Renewable energy mini grids – Indian experiences

Debajit PalitAssociate Director and Fellow

The Energy and Resources Institute, New Delhi

Email: debajitp@teri.res.in

ECOWAS Initiative on the contribution of the civil society and private sector to up-scaling rural energy

access in the ECOWAS region

October 29, 2012, Accra

Towards Sustainable Energy For All in West Africa

What is TERI

� A not-for-profit research & development and policy think tank;

� Established in 1974 in New Delhi;

� More than 1000 professionals, with centers spread across 5 cities in India; Overseas presence in London, Washington DC, Tokyo, Dubai and Addis Ababa

Working Areas

• Energy & Power

• Regulatory practices

• Habitats and transport

• Environment

• Water and NRM

• Climate policy

• Bio technology

• Social Transformation

Addis Ababa *

People lacking access

Source: World Energy Outlook 2011

Number of people lacking

access to electricity

Number of people relying on

traditional use of biomass

for cooking

Africa 587 657

Sub-Saharan Africa 585 653

Developing Asia 675 1937

China 8 423

India 289 855

Other Asia 378 659

Latin America 31 85

Developing Countries* 1314 2679

World 1317 2679

TERI’s Work on Energy Access

� Basic needs• Clean Lighting – Lighting a Billion Lives

• Clean Cooking – Improved turbo cookstoves

� Productive uses • Biomass gasifiers & energy efficiency in MSMEs

� Modern society needs • Green buildings, Demand Side Management

Lighting a Billion Lives

� LaBL sets up solar charging stations/DCmicro grid in energy poor villages thatoffer bright, and quality solar lightingsolutions to the local people on a fee forservice model.

� A trained local entrepreneur operates andmanages the charging station/DC grid andrents the solar lamps every evening for aaffordable fee.

� Technical Resource Centres, an after-salesservice network for responsive repairservices through local communityrepresentatives

� Till date , impacted around 400,000 livesthrough setting up of 2000 solar chargingstations/DC micro grids

Solar Charging Station

A typical Solar Charging Station

Solar charging stations are

expandable to energy hubs

providing :

• Battery charging

• Mobile charging

• Lantern charging

• Water purification

• Sale & servicing of solar/

clean energy devices

Solar DC micro grids are also considered in case of

compact habitations - in modules covering 10, 20, 40 HHs

Multiple Energy Sources

1. Solar PV

2. Wind Aero Generators

3. Biomass Gasifier

4. Hybrid Systems

Multiple Applications

• Charging lanterns

• Powering computers,

• Charging cell phones

• Water purification

• Livelihood applications

Located near the energy utilization points in a village to provide

electricity services as per the need of the community.

Solar Multi Utility

Mini-Grids in India

Mini-Grids in India

� Pioneer of Mini-Grid system

� First solar mini grid commissioned in 1996 in Sunderbans Islands

� State-of-the-art system designs & use of components (converters & inverters), continuing till date

� Cooperative model of service delivery

� Involvement of local community from planning stage

� Policy enablers from time to time

� Around 5000 villages covered through mini-grids, serving more than 50,000 HHs

� Multiple technology adopted

Why mini grids in India

� Technically, mini-grids are preferred for remote areas over other options such as solar home systems,

� as mini-grids provide electricity services for lighting & for powering various appliances, whereas SHSs typically provide only lighting services

� Can support small productive applications

� Organisationally, managing mini-grids are easier compared to individual systems due to their centralised operation through a proper institutional arrangement

Solar PV Mini-grid

Control Room, Battery Bank, Grid

Biomass Gasifier Power System

� Fuel Preparation

� Biomass Gasifier

� Cooling cleaning train

� Engine – Alternator

� Biomass drying

� Power evacuation

Source: TERI

Managing Mini Grids: Earlier Model

FUNDING AGENCY

PIA

Power PlantVEC

System

Supplier

Consumers

Consultant (DPR, system design, TA support)

Organize VEC

System Engineering.System Owner

$

Installation &Commissioning

• System custodian• O&M • LT line Maintenance

Electricity

Grant from Central GovernmentEquity by PIA/NGO or Beneficiaries

Revenue: Tariff, billing, collection

Village Energy Committee (VEC) Model

Source: TERI

Lessons from early Mini grids

� Decentralized, usually low capacity, covering remote areas

� Usually domestic loads served

� Community as stakeholder

� Tariff based on flat rate, locally decided, depending on fuel cost, O&M cost and WTP (~ US$ 1 per point/month)

� Non commercial in nature

� Inability to meet increased demand

� Low plant load factor

� Single energy resource catering to fixed load for fixed time

� Battery – Vulnerable, over drawl by most consumers

� Difficulty in O&M because of remoteness

� Limited technical knowledge of VEC – frequent system shutdown

� Not linked to any productive enterprise / irrigation pumpsets

Hybrid System

Source: TERI

Managing Mini Grids: Addressing low load

Source: TERI

Mini Grid – Private Sector

Husk Power SystemA for-profit entity - identifies suitable villages, builds the electricity supply, and

arranges for operations and maintenance, with the help of local partners.

