India’s power sector is one of the most diversified in the world. Sources of power generation range from conventional sources such as coal, lignite, natural gas, oil, hydro and nuclear power to viable non-conventional sources such as wind, solar, and agricultural and domestic waste. Electricity demand in the country has increased rapidly and is expected to rise further in the years to come. In order to meet the increasing demand for electricity in the country, massive addition to the installed generating capacity is required.

Also Read :Pm Modi StartUp India Plan

Market Size

Indian power sector is undergoing a significant change that has redefined the industry outlook. Sustained economic growth continues to drive electricity demand in India. The Government of India’s focus on attaining ‘Power For All’ has accelerated capacity addition in the country. At the same time, the competitive intensity is increasing at both the market and supply sides (fuel, logistics, finances, and manpower).

The Planning Commission’s 12th Five-Year Plan estimates total domestic energy production to reach 669.6 million tonnes of oil equivalent (MTOE) by 2016–17 and 844 MTOE by 2021–22. By 2030–35, energy demand in India is projected to be the highest among all countries according to the 2014 energy outlook report by British oil giant, BP.

As of November 2015, total thermal installed capacity stood at 196.2 gigawatt (GW), while hydro and renewable energy installed capacity totaled 42.6 GW and 37.4 GW, respectively. At 5.8 GW, nuclear energy capacity remained broadly constant compared with the previous year. India’s rooftop solar capacity addition grew 66 per cent from last year to reach 525 Mega Watts (MW), and has the potential to grow up to 6.5 giga watts (GW)1. India’s wind power capacity, installed in FY2016, is estimated to increase 20 per cent over last year to 2,800 Mega Watt (MW)2, led by favourable policy support that has encouraged both independent power producers (IPP) and non-IPPs.

India’s wind energy market is expected to attract investments totalling Rs 1,00,000 crore (US$ 15.7 billion) by 2020, and wind power capacity is estimated to almost double by 2020 from over 23,000 MW in June 2015, with an addition of about 4,000 MW per annum in the next five years.

Also Read : top 10 Reasons Why India Is Next Startup Hub

Investment Scenario

Around 293 global and domestic companies have committed to generate 266 GW of solar, wind, mini-hydel and biomass-based power in India over the next 5–10 years. The initiative would entail an investment of about US$ 310–350 billion.

Between April 2000 and September 2015, the industry attracted US$ 9.97 billion in Foreign Direct Investment (FDI).

Some major investments and developments in the Indian power sector are as follows:

SunEdison, world’s largest renewable energy company, plans to continue its focus on ‘Make in India’ by further reducing the cost of renewable energy and developing over 15 gigawatts (GW) of wind and solar projects in the country by 2022.

ThyssenKrupp India, the Indian arm of the German engineering conglomerate, plans to make high-grade environment-friendly boilers which use less fuel, for the Indian power sector by collaborating with a foreign company.

Aditya Birla Group has announced a partnership with the Abraaj Group, a leading investor in global growth markets, to build a large-scale renewable energy platform that will develop utility-scale solar power plants in India.

Sterlite Grid, India’s largest private operator of transmission systems, is joining hands with US major — Burn & McDonnell for its Rs 3,000-crore (US$ 462.5 million) power transmission project in the Kashmir valley.

Inox Wind Ltd, a subsidiary of Gujarat Fluorochemicals, a wind energy solutions provider, plans to double its manufacturing capacity to 1,600 MW at a total investment of Rs 200 crore (US$ 31.6 million) by the end of the next financial year.

The Dilip Shanghvi family, founders of Sun Pharma, acquired 23 per cent stake in Suzlon Energy, with a preferential issue of fresh equity for Rs 1,800 crore (US$ 284.8 million).

Reliance Power Ltd signed an accord with the Government of Rajasthan for developing 6,000 MW of solar power projects in the state over the next 10 years.

Hilliard Energy plans to invest Rs 3,600 crore (US$ 600 million) in Ananthapur district of Andhra Pradesh in the solar and wind power sector for the generation of 650 MW of power.

