RURAL ELECTRIFICATION IN DEEP

AREAS OF INDIA AND FEASIBILITY

STUDY OF SOLAR HOME SYSTEMS

Thesis
Submitted in partial fulfillment of the requirements for the degree of
DOCTOR OF PHILOSOPHY
by
KAMALAPUR GOPALKRISHNA DHRUVARAJ

DEPARTMENT OF ELECTRICAL AND ELECTRONICS

ENGINEERING
NATIONAL INSTITUTE OF TECHNOLOGY KARNATAKA,
SURATHKAL, MANGALORE -575025
July, 2013
 DECLARATION

I hereby declare that the Research Thesis entitled Rural

electrification in deep areas of India and feasibility study of solar home

systems Which i s b e i n g s u b m i t t e d t o t h e N a t i o n a l I n s t i t u t e o f

T e c h n o l o g y Karnataka, Surathkal in partial fulfillment of the

requirements for the award of the Degree of Doctor of Philosophy in

Electrical and Electronics Engineering is a bonafide report of the research

work carried out by me. The material contained in this Research Thesis has

not been submitted to any University or Institution for the award of any

degree.

Mr.Kamalapur Gopalkrishna Dhruvaraj

(Reg.No:040329EE04P2)
Department of Electrical and Electronics Engineering

Place: NITK-Surathkal

Date:
 CERTIFICATE

This is to certify that the Research Thesis entitled Rural

electrification in deep areas of India and feasibility study of

solar home systems submitted by Kamalapur Gopalkrishna

Dhruvaraj, (Register Number: 040329EE04P2) as the record of the

research work carried out by him, is accepted as the Research Thesis

submission in partial fulfillment of the requirements for the award of

degree of Doctor of Philosophy.

Research Guide
(Name and Signature with Date and Seal)

Chairman - DRPC
(Signature with Date and Seal)
 ACKNOWLEDGEMENT

It is a pleasure to thank the many people who made this dissertation possible.
I want first to thank my research supervisor Dr. Udaykumar R. Y. for all the hope he has
put on me, before I thought I could do any research at all. During more than two decade of
knowing him, he has enlightened me through his wide knowledge of Electrical Engineering
and his deep intuitions about where it should go and what is necessary. He patiently provided
the vision, encouragement and advice necessary for me to proceed through the doctorial
program and complete my dissertation.
Special thanks to my research progress assessment committee members Dr.M.C.
Narashimhan and Dr. D.N.Gaonkar for their support, guidance and helpful suggestions.
Their guidance has served me well and I owe them my heartfelt appreciation.

I would like to thank Dr. S. Mohankumar, Dr. K P Vithal, Dr. D. P. Giridhar and Dr. S. S.
Bhavikatti, for encouraging and supporting me all the time during this research progress.
I am grateful to unknown reviewers of journals and conferences for making valuable
comments that are really useful.
I am indebted to all my teachers, friends of Sri Dharmasthala Manjunatheshwar College
of Engineering and Technology, Dharwad and National Institute of Technology Karnataka
Surathkal, for all the timely help they have extended.
Thanks also to my mother and my late father for their continuous encouragement.
Thanks to my wife Rajani, daughters Shriraksha and Shubhashri, for their understanding
and affection that kept me are working for the research. Their love provided my inspiration
and was my driving force.

KAMALAPUR GOPALKRISHNA DHRUVARAJ

 ABSTRACT

The majority of the world’s population, primarily living in rural areas, lacks a number
of facilities as a result of poverty and insufficient access to energy. The conditions necessary
to satisfy basic needs and to promote economic and social development cannot be fulfilled.
Most of the people without access to electricity live in thinly populated areas in developing
countries and the extension of the grid to these areas are not feasible mainly due to
economical reasons.

Electricity is a desirable commodity in the majority of the areas, it should be noted

that electricity is only one of the options to satisfy the energy needs of the rural population,
along with other rural needs. Rural electrification is an integral component of poverty
alleviation and rural growth of a nation. The availability of electricity can support advanced
development methods such as tele-education and it could provide access to distant
information and support for farmers and other entrepreneurs. Hence present study addresses
electricity supply for deep rural and remote areas of India.
A study of several aspects of rural electrification in India, the role of Government of
India and the feasibility of Solar Home Systems is carried out in this thesis.
CONTENTS

Acknowledgements

Abstract

Nomenclature vi

1 Introduction 1

1.1 Research problem………………………………………….. 1

1.1.1. A matter of priorities………………………............... 1

1.1.2. Scope………………………………………………... 2

1.1.3. Rationale of the research……………………………. 4

1.2 Problem description………………………………............... 5

1.3 Research justification……………………………………..... 7

1.3.1. Objectives of the investigation……………………… 7

1.3.2. Societal relevance…………………………………… 7

1.3.3. Scientific relevance………………………………….. 8

1.4 Research domain. ………………………………………….. 9

1.5 Structure of the research…………………………………… 9

1.5.1. Fundamental and application-oriented research…….. 9

1.5.2. Research method…………………………………….. 10

1.6 Contents of the thesis………………………………………. 11

2 Rural Electrification in the World 13

2.1 Review of Literature……………………………….............. 13

2.1.1 Rural Electrification………………………………….. 13

2.1.2 Grid connected RE…………………………………… 15

i
 2.1.3 Renewables in RE……………………………………. 16

2.2 World rural electrification scenario………………………... 18

2.2.1 Definition of rural electrification…………………….. 21

2.2.2 Objectives of rural electrification……………………. 23

2.2.3 Features of rural electricity supply areas…………….. 23

2.3 Benefits of rural electrification…………………………….. 27

2.3.1. Assessment of benefits……………………………… 27

2.3.2. Socio-economic benefits…………………………….. 29

2.3.3 Socio-political benefits………………………………. 31

2.3.4 Environmental benefits……………………………… 32

2.4 Rural electrification planning……………………………… 32

2.4.1 Region oriented approach……………………………. 34

2.4.2 General challenges faced by rural

communities………………………………………….. 35
2.4.3 Technologies commonly used in rural electrification
policies……………………………………………….. 35
2.5 Implementation aspects……………………………………. 36

2.5.1. Rural electrification costs…………………………… 36

2.5.2. Tariffs and subsidies………………………………… 37

Conclusions………………………………………………… 40

3 Rural Electrification in India 43

3.1 Rural Electrification………………………………............... 43

3.2 India Profile………………………………………………... 44

3.3 Electrical Power Sector -a glance………………………….. 45

3.4 Status of Rural Electrification …………….. ……………... 54

3.5 Governance of Rural electrification………………………... 55

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 3.6 Rural Energy pattern- a case study………………………… 57

3.7 State Electricity Boards……………………………………. 58

3.7.1 Power sector reforms ………………………………... 59

3.7.2 Status of Electricity Boards………………………….. 60

3.8 Electrical Transmission and Distribution Network………... 63

3.9 Power Sector Reforms and RE…………………….............. 63

3.10 Specific challenges………………………………………… 65

3.11 International Experiences…………………………...…….. 66

3.11.1 Argentina…………………………………………… 66

3.11.2 Bangladesh………………………………….............. 67

Conclusions………………………………………………… 68

4 Rural load profile in India 71

4.1 Review of Literature……………………………….............. 71

4.1.1 Feeder modeling…………………………………….. 71

4.1.2 Power quality issues…………………………………. 73

4.1.3 Cost analysis…………………………………………. 76

4.2 Features of Rural Electrical Loads………………………… 77

4.3 Rural Load Profile - a case study…………………………... 79

4.4 Rural Feeders- a case study………………………………... 81

5 Renewables in India 85

5.1 Review of Literature……………………………….............. 85

5.2 Renewable Energy in India………………………………… 92

5.3 Sources of renewable energy for rural electrification……… 95

5.3.1 Small Hydro power…………………………………... 95

5.3.2 Wind Energy…………………………………………. 96

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 5.3.3 Biomass energy………………………………………. 99

