8th Knowledge Millennium Summit

2010-2020: DECADE OF INNOVATIONS

RENEWABLE ENERGY, FOOD SECURITY, HEALTHCARE & WATER

Universal Access to Energy The Indian Imperative

November 2010 www.deloitte.com/in

THE ASSOCIATED CHAMBERS OF COMMERCE AND INDUSTRY OF INDIA

Corporate Ofce: 1, Community Centre, Zamrudpur, Kailash Colony, New Delhi - 110 048 Phone: 011-46550555 (Hunting Line) Fax: 011- 46536481/82 46536498 E-mail: assocham@nic.in Website: www.assocham.org

MESSAGE

t gives me great pleasure to note that The Associated Chambers of Commerce and Industry of India is organizing the 8th Knowledge Millennium Summit 20102020: Decade of Innovaons on November 17-18, 2010 at New Delhi. This Summit is signicant because it is encompassing all the important sectors like food security, healthcare, energy & water. India as a naon oers tremendous opportunies to commercialize the innovaons already iniated by a number of companies across the globe as well as the innovaons parcularly suited to the demography of India. As a market of over a billion people, there is no beer place for the innovave companies to explore the Indian market and use this as an opportunity to innovate and commercialize their oerings parcularly in the elds of healthcare, food security, agriculture, energy and water. I congratulate ASSOCHAM for holding a Summit dedicated to innovaons in these elds and I wish the Summit a great success.

Dr (Mrs.) Swa Piramal President ASSOCHAM

Corporate Ofce: 1, Community Centre, Zamrudpur, Kailash Colony, New Delhi - 110 048 Phone: 011-46550555 (Hunting Line) Fax: 011- 46536481/82 46536498 E-mail: assocham@nic.in Website: www.assocham.org

THE ASSOCIATED CHAMBERS OF COMMERCE AND INDUSTRY OF INDIA

ACKNOWLEDGEMENT

t gives me immense pleasure that ASSOCHAM with the support of Ministry of Science & Technology is organizing the 8th Knowledge Millennium Summit 20102020: Decade of Innovaons. The 8th Knowledge Millennium Summit is of parcular signicance and importance as it is focused on innovaons in the decade of 2010-2020 which will drive the future of the country and world at large. ASSOCHAM by organizing this Summit intends to harness the potenal of innovaons in sectors like food security, healthcare, energy, and water. I thank Planning Commission, Ministry of Science & Technology, Ministry of Water Resources, Ministry of Food Processing Industries, Ministry of Earth Sciences, Ministry of New & Renewable Energy, Department of Bio Technology, Indian Council of Medical Research, Council of Scienc & Industrial Research, Indian Naonal Science Academy and the States of Karnataka, Gujarat & Maharashtra for their support. I also thank our Knowledge Partners Deloie, Ernst & Young, Frost & Sullivan & IIM Lucknow for their wonderful eorts in pung up the reports on Energy, Water, Healthcare & Food Security respecvely. I also wish to thank our all Sponsors & Media Partners for their overall support. I not only wish the Summit a great success but also assume that ASSOCHAM shall connue to organize such programs for larger public benets with great degree of excellence.

(D.S.Rawat) Secretary General ASSOCHAM

Introduction

A majority of the Indian population lives in numerous villages scattered all over India. According to the census conducted in 2001, a staggering 74% of Indian population lives in these villages. Most of the villages lack infrastructure and have difficult living conditions. Some are remote and are inaccessibly by road, while a few are so deep into the forests that no trace of urbanization is even seen among the rural population inhabiting those villages. In the past decade, a number of them have migrated to the cities to the lure of a better life. Even though a huge number of rural populace has migrated to the urban centers, still a large share of the Indian population resides in the villages. Most recent survey shows the rural population at 72.2%, proving that even today the majority of the Indian population lives in villages and this is bound to change at a slow pace in the next few decades. Though the Indian population has been growing at a rate of 1.55% since 1961, its energy consumption has been growing at a rate of over 6% Compunded Annual Growth Rate (CAGR_ between the years 20042008, mainly driven by its economic growth, which has been estimated by International Monetary Fund (IMF) to reach approximately 9% next year. Considering that the economic growth is sustained for the next few years, the energy requirement for India is pretty high.

