Countries across the world have devised strategies to address the challenge of climate change. Most of them have prepared action plans and set emission targets. India is also gearing up to be a part of this green initiative. The government launched the National Action Plan for Climate Change in June 2008, announcing voluntary targets for 2020 to develop a low-carbon economy. India has also set a target to cut the emission intensity of the GDP by 20-25 per cent by 2020 as compared to the 2005 levels.
Being the largest diesel consuming industry in the country, the telecom sector is responsible for 5.2 million tonnes (mt) of annual CO2 emissions (of the total 13 mt) and accounts for over 2 per cent of the country?s total greenhouse gas emissions. According to a study by AT Kearney, almost 50 per cent of the sector?s current carbon footprint can be attributed to diesel use.
Recognising the seriousness of the issue, the Telecom Regulatory Authority of India (TRAI) has recommended that all tower companies set carbon emission reduction targets for mobile networks at 5 per cent by 2012-13, 8 per cent by 2014-15, 12 per cent by 2016-17 and 17 per cent by 2018-19.
Accepting TRAIs recommendations, the Department of Telecommunications (DoT) has issued a directive to all operators stating that at least 50 per cent of rural towers and 33 per cent of urban towers be powered by renewable energy by 2015. Operators and tower companies are against this move. According to them, several regions do not have the solar and wind resources required to meet these targets due to the country?s varying topography.
However, the telecom industry, in particular, has been proactive in developing strategies to reduce its carbon footprint. Service providers, tower companies and equipment manufacturers are innovating and developing new products and solutions that help in improving energy efficiency and reduce carbon emissions. Besides the provision of energy efficient equipment, renewable energy solutions are being promoted on a large scale. The currently available alternative energy options are solar power, fuel cells, wind energy and biomass technology. Among these, solar power and fuel cells have witnessed the highest adoption.
Implementing green solutions
Tower operation, which is the largest energy consuming segment in the telecom sector, has been at the forefront of initiatives for a transition to greener technologies.
Bharti Infratel?s GreenTowers P7 programme has been a key initiative in this regard. It is a comprehensive energy management plan including seven energy efficiency subprojects and involves the deployment of clean energy technologies like solar power (solar photovoltaic [PV]), free cooling and fuel cells. It aims to reduce carbon dioxide emissions by 0.15 million mt per year, while decreasing the dependence on diesel generators (DGs) for backup power. Bharti Infratel, which has 33,000 towers across seven circles, has already installed solar power generation facilities at over 1,350 sites. The capacity of these systems is 3-10 kWh, depending on the number of tenants.
The company currently has over 6 MW of operational solar installations on its tower network, and has tried and tested other clean energy solutions including wind power. ?These are currently at different stages of deployment,? says Sairam Prasad, chief technology officer, Bharti Infratel.
The company is looking to add 1,000 solar sites by March 2013 and another 3,000 in the next two years. It also aims to operate over 500 sites on fuel cells, while the use of biomass and wind power technologies is at an experimental stage.
Another major infrastructure company, Indus Towers, which has a portfolio of about 112,000 towers across 16 telecom circles, has taken major strides towards reducing its carbon footprint ? its diesel consumption dropped from 475 million litres in 2009-10 to 425 million litres in 2010-11. The company aims to operate
20 per cent of its sites on renewable energy by end-2013, implying that around 20,000 sites will be diesel-free by the targeted period.
GTL Infrastructure has installed various green solutions at its sites. It has deployed cooling units instead of air conditioners at over 6,000 sites. These units utilise cool ambient air when the site temperature is high. ?Another major green initiative is the deployment of solar PV cells at tower sites. This enables operations without grid power, thereby reducing our dependence on DGs,? says Tushar Kapadia, vice-president, strategic initiatives, GTL Infrastructure. Like most other tower operators, GTL has introduced fuel optimiser controllers to optimise DG operations.
Another green initiative by GTL is the introduction of modified DGs running on biodiesel. So far, the company has installed these modified DGs at 6,500 sites, which is estimated to reduce its carbon footprint by 14,000 mt of CO2 per annum.
Moreover, Viom Networks, which operates around 38,000 towers, plans to power 2,000 sites through solar energy by 2013. This is part of the company?s aim to operate 25-30 per cent of its towers on alternative energy.
Meanwhile, telecom service provider Idea Cellular is experimenting with hybrid solar solutions for powering base transceiver stations (BTSs) in rural Bihar. The company has contracted Gemini Communications to install solar power systems at 1,000 tower sites in the Bihar circle by 2013.
Telecom companies are increasingly opting for solar power solutions not only for their tower operations, but also for backhaul systems like microwaves and VSATs. For instance, Tata Teleservices Limited uses solar power systems supplied by Tata BP Solar at 2,000 VSAT sites. Also, Bharti Airtel has sourced three solar PV systems valued at Rs 1.7 million each from the same supplier for installation at three microwave points in the Bihar circle.
Roadblocks
Though the sector is focusing on green energy solutions and models, several challenges are being faced in deploying them. These include a high initial capex, space constraints, energy storage issues, and the lack of skilled manpower and complete solutions providers.
Evaluation of the viability and suitability of tower sites for a specific technology is the first challenge for tower companies. In most cases, the information available on direct normal irradiance (for solar sites) and biomass feedstock availability (for bioenergy projects) is inadequate or inaccurate.