5.3.4 Solar Energy…………………………………………. 100

5.3.5 Off-grid generation based on diesel………………….. 101

5.3.6 Comparison of options……………………………….. 102

5.4 Solar for India……………………………………………… 103

5.4.1 Photo Voltaics………………………………………... 106

5.4.2 PV for a rural home………………………….............. 108

5.4.3 Factors considered for PV panel erection……………. 111

6 Feasibility study of solar home systems 113

6.1 Review of Literature……………………………….............. 113

6.2 Solar Radiation Estimation………………………………… 115

6.3 Simulation approach ………………………………………. 116

6.4 Demography of India ……………………………………… 120

6.4.1 Preliminary design…………………………………… 121

6.4.2 Number of panels for rural home…………………….. 123

6.4.3 Cost…………………………………………………... 125

6.5 Technical feasibility……………………………….............. 126

6.5.1 Project design………………………………………... 126

6.5.2 Economic considerations…………………………….. 130

6.5.3 Savings from PV System away from grid…………… 131

Conclusions………………………………………………… 132

7 Economic Aspects 135

7.1 Energy Pay Back Time…………………………….............. 135

7.2 Net Present Value………………………………….............. 139

7.3 Life Cycle Cost…………………………………….............. 140

iv
 7.4 Recycling of PV Systems………………………….............. 143

Conclusions………………………………………………… 145

8 Conclusions and future direction 147

8.1 Observations………………………………………………... 147

8.2 Policy Initiatives and National Solar Mission……………... 148

8.3 Conclusions ……………………………………….............. 150

8.4 Power generation projections………………………………. 152

8.5 Future Directions…………………………………………… 153

Appendix 156

References 167

List of Publications 173

Curriculum Vitae 175

v
 NOMENCLATURE

AIC : Average Economic Incremental Cost

APDRP :Accelerated Power Development and Reform Program

AT&C : Aggregate Technical and Commercial Losses

BAU : Business as Usual

BEE : Bureau of Energy efficiency

CAGR : Compounded Annual Growth Rate

CAIDI : Customer Average Interruption Duration Index

CCS : Carbon Capture and Sequestration

CEA : Central Electrical Authority

CERC : Central Electrical Regulatory Commission

CFL : Compact Fluorescent lamp

DAE : Department of Atomic Energy

DSM : Demand-side management

DST: Department of Science and Technology

ED : Electricity Department

EIRR : Economic Internal Rate of Return

ERR : Economic rate of return

ESMAP : Energy Sector Management Assistance Program

ETP : Energy Technology Perspective

GDP : Gross Domestic Product

vi
GoI : Government of India

HDI : Human Development Index

HH : household

HVDS : High Voltage Distribution Systems

IEA : International Energy Agency

KgOE : Kg Oil Equivalent

km : kilometer

kWh: Kilowatt hours

LPG : Liquid Petroleum Gas

LRMC : Long Range Marginal Cost

LTMC : Long Term Marginal Cost

MNRE : Ministry of New and Renewable Energy

MoP : Ministry of Power

MV : Medium Voltage

NEP : National Electricity Policy

NGO : Non Governmental Organisation

NRECA : National Rural Electric Cooperative Association

NREL : National Renewable Energy Laboratory

NTP : National Tariff Policy

O&M : Operations and maintenance

PFC : Power Finance Corporation

vii
PV : Photovoltaic

RE : Rural Electrification

RES : Renewable Energy Resources

RET :Renewable Energy Technologies

RGGVY : Rajiv Gandhi Grameen Vidyutikaran Yojana

RVE : Rural Village Electrification

SAIFI : System Average Interruption Frequency Index

SEB : State Electricity Board

SERC : State Electrical Regulatory Commission

SHS : Solar Home System

SPV : Solar Photo Voltaic

T&D : Transmission and Distribution

UNDP : United Nation Development Program

UNEP : United Nation Environment Program

USAID : United States Agency for International Development

USO : Universal Social Obligation

WCED : World Commission on Environment and Development

WEC : World Energy Council

WEO : World Energy Outlook

Wp : Watt peak

viii
CHAPTER 1

INTRODUCTION
1.1. Research problem
1.1.1. A matter of priorities
The year 1961 contained the first manned space flight: a striking example of
mankind’s capabilities enabled by applied scientific research. Some 25 years later
such flights have become common and now launchings on a profit basis are even
being performed to bring stationary satellites to orbit.
Mankind is capable of having a number of people remaining extraterrestrial for
many months. Further removed from us than the furthermost rural dweller on this
planet, the astronauts have an extremely reliable electricity supply at their disposal for
preparation of food, air-conditioning, heating, telecommunication, video equipment
and scientific experiments.
The International Space Station Alpha for instance, will be provided with a 94 kW
peak power generation system consisting of solar arrays and a nickel hydrogen battery
based energy storage system. In the future the system will be complemented with
solar dynamic generators. It should be noted that in orbit electricity generation by
solar arrays is considerably advantaged by the local solar constant flux of 1371 W/m²
as compared with a mean annual of 100-300 W/m² on earth.
The continuous power of this station amounts to 76 kW which includes an average
of 20 kW for the execution of payload experiments. In their remote accommodation
up to six astronauts will have an electricity supply of some 56 kW available for the
space station infrastructure including preventive, diagnostic and therapeutic medical
equipment and housekeeping operations (European Space Agency 1996). The power
available on board the Space Station Alpha for housekeeping and medical care could
fulfill the basic electricity needs of some 600 rural households in developing countries
by using modern energy-efficient appliances.
Although electrification commenced some one hundred years ago, currently still
about 40% of the world’s population have neither access to electricity nor to sufficient
other non-traditional energy forms.

1
 It is fairly certain that the world population will grow from the present five billion
to eight billion within the next 20 years or so and as a consequence the number of
citizens without an adequate energy supply will further increase if business as usual
(BAU) is supposed.
Most of the two billion people without access to electricity live in thinly populated
areas in developing countries and the extension of the grid to these areas are for
economical reasons not feasible. Thus other solutions are needed for these areas.
People have managed to satisfy extraterrestrial energy requirements but not those on
earth. Undoubtedly many reasons can be found to explain this inconsistency.
As demonstrated by space research, mankind is technically and organizationally
capable of realising complex and impressive projects. There is no reason to believe
that extraterrestrial power supply is economically more feasible, technically less
complicated or socially more obvious than the energy supply to the underdeveloped
rural and remote areas on earth.
The present global situation, in both positive and negative senses, is the result of
the intrinsic dynamism and effectiveness of a system consisting of three components:
science, technology and capital. This system has developed into a more or less
autonomous system in the sense that the human objectives to be realised, are not
determined in advance.
Additionally, it remains to be seen whether another order of priorities would have
led to an appropriate worldwide energy supply. It is a fact that at this very moment a
large part of the global village lives in poverty and suffers a lack of water, proper
health care and energy.
1.1.2. Scope
There is no doubt that energy is needed to achieve an acceptable quality of life for
the global village as a whole. Energy alone is not sufficient for creating the conditions
for economic growth, but it is certainly necessary. Over the next few decades a wide
range of energy forms will be required to satisfy the increasing global demand.
Moreover, our global energy system is such that developed and developing
countries are interdependent in their efforts to provide sufficient and affordable
energy and to maintain an ecologically sound planet. Emphasis should thus be on the
development of a global energy and environmental policy and planning to achieve a

2
sustainable energy supply for the world’s population and the mitigation of the impact
of energy-related activities on the environment.
The World Energy Council (WEC) is right in concluding that the energy and
ecological issues of both developed and developing countries and the transition to a
sustainable path of development will require a stronger determination by
governments, energy enterprises and international organisations.
The majority of the world’s population, primarily living in rural areas, lacks a
number of facilities as a result of poverty and insufficient access to energy. The
conditions necessary to satisfy basic needs and to promote economic and social
development cannot be fulfilled. The majority of the additional 2.8 billion people
predicted by the year 2020 are not even expected to have any access to commercial
forms of energy at all, supposing business as usual. The lack of access to a reliable
energy source is a major impediment to sustainable development, in developing
countries. The idea that all nations on earth have a right-and should have the means-to
pursue these benefits will become increasingly important in a world where
opportunity is disproportionately divided between the industrialised countries of the
northern hemisphere and the poorer nations farther south. Wider access to electricity
in developing countries will be a key requirement for narrowing the north-south gap.
If electricity is to truly promote human progress in developing countries, then the
problem of rural electricity supply must be addressed.
The subject of energy supply to rural and remote places appears on many agendas
including that of the World Energy Insight 2011(WEC report) “Energy poverty
hinders development and threatens growth. We must seek to identify ways of
providing electricity access for the two billion energy poor in developing and an also
developed country, the renewables market has great potential but will require
significant leadership to fully realise its potential: we need to promote the use of
already mature technologies, while fostering R&D for technologies that are not yet
mature.”
This study addresses electricity supply for rural and remote areas. Although
electricity is a desirable commodity in the majority of the areas, it should be noted
that electricity is only one of the options to satisfy the energy needs of the rural
population along with other rural needs. Bringing electricity to the people is ‘in itself ’

3
is not a contribution to reducing poverty nor does it automatically lead to rural
development. However, the availability of electricity can support advanced
development methods such as tele-education and it could provide access to distant
information and support for farmers and other entrepreneurs.
1.1.3. Rationale of the research
The utilisation of the electricity supply industry has brought many benefits to
society. Today, electricity plays a vital role in our society, socially, environmentally
and economically.
Over the last few years, the sector has faced rather dynamic changes, the most
salient being of an institutional nature. Today deregulation, power share, market
forces, unbundling, non-utility generation and third party access to the grids are the
new key words in the sector.
In a number of countries, the electricity supply sector has become the playing field
of traders, economists and brokers, with standards, values, performance and
procedures adapted to the new players and circumstances. In some countries
industrial, commercial and residential consumers are already able to shop for
electricity and therefore the electric utility operators will primarily be directed
towards effective competition. Obviously, the new circumstances will force utilities to
reduce costs and to reconsider their strategies and organisations.
Utilities in the poorer nations of the world are however still struggling to get
electrical supply and make electricity more widely available particularly in rural and
remote areas. They face problems such as institutional weakness, lack of capital,
uneconomic tariffs, and substandard technical and managerial performance. These
countries also have reasons to reassess their operations and in this respect they are
encouraged and occasionally obliged by lending institutions.
Apart from the institutional changes, utilities in both developed and developing
countries have to meet increasingly stringent requirements to protect the environment
and to conserve energy.
It is noted that rural and remote areas often have substantial renewable energy
potential. The IEA Renewable Energy Working Group Party argues that renewables
are localised energy sources and that their deployment benefits rural and remote
communities in terms of employment and income generation.

4
 New technologies effect at both the supply side and the demand side and there is
reason to believe that current developments and trends in the power sector will have
an effect on the way rural electricity supply behaves. It is also likely that the
developments will not only influence new systems but also existing rural electricity
supply schemes.
A wait and see attitude is not the appropriate approach. Some two billion people
and huge amounts of money are involved. Based on figures given Foley (1995), the
average costs per connection can be roughly estimated at US$ 12000.
With an average of five persons per connection, an amount of some 500 billion
dollars would be needed just to establish connection of the two billion people to the
grid. If the costs for the generation and transmission facilities were included, the total
amount would be in the order of 800 billion dollars.
The IEA Renewable Energy Working Party even estimated that in the next four
decades over five trillion dollar would be needed for additional generating capacity
only. A literature survey revealed that rural electrification has been the subject of
many studies and publications and the question had to be answered whether it would
be socially and/or scientifically justified to add further to this research. The answer to
this question appeared to be positive. Existing literature, with a focus on developing
countries, albeit comprehensive has mainly addressed the technical, financial and
socio-economical aspects in isolation.
It is clear that a comprehensive historical analysis of a broad field of rural
electrification cases can reveal lessons learned. An integrated analysis of the impact
of recent technological and institutional developments, and other trends, on the
electricity supply to rural and remote areas can contribute to the assessment of future
technical and institutional arrangements.
1.2. Problem description
The electrification of rural areas is expensive. Capital costs are relatively high and
revenues are frequently poor. However, rural electricity supply may have new
dimensions because of recent technological advances and the ongoing power sector
reform.
The developments and trends can be grouped into five dimensions: the
environmental aspects of power supply and the sustainability of power resources, the

5
technological advances, the organisation and performance of the power sector, the
societal trends and the institutional aspects.
Both energy sustainability and environmental constraints will increasingly force
appropriate measures onto the global power sector. The progress in the field of energy
technology, including renewables, has been significant and new opportunities present
themselves through both demand side and supply side management developments.
Renewables can contribute to the mitigation of environmental problems.
Conventional electricity generation will still be required but, for reasons of energy
efficiency, the combination with heat production needs to be pursued. This requires a
closer co-operation between the utility, industrial and commercial consumers in both
rural and urbanised areas. Over five trillion dollar would be needed for additional
generating capacity only.
In many less developing countries the performance of electric power utilities
supplying remote and rural areas has decreased gradually in spite of the provision of
external financial support. Moreover the benefits and progress of a considerable
number of rural electrification projects has fallen short of expectations, financially
and managerially.
There is a worldwide trend towards power sector reform including the
introduction of competition among suppliers. This development together with the
opportunities offered by renewables could have a major effect on the way rural
electrification is approached, not only in electrified countries but also in developing
countries. With the emergence of a more competitive and deregulated environment,
utilities are being forced to reassess the benefits and costs of many of their internal
business practices and to increase their efficiency. This development is at odds with
electricity supply to rural and remote areas because of their generally unfavourable
contribution to the financial performance of the utilities. It is therefore possible that a
drastic economic rationalism may result in a fall of interest in the electrification of
rural areas.
The central hypothesis is that current developments and trends force a more
advanced approach to electricity supply to rural and remote areas, which should be
reflected in the operations of utilities.