It may be hard to believe but approx 1.6 billion people in the world have no access to energy and one third of them are in India. Lack of access to energy is a serious hindrance to social and economical development. Cost effectiveness is also an important factor to increase the access to the poor in remote areas as most of the people in remote rural areas depend on biomass, including wood, charcoal, tree leaves, crop residues and animal dung. And the share of people relying on biomass is one of highest in India. Extending the grid in rural areas may not be cost effective hence small, stand alone renewable energy technologies can often meet the needs of the rural communities in a cheaper manner and it also has the potential to displace relatively costly crude based captive power generation. The focus of this report is to discuss rural energy scenarios in India and the need of technological innovations in increasing universal access to energy. Total Energy Consumption of India

Renewable 27% Nuclear 1% Hydro 2% Natural Gas 5% Oil 24%

Coal 41%

Figure 1 Energy Mix of India (Source: IEA)

Renewable Energy shown in the energy mix above constitutes amongst others Solar, Wind, Biomass. Further splitting down the renewable energy mix, we can observe from the table that there is immense potential to use the renewable energy to provide electricity to the rural regions.

No I A 1 2 3 4 5 6 B 7 8 9 10 11 II 12 13

Programmes/Systems Power From Renewables Grid-interactive renewable power Biomass Power (Agro residues & Plantations) Wind Power Small Hydro Power (up to 25 MW) Cogeneration-bagasse Waste to Energy (Urban & industrial) Solar power TOTAL Off-Grid/Distributed Renewable Power including captive/ CHP plants Biomass / Cogeneration (non-bagasse) Biomass Gasifier Energy Recovery from Waste Solar PV Power plants Aero-generator / hybrid systems TOTAL Decentralized Renewable Energy system Family Type Biogas Plants (nos) Solar Photovoltaic System I. Street Lighting Systems (nos) II.Home Lighting Systems (nos) III.Solar Lanterns (nos)

Estmated Potential

Achievement during 200910

Cumulative Achievement

16,881 45,195 15,000 5,000 2,700 50 MW/sq.km

126,50 MW 683.00 MW 129.00 MW 259.00 MW 4.72 MW 6.10 MW 1,208.47 MW 39.,80 MW 4,10 MWeq 9.32 MWeq 105.15 kWp 105.00 kW 53.43 MWeq

829.50 MW 10.925.00 MW 2,558.92 MW 1,308.00 MW 65.01 MW 9.13 MW 15,694.56 MW 210.57 MW 109.62 MWeq 40.25 MWeq 2.410 MWeq 0.954 MW 363.804 MWeq 41,85,442 88,297 5,84,461 7,92,285

120 Lakh

51,732

8,880 71,632 82,999 140 million

14

Solar Thermal programme I.Solar Water Heating Systems- collector area (m2) II.Solar cookers (nos) Wind Pumps (nos) Solar Photovoltaic Pumps (nos) Remote Village Electrification Other Programmes Energy Parks (nos) Aditya Solar Shps (nos) Batter operated Vehicles (nos)

0.50 million 0.02 lakh 5 106 703 villages and halmets 3 9 1

3.40 million 6.39 lakh 1,347 7,334 5000 villages /1257 halmets

15 16 III IV 17 18 19

513 302 305

Mweq = Megawatt equivalent, MW= megawatt, KW= Kilowatt,kWp= Kilowatt,peak; sq=square meter

Figure 2 Details of Estimated Renewable Energy potential, Achievement & Cumulative Achievements under different Programmes (as on 31.12.2009) (Source: Ministry of Renewable Energy, Government of India)

Tradition fuel is a term that is used to describe fuels such as wood, charcoal, dung, and biomass (among other materials). These fuels have been used before the industrial age and are used today in various rural areas of the world. These traditional fuels are also called biofuels sometimes. The modern fuels refer to the usage of liquid fuels, coal, electricity, renewable energy, etc. Very often we hear about policies and effects of the modern fuels. Most of the policies are overwhelmingly associated with production and consumption of modern energy forms. While the world focuses on the modern energy forms, it is often forgotten that over a half of the developing countries lack access to the modern energy sources. Over 2 billion people in the world survive on the traditional fuels such as animal dung, wood, charcoal, etc. for cooking, and an equal number lacks access to electricity. It is a well known fact that wood, charcoal, have very low efficiencies (e.g.: gas is approximately 10 times more efficient), and burning of wood also poses a threat to the health of the population due to inhalation of smoke. A few studies have shown that affordable interventions, such as a use of a stove with traditional fuels can reduce respiratory infections among infants and young children. Wood usage also encourages deforestation, thereby adversely affecting the environment.

