Creating livelihoods by implementing decentralised or distributed applications of renewable energy is doable, but definitely not easy to implement on ground.
Last year, the Ministry of New and Renewable Energy (MNRE) came out with a framework for promoting decentralised renewable energy (DRE), which is meant to help in powering livelihoods.
In the recent past, a number of DRE livelihood applications have been developed that are not only energy efficient but also economically viable, the Ministry had said. These include solutions such as solar dryer, solar or biomass powered cold storage/chiller, solar charkha, etc. According to experts, such DRE livelihood applications ensures scalability without large investments. Besides, the energy efficiency of such solutions enhances their economic viability by reducing the size of the generation and storage requirement.
Recently, Minister for Power and New and Renewable Energy, RK Singh, at an event said, “Our government is coming out with a new scheme for distributed applications of renewable energy.”
“There is already a lot of work happening on the ground and our scheme could benefit lakhs of families across the country. We will, however, need large-scale manufacturing and standardising of distributed applications of RE to lower prices and expand the sector. We have seen the potential of grid-scale solar power, India will scale up distributed applications of renewable energy for livelihoods. Just like we have a large programme on rooftop solar and solar irrigation, we will create a large programme for DRE livelihoods,” he said.
Singh also released two reports by the Council on Energy, Environment and Water (CEEW) and Villgro Innovations Foundation’s Powering Livelihoods initiative which showed that clean technologies have the potential to impact 37 million livelihoods in India’s agriculture and textile sectors and translate into a market opportunity worth almost ₹4-lakh crore (about $50 billion). The report further states that 70 per cent of women and farmers using clean technology reported an income increase, typically by 35 per cent. They use clean-energy powered products such as solar-powered silk reeling machines, multi-food processors, micro solar pumps, solar vertical fodder grow units, among others, to enhance and diversify their income. When there is a sovereign backing, then where is the challenge? Besides finance, two other key challenges are fixing accountability and creating awareness. According to Subrahmanyam Pulipaka, CEO, National Solar Energy Federation of India, the biggest impediment is social awareness among all stakeholders — financier as well as user.
Fixing accountability as to who will implement the scheme is a challenge as every State has its own mechanism. In some places it is the energy department and in others it is the skill development or or even the rural development department that deal with the issue.
According to the government, “energy infrastructure in India will require partnership between government, industry, and academia to develop the country’s capacity and storage of renewable energy and expand India’s research and development capabilities.” Abhishek Jain, Fellow and Director – Powering Livelihoods, CEEW, agrees that financing is an issue. “You are spot on when you say there is equipment cost, which leads to an upfront capital cost. And these solutions have higher capital cost when compared with their diesel or grid counterparts,” he said.
“You are typically looking at customers who are cash-strapped; these are rural micro-enterprises, farmers or producer organisations or self-help groups, who are not sitting on cash to buy a ₹1 lakh equipment upfront and hence financing is critical to enable scale,” he said, adding that this meant bankers, MFIs, small finance banks have to play an important role here.
“Support from the government can be very helpful, and there are existing schemes supporting technology adoption among micro-enterprises, such as Mudra or PM-FME. But the role of financing remains critical,” he added.
From CEEW, he said, “We have been engaging and explaining to financial institutions and bankers about the solutions. Creating awareness is very important. Many bankers do not know how they will evaluate these solutions.”
On the social aspect, Jain said, “We are promoting these solutions because, in many ways, they offer empowerment at the last mile. It helps farmers diversify their income. Farm incomes are coming down in comparison to non-farm incomes in rural areas. Only relying on cultivation income may not be sufficient for farming houses. Having these solutions at their doorstep, farmers can undertake value addition of their crops.”
For example, horticulture or aloe vera growers can do value addition by making pulp or juices. It also helps those growing perishable commodities in getting more bargaining power as they have an alternative to selling their produce in the mandi.
Some of the key findings of the reports released show that technologies like solar silk reeling and spinning machines and micro solar pumps had a significant share of women users, with a share of 92 per cent and 65 per cent, respectively. The use of these solutions not only helps in providing sustainable incomes for these users but also in improving productivity.
The report acknowledges that currently, the deployment of these technologies on the ground is limited to tens of thousands, and it is a challenge to scale at the pace required to address the needs of rural and peri-urban communities. Further, a lack of evidence on the commercial viability of such solutions makes it challenging to garner support from investors, financiers, policymakers, and market enablers — exactly what the report tries to bridge.
While the intent of the government is good, the way forward is creating an ecosystem for stakeholders to work collectively. Affordable financing is also the need of the hour. And creating a nodal agency, for example, to empower the panchayats to successfully implement the scheme with support from all the key entities — government as well as non-government.