6
 This study is to analyse rural electrification issues in the light of past experiences
and current developments in the electricity supply sector and aims to provide an
insight into the way rural electrification is to be carried out.
1.3. Research justification
1.3.1. Objectives of the investigation
Originally, the research was initiated out of surprise that so many rural
electrification projects in developing countries were considered to be below standard
and also from curiosity into the possible effects of current sectoral developments and
trends on rural electricity supply.
The idea that, where relevant, future electricity supply to rural and remote areas
should be done following a fresh approach played a role in the decision to actually
perform the research.
The research aims to prove the central hypothesis but it also seeks to contribute to
the utilities could take full advantage of new technologies and better insights to meet
their objectives.
In fact the research has a dual objective. In one respect it aims to make a
theoretical contribution to the scientific knowledge about rural electricity supply and
in the other to generate and disseminate knowledge which could support decision
makers of utilities and donor agencies when deciding on policy.
With regard to the latter point, the research concerns the field of strategic
planning, including the implications for utility operations. To this end the research
identifies and assesses relevant trends, looks ahead to opportunities for electricity
supply to rural and remote areas and translates the results into operational
recommendations. In this respect the present publication seeks to complement
existing literature and to act as a vehicle of technology transfer. The implementation
of the recommendations suggestions will need individual tailoring to specific
circumstances and this can only be done on the basis of a thorough knowledge of the
situation. The results of this research are expected to contribute for the
implementation, in rural and remote areas, of utility facilities that are energy-efficient,
environmentally, financially optimal and sustainable.
1.3.2. Societal relevance
The societal relevance of the research is based on the following observations.

7
 The large numbers of global villagers in rural areas that are still deprived of access
to electric power but undoubtedly want to use it in the very near future. A
continuation of business as usual would imply an increasing number of people
deprived of electricity.
The assessment of rural electrification projects revealed that many of the existing
rural electrification systems in developing countries fell short of expectations. The
costs associated with disappointing projects can be very high. There is a need for an
efficient, effective and affordable electricity supply to rural and remote areas.
The need is to implement ecological and energy sustainable solutions in the
world’s power supply. Rural areas in particular appear to offer opportunities for the
deployment of renewables and these can be geared up to meet the demands.
The tendency of reforming the power sector and introducing competition could
have adverse consequences but also opportunities for rural areas. A well performing
organisation is extremely important particularly when the developments become more
radical and significant.
Given these observations, it appears sensible to investigate whether presently
available technologies and insights enable and/or require a specific organisation of the
electricity supply to rural and remote areas. The results could contribute to the
betterment of the situation of rural communities and in the performance of the
organisations serving their areas.
1.3.3. Scientific relevance
In literature, there have been many publications on electricity supply to rural
areas. Foley (1995) addressed in his publications nearly all the aspects of rural
electrification.
Barnes (1988) focused in his study on the socio-economic impact of
electrification. He also addressed cost-benefit ratios of electrification in both financial
and social terms and the various rural electrification policies.
The National Rural Electric Co-operative Association has also been very active in
the field of rural electrification.
Most of the research has addressed issues such as the technical and financial
performance of both grid connected and decentralised power systems and the socio-
economic impact of electrification. The implications of recent developments and

8
trends for power utility operations seem to have received less attention. No research is
known of, in which the effects of current developments and trends have been
systematically and integratedly investigated as per my little knowledge. The present
research undertakes such a task.
This study links existing theoretical knowledge, case studies and practical
experience with the aim of increasing the specific expertise needed for organising
utility operations. In this respect the publication also aims of bridging the gap between
more theoretically focused researchers and managers/decision makers with a more
practical approach.
1.4. Research domain
This study is confined to the electricity supply to rural and remote areas. The
problems applicable to large scale systems differ from those of the electricity supply
to rural and remote areas and are mainly of an administrative and technical nature.
The importance of historical research is highly valued because it creates the
possibility of identifying analogies and analysing the experiences gained with
alternative arrangements. These cases have been selected on the basis of the extent
and quality of the available information and the diversity.
Given the scope of this study, past research and the experiences in both
developing and developed countries, it is argued that there is no need for an in depth
analysis of all the aspects of rural electrification. The reality of electricity supply to
developing rural areas is very complicated and there are many relevant aspects.
Technical developments have been analysed to identify their possible opportunities
and implications on both the supply and the demand sides. The emphasis is on an
integral approach and on the success factors for rural electricity supply.
1.5. Structure of the research
1.5.1. Fundamental and application-oriented research
The viewpoint has been put forward that science should serve only for the solution
of societal problems and that science as such should be avoided. There is a difference
between the notions of fundamental research and application-oriented research.
An important difference is that fundamental research can be considered as
independent of time, place, subject/client and observer while application-oriented

9
research is subject/client dependent. In the former case there is no direct beneficiary
while in the latter case a concrete person or organisation can always be recognised.
Another important difference is that fundamental research basically aims at
maximum truth and application-oriented research at maximum usefulness. In
technology the applications are in fact the horizon of all research, fundamental
research included and energy research is for the greater part, or even totally,
application-oriented.
The notions of fundamental and applied research do not cover certain activities
and the distinction is in fact meaningless because neither can exist without the other.
The best solution is to avoid a distinction between fundamental and applied research;
but a pragmatic approach is needed. Long term fundamental research remains
necessary to further explore basic existence and there is also a need for application-
oriented research to help in solving society-driven problems.
I have tried to approach the research in such a way that a synthesis of academic
research and power utility practices could be achieved. In doing so, I had to balance
the degree of attention paid to the various subjects.
1.5.2. Research method
Previously, rural electrification projects were treated as solely technical activities
and separated from other rural aspects. Evidence suggests that rural electrical energy
supply must be treated within the context of rural development at large.
To this end, thinking in processes rather than in disciplines is needed. In effect this
research aims at giving policy recommendations so that, those involved can make
relevant decisions applicable for their particular situation.
To transfer expertise to the industrial sector, a thematic and even more
importantly-an integrated approach is necessary. Moreover, one should focus on the
recognition of both problems and the directions of solutions.
The electrical energy supply to developing rural areas is an area par excellence
where technology, organisational, social and economical sciences should work
together. The present research does not unveil a new area but adopts an integrated
approach to identify the implications of various developments for the organisation of
power supply utilities in rural and remote areas.

10
 The objective of this research is to identify and assess relevant trends, to look
ahead to opportunities for electricity supply to rural and remote areas, and to translate
the results into recommendations that can be used by decision makers. This study
therefore analyses rural electrification issues in the light of past experiences and
current developments in the electricity supply sector and discusses theoretical aspects
related to the environment of electricity supply utilities.
In effect this work consists of three components: an analytical, case studies and a
practical component divided between a numbers of chapters. The analysis of the
developments and trends leads to three research themes: the rural market, the
available technologies, and institutional aspects.
The information needed for the research has been obtained from, study of
literature, survey of policy documents, project assessments and case studies. A
number of case studies are used throughout the research but they mainly provide
qualitative information. To the best of my knowledge, there is perhaps so far, very
few studies had been done on this area.
1.6 Contents of the thesis
Chapter 2 deals with the objectives, features of rural electricity supply, benefits of
rural supply namely socio-economic, political and environmental, challenges faced by
rural communities, technologies commonly used and implementation aspects like
costs in the world.
Chapter 3 discusses the salient features of Indian electrical power sector and
reforms, state electricity boards, governance of RE, a case study of energy pattern in
a village, transmission and distribution network, specific challenges, and international
experiences of Argentina, Bangladesh.
Chapter 4 makes a study of features of rural electrical loads in India, a case study
of load profile of urban, peri urban and rural feeders, and also comparison of three
different rural feeders.
Chapter 5 elaborates the different types of renewable energy options for India like
small hydro power, wind, and biomass, geothermal and solar. Few aspects of solar
for India, rural home and factors considered for PV panel erection are also touched
upon.

11
 Chapter 6 identifies the technical feasibility study of solar home systems, its
preliminary design, project design and economic considerations with a case study.
Chapter 7 gives insight into some economic analysis like energy payback period,
net present value, life cycle cost and recycling of PV modules.
Chapter 8 concludes with observations, recommendations, and future directions.

12
CHAPTER 2

RURAL ELECTRIFICATION IN THE WORLD

2.1 Review of Literature
2.1.1 Rural Electrification
The importance of rural electrification (RE) in the development process is
recognised in a number of studies and assessments of RE programs that have been
carried out during the past decade by the third world countries. (Mohan Munasinghe
1990)
Recent interest in RE has emphasised the importance of linking its development
with productive uses for energy and poverty reduction. This has been viewed as
necessary to increase the pace of RE and to reduce its concentration on a relatively
small number of developing countries. Despite this emphasis, progress in electrifying
remote rural areas has been slow. In part this has been attributed to the emphasis on
cost recovery and a reliance on the private sector to deliver electricity widely( Paul
Cook 2011). The literature on the role and relation of infrastructure in rural areas, to
economic growth and development. He focused on the poverty reduction by the major
international development agencies and examined the arguments for increasing rural
incomes. He analysed reviews the economic and social issues underlying the
development of RE, drawing on the experience with both grid and off-grid
applications in developing countries and assesses the impact of electrification on the
ability to generate income in rural areas.
It is commonly recognised among rural energy experts and development
practitioners that electrification activities in rural areas of developing countries should
be accompanied by complementary services. Nevertheless, RE projects that confine
themselves to hardware financing and civil works without undertaking escorting
activities are observed frequently. One intriguing result is that the target group is
frequently not aware of the economic potentials of electricity and hence cannot be
expected to consider the grid connection decision and the usage of electricity
rationally in an economic sense (Jorg Peters et al. 2011). He concludes that
responsibility for complementary services should be in principle with the grid

13
operator while the government or regulatory bodies have to assure welfare orientation
of the services.
Electricity at home has now become a basic necessity of life throughout the
developed and developing world. Grid connections have reached nearly all
households in the developed countries; in the developing world have so far been able
to connect below 50% of the households to centralised grids. RES now compete with
grid-connected electricity in remote and rural locations because of the followings.
(Siyambalpitiya D. J. T. 1991):-
• Rural locations have only a few consumers and they too are scattered over a wide
geographical areas.
• Remote locations are mostly inhabited by domestic consumers with a little
prospect for industrial and commercial growth.
• Domestic consumers are mainly peak-time consumers and do not contribute to the
improvement of the poor load factors.
India accounts for a third of the world’s population without access to electricity
and about 40% of those without access to modern energy. Such a situation exists
despite several initiatives and policies to support poor households. Alarmed by the
gravity of the situation, the government has recently announced an ambitious
programme of RE. The energy access situation of India, RE alone is unlikely to
resolve the energy access problem because of low penetration of electricity in the
energy mix of the poor. (Subhas C. Bhattacharyya 2006)
Prior to the advent of renewable energy technology, the global rural electrification
process (O. Dzune Mipoun and P. Pillay 2009) was delayed for reasons such as:
• The increasing problem of dispersal of the villages.
• The complications with alternatives to grid extension.
• The relatively higher electrification cost for villages located away from grid.
Therefore diesel village power supplies were used, disregarding the environmental
impact and low reliability of diesel generators.
There is a strong argument in favour of putting greater emphasis on efficiency and
restructuring issues, rather than concentrating solely on continued power sector
expansion. More attention needs to be given to improving the quality of the service