Not only are these traditional fuels economically beneficial, as they require a large amount of time invested in collection and gathering, but also are detrimental to the rural society. Though traditional fuels can be used more efficiently and in ways less damaging to the environment and to peoples health, much of the time and money has not been invested because of the focus on modern energy fuels. The definition of access to energy accepted by the United Nations is as follows, Access to modern energy can be defined as a households ability to obtain an energy service, should it decide to do so. Access is a function of availability and affordability. For energy to be considered available to a household, the household must be within the economic connection and supply range of the energy network or supplier. Affordability refers to the ability of the household to pay the up-front connection cost (or first cost) and energy usage costs. A high up-front cost may discourage poor households from making a switch to a modern energy form. With the global population on the rise the overall energy consumption is bound to grow. Most of the requirement is bound to come from the urban sector due to the industrial growth and also due to an increased percentage of urban population. Though the population of a few countries is

higher than the population of the developed countries, the per capita consumption is miniscule in comparison. Though the PPP adjusted GDPs paint a positive picture the per capita consumption of these nations tell us a different story. This proves that there is a section of the society which has a

requirement and that requirement is not met. This is an uncontested space and is left to be explored. Already this uncontested market has attracted a few people and is driving the movement to provide the rural population with affordable energy.

Figure 3 Global Energy use (kg of oil equivalent per capita) (Source: World Bank Data)

Figure 4 Global Electric power consumption (kWh per capita) (Source: World Band Data)

Rural Energy Scenario in India

India is country of extremes. It is a home to one of the richest men of the world, and also has a very high percentage of poor. Per capita income levels in India are among the lowest of all the nations in the world. One of the reasons that can be attributed to this poverty is the fact that its rural population is energy poor. Lack of access to modern energy services is a direct outcome of income poverty. The poor cannot afford to pay for the modern energy systems, and hence cannot improve their income levels, thus giving birth to vicious cycle. Their inaccessibility to modern sources of energy is also because of the locations they live in. Most of the poor live in sub-standard houses, in remote locations, which make them, unfit to be connected to the modern energy systems. Lack of proper roads and other infrastructure makes it even more difficult to provide these energy systems. Therefore, un-affordability and inaccessibility are the main reasons the poor dont have access to modern energy. Energy not only provides light and access to modern electrical appliances but as an effect can cause a huge effect on economic development, livelihoods, social dignity, and environmental sustainability. There have been studies that relate the high access of energy to the reduction of poverty. To break free from the vicious cycle of linked events, the United Nations Development Programmes (UNDP) has listed a set of

Millennium Development Goals (MDGs). A lot of organizations and NGOs have taken the MDGs seriously and identified their linkage to energy access. Though everyone is aware of the linkages between the development and energy access, not many national and international actions have taken place in this direction. Mainly the supply-side has dictated the energy development, while the demand-side has always been neglected. There is a demand that exists at the bottom of the pyramid, and a business directed at achieving this can not only reap benefits but can also see an eco-sociological change among the millions and influence the life of many. Energy service for sustainable development has not been the focus of energy planning until recently. The focus of energy sector, ever since the discovery of modern fuels, has been on to expand the capacities of oil refinery capacities, and on maintaining a steady supply of fossil fuels. After a massive price fluctuation of the modern fuels, the urban population understands the need to develop of sustainable energy alternative. This is a positive development for the rural population, as it will spur research to develop cost-effective solutions that not only are reliable but also sustainable. A report by National Sample Survey of India (NSSO) in 2007, three quarters of the Indian villages were electrified, but only

55% of the households had access to electricity, while the remaining mainly were dependant on kerosene for lighting. The situation for modern cooking fuels was graver. Only a 10 of the rural households had access to LPG, and the majority of them depended on biomass for their cooking energy needs. This disparity in the availability of modern cooking fuels presents a pressing issue that needs to be addressed to change the lives of these rural households.
th

Low Income Biomass LPG Dung Kerosene Coal Biogas Electricity Others Total 44.3 0.4 5.0 0.2 0.5 0.0 0.0 2.7 53.1

Middle Income 59.7 5.2 7.3 1.0 0.6 0.2 0.0 3.3 77.33

High Income 10.5 7.5 1.5 0.8 0.2 0.2 0.0 1.5 22.24

Total 114.5 13.1 13.8 2 1.3 0.4 0.07 7.5

Figure 5 Number of rural households using a particular energy carrier as a primary cooking fuel (Source: NSSO 2007)

Number of Rural Households' source of cooking energy (in millions)

High Income Biomass LPG Dung Middle Income Kerosene Coal Biogas Electricity Low Income Others

