- Shifting of power generation capacity toward non-coal sources
- Use of digital and communication technology to automate information gathering can help reduce costs
- Advanced technologies like distributed power solutions can help address the challenges of rural power distribution
By adopting non-traditional solutions India could increase access to power for more than 300m additional people by 2034, with annual per capita consumption of 1,800 kWh for those connected to the grid.
To meet this desired outcome India would require an additional 455 GW of installed capacity along with significant investments and operational improvements in transmission and distribution (T&D) networks.
Using traditional means to achieve these targets would require investments of almost US$ 900bn over the next two decades. To put things into perspective, India spent only US$ 120bn of the available US$ 170 billion in the Eleventh Five Year Plan on power infrastructure. Hence, achieving the Winning Leap target through traditional means would require current investments to be doubled on an annual basis.
India’s dependence on fossil fuels for energy generation has also resulted in high greenhouse emissions, with India being ranked fourth, behind China, the US and the EU in global emissions. Moreover, growing dependence on coal as a source will require increasing imports which may not be a viable solution for India’s economy in the long run.
The rural-urban divide in access to power also sounds a loud warning bell. In 2014, almost 31,000 villages in India had no access to electricity. Moreover, per capita consumption in rural households is estimated to be only one-third of average consumption in urban India.
All these factors strengthen the need for Winning Leap methods for India to achieve its universal access targets. Winning Leap solutions could save 20% of projected investment (US$ 200bn) to provide universal access to power while tripling consumption on a per capita basis. The Winning Leap ideas below address India’s power-related challenges.
1. Move toward a diverse energy mix - Given the limited availability of coal and the extensive carbon emissions from thermal power plants, India will need to shift its power generation capacity toward non-coal sources. Only then can it meet the increased need for power in an environmentally sustainable way. China, whose power is generated mostly by coal-based plants, is experiencing the consequences first-hand, including a high level of air pollution that’s raising alarms around the world.
2. Encourage private participation in transmission and distribution - As much as 24-30% of power generated is lost in transmission and distribution, including 15% lost to theft. Use of digital information and communications technology to automate information gathering can help reduce such losses, ultimately improving efficiency and reliability in production and distribution as well as lowering costs. Though a comprehensive smart grid may not be financially feasible in the near term for India, components of smart-grid solutions—such as integrated communication systems, sensing and measurement instruments, and smart meters— could help improve efficiency, reduce costs, balance demand and supply, and reduce wastage and loss of power. Such tools could also help consumers track and optimise their energy usage, thus reducing their utility bills.
Another idea for improving efficiency in the power system is to encourage private-sector participation in power retail. Utility customers want a better experience, including more pricing options, and private sector companies could satisfy this unmet need. India has historically invested more in power generation than power distribution. If private companies handled more distribution, the entire value chain could be strengthened.
3. Deploy advanced technologies - Investing and developing capabilities in advanced storage and distributed power could go a long way toward addressing the challenge of rural power distribution in India. Distributed power solutions generate power at or near the point of use and can be installed quickly, sometimes in weeks compared with years for traditional centralised power generation and distribution setup. Distributed power also enables a local level of control, management, and demand planning. In China, the government has defined policies aimed at increasing the share of distributed power. By 2015, China aspires to have 1,000 distributed power projects fuelled by natural gas, a solar-power capacity of 10GW, and 100 “showcase” cities receiving distributed power.
Diversifying and optimising fuel sources, focusing investments on transmission, strengthening R&D in advanced storage facilities, and bringing in smart-grid solution elements are examples of the non-linear moves that could benefit India’s power sector.