14
and reducing losses through rehabilitation and reinforcement of power systems.
(Mohan Munasinghe 1989)
2.1.2 Grid connected RE
The RE in developing countries is fundamentally different than in developed
countries. So different electrification could be made by a Medium Voltage
distribution system or by an autonomous hybrid power system. (Thirault D. 2003)

Many problems associated with RE are socio-economic in nature and do not have
simple solutions. There are however, a number of technical problems, which have
arisen from an unplanned growth of grid. First rural electrification in India has been
almost entirely carried out by extending the grid. Secondly the distribution networks
have grown in a haphazard fashion. As a result, distribution losses are very large and
often the terminal voltages are poor. Rarely have rural local resources been utilized
for generating power. The first way is to study the already existing system and
providing solutions like-express feeders, replacing transformers of relatively larger
ratings, computer aided cost effective solution for loss minimization. (D P Sen. Gupta
1989)
RE is not an attractive investment options to the utility. However, the benefits to
the individual consumers and to the national economy are considerably high. RE in
Srilankan case with circuit configuration, consumer density, consumer distribution,
potential for industries and cost analysis is carried. ( Ijumba N M 1999).
The demand side management (DSM) in rural areas (in France) of transmission
and distribution, involving the power load curve. DSM has been implemented from
1995 onwards to avoid the need for grid reinforcement and renewable sources dealt.
(Jean Pierre Tabet 1997)
ESMAP (2005) dealt with different aspects rural electrification in Brazil like grid
extension, isolated systems and decentralised systems. Social and economic benefits
of rural electrification and development in the Philippines are measured.
Performance of electrical and electronic equipment at various farm rural industrial
sites in and power quality monitoring of rural distributions in Canada is presented
(Don O Koval 1992).

15
 Mathematical modeling of rural distribution network, voltage drop, loss
calculations and power flow studies using digital computer.(Charles W Brice III
1992) The cost of delivering electricity in remote areas considering cost of generation
of electricity and also cost of its transmission and distribution in the country have
been estimated. Considering electricity generated from coal thermal power plants, the
delivered cost of electricity in remote areas, located in the distance range of 5–25 km
is found to vary from Rs. 3.18/kWh to Rs. 231.14/kWh depending on peak electrical
load up to 100 kW and the load factor.( M.R. Nouni et al. 2009) He concludes that
micro-hydro, dual fuel biomass gasifier systems, small wind electric generators and
photovoltaic systems could be financially attractive as compared to grid extension for
providing access to electricity in small remote villages.

2.1.3 Renewables in RE
South Asia accounts for 42% of the global population without access to
electricity. Such a situation continues to exist despite several initiatives and policies to
support electrification efforts by the respective governments. The challenges to
enhance electricity access are manifold including technical, financial, institutional and
governance barriers, focussing on renewable energy based mini-grids, stand-alone
systems and also conventional grid extension. The household connection needs to be
improved considerably through a targeted approach and innovative micro-lending
model. At the same time the electricity supply also needs to be enhanced, such as
through distributed power projects utilizing locally available renewable resources, to
ensure that connected households continue to receive electricity and that supply
constraints do not inhibit extending electrification to new areas. Developing a
regulatory mechanism to extend the tariff fixation for mini-grid projects and
providing cross-subsidies to ensure long term sustainability of such projects are
highlighted.( Debajit Palit and Akanksha Chaurey 2011) Finally, economic linkages,
access to credit and institutional arrangements also need to be organized
appropriately, especially for off-grid RE to facilitate successful outcomes.
The demand for energy in rural areas is likely to continue to rise due to the
development process and increase in population. The need for bringing about
efficiency in the usage of non-commercial fuels such as fire wood and agricultural

16
residues is important, while at the same time renewable sources of energy such as sun,
wind and hydal potential have to be harnessed for meeting the increasing demand of
energy in the rural areas. RES of energy being decentralized in nature are cost
effective in modular form and help to cut in transmission and distribution cost.
(Anantha A 1996)
Promoting renewable energy in India has assumed great importance in recent
years in view of high growth rate of energy consumption, high share of coal in
domestic energy demand, heavy dependence on imports for meeting demands for
petroleum fuels and volatility of world oil market. A number of renewable energy
technologies are now well established in the country. The technology that has
achieved the most dramatic growth rate and success is wind energy; India ranks fourth
in the world in terms of total installed capacity. India hosts the world’s largest small
gasifier programme and second largest biogas programme. In spite of many successes,
the overall growth of renewable energy in India has remained rather slow. (S.C.
Bhattacharya and Chinmoy Jana 2009) He has dealt with the number of factors that
are likely to boost the future prospects of renewable energy in the country; these
include global pressure and voluntary targets for greenhouse gas emission reduction, a
possible future oil crisis, intensification of rural electrification program, and import of
hydropower from neighboring countries.
Hybrid energy sources are preferred because of abundant and freely available,
virtually pollution free and have comparatively low maintenance costs. However, this
energy has not been exploited fully, mainly due to the relatively high costs associated
with the energy conversion technologies. Rural loads are characterised by low load
factor, which has a negative influence on plant operating costs and makes it less cost
effective to supply them from grid. In such cases hybrid energy sources become the
best alternative despite having comparatively high installation costs. The cost can be
minimized if there is optimal load sizing by which the source and load characteristics
are effectively matched and the supplied energy is efficiently and rationally utilized.
(Ijumba N M 1999)
Available distributed generation technologies and their economic performance in
rural areas of India with particular emphasis on comparing the costs of hybrid
distributed generation systems with conventional grid connections for remote rural

17
villages. Modeling inputs are based on demand, fuel availability, costs and local
operating conditions found in the Kachchh district of Gujarat. (Hansen C. J. and J.
Bower 2003)
2.2 World rural electrification scenario
Electricity is the key to the modern world. In addition, with technical progress, the
gap between the electrified and the non-electrified world continues to widen. The
dilemma facing many developing nations is that while they recognise this, the
required resources are in short supply. Rural electrification policy making is a
challenging task. This demands clear thinking about the distribution of benefits of
rural electrification, payment for obtaining, criteria to be used in the selection of areas
for electrification and supply technologies.
Motivations for rural electrification programs are generally threefold: social,
environmental and economic. A few governments have based their programs on
explicit political objectives such as improved rural political stability but more
commonly social and economic objectives are combined. Financial logic indicates
that electrification should focus first on those areas with high economic growth
potential and lowest cost. However, other goals such as social equity, agricultural
development and reversal of rural-urban migration may force utilities to compromise
their financial objectives. (Table 2.1 and Fig. 2.1 to Fig. 2.4)
Table 2.1 Electrification in the world (Source: World Energy outlook 2009, IEA)
Population Electrificati % age % age Rural
without on rate Urban electrification
electricity (millions) % electrification
Africa 587 41.9 68.9 25.0
North Africa 2 99.0 99.6 98.4
Sub-Saharan Africa 585 30.5 59.9 14.3
Developing Asia 799 78.1 93.9 68.8
China & East Asia 186 90.8 96.4 86.5
South Asia 612 62.2 89.1 51.2
Latin America 31 93.4 98.8 74.0
Middle East 22 89.5 98.6 72.2
Developing Countries 1,438 73.0 90.7 60.2
Transition economies 3 99.8 100.0 99.5
& OECD
World 1,441 78.9 93.6 65.1

18
 The pace of rural electrification over much of the developing world is
painfully slow. In many African and South Asian countries, it is even lower than
rural population growth. In low-income countries final consumption of energy in the
residential, services, industry and transport sectors is low and is comprised mainly of
biomass. In high-income developing countries, the fuel mix is much more diverse and
the overall amount of energy consumed is much higher.

Fig. 2.1 World Population without access to electricity

(Source; World Energy outlook 2009 IEA)

Billions of people:
Abject poverty: 1.3
Poor: 0.6 3.3

Less poor: 1.4

2.8
Middle class: 1.4

Rich: 1.2

Fig 2.2 Mapping energy access taxonomy (source; Gruebler at al. 2008)

19
 Fig. 2.3 People without electricity Fig. 2.4 Energy access (Source; WEC 2010)
Demand for mobility, which is indicated where the share of other petroleum
products in final energy consumption is high, is much greater in countries with a very
low percentage of the population living on less than $2 a day (Fig. 2.5).

Fig. 2.5 Per-capita energy consumption (toe) and income in developing countries
About 22% of the world’s population still does not have access to electricity. In
2008, this represented 1.5 billion people, most of who lived in remote areas often
difficult to access and to connect to national or regional grids. The IEA (2009)
estimates that roughly 85% of the people without electricity live in rural areas in
developing countries, mostly in peri-urban or remote rural areas. Today, most of these
people are found in sub-Saharan Africa and South Asia. The IEA predicts that in
2030, if no new policy to alleviate energy poverty is introduced, 1.3 billion people
(16% of the total world population) will still be denied electricity most of whom in
South Asia and Africa. Fig. 2.6 provides an illustration of the quality of energy

20
services for cooking and lighting as income rises at the household level. The figure is
reflective of energy consumption in rural households.
Cooking Lighting Cooking Lighting Cooking Lighting
CFL Gas, LED
Electric
Energy Bulbs oven CFL
Improved Solar
Services
cook Lantern Biogas Solar Biogas
stove lantern
Kerosene Improved Improved
Three lantern cook Kerosene cook
Stone fire Candle stove lantern stove

Low Income Middle Income High Income

Fig.2.6 Quality of energy mix services in rural households (Source; WEO 2010)

The indicator of the quality of delivered energy services on the vertical axis (Fig.
2.6) is designed to capture a variety of dimensions, including cleanliness, efficiency
and affordability. Access to electricity accordingly can reduce total household energy
costs dramatically, if upfront costs related to the connection are made affordable. In
addition, successful energy efficiency initiatives reduce electricity demand which has
the secondary benefit that existing generation plants can be used to supply new
households, thereby reducing the need for capacity additions.
Not all electrification policies target poor rural households. Some also target a mix
of farms, big villages and small towns all of which call for different technologies. In
fact, rural electrification policies are shaped according to the various energy needs,
resources and target groups.
2.2.1 Definition of rural electrification
Basically, the concept of RE refers to the electricity supply to areas outside of
cities. But many researchers have given the concept highly divergent interpretations.
(Munasinghe 1990) He notes that rural electrification schemes are often defined in
terms of local administrative units mainly for convenience in implementation. He also
observes that most often the term RE refers to connections to a central grid.
As per the understanding of agencies such as the World Bank, the concept of RE
does not only refer to strictly rural areas as defined in the country statistics but may