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

Figure 6 Number of rural households using a particular energy carrier as a primary (Source: NSSO 2007)

As seen from the graph above, a maximum percentage of the cooking energy can be attributed to biomass. The dominance of biomass is due to the ready availability of the sources of biomass (including cattle dung) in rural India. A very small percentage of fuels that are seen in the figure above can be attributed to modern fuels such as LPG, Kerosene, etc. According to the National Sample Survey Organisation (NSSO), approximately 84% of the cooking fuel requirements in the rural households are met by Biomass. A very small percentage of modern fuels are used in the rural households. Biomass is expected to retain the dominance among the rural cooking fuels for the foreseeable future. A study, conducte by Planning Commission in 2006, estimates the percentage of Biomass to remain at 52% in 2031-2032. The remaining demand is forecasted to be met by the modern fuels and other sources.
Figure 7 Rural Cooking Fuel Dependencies (Source: NSSO 2007)

LPG, 8.6% Kerosen e, 1.3%

Others, 6.0%

Biomass, 84.1%

An analysis conducted by the Harvard Kennedy School shows the relationship between the modern cooking fuels and the rural household incomes. The relationship between rural energy poverty and income poverty is quite evident when one looks at the graph depicting the access of energy in relation to the Monthly per capita expenditure.

Figure 8 Access to modern energy carriers for cooking and rural poverty in 2005 (Source: Harvard Kennedy School)

Figure 9 Trends in household access to modern cooking fuels (Source: Harvard Kennedy School)

The two graphs above portray a very disheartening picture. The percentage access to modern fuels indeed depends on the income levels and the difference of percentage access to modern fuels between the urban and rural population has been growing since the 80s. Though the government is promoting higher penetration in urban and rural population, the rate of penetration should be higher in the rural populations to decrease this glaring difference between rural and urban modern fuel access.

Avenues of Rural Energy Distribution

Small/Mini/Micro Hydro Technology

Water has always served a source of development. It is used for irrigation and farming, it is used for consumption, and it is used for washing and other miscellaneous purposes. It has a ubiquitous presence, barring a few regions in the world, and over the years has served as a force of nature. Water power can be harnessed in many ways. But all the ways in principle are controlling the rate of flow of water that is directed to a turbine, which in turn generates electricity. Dams have been built to control the flow rate of water and produce large quantities of electricity. Recently, research is being done in the field of ocean energy. This research aims to capture the energy of the ocean waves thereby adding a sustainable energy source to the energy portfolio of the world. Small hydro power is no different from the hydro power generation, except for the fact that it produces small amount of energy and does not require huge capital costs that the larger hydro projects require. Small Hydro Projects (SHP) typically produce 5KW 15MW of electricity. Small Hydro Projects (SHPs) are advantageous to rural conditions because of their small size and portability. Time and

again, projects in remote villages have proven the effectiveness of these SHPs. SHPs have been set up in villages that lie on the banks of rivers, and where the flow of the river can be used to harness electricity. A typical small hydro project requires a settling tank, a forebay tank, a penstock for the water to flow, a powerhouse containing the turbine at the end of the penstock, and cables to distribute the energy. Depending on the end user requirement, the power from the turbine can be directly used for mechanical purposes or can be connected to an electric generator to produce electricity. Many rural industrial applications require the raw mechanical power to grind, mill, etc. and some also do require electric power. For domestic use, the power generated by the electric generator can be sent to different homes via an electricity distribution system, or can be supplied via batteries, which can be periodically charged at the turbine. Steep rivers flowing all around the year provide an ideal condition for a SHP. Usually such conditions exist in villages in and around the hills, and in various valleys. In India, the Hind-Kush Himalayan region is an idea set up for the small hydro project.

In India, United Nations Development Program (UNDP) funded a small hydro project in Kerala with the help of the NGO, Mallanadu Development Society. Investing a total sum of $22,000 the project gained experience by do-and-learn approach. The community where this project was executed (a remote village called Thulapally) now has its own power system and now is more interested in preserving its own forest system than before (when it used the forest wood as an energy source). The community pays a small amount to maintain the power generation and since the project generates power for local use, there is hardly any transmission and distribution loss. Benefits of SHPs: Elimination of the usage of firewood Protection of the environment surrounding the rural village Improvement of indoor air-quality and therefore the reduction of respiratory illnesses Presence of light at night enables the children to study more conveniently Time spent on collecting wood is now spent on generating income Sense of ownership among the local residents and creates a caring community Low capital investment

