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A solar push for rural India

According to reports, till solar plant costs come down further, lighting of villages may have to be funded by subsidies. But funds are no constraint. And solar power is a better option than reaching copper wires to villages.

The solar renaissance that is sweeping the globe has brought within reach a solution to a vexing problem — bringing electricity to small, remote villages. It is never easy to reach electric power to villages, especially when there is not enough to distribute.

That is why some 1.4 billion people in the world — 400 million of whom are Indians — do not have access to electricity. No matter what you do, there will be areas you can’t take electricity to. Who would build power pylons and run tens of kilometres of cables to a village of 25 households?

But sun is everywhere. And tapping solar power, while still being an expensive proposition, is much less costly now compared to some years ago. And the good news is, it is beginning to happen.

Take the example of the Meerwada village of some 70 housesholds in the Guna district of Madhya Pradesh. SunEdison, an American company with operations in India, recently put up a small, 15 KW solar power plant, spending Rs 30 lakh. Now Meerwada has power 24×7. When the plant went live, about a couple of months ago, Meerwada was the object of envy in the neighbourhood.

SunEdison fixed a monthly rate based on the number of appliances in a house but, obviously, this was insufficient to cover costs (mainly capex costs).

The programme was funded by SunEdison’s global social programme, which it calls SunEdison Eradication of Darkness (SEED), but the model itself is subsidy-driven.

Is it possible to sun-light a village without any subsidy support? It is, if one can organise some commercial activity for the villagers, so that they first earn money using the newly-obtained electricity and then pay for it out of the earnings.

Pilot study

This model is for all to see in an experiment conducted by the Minda group in the village of Mangladhuli, some 100 km from Agra. The company put up a tiny, 1.2 KW solar power plant and 1.5 km of cables to bring 8 hours of electricity a day to the villagers.

Minda NextGenTech collects Rs 150 a month from each household. With the help of an NGO, villagers could buy grinders and earn money by grinding spices and pulses.

The NGO took care of marketing the products. Minda did it on a pilot basis, and intends to find entrepreneurs who would buy the solar systems and get into the business of providing electricity in villages. But, then, it is not always easy to first find some gainful commercial activity and then provide electricity.

Until solar plant costs come down further, solar-lighting of villages may have to be funded by subsidies.

Funding options

Is there money? Oh, yes, for sure. Here are some options:

Since nobody grudges paying a little extra as the money verifiably goes to a social cause, it is possible to levy a small cess, say 5 paise, for every unit of electricity sold in the country. India generates some 900 billion units of electricity.

Assuming that only 40 per cent is priced and paid for, one can collect Rs 1,800 crore.

Companies spend huge sums on CSR activities. While there is no estimate of total CSR spends, it is estimated that if they are mandated to spend 2 per cent of profits on CSR, they would spend Rs 8,700 crore. Let us assume that 0.2 per cent, and not 2 per cent, is spent by Corporate India on solar rural electrification. You get Rs 900 crore.

Our Members of Parliament get Rs 5 crore a year for developing their constituencies —Rs 2,670 crore a year.

Assume that a third of the MPs represent constituencies that have un-electrified villages. The money with them works out to Rs 900 crore per year.

The National Clean Energy Fund today has Rs 3,864 crore, and the government expects to collect Rs 10,000 crore by 2015. If ony 10 per cent of this is earmarked for solar rural electrification, you would have close to Rs 400 crore.

Companies such as TV manufacturers, which could benefit from village electrification, can be asked to volunteer small sums of money for this purpose.

International grants, easy loans from multilateral lending agencies, philanthropic organisations.


Clearly, neither technology nor funds is a problem. It is a question of just getting on with it. Also, solar-based decentralised, distributed generation (DDG) appears a better option than reaching copper wires to villages, because of reliability and avoidance of transmission and distribution losses. Indeed, the Rural Electrification Corporation (REC) can take up these micro-generation solar projects in addition to (or in the place of) its DDG projects.

Until last year, REC had done only 34 DDG projects at a cost of Rs 3,095 crore or Rs 90 crore a project. It is not clear as to how many villages have been covered under these projects, but they are not likely to be cheaper than solar.

The social transformative role that electrifying villages plays is unimaginable. The opportunity to earn more money is really besides the point. The real benefits are in terms of education and healthcare. Quality of life improves — children can study for longer hours; womenfolk can perform chores more comfortably.

Meerwada can now have a fridge to store vaccines and medicines, such as for treating snake bites. Imagine — just Rs 30 lakh can upgrade a whole village!

Now is the time to take up electrification of India on a mission mode. It can be done. We recently succeeded in eradicating polio. It happened because the whole country involved itself in the administration of medicine to every single child. Putting a solar power unit in every single village is lot easier than that.

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