21
also include small to medium-sized towns which are service centers for the
surrounding rural areas within a given region.
Rural electrification is defined as “the availability of electricity for use in rural
communities regardless of the form of generation”. RE comprises all activities aimed
at enabling users situated outside major cities to have access to electricity. (Barnes
1988). The electrification process can be differentiated from the conventional scheme
of extension of a national grid, as it covers everything up to independent
configurations supplying power for a specific, determined need, and the solving of
specific technical and economic problems.
In recent years, with the sustained and rapid development of economy and a huge
demand for energy consumption in rural areas, the electricity’s supply cannot meet
the requirements of rural electricity consumption development and turns into a
bottleneck to economic development in rural areas. It became particularly important
that the Wu Guangwei et al. (2011) took a research of electricity consumption in rural
areas and then established a predicted model of regional electricity consumption in
rural areas.
Literatures revealed that most of the RE projects in the past referred to
communities of between 500 and 2000 people. The definition of rural electrification
varies considerably between the countries. In one country rural also includes
provincial towns with a population up to 50,000 and in another it refers to small
farming villages and surrounding areas. (Foley1990) He identifies that one of the
consequences of these differences in interpretation is that a comparison between rural
electrification projects in different countries is extremely difficult if not impossible.
In the context of this study rural electrification encompasses the activities
designed to provide people with access to electricity in those areas which show
specific features. These features do not only include low loads and the need for
special approaches and area specific opportunities.
The method of bringing electricity to these areas can be very different including
isolated generators serving a single or several consumers, supply from a regional or
national grid, and solar home systems. It is also observed that the methods can vary,
depending on local circumstances and the degree of saturation of the electricity
supply.

22
2.2.2 Objectives of rural electrification
The objectives of rural electrification programs in the latter countries have been
very mixed. In one country the reduction in the growing disparity between rural and
urban areas with its social consequences and resulting urbanisation was the main
objective, while in other countries the improvement of social conditions or the
discouragement of the unrestrained expansion of decentralised and non standardised
power systems typically had priority.
The improvement of the economic situation of the population by increasing rural
industrialisation and productivity, and the improvement of rural living conditions up
to the level enjoyed in urban areas.
There is indeed good reason to consider both objectives simultaneously. To
successfully support rural development, the appropriate circumstances in rural areas
are necessary and, in this respect, electricity is a very attractive means.
Rural electrification schemes are usually justified by reference to multiple
objectives and the reasons for the implementation of a rural electrification programme
may vary from one country to the other.
The objectives can theoretically be grouped into four categories: economic, social,
political and environmental. In practice, however, often two or more objectives occur
simultaneously and are interrelated.

2.2.3 Features of rural electricity supply areas

From the energy point of view, there are important differences between urban and
industrialised areas and rural areas.
• Urban and industrialised areas feature a substantial higher energy density and
market opportunities for both heat and power relative to rural and remote areas.
Linked with these differences are the methods and opportunities appropriate to
satisfy the energy needs.
• The features of urban and industrialised areas make it economically more attractive
to develop and operate connections to a local, regional or even a national power
system, to efficiently deploy combined heat and power units, and to provide
adequate services. These circumstances offer opportunities to provide heat and
power at reasonable prices.

23
 Rural areas show other features like characterised by scattered clusters of
premises or by scattered single farms. In most developing countries rural electricity
systems are characterised by dispersed consumers with often limited consumption, a
low load factor and relatively low quality of power supply. Dispersed consumers
require long supply lines and/or diesel-based or other generating units.
RE benefits the poor, acts as a catalyst to rural development. Rural energy
problems are particularly complex and RE tries to offer an easily replicated solution,
it assists in reducing rural-urban migration and thus in the alleviation of urban
congestion and its associated social consequences, it helps to promote political
stability in rural areas and it has, through the provision of better lighting and other
gadgets, social benefits such as an improved health, the enhancement of literacy,
general education and the social cohesion and development in rural communities.
RE is not sufficiently special relative to urban electrification, conventional rate of
return criteria should play a stronger role in determining rural electrification
expenditures and that some of the non-monetary benefits appear neither to be
widespread nor as strong as supporters of rural electricity suggest. While rural
electrification is nonetheless important in the development process, it is more usefully
integrated into wider rural energy development schemes. On the basis of an
assessment of the actual achievements of projects, that there is no or only little
evidence that the expectations regarding the benefits often attached to rural
electrification, have been substantiated in the past.
Rural electrical distribution projects generally cost more than urban electrical
distribution projects per connected household and that government policies are
sometimes directed specifically at the rural areas making it necessary to identify rural
areas in electrification programs. However in some countries power distribution
installations often cover the electricity supply to urban, peri-urban and rural areas and
therefore a precise separation may be difficult. There are three major reasons
suggested for a distinction between rural and urban power supply:
1. Rural electrification schemes generally cost more on a per connection basis as a
result of dispersed loads, the rather low consumption and the poor load factor.
2. Rural electrification should be integrated or coordinated with other rural
development programs.

24
 3. Urban and industrial power supply and rural power supply need different
marketing and technical approaches.
Table 2.2 summarises a number of features specific to urban/industrialised supply
areas and rural supply areas.
The electricity needs of one billion rural poor, who often live in remote areas, are
quite different from the urban and grid accessible populations. The information
provided in the table 2.3 assumes an average family size consisting of six people. The
estimates given are for end-use equipment that is currently commercially available.
The estimated power use is about 0.08 kWh per day per person (80Wh/day/person).
The annual power use per person is about 30 kWh (0.0035 kW per person). With
rapid advances in efficient end-use technologies, such as CFL, white LEDs, the daily
energy usage will be further reduced. At present, the initial costs of these technologies
are prohibitively high for implementation.
Table 2.2 Comparison of urban and rural supply (Source; Munasinghe 1990)
Features Industrial/Urban supply Rural supply areas
areas
Area load (kW/sq.km) 500 to 100,000 2 to 50
Consumer density >500 1 to 75
(Connection/ sq. km)
Number of consumers/km >75 1 to 75
length (both MV and LV )
Total cost/kWh(UScent) 10 to 15 Grid : 12 to 50
Diesel : 25 to10
SHS :50 to 500
Investment cost/ <500 500 to 700
connection average 1200
(US $) excluding extremes of over 2000
generation & transmission
Social aspects Limited Specific financial
support and solutions
needed
Technical and Large projects; often heavy Various technologies &
organisational aspects power technologies on small scale applications;
supply and demand supply; low load factor-domestic
Reasonable load factors as & agricultural loads;
a result of mixed loads intensive customer
support
Socio-cultural aspects Seldom important Important
Economical aspects Profitable business Limited profitable
opportunities business opportunities

25
 Table 2.3 Estimated capital cost and energy use for household electrical services
Equipment(numbers) Capital cost Power Usage Daily
(US$) demand (hours/day) energy
(kW) (kWh/day)
Light fixtures(2) 6 - - -
Bulbs 2 numbers 10 0.040 5 0.2
(20Watt,CFL)
TV 90 0.007 4 0.18
Other 50 - - 0.18
Total/household 200 - - 0.48
Total/person 34 - - 0.08

Rural people generally do not want energy in itself, but the ‘energy services’ it
provides, such as lighting etc. An estimate of the required services results in an
average of 0.025 kW per person which is an order of magnitude smaller than the
global average of 0.3 kW per person, significantly smaller than the 1.8 kW per person
in the United States. Thus, the electric power per capita of about 219 kWh per year
(based on 0.025 kW per person) would be quite small but it would be sufficient to
meet basic necessities and improve the Human Development Index(HDI)
considerably. While describing the energy problems of the poor, the IEA points out
that about 1.6 billion people are living on less than $2 per day. Because of the lifestyle
changes electricity brings, it is observed that spending about 10% of the family
income towards the electricity services is quite common. The estimates of per capita
income ($225) and average required electricity services (219 kWh) result in an
affordable unit cost of electricity of about $0.10 per kWh.
In developing countries the majority of the people still live in rural areas but
urbanisation is growing. In 1950, about 83%, and in 1975 about 75%, of the
population in developing countries lived in rural areas. At the turn of the century
some 60% of the population of developing countries is expected to live in the rural
areas but nevertheless rural population continues to grow by 1.4% (Asia) and 2%
(Africa) per annum. The measures which are effective in the long run in releasing the
pressure on migration encompass a control on the population growth, the creation of
employment and the education i.e. Providing Urban Amenities in Rural Areas
(PURA).

26
2.3 Benefits of rural electrification
The idea that RE in itself substantially contributes to the development of rural and
remote areas was prompted by the experience that most of the expectations were
structurally not met, and on the other by a growing discomfort about the below
standard performance of many rural power systems in developing countries.
Economic and environmental benefits of rural electrification tend to be overestimated
and the costs understated. The majority of the rural electrification projects were
related to the extension of a central grid and demand forecast was often based on
overoptimistic expectations regarding regional development and people’s ability to
pay.
Rural electrification is potentially a desirable investment in many countries but
there has been considerable discussion going on about the socio-economic benefits
and the costs of the electrification of these areas in developing countries. For many
rural people in the Third World however, electrification of their areas means
modernity, progress and, above all, ‘light in the darkness.’ (Foley 1990)
2.3.1. Assessment of benefits
RE can be made effective with complementary factors like: local attitudes and
skills, the state of the infrastructure, levels of income, patterns of land use and land
ownership, access to credit and the demand for products. An impact evaluation needs
to address all the attributes of rural development: improvements in infrastructure to
support local industrialisation increase in agricultural productivity and improvements
to public services (Barnes 1988). A quantification of the effects of electrification in
terms of these aspects is however difficult and the conclusions rather unreliable; the
indicators are often debatable as they depend on many other factors. The
methodologies used to analyse the costs and benefits of rural electrification have been
the subject of many studies and papers. Basically there are three methods that can be
used to assess the economic benefits of electricity used for productive purposes:
• Direct method- the willingness and/or ability of the consumer to pay based on the
additional income generated through the use of electricity.
• Indirect method- the additional output of the production process as a result of the
use of electricity.