Low maintenance charges To increase the attractiveness of the small hydro projects, innovation in this area has been propagated. These innovations aim to address a different situation which is not the primary purpose for the hydro project setup. A few of the following are innovations in that direction, Installation of small hydro projects within drinking water supply systems Installation of SHPs within irrigation systems Installation of SHPs within wastewater treatment plants Improvement in flood protection Improvement in ecological performance A major innovation that has taken place in the small hydro energy space is the usage o pico-hydro systems. Water falls into the propeller at the bottom of the pico-hydro unit, making the shaft turn. As the shaft rotates, it turns an alternator in the upper part of the unit to create an AC-electricity supply. The advantages of pico-hydro systems are the requirement of low head (approximately 1.5m), low flow rate (approximately 35ltrs/sec), affordable price, and portability. These advantages make it an ideal candidate as a rural energy system. The low cost is a very attractive factor to attract the poor. The low water

head makes it convenient to many households. These systems are small and can be maintained by the household on a day to day basis. Because of the simplicity of installation, often the safety aspect is overlooked, creating a hazardous situation often. As the power cannot be regulated by these pico-hydro systems, a power surge is a possibility and this surge may destroy the appliances using the power generated. These pico-hydro systems generate approximately 1KW-5KW of electricity and are mainly used to for lighting. A few larger pico-systems have also been used to power televisions, CD players, video players, etc. Innovative business models can also be used to make SHPs more attractive to the rural community. A business model that leases out a small-hydro system to a rural community as a whole will reduce the capital investment by the rural folk and make it attractive. The project can cover its costs by delegating the responsibility to the community leader, who can collect the monthly rental from all the individuals who use the electricity generated. A flat rate

system can be used to level the field for everyone. Since the energy usage is limited to a few appliances in the rural regions, a simple tariff system can be developed which would not require any metering. This collaborative model includes everyone in the village as a share holder of this project and once the community sees the benefits of having electricity, it will appreciate the project even more. SHPs have been used across the globe in countries such as Nepal, Sudan, Peru, etc. and have successfully helped the rural community and bettered the lives of the many in that community. India has a large percentage of low-income population and a large percentage of rural population that can benefit from the Small Hydro Projects. Private participation may be encouraged in this segment by providing tax incentives, or by encouraging CSR activities in the burgeoning economy.

Solar
Electricity consumption in India, currently about 600 Twh annually, is set to double by the next decade; by then it would have surpassed Russian levels in the process and in order to supply this extra electricity, total generating capacity needs to increase substantially by 332 GW to 488 GW. Coal, which already provides almost 52% of Indias power, is expected to remain the dominant primary fuel. With Indias commitment to the world on its per capita carbon emission targets and reducing carbon intensity by 20-25%, openings exist for renewable, nuclear and gas power to increase their share in the fuel mix for the additional power capacities. India's geographical location coupled with various schemes and incentives announced by the government is aimed at accelerating the growth momentum of the Indian solar power Industry from both capacity and generation perspective. The Government through the Jawaharlal Nehru National Solar Mission (NSM), launched in January 2010, has set a target of setting up 20,000 MW of solar power by 2022. The Government of India (GoI) has initiated many schemes such as providing subsidy, tax holiday and accelerated depreciation for power producers, concessional duty on the imports of raw material, soft loan, elimination of excise duty on specific devices/systems, etc. to

increase the production as well as use of solar energy in the country. Given that the focus of the latest regulations is directed at developing generating capacity, the incentive mechanisms are considered on a normative cost plus basis where offerings of higher tariff to solar power producers considers an attractive pre-tax return on equity of 19% for first 10 years and 24% thereafter. Apart from this, the NSM has set a target of establishing 20 million square meter solar collector area and 2000 MW of distributed off-grid applications by the end of 2022. Additionally, the Special Incentive Package (which expired in March 2010) under the Semiconductor Policy in India had attracted investments to the tune of USD 18 billion by manufacturers of PV equipment. Similar policy is also being considered for Solar Thermal equipment manufacturing. Investors in solar power also stand to gain greatly from the implementation of a renewable energy certificate trading system as it could augment the chances of the development of solar farms, which are currently dependent on government subsidies. India has one of the largest power generation capacities; however, it still is one of the lowest consumers of power on a per capita basis at about 610kwh. Given that typically power consumption is a supplycentric phenomenon in large developing

countries, India has a long way to go before even parity between peak power supply and demand may be achieved.

