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Prayas Energy Group, Pune Powering 1.2 billion people: Case of India’s Access Efforts Shantanu Dixit Prayas (Energy Group), Pune 23 th February, 2012,

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Presentation on theme: "Prayas Energy Group, Pune Powering 1.2 billion people: Case of India’s Access Efforts Shantanu Dixit Prayas (Energy Group), Pune 23 th February, 2012,"— Presentation transcript:

1 Prayas Energy Group, Pune Powering 1.2 billion people: Case of India’s Access Efforts Shantanu Dixit Prayas (Energy Group), Pune 23 th February, 2012, Washington DC World Bank Energy Days

2 ‘Prayas’ means ‘Focused Effort’ Based at Pune, India Focus on protection of “Public Interest” in electricity sector Research based, policy advocacy Voluntary Org. About Prayas … Activities: Research & intervention (regulatory, policy) Civil Society training, awareness, and support 2

3 Outline Why access and what is access ? Case of India’s access efforts Concluding comments 3

4 Why access? Electricity – a versatile source of energy Equity and ethical imperative – reduce drudgery, improve safety – social infrastructure (health facilities, schools etc.) The economic imperative – avoids excessive expenditure for kerosene – increases productive working hours of the day – promotes small scale economic activity (industry/agriculture) 4

5 Electricity–HDI linkage 5

6 What is Access? Basic lighting Basic domestic appliances Social needs – schools, health facilities, street lighting Productive needs – small industries, shops, agriculture 6

7 India’s Access Efforts – Phase 1 1970s and 1980s – Food crisis led to adoption of ‘green revolution’ – Need for increased irrigation and hence electrification of agricultural pumps – through grid extension – Household and village electrification a by-product of this productive load development – Village electrification definition “if electricity is being used within its revenue area.” (till Oct 1997) 7

8 India’s Access Efforts – Phase 1 8

9 India’s Access Efforts – Phase 2 1990s and 2000s Several grid based schemes: Kutir Jyoti Yojana (1988-89); Pradhan Mantri Gramodaya Yojana (2000-01); Accelerated RE programme (2003-04) & Accelerated Electrification of 1 lakh Villages & 1 crore Households (HHs) (2004-05) Attention to restructuring and financial viability 9

10 India’s Access Efforts – Phase 2 10

11 India’s Access Efforts – Phase 3 Change in village electrification definition (2004): Electrified if basic infrastructure like Distribution Transformer and lines are provided in inhabited and dalit bastis; electricity is provided in public places like schools, PHCs etc and a minimum of 10% of HHs are electrified. National Electricity Policy 2005: “…the nation has set itself the target of providing access to all households in next five years.” – ensure minimum lifeline consumption 1 unit/household/day as a merit good by 2012 Challenge – Non-electrified population in India comparable to USA (> 300 Mil. people), 1/5 persons in world without electricity lives in India 11

12 RGGVY Scheme Overview …1  Launch of RGGVY (rural electrification program) – Merging of earlier electrification schemes Launched in 2005 and addresses two components rural electrification – developing distribution infrastructure (Distribution backbone with 33/11 kV or 66/11 kW substation and distribution transformer) in rural areas to meet electricity demand of all HHs – free connections to all Below Poverty Line (BPL HHs) 12

13 RGGVY Scheme Overview …2 Infrastructure investment – 90% grant by Govt. of India and 10% as loan by REC to the State Governments. – Total Investment: Rs. 70,000 cr (US $ 14 Billion); half spent. Critique and Concerns about RGGVY – Top down, One size fits all approach – Emphasis only on HH electrification – Above Poverty Line HHs connections lagging behind – Construction quality of network and delays in meeting target – Inability to supply adequate & affordable power 13

14 RGGVY Achievements Physical infrastructure – 100,917 villages electrified (90% of target) – 18 Million HHs electrified (78% of target) 14

15 Increase in rural HH electrification (%) through RGGVY 15

16 RGGVY – What about electricity? Hrs. of supply often < 6 hrs./ day PEG proposal for restructuring of RGGVY – Less hrs of supply due to structural disincentive (loss of US cents 8/kWh of sale to HH) – Central government to allocate low cost power to RGGVY consumers – Need 14 GW capacity to address structural disincentive (likely addition in next 5 yrs ~ 100 GW) (Refer Background Paper for Roundtable on Electricity for All : Challenges and Approaches, by PEG and PIC at Pune on 18 th Feb 2012) 16

17 What about ‘Green Access’ ? 17 Decreasing costs and increasing potential of RE Grid Connected RE Capacity (~24 GW) Generation (~ 50,000 MU)

18 18

19 Wind Potential Estimates (GW) for India 19

20 Green Grid ? Grid essential for harnessing large scale RE – Geographically un-equal distribution – Varying generation, needs balancing mechanism Enables large investments, better monitoring, less drain on government finances Grid connected RE target ~15% by 2020 (~ 250 TWh) Grid RE needed (2010-2010) – 75 GW / 160 TWh – Equivalent to powering 100 mil. HH @ 100 units / month 20

21 Concluding Comments …1 Grid – Enables large scale access – Green grid is feasible Challenges – Reliable supply, structural disincentive – Grid O&M Off-grid – Suitable in specific situations – Distributed grid-interactive renewables Challenges – Equity in tariffs – High cost and O&M – Weak monitoring 21

22 Concluding Comments …2 Primary objective should be providing ‘quality access’ as soon as possible Not just techno-economic optimum solution but must consider ‘political economy’ and ‘governance’ framework. 22

23 23 Thank You Prayas Energy Group Shantanu Dixit Ashwin Gambhir Sreekumar N.

24 Off-grid approach …1 From 2000, Ministry and New and Renewable Energy (MRNE) programs for remote villages – Village Energy Security Program, Remote Village Energy Program Current installation (as on 31.08.2011, source: MNRE): Remote villages/hamlets with DRE: 8846 nos Biomass gasifiers (rural):15.5 MW SPV systems (> 1 kW): 72.5 MW Water mills/micro hydel: 1818 nos RGGVY – Decentralized Distributed Generation (DDG): for hamlets where grid connectivity is not feasible / cost effective. Capital subsidy of $ 100 Million earmarked. 24

25 Off-grid approach …2 Total HHs (Million)259 HH Electrified by Central Grid (Million)191 (74%) Villages Electrified through Grid (31 st Jan 2012) 551187 (93%) Number of Villages/Hamlets with lighting service through DRE (as per MNRE) 8846 HHs (Million) with lighting (4-5 hours) through DRE, assuming 100 HHs/hamlet. 0.9 25

26 Challenges for Off-grid Higher institutional capacity and community involvement need Limitations on provision of social and productive load in economical manner. In-equity in tariffs Maintenance and Operation issues (technical, fuel, costs, tariff collection etc) 26

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