For example, erratic resource availability and space constraints are the key challenges in operating gensets on solar energy, whereas wind-powered gensets are not suitable for low energy requirements and involve a high capex. ?Renewable energy solutions involve significant space requirements and telecom tower companies may not have such large spaces at most of their sites,? says Kapadia. Tower companies are now focusing on the renewable energy service company (resco) model introduced by the Tower and Infrastructure Providers? Association (TAIPA).
The resco model
TAIPA has issued a request for proposal for rescos to work with tower companies. According to the proposal, the biggest challenge for the viability of these companies is the lack of scale. TAIPA has proposed that the tower companies act as anchor clients for a resco in a particular rural area. It can then provide energy to the area (electricity generated for a BTS can also be used by common service centres or ATMs) apart from the tower companies, which would provide revenue assurance by reducing the cost-price gap. Therefore, the model envisages the aggregation of power demand by all tower companies in a particular area to achieve scale. Its success depends on the commitment to remain anchor clients for a long tenure ? probably 10 years.
Some tower companies have implemented pilot projects, but there are several challenges in the large-scale deployment of this model. For instance, there are multiple regulatory issues, especially if the power generated is shared or distributed.
Despite the associated challenges, many pure-play power companies have shown interest in meeting the telecom sector?s energy needs through this model. These include Mahindra Solar, Lanco Solar, Gemini Communications, Applied Solar Technologies, Anu Solar and Tata BP Solar.
Regulatory push
Driven by the need to reduce energy costs, the industry is focusing on implementing renewable and energy-efficient solutions. But there is a need for a policy push to encourage telecom service providers to increase their consumption of cleaner fuels. Initially, this can be achieved by providing subsidies for using solar, wind and biomass energy systems.
The Ministry of New and Renewable Energy (MNRE) has taken initiatives in this direction. In 2011, it launched a programme to power 400 telecom towers with solar panels under the Jawaharlal Nehru National Solar Mission. Under the Rs 1.2 billion initiative, a 30 per cent subsidy on the capital cost is being provided. Of the 400 towers, around 100 are proposed to be installed by state-owned Bharat Sanchar Nigam Limited.
However, the overall industry response to this initiative has not been very encouraging ? only a few telecom operators have come forward due to the small coverage (only 400 towers).
The Universal Service Obligation (USO) Fund?s subsidy for the use of solar energy for digital satellite phone terminals and new village public telephones is another key initiative. The USO Fund, in collaboration with the MNRE, provides subsidies for setting up solar chargers at 50,000 VPTs. A similar subsidy is provided for setting up solar mobile charging stations in 5,000 villages in partnership with The Energy and Resources Institute?s ?Lighting a Billion Lives? project.
Need for innovation
Technological innovation is required to drive the mass adoption of renewable energy solutions by operators. Efforts to this end have been initiated, which is evident from the solutions and models that are currently available in the market. A look at the companies that have entered this space and the solutions offered by them:
? Managed energy service provider Luminous TeleInfra has designed and implemented energy saving solutions for BTSs and daily operations under the fixed energy model. The model comprises a predefined set of processes, methods and tools to achieve the desired key performance indicators. The company has provided its solutions at over 200 sites across the country and is currently managing a cluster of 50 sites in Bihar for a period of six months.
? Founded in 2009, NextGen operates in the waste-to-energy, and emission management and sustainability domains. It has developed an in-house biogas technology for decentralised organic waste-to-energy application. Biogas plants based on this technology are designed to process 25 kg-50 tonnes of waste per day.
? KMR Infrastructure designs, finances, installs and operates small renewable energy plants. It has developed the Franchise Fund model, which would help small-scale renewable energy-based franchises by providing assistance in areas such as project conceptualisation, financing, technology selection, procurement, project management, operation support, and training and after-sales services.
? Air Liquide, which offers hydrogen fuel cell-based energy solutions for stationary applications such as telecom towers primarily in Europe, has entered the Indian market. The company has been involved in a demonstration programme with an Indian telecom infrastructure operator since mid-2011 and intends to launch commercial operations in mid-2012.
? VNL has developed the WorldGSM system, a solar-powered turnkey GSM and broadband system specifically developed for rural areas which generate ARPUs of less than $2-$3 per month. WorldGSM is the world?s first commercially viable GSM and broadband system, which is independent of the power grid. It runs exclusively on solar power and does not require DG backup.
? Japan-based manufacturer of micro wind turbines (MWTs), Zephyr Corporation Limited is offering the Airdolphin MWT in India. The cost of buying and installing two Airdolphin turbines and batteries on a tower to power a typical GSM BTS requiring 600-1,000 W of power at an average wind speed of 6-7 metres per second is Euro 14,000-Euro 20,000. As compared to this, the cost of diesel for operating such a site is Euro 12,000-Euro 15,000 per year.
? Established in 2008, E-Hands Energy has executed several hybrid projects in India and other countries. Its solutions range from 0.8 kW (600 W of wind and 200 W of solar PV) to 7 kW (3.5 kW of wind and 3.5 kW of solar PV) systems. At locations with adequate wind speeds, these solutions are capable of eliminating diesel usage.
A long way to go
According to Bridge to India?s latest quarterly market analysis, ?The India Solar Compass?, 2 GW of solar power capacity could be installed at telecom towers in India by 2016. However, given the aforementioned challenges, this will not be an easy market to capture.
The resco model is a new option, but will take time to develop before it can be deployed on a large scale.
Besides government initiatives, entrepreneurial ventures with innovative business models and products will play an important role in developing an off-grid solar power market for telecom companies in India.
