According to reports, telecom tower providers are looking to reduce operational costs by inviting proposals next week for setting up independent renewable energy companies that will generate and supply green power to run towers.
Taipa, the industry association representing tower infrastructure providers across the country, is working on a request-for-proposal or RFP for the initiative that will help save the cost of diesel for running towers especially in areas where grid electricity is not available. “The RFPs should be out by next week, followed by a pre-bid conference,” said Taipa’s director general Umang Das.
The industry body had proposed the creation of renewable energy service providing companies or Rescos that will set up independent plants to sell power to tower companies or telcos. This off-grid distribution model may also sell surplus power back to the grid, Das said. Thanks to erratic power supply, about 60% of India’s 400,000 telecom towers depend on diesel generators and according to sector regulator Trai consume nearly 2 billion litres of the fuel every year. The regulator has directed them to reduce their dependence on diesel and cut carbon emissions by running at least 50% of all rural towers and 20% of the urban towers on hybrid power by 2015. Tower firms have been partially successful in their experiments with producing power from solar energy, fuel cells and other renewable sources.
Bharti Infratel, the tower arm of Bharti Enterprises, for instance, has been able to save 25.64 million litres of diesel after powering 12,000 tower sites with solar energy. Viom Networks, Indus Towers and American Tower Corporationare among the players that believe reduction in costs is critical for the industry that has seen no new towers being added over the past year. The companies were hoping for new business to come from the rollouts expected from the new players that got the licences in 2008. But this did not happen because of the Supreme Court verdict cancelling the 122 mobile permits.
Instead, telcos have wound up operations and are being sued for breach of contract – Reliance Infratel dragged Etisalat DB to court. Further, the regulator has proposed changes in fee structure and wants to bring tower firms under the unified licensing regime, which will force them to pay revenue to the government. Other changes, such as the cut in FDI to 74%, have also deterred foreign investment and put a question mark over the shareholding patterns of companies such as the American Towers Corp India.