimidating for most people who are not even aware of the basics of electrical equipment. There’s no doubt about the potential of the DERC initiative but it needs to be promoted well. One explanation could be that before promoting the initiative it is necessary to get the energy evacuation infrastructure in place before going in for full scale promotion. The utilities like BSES and Tata Power probably understand the tremendous potential of the initiative and the response it will generate after a promotional campaign.

On their part, the utilities are already doing the necessary groundwork for what could become a win-win public-private initiative and create a whole new market segment in the process. BSES for instance, has partnered with Ecolibrium Energy, an energy management consultant that uses highly advanced technology to help optimize energy usage. The renewable power evacuation mechanism for BSES customers interested in selling renewable power to the BSES grid is being developed in collaboration with Ecolibrium. It will be integrated to a software platform that will manage the entire operation with one or a few clicks.

A couple of decades ago, who would have thought of selling power to the grid and earn energy ‘credits’ that are redeemable against power bills? It’s true that renewable energy was very much on during that time and some people did talk about its potential but nobody really took it seriously. Why would they? Petrol and Diesel used to be cheaper than the cost of CNG today and food wasn’t as expensive as it is now. More importantly, India’s population was 20% less than what it is now and pressure on resources wasn’t all that high. Since our incomes haven’t really kept pace with inflation and population growth, while resources dwindled, we are now among the top users of renewable energy globally with over 30 GW of installed capacity.