Energy consumption and cost management have always been key priorities for telecom tower companies in India. In recent years, several initiatives have been taken by towercos and energy service companies (ESCOs) to optimise energy consumption at tower sites and better manage the energy requirements. At a recent virtual conference on Telecom Infrastructure in India, Vijay Jain, chief operating officer, Tower Vision, Sarraju Narasinga Rao, chief technical officer, OMC Power, and Sanjay Saxena, national energy head, ATC India, shared their views on the current energy consumption and management trends in the Indian telecom infrastructure space, and the practices adopted by towercos to ensure energy efficiency. The key takeaways from the discussion…

For a tower site, energy cost, or what is commonly referred to as power and fuel cost, accounts for about 40 per cent of the site’s total operational expenditure. As per industry estimates, on an average, a tower site typically consumes about 100 litres of diesel and 2,000-2,500 units of electricity per month. In terms of prices of the two energy sources, diesel is a much more expensive option. The ratio between grid power and diesel prices stands at about 1:3.

Over the years, the use of diesel generator (DG) sets has reduced significantly, with grid power emerging as the key source of power at tower sites. Towercos typically meet 70 per cent of their energy requirements through grid power, whereas 28-29 per cent is supported by DG sets and 1-2 per cent by renewable sources of energy, mainly solar. For Tower Vision, almost 98 per cent of its sites are connected to the grid, but the company uses DG sets or batteries as back-up at several sites.

Achieving energy efficiency – Key trends and industry experience

In the past one decade, the industry as a whole has managed to bring down diesel consumption by about 50 per cent despite a steady growth in the number of towers and tenancies on each tower. This has been possible due to a marked improvement in the availability of grid power. Further, there has been an overall reduction in the telecom load per se. The load drawn by base transceiver stations (BTSs) has come down as more energy efficient equipment has made its way into the sector, especially at tower sites. The newer equipment does not suffer from a high loss of energy. Further, the conversion of AC voltage-based equipment to DC has resulted in the trimming of energy losses. The biggest factor driving down energy consumption at sites has been the elimination of air conditioning requirements. Air conditioners have been the biggest guzzlers of power at tower sites, but most of the new BTSs now have the capacity to withstand higher temperatures. This has significantly reduced the air cooling requirements.

The availability of grid power supply has improved tremendously. There are some very progressive electricity boards, and it is not just about the availability of power supply, but also about the facilities that they extend such as online generation of bills, acceptance of online payments and grievance redressal systems.

Over the years, the industry has managed to bring down its energy consumption from the earlier alarming levels. Consequently, the energy cost has also come down, but the battle is just half won. In recent years, with large-scale sector consolidation, telcos have become extremely cost conscious, which is exerting a huge pressure on towercos to further reduce the operational cost of towers.

Cost economics

While the industry has achieved energy efficiencies, the cost of sourcing power has risen sharply. Electric Board (EB) power costs have increased from an average of Rs 6-7 a unit in 2015-16 to Rs 19 a unit at present. Unfortunately, the telecom sector does not get any tariff preference even today. The towercos continue to operate on the commercial tariff structure, under which tariffs are pretty high. With data services coming in, the load on sites will only go up, thereby increasing the energy costs.

Meanwhile, the cost of batteries has gone down. Several years ago, lead acid batteries were preferred to VLRA due to their cost advantage. The cost of the latter was almost 1.5 times the cost of the former. This differential has reduced significantly in recent years. Interestingly, the cost of lithium batteries has also come down, but the supply chain remains a challenge.

Role of automation

Technology interventions are critical in the towerco industry. Towercos have distributed operations and technology can help monitor these operations at each site. Today, various IoT devices are available that can generate site specific data, which can be analysed at the edge to take actionable decisions regarding energy despatch or load redistribution. A key observation by industry stakeholders is that mobile data is often not enough to run technology applications. The industry will have to explore alternate bands/channels on the backhaul network itself. Another key issue is the lack of storage capabilities to store the huge quantum of data generated by sensors.

That said, the pandemic ushered in a new wave of technology adoption for towercos, as all the companies were forced to switch to remote operations in the wake of the lockdown. Automation can help in bringing down manual intervention at sites.

Energy requirements of 5G

With the roll-out of 5G, efficiency will improve, but the need to densify networks will result in higher power consumption. As a result, the watt per bit will come down, but the data bits will grow exponentially, thus increasing the overall consumption at a site. IP-1s need to gear up for this demand by strengthening their grid connections and storage capacity.

Future priorities

Going forward, there is an urgent need to maximise the use of EB as much as possible. Much improvement is required at the last mile level, where the industry experiences a lot of breakdowns and interruptions. Any site that has 16-18 hours of quality and consistent grid power supply is considered ideal, provided that AC usage on the site as well as the load (measured typically by the number of tenants on a site) is low. So, for a 1.8-2 tenancy ratio, 16-18 hours of interrupted power supply should suffice.

Improving the energy storage ecosystem is also important as towercos would like to use batteries for dealing with smaller duration cuts, rather than resort to DG sets. VLRA batteries have gone mainstream and their adoption will continue to grow. Lithium batteries are also catching up and will see a sizeable increase in the next five years. However, charging batteries on site is cumbersome. For a 2 kW BTS, the company often has to install a 10 kW charging station on site.

In the medium term, switching to renewable sources of power will be important. Solar power, in particular, holds the potential to compete with the grid. The per unit cost of power sourced from a large solar plant is in fact one-third of the grid cost. At present, solar power is used at locations where there is a cluster of sites available, as it is not economical for discreet sites. ESCOs typically set up power plants outside a village in rural areas and cater to multiple towers through that plant.

Ultimately, in the very long run, fuel cells are likely to emerge as a formidable source of powering towers. They might even replace battery systems, but only in the very long run, say 10-15 years. Currently, there are two pilots being undertaken in the industry at the telco level.

Net, net, reducing energy costs will continue to be a key focus area for towercos. To ensure technology interventions or make technologies like fuel cells a reality, more collaboration is required on ground. Any new technology will require a huge capex, with a recovery cycle of 5-10 years. Unfortunately, the sector’s dynamic situation and changing business scenarios have forced telcos to be very short sighted. They are not willing to partner for a long-term period, and are looking for short-term solutions, which can only produce incremental results. For a significant cost reduction or a major breakthrough, capex infusion and long-term agreements will be fundamental.