Solar technology provider SunEdison signed a definitive agreement to acquire Continuum Wind Energy, Singapore, with assets in India. The company, headquartered in Belmont, California, would take over 242 MW of operating wind assets that Continuum owns and operates in Maharashtra and Gujarat as well as 170 MW of assets under construction.

Japanese internet and telecommunications giant SoftBank, along with Bharti Enterprises (of Sunil Mittal) and Taiwanese manufacturing giant Foxconn, plan to invest US$ 20 billion in solar energy projects in India.

Also read : padma Awards 2016

Government Initiatives

The Government of India has identified power sector as a key sector of focus so as to promote sustained industrial growth. Some initiatives by the Government of India to boost the Indian power sector:

The Union Cabinet has approved the Ujwal DISCOM Assurance Yojna(UDAY) for financial turnaround and revival of power distribution companies (DISCOMs), which will ensure accessible, affordable and available power for all.

The Government of India has resolved the issues regarding transfer of mining leases and grant of forest clearances to the winning bidders of coal blocks. It expects operations to start in about 10 more mines by March 2016, easing coal availability to the projects attached to these mines.

The Ministry of Power has planned to provide electricity to 18,500 villages in three years under the Deendayal Upadhyaya Gram Jyoti Yojana (DUGJY). Out of these, 3,500 villages would receive electricity through off-grid or renewable energy solutions.

The Ministry of New & Renewable Energy is implementing two national level programmes, namely Grid Connected Rooftop & Small Solar Power Plants Programme and Off-Grid & Decentralised Solar Applications, in order to promote installation of solar rooftop systems, as per Mr Piyush Goyal, Minister of State (Independent Charge) for Power, Coal & New and Renewable Energy.

The Government of Odisha plans to set up a large 1,000-MW solar power park under public-private partnership (PPP) mode involving an investment of about Rs 6,500 crore (US$ 1 billion).

The Government of Telangana plans to set up an incubator centre, in collaboration with University of Austin, Texas, for start-ups in the renewable energy sector, to support new companies entering the renewable energy market.

A Joint Indo-US PACE Setter Fund has been established, with a contribution of US$ 4 million from each side to enhance clean energy cooperation.

The Government of India announced a massive renewable power production target of 175,000 MW by 2022; this comprises generation of 100,000 MW from solar power, 60,000 MW from wind energy, 10,000 MW from biomass, and 5,000 MW from small hydro power projects.

The Union Cabinet of India approved 15,000 MW of grid-connected solar power projects of National Thermal Power Corp Ltd (NTPC).

The Indian Railways signed a bilateral power procurement agreement with the Damodar Valley Corporation (DVC). The agreement was signed between North Central Railway and DVC. This is the first time the Railways will directly buy power from a supplier.

US Federal Agencies committed a total of US$ 4 billion for projects and equipment sourcing, one of the biggest deals for the growing renewable energy sector in India.

The Road Ahead

The Indian power sector has an investment potential of Rs 15 trillion (US$ 237 billion) in the next 4–5 years, thereby providing immense opportunities in power generation, distribution, transmission, and equipment, according to Union Minister Mr Piyush Goyal.

The government’s immediate goal is to generate two trillion units (kilowatt hours) of energy by 2019. This means doubling the current production capacity to provide 24×7 electricity for residential, industrial, commercial and agriculture use.

The Government of India is taking a number of steps and initiatives like 10-year tax exemption for solar energy projects, etc., in order to achieve India’s ambitious renewable energy targets of adding 175 GigaWatts (GW) of renewable energy, including addition of 100 GW of solar power, by the year 2022. The cumulative installed capacity of solar power in India has crossed the 4 Gigawatt mark as of June 30, 2015. The government has also sought to restart the stalled hydro power projects and increase the wind energy production target to 60 GW by 2022 from the current 20 GW.

since independence, India has made immense progress towards achieving food security. Its population has tripled, but food-grain production has more than quadrupled; there has thus been a substantial increase in available food-grain per capita.