27
 • Intermediate method- the determination of the costs avoided by the introduction of
electricity.
These three methods only measure the static, immediate benefits of electrification
but that many more benefits such as the growth of small scale industries and
commercial enterprises, and the social development of a community may be
identified. It is very difficult to determine the socio-economic impact of rural
electrification projects for two essential reasons:
 It is impossible to isolate the specific impact of electrification within a
development process.
 Most available assessments were carried out by organisations that were involved
in the projects and thus it was important that the conclusions of these assessments
were positive.
Benefits of rural electrification are consumer, utility and country. In terms of the
feasibility of rural electrification, utilities compare their costs and benefits and the
result is usually negative. There are however other benefits, some of which are very
difficult to quantify. (Munasinghe 1999)(Table 2.3 and 2.4)
Tables 2.3 Quantifiable benefits of rural electrification (Munasinghe 1999)
1 Industrial uses of electricity
1.1. Motive power: replacing liquid fuel.
1.2. Lighting: replacing liquid fuel or gas.
1.3. Space heating, cooling and refrigerating: replacing liquid fuel, coal, gas,
biomass or animal waste.
1.4. Processing food: replacing liquid fuel, coal, gas, biomass or animal waste.
1.5. Transport: replacing liquid fuel
2 Commercial uses of electricity
2.1. Lighting.
2.2. Air-conditioning and refrigeration.
2.3. Improved audio and video opportunities.
2.4. More attractive atmosphere.
2.5. Longer opening times
3 Household uses of electricity
3.1. Lighting-replacing liquid fuel, gas, biomass or animal waste
3.2. Cooking-replacing biomass, animal waste, liquid fuel, coal or gas.
3.3. Space heating, cooling and refrigeration-replacing biomass, animal waste,
liquid fuel, coal or gas.
3.4. Home appliances (fan, iron, radio, TV etc)-replacing batteries, biomass/ coal.
4 Agricultural uses of electricity
4.1. Water pumping-replacing liquid fuel, coal, and gas or muscle power.

28
 4.2. Heating and drying-replacing biomass, coal or liquid fuel.
4.3. Chaff cutting, threshing etc-replacing liquid fuel, hydro and muscle power,
coal or biomass

Tables 2.4 Non Quantifiable benefits of rural electrification (Munasinghe 1999)

1 Modernisation, dynamic growth and attitude changes-catalytic effects.
2 Improvement of quality of life, community services and participation.
3 Income redistribution and improving social equity.
4 Employment creation.
5 Other socio-political effects such as improving political stability, reducing
discontent and disparities between urban and rural areas.
2.3.2. Socio-economic benefits
Numerous opportunities exist in rural areas to improve economic productivity by
means of electricity and to achieve social benefits. RE by itself has never been a
catalyst for economic development. Impact of electrification on agricultural growth is
often overestimated and that there is little evidence that electricity by itself results in
new agro-industries and commercial activities.
RE on its own does not cause development of rural areas but it can provide a
stimulus to economic activity, especially in the service sector and it can have a major
impact on the form that development takes.
The tendency to overestimate productivity gains in the industrial and commercial
sectors during the economic appraisal of electrification schemes has been systematic.
(Munasinghe 1990) He is of the opinion that rural electrification appears to stimulate
agro-industrial and commercial activity. He also reports that the electrification of rural
areas in developing countries promotes agricultural development best when certain
complementary inputs were included. It is best to select rural areas that are ready for
sustained growth for early electrification since these will generally exhibit rapid
demand growth. The more developed an area, the greater the impact of electricity on
economic growth and that rural electrification is a selective catalyst in the sense that
the regions already well equipped with infrastructure other than energy in fact reap
the stimulating effects.
The willingness to pay was determined on the basis of the avoided costs for
alternative energy resources. For domestic and small commercial consumers the
willingness to pay appeared to be 30% above the actual electricity tariff. For large
commercial consumers the willingness to pay was calculated at 42%. Electrification

29
had stimulated local economic development including the establishment of new
businesses.
RE should be regarded as an infrastructural prerequisite, based on an already
achieved economic level, for the further promotion of rural development. It should not
be seen in isolation from the overall development level and programme should not be
derived from the natural, but subjective, wishes of rural people to benefit from the
comfort of services requiring electricity supply. It should rather be justified in
connection with factors such as:
• An identified potential of economic activities which could not, or not adequately, be
realised without the availability of electricity.
• The ability and willingness of the society and their political representatives to
redistribute surplus and funds in favour of the development of rural areas.
• The ability of the institutions/establishments implementing the programme and
benefiting from it to cope with the organisational and financial requirements.
Thus, RE could become an instrument to diversify the economy, to create
employment, to improve general living conditions and to reduce rural-urban
disparities. Also it can contribute to prevent over-centralisation, congestion and
growing shanty townships and informal settlements in urban areas.
Rural electrification can significantly contribute to social and economic
development but that opportunities depend on complementary programs. A certain
degree of economic development seems to be necessary in creating the conditions for
successful rural electrification. This implies that electrification should follow and not
attempt to lead, regional economic development. When RE is considered and planned
in combination with other rural development activities, the social and political
circumstances need to be conducive. (Barnes 1988)
Investigations have shown that electrifying areas in general gives rise to increased
energy use because people begin to use all kind of appliances. Therefore argues that
providing electricity to a region may actually increase overall energy use, making
assumptions concerning energy cost savings somewhat difficult. He adds that with the
electrification of rural areas part of the population makes a major step forward.
Besides the social benefits, decision makers tend to give more importance to the
economic impact of access to electricity as an income-generating process. Electricity

30
use is expected to lead to more productive processes; the growth of businesses or
farms using electricity will then increase demand for electricity, leading to a virtuous
growth cycle profitable to both electricity providers and rural communities. Electricity
is indeed an important input to rural businesses, farms or other small rural structures,
adequate local conditions such as organised rural markets and sufficient credit are
necessary for such businesses to grow.
2.3.3 Socio-political benefits
Naturally the social objectives of rural electrification are directed at an
improvement in the living conditions of the rural population including the creation of
appropriate circumstances for education and health care.
Electrification of rural and remote areas in developing countries can more or less
be seen as a social project: the quantity of electricity is sufficient for lighting and a
few domestic appliances but insufficient to support productive uses. Electrification
should help to alleviate the perceived problems and boost the priorities of the
population, and it should be part of a rural development strategy. In general, the rural
population attaches great importance to the domestic uses of electricity. RE programs
sometime mainly benefits the higher income groups, although in some cases lower
income groups have benefited as secondary beneficiaries. However without any
additional productive use of power, there will be no increased income generation and
thus a limit to the ability to pay for the electricity.
Despite the fact that the impact of rural electrification on security, political
stability and urban/rural bias is difficult to measure, experience shows that the impact
of electric lights on security, civil order and educational facilities is perceived by most
rural dwellers as clearly positive. Gain in recreational opportunities such as TV and
radio and over time through the use of other electric appliances are benefits. But the
impact of the availability of electricity on rural/urban migration, water supply,
irrigation and cooking appears to be limited.

An improvement in the living conditions in rural areas can be effected through

satisfying basis needs and by promoting small-scale industrial activities aimed at
increasing economic independence. Reports also indicate that children living in
houses with electricity take advantage and do their homework mainly in the evening.

31
 Studies have revealed that in many developing countries most of the industrial
employment can be found in small-scale enterprises in rural areas and this is one of
the reasons why sufficient attention should be paid to rural development. In this
context it should be stated that an adequate provision of services, infrastructure and
technology has a decisive influence on the growth of agriculture and associated
industries.
Rural areas should not solely act as a supplier of raw materials but should also aim
at the manufacture of products with an added value. This aspiration can only be
realised if modern forms of energy, particularly electricity, are available.
2.3.4 Environmental benefits
Electrification of rural areas generally does not prevent deforestation during the
early years after electrification. It appears that the expected switch from wood fuel to
electricity for cooking purposes only happens on a very limited scale. In general the
rural population lacks the financial resources to buy electric appliances. Also the
cooking habits and the opportunity of buying small quantities of traditional fuel are
cited as reasons. In rural areas, land clearing for agricultural uses is often the main
cause of environmental degradation. The energy demand of the rural population is
seldom the cause of deforestation and, moreover, the population has often been
successful in managing the local environment.
In some countries, both urban and rural dwellers have discovered that the forests
can be a means to generate income with the effect of over-utilisation of resources. It is
therefore of utmost importance that any policy regarding energy supply and the
associated environmental impacts should cover both the urban and the rural areas.
2.4 Rural electrification planning
In developing countries, rural electrification is either treated as a stand-alone
project or as part of a country-wide distribution expansion program. In both cases it is
extremely important that objective criteria for village selection are developed and
applied in order to avoid interference.
“there does appear to be a general link between high levels of access to electricity
in rural areas of a given country and the period of time for which serious
electrification efforts have been pursued. Therefore, nations which have longstanding,

32
well established rural electrification programs, with strong government support, tend
to have fared better”. (Munasinghe 1990).
Strategic planning requires dealing with the main grid configuration and the
associated future investments, from grid planning covering individual investments in
the near future and construction design. The latter deals with the structural design of
each network component. An important feature is the area coverage: the extent of the
area, the number of consumers, and their distance to the grid to be served. The type of
coverage defines, on the basis of certain selection criteria, an area in terms of number
and classes of connections and a time frame.
Systematic planning of distribution systems is particularly poor in those
developing countries where the utilities are attempting to meet targets for connecting
a prescribed number of villages to the grid. This often results in meandering grid
systems which are inadequately equipped for future expansion, prone to outages and
which show excessive voltage drops and line losses.
The electrification of new areas is often seen as the first priority and so existing
systems are not reinforced in time and service reliability is jeopardised. Distribution
grid has been a dynamic nature and that additional investments are needed during the
phases of extension process, densification of the grid and reinforcement dynamics.
These phases can be recognised in every rural distribution system, since most grids
were initially planned for specific end-uses. They also conclude that the price
equalisation and other funding mechanisms systematically favour a single technical
option ‘connect a village to nearby village’ i.e. extending the central grid system.
Less capital intensive and more flexible solutions are needed to speed up the
electrification of rural areas for this purpose. A more sophisticated analysis of the
most cost effective ways of meeting rural energy needs is needed that takes into
account all the other possibilities. The cost of grid-supplied electricity is
underestimated and that this is particularly true where small and/or distant population
centre are connected.
The traditional approach using grid extension remains appropriate for urban and
industrial areas and for rural areas with a well-developed demand. For rural and deep
areas with a low demand, central grid based electricity supply is very sensitive to
demand growth and in general is too costly. For these situations decentralised

33
generation facilities are more appropriate. The application of hybrid systems such as
diesel sets in combination with PV, a hydro and wind-turbine strongly depends on
local circumstances and they tend to be technically complicated.
2.4.1 Region oriented approach
Rural development programs generally aim at improvement in infrastructure, to
stimulate local industrialisation, agricultural production and social services. Rural
development plans tend not to include electrification. As a consequence, and in spite
of the availability of electrical energy, there are very few development projects that
include a clear view of utilizing electricity for rural development for instance in the
agro-industry.
Although adequate energy provision is not the only relevant factor in rural
development, it is one of the prerequisites for improved agricultural and rural
industrial productivity. Modern energy in the form of electricity, in combination with
other essential conditions can help raise agricultural output by promoting innovation
and improving irrigation. Electricity, in particular, has also a vital role to play in
improving living standards through satisfying the basic needs of rural households
such as lighting.
A broad definition of rural electrification ensures that regional planning objectives
can be considered and that electrification can be regarded as a sub-programme and
development tool rather than one out of many vaguely defined projects. Traditional
energy technologies whenever feasible as such technologies have, in many cases,
been developed over a long period of time to meet the specific needs of the rural
areas.
All these considerations underline the need for an integrated and region-wide
approach to rural development. Such an integrated approach in rural development
schemes would of course demand close co-operation between programme developers,
energy engineers, foresters, sociologists, and the participation of the local population.
It is noted that there are probably few examples of such an approach, mainly because
of the tendency in many developing countries to centralise planning and decision
making.