____________________________________ Our people have a right to economic and social development and to discard the ignominy of widespread poverty. For this we need rapid economic growth. But I also believe that ecologically sustainable development need not be in contradiction to achieving our growth objectives. In fact, we must have a broader perspective on development. It must include the quality of life, not merely the quantitative accretion of goods and services. Our people want higher standards of living, but they also want clean water to drink, fresh air to breathe and green earth to walk on.

- Dr. Manmohan Singh, Prime Minister of India

In light of this vision, India subscribes to the view of a global goal for temperature increase not to exceed 2 degrees Celsius by 2050 from mid-19th century levels. India has been working towards a sustainable development of the economy keeping in mind the resultant impact on climate change. India has committed targeting a further emissions intensity decline of 20-25% by 2020 on 2005 levels. It has declared that its per capita emissions will never exceed the per capita emissions of the developed countries even after accounting aggressive emission reduction targets of such countries. India also has a strategic and economic reason to focus on renewable energy, in particular solar: En-cash upon the vast renewable resources including solar, hydro, wind and biomass available within the country Address energy security by reducing its dependence on imported feedstock Control rising carbon emission from new power generating capacities Meet the Power for All by 2012 target by reaching remote locations which are difficult or economically unviable through distributed systems

Utilize the opportunity to become a manufacturing and R&D hub for solar power globally Reduce capital cost of solar power With this objective of addressing climate change issues and at the same time managing economic growth, the Government has prepared the National Action Plan on Climate Change (NAPCC) with the objective of preparing a strategy and action plan for adaptation and mitigation mechanisms for India to address the climate change challenge. The strategy of NAPCC is focused on: Increasing the proportion of renewable energy sources in fuel mix of the new capacities created to meet growing power demand Promoting energy efficiency Conservation of national resources Increasing carbon sink For the purpose, NAPCC has identified 8 missions of which the first one launched is the Jawaharlal Nehru National Solar Mission. Amongst all the renewable resources potential available within India, Solar has the maximum potential; it is the least tapped despite having some of the more favorable conditions globally.

With NAPCC targeting a 5% share of renewable energy purchase in total energy in 2009-10 and increasing by 1% every year for next 10 years, solar power is expected to gain a major share of this demand. India has one of the worlds highest solar intensities in the world with annual solar yield of 1700 to 1900 kwh per kwpeak (Kwh/Kwp). This is equivalent to 5,550 trillion Wh energy potential per year.

Blessings of the Sun on India: Most of the country receives more than 4 kWh/m2 /day About 300 sunny days in the most part of the country Solar Thermal and Photo Voltaic, both can be harnessed It is interesting to note that, even with tapping 1% of the land area at 10% efficiency factors it is expected to generate around 54 billion Whrs of power per annum. However, current installed capacity of gridconnected solar power within the country is only about 6 MW. In order to leverage this key solar advantage, the NSM has set an aggressive target of creating 20 GW of solar power generation capacity by 2022. To facilitate this process of enabling development of both capacity and generation as planned, the Government of India is taking various steps which are positively directed with articulating a Mission Statement followed up

Figure 2 Solar Radiation map of India

with a revamp of the Regulations focused at increasing serious participation in the sector.

Though blessed with a large number of sunny days, the penetration of solar energy has been limited in India. Rural households particularly present ideal conditions for the usage of photovoltaic systems. Photovoltaic systems are portable, increasingly affordable and require minimal maintenance. Aside from pollutants expelled during the manufacturing process, photovoltaic systems did not create a waste stream. By converting a free and abundant source of energy into direct current electricity, photovoltaic technologies may be used to power a wide variety of appliances from basic lighting to refrigerators. Photovoltaic systems may be installed by an individual household or may be linked

together to form a grid with sufficient energy production to power an entire community. Finally, when linked with appropriate financing mechanisms, photovoltaic systems represent a cost-effective tool for securing needed electrical capacity. Photovoltaic technologies hold great potential for extending electrification into rural areas of developing countries. Certain projects in Africa, with the help of Rural Energy foundation, were successful in setting up satellites that connected these remote villages to the rest of the world. This connectivity not only helped the young to gain knowledge from around the world, but also provided the rural community a feeling of connectivity to the rest of the world.

