The Cellular Operators Association of India (COAI) has proposed that the telecom sector be charged industrial tariffs for electricity and not commercial rates, and that power connections be expeditiously provided to telecom infrastructure facilities. It said that this was important given the essential nature of services and socio-economic benefits that accrue across multiple sectors from faster 5G deployments. COAI has also batted for the sector to be provided uninterrupted 24×7 power supply.
According to COAI, most states currently provide electricity at commercial tariff rates to the telecom industry, placing it in one of the highest brackets of power tariffs. In most states, the difference between an industrial electricity tariff category and a commercial electricity tariff is significant, leading to an avoidable burden to the overall telecom sector. COAI suggests that applying the industrial electricity tariffs for telecom services will yield significant cost benefits for players, which will give the telecom sector more money to roll out infrastructure. Further, COAI is of the view that the criticality of telecom connectivity has been proven beyond doubt during the pandemic when the sector supported almost all businesses and services. Hence, for healthy progress of the sector, overall benefits to businesses, and the larger socio-economic growth and prosperity of the country, it is important that industrial tariffs be made applicable for telecom across all states.
To this end, the association has written to various states, flagging the issue, and making a case for the applicability of industrial tariffs for electricity usage by the sector. COAI has also made a case for priority electricity connection arguing that new connections need to be provided in a predictable time-bound manner. For base transceiver stations or telecom towers to operate without interruption, a continuous, outage-free grid supply is essential so the dependency on diesel generators can be minimised, and telecom operators can achieve sustainable profits. On green energy, COAI is pushing for load aggregation for telecom sites to avail the green open access energy. COAI opines that electricity consumption at each telecom site should be allowed to be aggregated (that is allowing aggregation of loads of multiple towers) and offset with green power (solar, wind, hydro) generated at distant locations.
Telecom towers have a power energy load requirement of 10 kW. Hence, while the reduction from 1 MW to 100 kW for availing green open access is a welcome step, it is not helping the telecom industry, where the number of telecom towers is projected to grow at a very fast pace. Under the current regime, the only way to be eligible is by allowing aggregation of multiple towers, which is the industry ask, COAI said in a note. These demands being addressed would spur the telecom infrastructure proliferation, which would in turn translate into better and deeper penetration of telecom connectivity across states, including for advanced 5G networks. Such high-speed networks will enable higher technology intervention in critical sectors such as education, healthcare, agriculture and others. Further, with the number of network elements increasing due to 5G deployment, the net gain in numbers will more than offset the perceived financial impact to the state, owing to industrial tariff being lower than commercial tariff.