34
2.4.2 General challenges faced by rural communities
Rural electrification is defined here as the process by which access to electricity is
provided to households located in the isolated or remote areas of a country. Remote or
rural regions lacking electricity supply are often characterised by well identified
challenges. They may lie at a reasonable distance from central grid, remote villages,
may be difficult to access (far from urban centers with a difficult terrain such as large
rivers or jungles), or may suffer harsh climatic conditions that render electrification
through grid extension a perilous task. Rural communities are also often highly
dispersed with a low population density and characterised by low load density
generally concentrated at evening peak hours and low revenues. In light of these
challenges, electricity provision to the world’s rural poor calls for a committed and
long-term action plan. The benefits that electricity access brings to households and
communities are justified not only on social and economic grounds but also on
grounds of equity objectives.
At the rural household level, electricity is mainly used for powering light bulbs,
fans, television sets and radio. When electricity is used for powering home appliances,
household chores tend to become less tedious; when it is used for lighting, the relative
brightness of the light bulb as opposed to candle light/wick lamp allows children to
read or study in the later hours of the day, bringing obvious education and leisure
benefits. Women and children benefit directly from these improvements, but
television sets offer comfort during evening leisure time.
2.4.3 Technologies commonly used in rural electrification policies
Socially, ethically and economically beneficial, the electrification of rural or
remote areas is usually high on the agenda of the leaders of major emerging
economies, but the main problem to overcome is the choice of the technology. The
choice of a specific energy technology for rural electrification naturally depends on
the targeted country and on whether it is a whole region, community, business, farm
or household that is to benefit from the process. Issues of customer and load density,
relative distance to the national or regional grid, landscape, availability of natural
resources such as wind, sun, water, forests, economic and financial aspects,
availability and maturity of any chosen technology, all these factors influence the
decision maker in his choice of the technology or technology mix.

35
 The pool of potential energy technologies for rural electrification programs is
quite large and each technology naturally varies in its generation technique, costs and
in the quality of the service it delivers. When aiming to electrify a rural community,
the first question is its distance from the grid. If grid extension appears to be relatively
easy, is cost competitive with respect to other local auto generators, and if the region’s
load density is considered sufficient, then grid extension will usually be a preferred
option. In India for instance, the first choice for a majority of the villages has been
through grid extension. But many of the dispersed rural communities did not meet all
these criteria at once. Grid extension was then the final phase of a sequential rural
electrification process and other local electrification technologies were chosen in the
meantime. In fact, once demand was built over the years by means of auto generation,
and it became economically feasible to connect to the central grid, grid extension was
chosen as a final step. Recently, however, mentalities have been changing and
governments as well as rural communities are beginning to see stand-alone systems as
long-term and reliable options for power generation, rendering grid extension less of a
mandatory long-term means of electrification.
2.5 Implementation aspects
2.5.1. Rural electrification costs
Both investment and operation costs of rural electricity supply differ from one
country to another but they are always far higher than in urban areas. These higher
costs are due to the following factors:
• Dispersed loads requiring long medium voltage lines or decentralised diesel power
stations.
• Line losses are often very high and the power system prone to service
interruptions.
• Expensive billing procedures and control of illegal connections.
• Low load factor due to dominant domestic consumption, agricultural demand with
seasonal periodicity and the absence of industrial demand.
Average costs per connection depend heavily on the structure of the medium and
low voltage distribution system and particularly on the number of customers served.
Cost per connection increases considerably with below 1000 connections.

36
 Transmission system and service connection costs are generally similar, at say
US$ 100 - 125/connection. An average modern central power station would cost US$
1,000 per kW. If a modest maximum load per connection of 0.4 kW, a coincidence
factor of 0.85 and a reserve margin of 30% is assumed, the total investment cost per
grid connection would amount to some US$ 1,900.The cost per connection is used to
compare costs of projects but it is not really a good comparator because of the
different mix of consumer categories.
Grid based electricity is by far the most costly form of energy supply in low-
density rural areas, when compared to the other alternatives. The real cost of
electricity is very high and in most cases is underestimated because of the low load
factors, the large distribution losses and the additional burden imposed during peak
demand periods. The economic internal rate of return (EIRR) of rural electrification
projects is generally below 15%. However the accuracy of the EIRR calculation for
most projects is not reliable. If all the benefits of rural electrification projects are to be
included in the economic analysis, then estimates will be required for the following:
• Revenues and connection charges paid by consumers.
• Any net cost savings realised by consumers due to electricity substituting for other
fuels.
• Consumer surplus from consuming more energy than previously i.e. on created
demand and increased production realised by agricultural, industrial and commercial
consumers.
• Unquantifiable benefits due to improved health services and education, increased
satisfaction and stability etc.
• Environmental benefits and hidden costs.
Grid-based systems are often implicitly assumed to be the least-cost solution when
compared with decentralised diesel generation.
2.5.2. Tariffs and subsidies
In many developing countries tariffs are permanently very low. Munasinghe
(1990) observes that in quite a few developing countries rural electricity tariffs rarely
cover more than 15% to 30% of estimated costs of supply.
Subsidisation often leads to a more rapid demand growth than would occur
without subsidies, making rural electrification projects appear rather successful. Also

37
subsidised electricity prices conceal the real costs, put the electricity supply entity at
risk. Today it is widely accepted that electricity should be provided economically and
efficiently at a price which, on average, reflects its full cost including the actual costs
of the resources employed and of the environmental detriments. Such prices give the
customers the right signals to use electricity efficiently, and enable the power
company to generate the financial resources needed for investments, operation and
maintenance.
Given the high capital costs and operation and maintenance costs of grid-based
rural supply systems, and the present ability to pay by the majority of the rural
dwellers in developing countries, it is unlikely that all costs can be covered in the near
future. However, tariffs should at least generate income to cover the operation and
maintenance costs and part of the capital costs to allow the utility to perform normal
operations. Apart from indirect subsidies, other subsidies extended are- subsidy on the
investment cost, subsidy to relieve the poor and cross-subsidy to achieve nation-wide
or region-wide tariffs.
a) Subsidy on the investment cost
Investment costs of rural electrification programs in industrialised countries have
in most cases been subsidised. In Ireland for instance, the government paid up to 50%
of the investment costs of rural grid extensions.
The success of the rural electrification programme in Thailand was the result of a
combination of factors: a commitment by the government to rural development and to
improve living standards in rural areas, a careful grid expansion plan with appropriate
selection criteria, cost orientation, an advanced revenue collection programme, a
pragmatic institutional approach and a system of cross-subsidies.
As a result of these measures, the cross-subsidisation, and a special bulk power
purchase tariff, the utility was able to finance the rural electrification programme and
have a reasonable return on its investments.
b) Subsidy to relieve the poor
One should be aware of the potentially perverse effects of subsidies, such as
electricity revenues obtained from the urban poor being utilised to subsidise the rural
rich. Better-off households benefit more than the poor from subsidised tariffs since

38
they can afford to purchase appliances and thus increase electricity consumption.
(Munasinghe 1990)
Subsidy programs should therefore be well designed and the beneficiaries
carefully targeted. The effects outlined above could be avoided by a tariff system with
which small consumers (up to say 35 kWh per month) are offered a low so called life-
line tariff. Such a tariff does, in general, not jeopardise utility operations and the
impact on larger industrial and commercial consumer tariffs is often modest.
Another method which is used (in some urban areas of South Africa) and which
helps the poor to obtain access to electricity is the possibility of paying only part of
the connection fee together with the use of a prepayment meter and an associated
tariff. The tariff covers the energy component plus a surcharge for re-payment of the
remaining connection costs.
c) Cross-subsidy to achieve uniform tariffs
In many countries, consumers in rural areas are often cross-subsidised by
consumers in urban areas. In industrialised countries, rural electrification was seen as
a way to modernise, and a policy was developed to subsidise rural consumers by
urban consumers. The major arguments underlying this policy were:
• Equal access by all citizens to public services including electricity.
• Inter-regional solidarity for reasons of national unity.
• Positive effects of electricity on rural development and living conditions.
As long as the number of consumers in rural areas is small compared with those in
urban areas, the impact on the general tariff will be modest. Without cross-
subsidisation, the tariff difference between the most favourable urban area and the
most unfavourable remote location could be well over 100%. The average will usually
be in the order of 30%.
Cross-subsidisation from urban to rural consumers is increasingly prevented by the
demographic situation in developing countries. Price equalisation to the benefit of
rural regions gives grid based electricity a false appearance of competitiveness
compared to less subsidised alternatives. This is notably the case with energy
conservation programmes and autonomous generating facilities. The latter have the
advantages that investments can be made more in line with actual demand growth and
they also offer the opportunity to exploit local available resources.

39
 Munasinghe (1990) argues that reasons for cross-subsidy must be well justified
and quantified including the corresponding efficiency benefits. He also states that it
may be better not to cross-subsidise but to focus on promoting the productive use of
power in rural areas because these types of consumers are more likely to be able and
willing to pay higher prices. The resulting revenues could then be used to subsidise
tariffs to poorer households.
Conclusions
Many energy sources will become economically feasible sooner if subsidies for
hydrocarbon sources of energy are eliminated and their prices include the costs of the
pollution associated with their use. It is emphasised that, apart from life-line tariffs,
direct subsidies on energy should be avoided and the environmental impact costs of
energy internalised.
Electricity is not a primary necessity of life. The greater proportion of the
population living in developing countries does not have access to electricity.
Traditional energy technologies have been developed over a long period of time to
meet the specific needs of the rural area and should not be ignored.

There are indications that socio-political changes, the spreading communication

gadgets and other electronic equipment, will induce a growing demand for electricity,
even in the deep rural areas. Essentially rural dwellers want improved lighting, video
and audio; electricity can provide these services conveniently. Electricity, because of
its flexibility, versatility and increasing pervasion, is essential if the rural areas in the
developing world are to rise significantly above the level of subsistence.
The contribution to energy related global pollution by the industrialised world is
still larger than that by the developing countries. There is no doubt that the global
village will face a number of problems in meeting the expected growth in demand for
energy services over the coming decades. The future challenge will be to meet the
increasing demand for energy services by the efficient, sustainable, environmentally
and socially acceptable ways. There is no doubt that electricity will play a major role.
Electricity has a number of advantages including the opportunity for fuel diversity and
deploying locally available resources, decentralised power generation and a guarded
control of environmental pollution.