Another organization that has made use of solar energy to uplift the life of a rural household is Solar Electric Light Fund (SELF). SELF believes that energy access is a human right, and without the access to energy community development becomes almost impossible. SELF is currently assisting in using cost-effective photovoltaic systems and LEDs for a project called $300 house, which plans to provide model homes for the urban slum dwellers. This model house aims to capture all the basic requirements of a person, without compromising the aspect of sustainability. SELF, through its experience in bottom of the pyramid markets, has developed a model called Solar Integrated Development model. In essence it is a maturity model for Total Village Empowerment. Using this model SELF plans to empower a village in a step by step manner. By using solar power pumps and filters access to water is improved. This access to water improves the crop yield, providing a good supply of food. Availability of adequate food creates healthy children and increasingly healthy population. Health is also improved by using solar energy to store vaccines at appropriate temperatures and enabling doctors to treat the patients at night. Education is improved due to classrooms powered by solar lamps. Children can study at night and internet accessibility is possible due to a solar powered satellite in the

village. All these activities provide ample opportunity for the members in the community to start their own businesses to support these activities. Thereby bringing in an economy that is sustainable and that uplifts the villages standard of living.

Government should implement innovative models such as the SID model. Helping in small clusters will be beneficial to a family but will not bring about a sizeable change in the complete village or rural population. To draw the complete power of the solar energy, government should look at rural development holistically and should device policies keeping that in mind. Following the SID model and providing the necessary equipment at each stage will bring about a complete economical empowerment in a village. Among the many innovative models to make solar energy attractive among the poor, one model that stands out is the Distributed Energy model. The Sun Shines for All (TSSFA) project makes use of this model. What this project aimed to achieve was to not subsidize the cost of solar

products, but by leasing the products to the poor, increase their income to the level where they can afford the market price of the solar products. TSSFA gave the poor solar equipment, which they termed as a solar energy package, which would give them light and 12V power outlets. For the access to electricity, the poor paid the foundation a small fee every month. This business model was developed in such a way that the company would break even after four years, eliminate the cost of purchase, & make them affordable. The foundation has run this project in rural parts of Brazil and a similar project could be used in India to improve the lives of millions. Burgeoning micro-finance industry has a very deep network in the rural areas of the country. This network can be used to collect the rental payments, thereby reducing the costs even further. Rural electrification supported by renewable resources allows individuals to benefit from electricity without polluting their environment. Indoor air quality may be improved as solar stoves replace traditional indoor fireplaces. Women and children can dedicate less time to foraging for fuel wood while evening lighting permits weaving or studying at night. Rural health centers can refrigerate vaccines and PV powered water pumps can permit families to draw water from deeper wells. In short, PV technologies offer a broad range of

solutions to the challenges of sustainable development.

Biomass/Biogas
India, being an agricultural country, has a large biomass resource. If harnessed correctly, this vast resource can be used to generate energy for the rural households. Due to lack of awareness among local farmers, the biomass resources are not effectively used. Biomass energy is created using crop residues and animal wastes (mainly cow dung in India). Biomass energy products include biogas, electricity from biomass power generation, and various biofuels. These systems can be affordably established at both household and livestock farm scales, use readily available agricultural wastes, have few recurrent costs, need no highly specialized skills, and

have high potential for extra revenues through the Clean Development Mechanism because of the potential for greenhouse gas reduction. Some of the benefits of biomass to the rural energy sector are, Biomass is renewable and therefore can be sustainable resource Transportation of biomass is not economically viable and therefore makes it a local resource, which the villages can use to benefit from (without the possibility of big corporations taking over and diverting it to other places) India is rich with biomass resources and therefore offers a plenty supply of the source fuel Biomass is a clean energy and is safe for the environment Waste reduction is a windfall of the biomass energy generation Though, Biomass is readily available in rural communities and is used even today. But to use them without causing harm to the households has been the main challenge. Biofuels, which are different forms of energy derived from biomass, help the generation of energy in a better way. Biofuels are mainly of three types, namely solid biofuels

(wood pellets, wood chips, etc.), liquid biofuels (biodiesel, bioethanol, etc.), & gaseous biofuels (biogas, and syngas). Research to improve the lives of the rural households making use of this sustainable resource has been active for a while. Technological innovations to improve the usage of biomass have brought about better cooking systems and family sized biogas gasifies providing 3-4 cubic meter gas per day. The government has tried to increase its penetration and is still working on increasing the usage of biogas based systems in the villages. Innovations in extracting more out of biomass have led to the development of biomass technologies for thermal and electricity generation applications. Gasifier technology has penetrated the applications such as village electrification, captive power generation, & process heat generation in industries producing biomass waste. Innovative modifications of existing generator sets, such as a mobile 7 KW dual-fuel power set have been designed by TERI. Dual-fuel plants with larger generating capacities have also been developed where there was need.

