Implemented by Indo-German Energy Programme – RE Component Santosh Singh, GIZ India 13/05/14 XXX Seite ‹#› Implemented by IGEN-RE Component Concept AREAS OF INTERVENTION 1 Decentralized rural electrification 2 Retailing of stand-alone RE products 3 RE policy and RE promotion at union state level 4 13/05/14 13/05/14 MAIN FOCUS Replicable Business Models OBJECTIVE Improved Conditions for Renewable Energy in Rural Areas Enabling Environment, Scaling-up Policy dialogue at national level XXX Seite ‹#› Implemented by IGEN-RE Activity Overview Rural Electrification / Mini Grids Market Development for RE products Solar Mini Grids Uttar Pradesh West Bengal Pine Needle Gasification Uttarakhand Financial Viability of Biomass Gasification National Improved Water Mills Uttarakhand Improved Biomass Cookstoves Uttarakhand, Bihar, West Bengal, UP Solar Water Pumps Bihar SELCO Incubation Centre National Facilitating Finance Cross-cutting Issues Involving Corporates National Gender 13/05/14 13/05/14 XXX Seite ‹#› Implemented by Rural Electrification – Mini-grids 13/05/14 XXX Seite ‹#› Implemented by Context < 10% Access to Electricity data for UP - Census 2011 • 37% households (24% rural households) have access to electricity • 5 districts - < 10% rural households electrified • another 26 districts - < 20% rural households electrified • Total number of rural households without access ~ 19.3 million 13/05/14 < 20% XXX Seite ‹#› Implemented by Objectives • To assist in the implementation of 4 - 6 pilot project clusters across 2 districts (Ballia and Banda) based on a district level clustered/bundled approach that helps attract private sector participation in establishing and operating solar mini-grids. • To help develop the framework for a roll-out of a similar programme on a larger scale across Uttar Pradesh/India based on the lessons learnt from the pilot implementation. 13/05/14 XXX Seite ‹#› Implemented by IGEN-RE Approach The approach based on an understanding of the challenges with existing mini-grids in UP and other parts of India Bundling to provide a certain degree of scale to private enterprises Detailed demand assessment across a district/selected blocks in order to segregate the villages across different segments • Type 0 - Lighting only (MGP model) • Type 1 - Lighting + Entertainment ~ 5 – 10 KW • Type 2 – Type 1 + Commercial load ~ 10 – 25 kW • Type 3 – Type 2 + rural enterprise load ~ > 30 kW Standardized solutions for each type Bundles of each type to be tendered out to private players In addition to the subsidy from MNRE, investment in the distribution network (distribution code compliant) by the state government 13/05/14 XXX Seite ‹#› Implemented by Key Advantages of Proposed Approach • Pre-investment costs reduced for private players due to prior assessment of demand • Bundling leads to economies of scale/density  reduced O&M costs • Distribution code compliant grid  better chances of integrating with the main grid when it reaches there • Cost of the distribution network borne by the state • A state-driven programme – better coordination across stakeholders  regulatory certainty  reduced risk perception among investors 13/05/14 XXX Seite ‹#› Implemented by Innovative Business Models for ICS 13/05/14 XXX Seite ‹#› Implemented by The IGEN-RE Approach 13/05/14 XXX Seite ‹#› Implemented by Stimulating Demand • Enhancing Affordability of ICS • Tapping Carbon Finance to reduce stove costs • Developing innovative models for end-user financing • Effective awareness and communication • Designing cost effective blueprint for awareness and marketing campaigns to reduce marketing and communication costs for entrepreneurs 13/05/14 Seite ‹#› Implemented by Improving Supply • Identifying appropriate technologies • User acceptance field study for 6 different ICS in Bihar, UP and West Bengal (“The Kaleidoscope of Cooking” Report available at www.igen-re.in ) • A scientific measurement of ICS performance in actual use condition is being conducted by IIT Delhi and Berkley Air Monitoring Group • Developing low cost distribution models • Reducing the distribution cost for ICS • Optimising logistics for dissemination 13/05/14 Seite ‹#› Implemented by Market Ecosystem • Facilitating Knowledge Sharing • India Cookstove Forum 2013 • Support to networks and industry associations • Providing Detailed Market Information • Market survey in 4 states: Bihar, Uttar Pradesh, Uttarkhand, West Bengal • Facilitating enterprise finance • Study on barriers for financing rural energy enterprises 13/05/14 Seite ‹#› Implemented by Market Based Dissemination of Solar Water Pumps 13/05/14 XXX Seite ‹#› Implemented by Present Market Status • Primarily driven by Government Tenders. • Eligibility criteria encourages participation of large companies. • Limited opportunity for enduser financing through involvement of Rural Banks. 13/05/14 XXX Seite ‹#› Implemented by Potential for Solar Pumps for Irrigation • Potentials for replacing 9 million diesel pumps with solar PV pumps. (CSTEP). • Potential of about 70 million solar PV pumps to be installed by 2020. (HWWI) • Potentials of 16,200 MW in the period 2017-22 from the agriculture category (KPMG) 13/05/14 XXX Seite ‹#› Implemented by The Challenges in Technology Adoption (I) • Awareness • Affordability • Lack of awareness about the technology. • Limited involvement of rural banks for end user financing. • Consumers are unaware of the performance/ potential of the technology. • Even with the government subsidy support, the upfront cost (10-15% of the total cost) of solar water pumps is often too high for some farmers. • e.g. at the time of conversion from diesel to solar many farmers insist on 5 HP rather than on 2 HP pump. Assumption is : the bigger the better. 13/05/14 XXX Seite ‹#› Implemented by The Challenges in Technology Adoption (II) • Availability • Issue of Risks • Not available through local supply chain (vendors) and hence farmers unaware of the technology. • Farmers are risk averse when it comes to purchasing high value products. • Availability and quality of support for after sale service. • Fear of theft. 13/05/14 • Lack of standardisation. XXX Seite ‹#› Implemented by Study on Potential and Challenges of Solar Water Pumping for Irrigation in Bihar • Technology overview • Potential and application of solar pumps in India • Potential in Bihar • Specific barriers and solutions for the application of solar pumps for irrigation in Bihar • Can be downloaded from www.igenre.in 13/05/14 XXX Seite ‹#› Implemented by Technology Demonstration Site at Vaishali District, Bihar Key activities • Two 5 HP submersible pump managed by a farmers’ cooperative; “Pay-per-use model”. • Technology demonstration for at least 250 farmers from different districts. • Training for bank managers: technology, financial viability of solar pumps 13/05/14 XXX Seite ‹#› Implemented by Addressing Financing Challenges in RE Sector 13/05/14 XXX Seite ‹#› Implemented by Our Approach • • Focusing on different segments of RE sector and understanding their unique challenges and demands • A detailed analysis done by Dalberg Global Advisors • Proposed solutions are being developed for the pilot A dedicated catalytic facility for • Debt financing for working capital of RE entrepreneurs • Innovative end-user financing for ICS • Project Finance for mini-grids and micro-grids 13/05/14 XXX Seite ‹#› Implemented by Thank You. [email protected] As a federal enterprise, GIZ supports the German Government in achieving its objectives in the field of international cooperation for sustainable development. Published by Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH Author(s) Santosh K. Singh Registered offices, Bonn and Eschborn, Germany Indo German Energy Programme GIZ India, B 5/2 Safdarjung Enclave New Delhi – 110029 T 011 49495353 E [email protected] I www.giz.de 13/05/14 Responsible Hari Natarajan Photo credits © GIZ/Enrico Fabian/Dharma Life XXX Seite ‹#›