Intro: India is a blessed country having the potential for renewable energy generation. But unfortunately, we have failed to harness this potential. We need to develop alternative means of generating power which is safe for the environment.
India today stands at some sort of inflexion point in its development history. It needs huge power generation facilities for its teeming millions and for meeting the requirements of the set ambitious targets of economic development over the next few decades. Today, the per capita consumption of electricity in India is less than 600kWhr, one of the lowest in the world, while the same in the United States of America (USA) is close to 12, 500 kWhr. For India it is a matter of concern for the gap in the demand and supply of electircal power.
But much more important than India's gross power needs today is the challenge posed by the growing constraints on power generation by conventional resources like coal, oil or nuclear fuel. Continuous dependence on fossil fuels is adding to global warming and its attendant deleterious effects. Difficulty of disposal of nuclear waste and its hazardous nature as also the uncontrollable damaging effects of accidents associated with nuclear power plant operation have put question marks before the desirability of nuclear power generation. This has thrown up in a big way the need to establish renewable, environmental friendly generation on a large scale.
Solar, wind and biomass are the main resources of renewable energy generation. But neither the means nor technologies for generating the required amounts of power for global needs on a sustained and economically viable basis are yet available. But we must understand that the adverse fallouts of fossil fuel based power generation manifesting in severe climate changes, freezing lakes, frequent wild fires, excessive rains or floods or droughts and tsunamis are challenging us to develop alternative means of generating power that is soft on the environment.
India, like in many other areas, is a blessed country even in the potential for renewable energy generation. It has one of the largest amounts of suitable natural solar radiation as a power generating resource and also possesses good wind power generation potential. Being an agro and livestock rich country, it has also huge biomass energy generation potential. But unfortunately, like in all other areas, we have failed to harness all this potential.
Renewable energy generation in the aforesaid areas does not require any complex technology that is not available in India. It needs capital, yes. But a lot of capital exists in India which the government needs to tap–whether by way of unearthing the humungous amounts of black money or by bridging the shortfall in tax revenues. This is besides the illegal Indian money stashed abroad, whose retrieval has been a hot subject of popular discussion and discourse. Thus, instead of allowing 100 per cent FDI in renewal energy generation, it may be more prudent to raise domestic capital and restrict FDI to 49 per cent which will restrict flight of foreign exchange from the country and will also retain the ownership of energy generation entities with India.
Investment in the power sector in India has been hamstrung of late by the continuing inefficiency of the power distribution sector where the average ATC (Aggregate Technical and Commercial) losses exceed 25 per cent. Without this loss figure coming down to below 5 per cent, no business model of power generation is going to be commercially viable or sustainable. The dire need for distribution sector reforms, therefore, is again stressed. Along with this, we need to undertake indigenous R&D to develop better technologies for producing renewable energy on an economically viable basis and on the wide scale to cater to the huge consumer and industry requirements. Our central sector PSU, Bharat Heavy Electricals Limited (BHEL) has capabilities to manufacture a fairly wide range of equipment for renewable energy generation. Even in the private sector, Suzlon and Moser Baer are two prominent companies engaged in renewable energy generation equipment. Therefore, we actually need to attract domestic and foreign investors to this rainbow sector by creating the proper investment climate that will generate comforts for growth and profitability. We need to regulate the sector for rational and fair tariff fixation and for ensuring proper revenue realisation to energy generation agencies from the power distribution networks.
(The writer is a senior columnist)