Figure 11 Schematic of a 40-kilowatt dual-fuel gasifier system at TERI's Gurgaon facility (Source: TERI)

TERI has periodically innovated the biomass systems for small scale power generation, leading to the development of systems in the range of 3.5KWe to 100KWe. One of the TERIs innovations has been in the work of its gasifier systems. As quoted by TERI, TERIs gasifier system comprises a downdraft throat-less gasifier, has multi-fuel capability and end-use flexibility. Fuel wood or briquettes produced from agricultural residues can be used in this gasifier. The throat less design makes for smooth fuel movement, with the gasifier allowing comparatively larger pieces of wood or fuel briquettes. Water seal arrangement with continuous grate-shaking mechanism simplifies ash and char removal without shutting down the system, thus enabling long uninterrupted operation. Entry of preheated air at two levels helps obtain good quality gas, with low impurities in raw gas. This also reduces the load on the gascleaning system. Induction of a cooling tower minimizes water requirement for gas cleaning and also reduces the quantities of tar-laden water to be disposed of. TERI has also innovative designs of modified engines that use only producer gas. Water pumps that are used for irrigation can immensely benefit from these low cost innovations. TERI has successfully installed these gasifier systems in Orissa and Uttaranchal. It plans to install more such innovations in the future. There have

been other biomass innovations but they are not yet cost-effective for rural usage. To benefit the poor, the biomass innovations should be cost-effective, efficient, and sustainable. In a country such as India, where a large percentage of the population is below the poverty line, continuous cost-innovation is required. There are a number of universities and innovators who have been working to come up with cheap solutions for biomass, with the hope that these cheap solutions can be either home-made or attract a large rural population. One such innovation has been the Experimental biogas unit design. This design aims to achieve low cost, home production, easy capacity addition, and use of kitchen waste along with biomass (i.e. multiple resource usage). This design is still in the experimental stage (as reported by http://www.indg.gov.in/).

Figure 3 Experimental biogas unit design (Source: http://www.indg.gov.in/)

Another low-cost solution that has been developed is that of a Biomass gas stove developed by Dr. A. Sampathrajan. This simple stove is a cylindrical drum made of clay, sand & paddy husk. It is 290 mm in diameter & 630 mm in height. Biomass is held by an iron gate, which is fixed at 50m from the bottom. It also has outlets for ash removal and secondary air supply. This biomass gas stove works on updraft gasification and can make use of materials such as woodchips, agricultural residue, dry leaves, barks, etc. Biomass is dumped over ignited charcoal to operate the stove. According to Dr. Sampathrajan, this stove increases the thermal efficiency by 23-25% and saves 10% in fuel and 40% in time compared to the conventional wood stove.

There have been other innovations that have been promoted by big corporations. One such innovation has been the Oorja smokeless biomass stove, which is promoted by BP Energy India. Over 5000 rural households in Madurai and Virudhnagar have benefitted from this smokeless stove. This stove was manufactured with inputs from Indian Institute of Sciences, Bangalore and promoted by BP. It was manufactured with a small cost of `675, making it affordable to the poor. An analysis by the Hindu news paper showed that the cost of cooking also reduced by almost 50% due to the usage of the Oorja stove.

Conclusion

For a sustainable GDP growth, it is important to have access to affordable energy sources in the remotest areas. Rural Energy Penetration helps in: Development an ecosystem including NGOs, private and public sector in expanding reliable and affordable energy access to the poor Empowerment of local rural communities and it leads to sustainable benefits. Scaling up of clean, safe, affordable and accessible energy sources and services Connecting rural areas with rest of the world. Improved education opportunities hence Socio-economical growth. Preparing the rural community for natural disasters due to improved connectivity and communication

Promoting new approaches and methodologies for affordable modern energy sources. To summarize universal access to energy at the household level depends on various factors such as prioritizing energy access and long term policy commitment by national government, creating of strong institutional, regulatory and legal frameworks and financing from all available sources. It is important that government facilitate support from national and international development organizations on research, design and development of appropriate technologies. In rural areas reliance on renewable energy and use of locally produced bio-energy to generate is important. Collecting, compiling and sharing knowledge is also equally important.

Contributors

Kalpana Jain
Senior Director kajain@deloitte.com

Neeraj Gupta
Senior Manager negupta@deloitte.com

Vikas Reddy
Assistant Manager vreddy@deloitte.com

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