Equity investments Subsidy (optional)

• Generates, transmits and distributes electricity

• Trains local people to operate gasifiers• Negotiated tariffs• Billing and revenue collection • Grievance redressal

Equity

Investors

MNRE

Husk power

Systems

Consumers

Sells electricity on

light point basis

Technology

partner

Design,

I&C

Sign contract

with HPS

Coverage ~ 80 villages, 33 kWe systems,300-400 households in a villageTariff: ~ US$ 3/month/HH for 2 lights, 4hrsSynergies created for co-benefits & viability

Solar Power : 50 households connected from 400 Wp

of solar panels. Panels are installed on the rooftop of a

village house at a central place in the village.

Battery Bank: 24 V 100 Ah of storage capacity.

Batteries are stored in a cabinet inside the same house

or distributed battery storage at HHs

Power Distribution: DC distribution lines run along the

rooftops from the battery bank to households within

the village. Power is distributed for 5-6 hours each

night at 24 volts.

LED: Each household having 2 or 4 LED lamps

Solar DC micro grid – New Development

� Providing access to population earning much less than 1$/day

� Remote, tribal communities without cash disposable income

� Subsidy vs. financing – affordability ?

� Subsidy for capital infrastructure

� ensuing operational sustainability improved quality of life

Mini Grids in Chhattisgarh - A case study

CREDA has reportedly electrified around 35,000 households

through renewable energy based mini-grid

Solar mini-grid model of CREDA

Financing

� Capital cost ~ 25000 INR (500$) per household

� Capital subsidy- 18,400 INR (368$) per HH – by MNRE

- Balance by state government

� Tariff per connection = 30 INR/0.6$ (2x11 W CFL)

� Tariff subsidy (by state government)- 25 INR (0.5 $) per HH connection

3 tier Maintenance System

� Comprehensive Annual Maintenance Contracts (CAMC)

� Three tier system of maintenance

- Project level – operator

- Cluster level – cluster technician

- For multiple clusters – Cluster supervisor

� Parallel supervision by CREDA staffs

Partners(Group)

Skills(Organize)

Allocate(Load)

Service(Delivery)

> Install> Operate> Maintain

H : Service Hub

( Base station )

-Technician / Helper

- Spares / Consumables

V : Villages in the Cluster

Village Cluster

-15 Villages

- 50 Customers / Village

Cluster Based Service Delivery

Source: CREDA

CLUSTER based Service delivery

Total Number of villages covered 150

Revenue / month Expenses / Month / cluster

No. of Villages / cluster 15 NosRate Rate

No. of Customers / Village 50 Technician 1 8000 8000

Total No. of Customers / cluster 750 Helper 1 3500 3500

Collection per Customer 35 Conveyance 1 3000 3000

- Through CREDA 25 Others 1 1000 1000

- Direct 10 operators 15 700 10500

Total collection / cluster / month 26250 Expenses / month / cluster 26000

Total AMC collection / cluster 315000 Expenses / year 312000

No of clusters 10

Total collection under CBSD 3150000 Expenses / year 3120000

Financials

Source: CREDA

Key factors for success

� Top-down approach /Organized delivery model

� Driven and implemented by CREDA with support from state government & MNRE

� Commitment and enthusiasm across all levels of CREDA

� Opposed to popular approaches “let the community handle” -Each entity sticks to what it does best

� Effective maintenance (PPP model)

� Fruitful partnership between CREDA and System Integrators

� Structured communication channel between CREDA and contractors

� Strong govt. support and political will

� Maintenance subsidy of Rs 25/household (benchmarked to household’s expenditure on kerosene & Single Light Scheme)

� Strong political leadership

26

Key factors for success contd…

� Creating an eco-system for solar electrification� Solar shops� Support to local manufacturing and development

� Modular training and capacity building� Different for different stakeholders depending on

need and requirements� Learning from doing

� Transition from ACMC to long-term CMC� Introduction of fully commercial model in select

locations

Key Lessons

� Service delivery models to be structured considering the uniqueness of the region within which the plant is to be installed -Today off-grid, grid-connected tomorrow

� Contrary to prescribed models of off-grid electrification, top-down approach/organized structure seems to be working better than community model

� Designing variable tariff structures considering both ability to pay as well as operational expenses

� Access to electricity is merit good

� Need to build local capacity and adopt clustering for effective maintenance & viability of operation

� Strong regulatory & policy regime supports development of projects – Viability gap funding/Results based aid

Framework for Mini Grid

Level 1- Basic needs

• Lighting

• Communication • Cooking • Heating

Level 2 - Productive uses

• Agriculture (water pumping, mechanized tilling etc.)

• Public health centres

• Education (Schools, tu ition centres etc.)

• Street lighting

• Sewing, cottage industries • Grain grinding

Level 3- Modern society needs

• Modern domestic gadgets

and appliances for space cooling, heating etc.

• All productive applications for

24/7 usage • Transport

Small scale RETs

Ideal for isolated and vulnerable communities

Facilita te

Village-scale mini-grids Ideal for larger or more

developed villages

Facilitate

Mini-grids coupled the main grid

Ideal for cluster of

villages

Facilitate Creates the

market for mini-

grids

Could develop

into

In conclusion

Ecosystem(AAQS)

Appropriate Technology

Innovative Financing

Local Skills

Enabling Policy

Not ‘how can we make community use the mini-grid technology’, but

‘how can more & more people get access to and sustainably benefit from this technology’

Sustainability

condition

2012: International Year of Sustainable Energy for All

Let us together make a change