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Acme Tele Power: Case for Renewables

December 29, 2010

Alok Goel, Vice-President, Sales and Marketing, ACME Tele Power 

There has been a lot of discussion on the adoption of renewable energy sources to meet the power needs of the telecom sector and reduce its dependence on conventional resources. But before the industry starts considering this option, it is essential to identify the key drivers for the transition towards renewable energy resources and ensure whether it is appropriate for the sector to make the shift.

The first factor that necessitates switching energy resources is the high costs involved with conventional sources of energy. For a long time, operators and infrastructure providers depended on diesel generators (DGs) to address the problem of inconsistent and unreliable power supply from conventional sources. But this dependence increased the demand for diesel, resulting in a 15 per cent rise in the cost of the fuel annually. Moreover, the government has been considering deregulating diesel prices, which would further increase fuel costs. Diesel pilferage also adds to the cost of the fuel.

Currently, energy accounts for 25 per cent of the telecom companies’ total operational costs. The gravity of the situation can be gauged from the fact that more than 10 per cent of the telecom towers have no grid supply while almost 50 per cent have much less than 12 hours of grid power availability. Voltage fluctuations even in areas with reliable power supply further necessitate the use of DG sets. These figures would fall further as the telecom industry focuses on rural and semi-urban areas, where the power supply scenario is worse than that in the cities. The number of telecom towers in the country is expected to increase from 337,000 to 463,000 by 2013.

From the regulatory point of view too, there is pressure on the industry to manage its energy needs. The country has committed to reduce carbon emissions by 20-25 per cent of the 2005 levels by 2020 under the mandatory fuel efficiency standards. The government has taken initiatives like the National Solar Mission, which provides subsidies to promote solar power capacities. Also, the Universal Service Obligation Fund invests in pilot projects using renewable energy at remote sites. Therefore, there is also a cost incentive for the industry to go green.

Solar, wind, biomass and fuel cells have been the major renewable options in the country. Each of them has its own advantages over DG sets. Solar power, for instance, can result in a potential saving of 3 kW DC load more than DG sets. It is the most widely adopted renewable energy option in India as it involves low maintenance costs, is more convenient to use than DG sets and is an environment-friendly solution. Although solar projects require high initial capex, the costs are justified in the long run.

The deployment of wind energy depends on the wind density of a location. The use of fuel cells, on the other hand, has not picked up due to the skewed supply of hydrogen in India, which is a key ingredient of the fuel. The demand for fuel cells is expected to increase once a supply chain for hydrogen is in place.

Another fuel option is biomass, which is abundantly available in the country. India produces over 320 million tonnes of agricultural residues every year and about 40 per cent of the country’s primary energy consumption is based on biomass. It is a cheaper and cleaner fuel option as compared to diesel, and can be exploited in land-rich rural areas. However, high investments and the need for a dedicated team to operate biogas plants are the major hindrances to the large-scale adoption of this fuel.

It is evident from the prevalent conditions that the industry needs to adopt renewable options on a large scale. It has been estimated that 118,000 renewable energy tower sites can save up to 2.5 billion litres of diesel every year. The regulations for carbon emissions also mandate a shift from the current practices. Therefore, for the industry to function efficiently in the long run, it is important to reduce the dependence on non-renewable energy sources.



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