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DoT mulls viability gap funding for tower firms’ renewable energy initiative

According to reports, the Department of Telecom is looking at the possibility of extending viability gap funding to telecom tower firms for speeding up adoption of renewable energy.

The support could be provided either from the Universal Services Obligation fund or from the various schemes under the Ministry of New and Renewable Energy (MNRE).

The Tower and Infrastructure Providers Association (TAIPA) has estimated that the telecom companies would need Rs 33,000 crore to meet the green initiative targets set by the DoT.

Tower companies are supposed to power 50 per cent of rural towers and 20 per cent of urban towers by hybrid power (renewable energy + grid power) by 2015. Minimum 75 per cent of rural towers and 33 per cent of urban towers are to be powered by hybrid power by 2020.

There are 7.42 lakh mobile base station and 5.85 lakh mobile towers across the country. Of this 3.5 lakh towers are in rural areas. The power requirement of the base station is 1-3 kilowatt each day. According to the Telecom Regulatory Authority of India, it takes 8,760 litres of diesel annually to run these towers.

To cut down on carbon emissions and costs, private telecom companies are doing pilot projects for running the towers through renewable energy. The Tower Pune-based Creative Mark Engineering Solutions and Mahindra & Mahindra have been selected by private telecom tower companies for supplying renewable energy. Tower companies, including Indus, Bharti Infratel, American Tower Corporation and Viom, had floated a joint proposal for the project.

Under this project, the renewable energy service company (rescos) will set up renewable energy-based power plants near the telecom towers and sell power to the telecom company at a pre-determined cost on a pay-per-use model. The power generated by the rescos will be off-grid. But additional power generated by them can also be sold to commercial users living in areas where the power plants are located.

The TAIPA had floated the Request for Proposal inviting NGOs and private green power companies to generate and supply off-grid power to telecom towers in the country.

The Ministry of Communication has now set up a committee comprising officials from DoT, MNRE and the industry to work out the modalities to expand such projects across the country. The Government has already given infrastructure status to the tower companies that makes it easier for them to get viability gap funding.

One comment

  1. Why viability Gap Funding is needed? Why Capital Subsidy is needed? Let these big companies show the costs and the business models to DoT and MNRE and what technology for hybrid is selected…. before announcing any support, let the papers be subject to public scrutiny, who will show the low cost models…….. off grid models, standalone systems costs more with storage, hence, grid power is needed, hence, why not have solar tree concept for each tower to reduce the land requirement with learned and transparent business plan with financial number to help DoT, energy buyers of telcom industry with the technology deployed….. private PPA for one or two companies will not be cheap and sustainable, instead, let this system be owned by the tower companies with normal depreciation with a proven technology with small RESCOS managing these small powering units, which is not a rocket science……. like DG sets, these solar trees can be owned by these tower owners as Solar Power generators, for which government subsidy (VGF or Capital Subsidy or Accelerated depreciation is not needed), instead a simple interest subsidy is needed to match….. visit my company web site: for roof top system or low cost solar pv to know how interest subsidy helps…. thus, avoid dependence on Government on VGF or Capital susbsidy, rather prove your equipment and technology through interest subsidy which shall be paid against performance….. TATA NANO was given loan at 0.15% for 20 years for rs. 2100 crores. Hence, we need to ask such low cost finance, rest shall be managed through open and transparent business models, which shall be part of policy, thus, no extra burden on the government through Capital subsidy or VGF and create non working models like Biomass power projects or imported coal based UMPP etc….Solar PV power project development in every taluka will eliminate all this power shortage problems by creating small entrepreneurs in each taluka at low cost……..At present the grids are not uniformly laid to access, less power is generated, more losses in the grid (many are fictitious), hence, if we develop Solar PV projects in every taluka with new grid lines, it will eliminate this SHARKS of Off grid to charge huge money and the Diesel Subsidy will vanish substantially….as the irrigation pump sets will also have power….. Think holistically and not to extract juice through many ministries and secretaries in the name of Renewable Energy Development….. each ministry should not poke in to subsidy, instead MNRE (having now learned the huge economic dent on economy through these errant subsidy payout or deployment, yet, inefficient systems) must be made to comeout with Interest subsidy to hold the developers responsible to prove their project and then only seek interest subsidy instead of one time benefits like Capital Subsidy, Viable Gap funding or Accelerated Depreciation and make the government to loose on funding and also on tax collections !! Is this COUNTRY FIRST CULTURE to make good policies with Learned Policy makers??

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