But more can be done. Crop yields in India are still just 30% to 60% of the best sustainable crop yields achievable in the farms of developed and other developing countries. And poor infrastructure and unorganized retail means India has one of the world’s highest levels of post-harvest food loss.

Clearly, it is time for change. We not only need to respond to long-standing issues and challenges, but we must also face newer realities. The natural resources on which agriculture is based – land and water, above all – are being degraded and there is growing competition for their use. Climate change is already exacerbating this situation, making agriculture more risky, and it will have an even greater impact in the future.

But the public-private partnership model could be just the game-changer India’s agricultural sector needs. By drawing on the collective power of all agricultural stakeholders, PPPs can transform the sector at multiple levels. With the government providing and co-financing the back-end of the value chain, and the private sector and farmer contributions doing the rest, the agricultural sector could remain a primary engine of rural growth and poverty reduction in India.

Here are three ways PPPs could do that:

  1. Investing in smarter value chains

PPPs could help spur the development of the food processing industry, one of the newest sectors in Indian agriculture. The food processing industry must do more than just increase the shelf life of food, preserve food nutrients and provide fortified products. Instead, supported by government and private investments, it should also look at providing farm extension services, enhance price realization, cut out intermediaries and improve the supply chain through forward and backward linkages.

An important role of the government, besides funding, will be to create an enabling environment for private investment. This needs to be done through tax rationalizations, duty exemptions, increases in public spending, priority sector lending and FDI. It is steps such as these that will boost private sector investment in supply chain infrastructure and services, leading to a reduction in waste and more added value.

 

  1. Improving access to credit, technology and markets

PPPs could help bring cutting-edge technologies and approaches to India’s agricultural sector. IT and biotech stand to transform agriculture, raising its production levels and outputs. We need PPPs focused on getting farmers access to vital information, methodologies and the latest technology to help them in areas such as crop rotation, weather patterns, fertilizer use and going organic – all at the click of a button or a simple SMS on their mobile phones.

Biotechnology, meanwhile, can equip growers with techniques for developing high-yield crops, managing pests, better utilizing waste water and focusing on nutrition. The remarkable breakthroughs made in the cereal production industry show how much of an impact biotechnology can make. PPPs can help replicate this success in crucial areas such as oil seeds and pulses, which are highly import-intensive.

In the same way, PPP projects, when targeted at helping farmers connect with their marketplaces and financial institutions for micro-funding, can usher in massive alterations in the rural economy.

 

  1. Building farmer resilience to environmental shocks

India’s farmers are constantly threatened by adverse weather and environmental conditions that spell disaster for their produce. Extreme situations such as flooding and droughts constantly plague India’s farming community. PPPs that protect the agricultural sector against the vagaries of nature can be life savers. In fact, in a country where farmer suicides are common, such interventions can actually save lives. PPPs that help the agricultural sector deal with weather shocks, and allow farmers to minimize risk through insurance, can be a crucial helping hand.

While PPPs in the agri space are not commonplace, they need to be. The Maharashtra government has already made a start with its Maharashtra Public-Private Partnership for Integrated Agriculture Development (PPPIAD) project. Under the aegis of this initiative, Maharashtra is developing integrated value chains for selected crops through PPPs and co-investment.

Part of the World Economic Forum’s New Vision for Agriculture, the project aims to develop integrated value chains. What began with 11 projects in 2012-13 now encompasses 33 value chain programmes, with more than 60 participating companies. The project focuses on 15 key crops and has already reached almost half a million farmers, with a target of 5 million by 2020.

PPPs like the Maharashtra project are the way to go for India’s agricultural sector. They are proving to be an important step in renewing and rejuvenating rural economies and leading them to inclusive and sustainable growth.

You May also Like : Politics Over Hyderabad Student Death

 

SHARE
Next articleANDROID 6.0 MARSHMALLOW

NO COMMENTS

LEAVE A REPLY