Smart Grid with Energy Efficiency: An Expert View-1

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Most of the system planners believe- Intelligently planned smart grid and smart meter systems that integrate energy efficiency and conservation as central goals will have a great potential to reap system-wide benefits.

The following are the views of Shri. S Padmanabhan, executive director, operations, Tata Power, India (Courtesy, FE)

The Rio Summit was first tabled in the year 1992 with the objective to secure renewed political commitment to sustainable development, assess progress towards internationally-agreed goals on sustainable development and to address new and emerging challenges. In this year’s summit, energy was one of the seven critical issues to be addressed.

Energy has been universally recognized as one of the most important inputs for economic growth and human development. There is a strong two-way relationship between economic development and energy consumption. Sustainable development in terms of economic growth, development of jobs, climate change, food production, industrial manufacturing—just about anything—is not possible in any country without energy. But equally important is the fact that, over a long period of time, it is not possible to continue the use of energy without a focus on sustainability.

In India, power generation is largely dependent on fossil fuels due to unavailability of cleaner fuel sources like gas and nuclear energy. Recognizing that fossil fuels impact climate change, the government of India has taken many steps to ensure sustainable energy development. India was one of the first countries in the world to set up a ministry of non-conventional energy resources, in the early 1980s. However, in spite of this early impetus, the regulations governing renewable energy in India remain fairly underdeveloped.

The fuel mix has undergone changes and growing environmental concerns have led to an interest in renewable sources of energy including solar, hydro, wind, bagasse/biomass/agri residue, municipal and industrial waste, and geothermal and tidal energy. India has been attracting over $3 billion every year in the renewable sector and has emerged as one of the most developed renewable energy markets in South Asia.

The government of India has targeted capacity additions of 15GW of renewable energy in the Eleventh Five-Year Plan (2007-2012). These targets, if achieved, would bring the cumulative installed capacity to over 25GW in 2012.

An increasing number of private power producers are also opting to increase their renewable energy portfolio over the years. Companies such as Tata Power already have an installed capacity of over 700MW of clean energy portfolio, i.e. 22% of their total capacity, and are targeting 25% of their total power generation to come from clean sources in the next five years.

The sector has also undergone substantial structural changes. Regulatory policies have played a predominant role in changing the landscape of the Indian power sector. In 1992, a full-fledged ministry of non-conventional energy sources was set up for resource assessment, technology development and demonstration of renewable sources of energy. In 2006, this ministry was renamed as the ministry of new and renewable energy to explore and recommend several technologies which became commercially viable with new advancements in technology and manufacturing innovations.

Given the limitation on the conventional sources of energy, a long-term view needs to be taken to ensure energy security through the development of appropriate indigenous alternatives. A prudent and practical renewable purchase obligation mechanism would serve the objective well to develop these technologies as commercially-viable alternatives. Currently, India ranks among the world’s top 20 economies in attracting funds for clean energy projects.

There is also a need to move away from large grid-connected plants to smaller decentralised solutions, not just in wind or solar but in the entire renewable space. Such decentralised renewable solutions are commercially viable in many places without the need for subsidies. When supported by policy and regulatory framework, such an approach will not only save on the use of land, it will also be cutting down the need to install long and expensive transmission lines to wheel power from where it is generated to where it is used.

In the long run, distributed generation will help consumers to get power at lower tariff as power will be available at lower per unit cost. More employment opportunities, both at plant management level and in the manufacturing sector for related machinery, will improve living standards of the people. The availability of power at low cost will attract more investments, which would be more evenly distributed throughout the country rather than being limited to cities alone.

Further, energy saved is energy produced. Energy efficiency should be encouraged through effective demand-side management (DSM) programmes for customers and general awareness programmes for the public at large. Tata Power has already taken a lead in this space through its unique initiative on DSM called ‘My Mumbai Green Mumbai’, offering a variety of energy-efficiency schemes for its customers, and ‘Tata Power Club Enerji’—a nation-wide energy conservation club for school children that has sensitised more than 6.2 million citizens till date and has saved more than 3.5 million units till date.

It is important for players in the power sector to join hands with policymakers and regulators to make advancement in technology, encourage energy efficiency to customers, strengthen the renewable energy portfolio, accelerate the development of cost-effective energy-efficiency programmes and manage consumers’ demand for electricity such that it can be turned into reality.

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