40
 Rural electrification is but one aspect of rural development and it is often just one
of the possible options for satisfying the energy needs of the rural population. All
aspects of rural development must be considered together and it is important that the
electrification of specific areas is placed in the proper context with respect to other
development priorities. One of the most important issues with rural electrification is
the comparison between the costs and benefits. If affordable tariffs are taken as the
basis, a cost benefit analysis of a rural electrification project will usually result in a
negative outcome. The electrification of rural areas, however, should not be assessed
as an independent activity, but as one of the components of a rural development
programme. D Barnes and G Foley (2004) identified the following key points for
successful rural electrification program-
• Setting up of effective institutional support
• Dealing with the political dimension
• Criteria for rural electrification
• Importance of cost recovery
• Charging the right price for electricity
• Lowering the barriers of obtaining a supply
• Benefits of community involvement
• Reducing the construction and operating costs
• Alternatives to the grid
Experience revealed that the impact of rural electrification could have been higher
if other conditions would have been satisfied. There is reason to believe that, in the
past, in many electrified rural areas, further development has been limited as the
consequence of a lack of credit facilities, continued use of old fashioned technology,
lack of entrepreneurial and skilled labour and supporting services.
In this context it is noted that the electricity supply to deep rural areas offer
opportunities for the deployment of modern decentralised renewable energy
technologies. Stimulated by the liberalisation of the power sector, private capital is
increasingly invested in large power projects that can give an acceptable rate of
return.
To a number of industrialised countries investments in sustainable energy projects
in rural and remote areas are an attractive opportunity for so-called green funds. These

41
funds offer a limited return on investment but have fiscally attractive features. It
should however be noted, and this is particularly true for the poorest countries, that
sufficient financial resources can only be made available if the international
community gives priority to the development of rural areas in the developing world.
The energy sector in these poor countries should therefore be used as an instrument to
realise socio-economic rather than political objectives.

42
CHAPTER 3

RURAL ELECTRIFICATION IN INDIA

3.1 Rural Electrification
Governments all across the world confront the challenge of ensuring that their
people have access to the basic infrastructure services such as water, electricity etc.
This challenge is particularly acute for developing countries with large rural
population like India, Bangladesh, and Pakistan etc where density, distance, and
resource availability raise costs above local ability or willingness to pay.
Electricity is accepted as one of the driving forces of the economic development
of all the nations. The challenge of continuously generating electricity and meeting
the growing demands is daunting for both developed and developing countries,
exerting tremendous pressure on the energy infrastructure. From the time of India's
independence in 1947, the demand for electricity has grown rapidly. The per capita
consumption of electricity has increased at a CAGR of 6.04% since 1947. This
sustained growth is the result of economic development and has been accompanied by
structural shifts in consumption pattern.
Universal Service Obligation (USO) is an obligation imposed on the utility/service
provider to ensure provision of either the full package or a basic package of service of
good quality, to all users at affordable prices. Universal Service and Universal Access
though are closely related concepts and are sometimes used interchangeably; hold
different meanings. Therefore, it is essential to identify the subtle difference that
exists between these two terms. Universal service is aimed at increasing the number
of individual households with electricity connections and providing such services to
all households, including those in rural, remote and high cost locations. Universal
service policies also focus on ensuring that the cost of electricity services remains
affordable to individual users or to targeted groups of users. Universal service policies
are more commonly found in developed countries.
While universal service is a realistic policy objective in many industrialised
countries, universal access is a more practical goal in most developing countries.
Universal access policies work to increase access to electricity services on a shared
basis, such as on a community or village-wide level. Universal access programs

43
typically have the aim of providing a basic and initial connection to electricity in rural
or remote villages or low income urban areas. USO, thus, places an obligation on the
utility/operator to provide basic and initial connection to village or community.
In India also, there is a move from universal access to universal service with the
Government of India (GoI) setting out for itself, the Mission 2012, which aims
‘Power for All’ by 2012 accordingly:
• Rural (Village) Electrification should be completed by the end of the 10th Plan,
i.e., by the year 2007; and
• Access to all households should be provided by the end of the 11th Plan, i.e., by
the year 2012; and
• At least one unit of electricity per day is provided to all household Below the
Poverty Line.
Further the National Rural Electrification Policies also provide that the progress of
rural electrification would be reviewed in terms of the achievement which provides
for:
 Accessibility to electricity: Increase from the currently assessed levels to all
households by 2012.
 Availability of power: Increase from the current limited levels to demand matched
by 2012.
 Reliability of power supply: Increase from the currently low levels to 24 hours by
2012.
 Quality of power supply: Increase from the currently poor levels to 100% by 2012.
 Affordability of power: Pricing based on the ability of consumer to pay.
3.2 India Profile (Table 3.1)
• India is the 7th largest country of the world with the population crossed over 1
billion.
• India is a federal State divided into 29 states and 7 union territories.
• The economy is growing at a rate of over 8% Gross Domestic Product (GDP).
• Agriculture contributes less than 24% of the GDP.
• The mainland of India extends between 8° 4' N and 37° 6' North Latitude and 68°
7' and 97° 25' East Longitudes. The Tropic of Cancer 23° 30' N divides India
almost into two halves. (Fig. 3.1)

44
3.3 Electrical power sector-a glance
India’s first hydroelectric power station was commissioned in the year 1880 at
Darjeeling and commercial production was started in Calcutta way back in 1889.
From the last 130 years the electric power generation, transmission, distribution and
utilization sectors have grown considerably in magnitude. At the time of
independence, power generation capacity was 1362 MW by private companies like
Calcutta Electric Company and others. There has been a phenomenal increase to 1,
86,654.62 MW as on 31, Dec. 2011.
Table 3.1 India Profile (Source; Load Generation Balance Report, 2010-11)
Population 1210193422(census 2011) 17.7% of world population
Rural 742490639(census 2011) 61.35%
Urban 286119689(census 2011) 23.64%
Population 10286103282(census 2001) -----
Rural male 532156772: (census 2001) 51.735%
Rural female 496453556(census 2001)- 48.26%
Area 3287240 square kilometer ------
Density 382 per sq.km

Fig. 3.1 India Map

Electricity is a concurrent subject specified in list III and VII schedule of the
constitution of India under which both the Parliament (Central Government) and state
legislatures have the authority to legislate on the subject. In India states have their

45
own State Electricity Boards (SEB) constituted under Section 5 of the Electricity
(supply) Act 1948. Hence they played a major role in rural electrification and are well
supported by the Central Government.
In 1981, the GoI established a Commission for Additional Sources of Energy
under the Department of Science and Technology. Commission had the responsibility
of formulating policies and their implementation for the development of new and
renewable energy apart from coordinating and intensifying R&D in the sector. In
1982, the commission was given full status of a department called as Department of
Non conventional Energy Sources and put at par with other energy departments, such
as coal and power. Finally, in 1992, the GoI upgraded the department to a full-fledged
ministry known as Ministry of Non-conventional Energy Sources (MNES)
exclusively devoted to the renewable energy promotion and it is renamed as Ministry
of New and Renewable Energy (MNRE) in 2006.
Electrical power sector in India is a vast and complicated. Hence the power sector,
policy setting and implementation is divided between five ministries: the Ministry of
Power (MoP), the Ministry of Coal, the Ministry of Petroleum and Natural Gas, the
Ministry of New and Renewable Energies (MNRE) and the Department of Atomic
Energy, and government commissions and agencies. Central Electricity Authority
(CEA), under the MoP, acts as an advisory body to the central government on matters
of national electricity policy. (Table 3.2)
Table 3.2 Responsibilities of Indian Power Sector
Policy Making Central Government, State Governments
Planning Central Electrical Authority(Planning Commission under
central Government),State Planning Department
Regulation Central Electricity Regulatory Commission (Appellate
Tribunal for Electricity),State Electricity Regulatory
Commissions
System Operators National Load Dispatch Centre, Five Regional Load Dispatch
Centres, State Load Dispatch Centres
Generation Central generating stations, Joint ventures-Centre &State,
State Generating Stations, Independent Private Producers
Traders Traders designated to trade across borders(PTC)
Inter-State traders
Distribution State Electricity Boards, Distribution companies,
Private companies
Financial Institutions Power finance corporation(PFC), Rural electric Corporation
Energy Conservation Bureau of energy efficiency(BEE)

46
 Under the MoP, the Central Electricity Regulatory Commission (CERC) regulates
central and interstate-level power-related activities, while the State Electricity
Regulatory Commissions (SERCs) work on state-level licensing, state level electricity
tariffs and competitive issues. Among MNRE’s main activities is the expansion of
the use of renewable energy technologies in remote rural areas. Key objectives of
MNRE are-
 To promote deployment of grid-interactive renewable power generation projects,
 To promote renewable energy initiatives for:
 meeting energy/ lighting needs in rural areas,
 supplementing energy needs in urban areas,
 supplementing energy needs in industry and commercial establishments
 To promote research, design and development activities at premier national
institutions and industries on different aspects of new and renewable energy
technologies and help development of new products
 To encourage development of a Robust Manufacturing Industry in Renewable
The vision of Indian renewable energy program is - to develop new and renewable
energy technologies, processes, materials, components, subsystems, products and
services at par with international specifications, standards and performance
parameters in order to make the country a net foreign exchange earner in the sector
and deploy such indigenously developed and/or manufactured products and services
in furtherance of the national goal of energy security.State governments also can set
their own laws and regulations to be applied on their territory. Hence the
implementation of power sector reforms differs in each state. Power sector scenario of
India is as shown in tables 3.3, 3.4 and 3.5. (As on 31-9-2011)
Table 3.3 Electricity generation Table 3.4 Power sector (31-9-2011)

Sector MW %age Fuel MW %age

State Sector 83,313.65 45.88 Total Thermal 118409.48 65.21
Central Sector 56,572.63 31.15 Coal 99,503.38 54.80
Private Sector 41,671.84 22.95 Gas 17,706.35 9.75
Total 1,81,558.12 Oil 1,199.75 0.66
Hydro (Renewable) 38,206.40 21.04
Nuclear 4,780.00 2.63
RES (MNRE) 20,162.24 11.10

47
 Table 3.5 Power supply position in 2010-11 (Source: CEA, LGBR)
Region Requirement Availabil Deficit % Demand Met Deficit %
(MU) ity (MU) (MW) (MW) (MW)
(MU)

Northern 254,231 224,661 -29,570 -11.6 37,159 31,439 -5,720 -15.4

Western 258,528 223,127 -35,401 -13.7 39,609 32,586 -7,023 -17.7
Southern 220,576 206,544 -14,032 -6.4 32,178 29,049 -3.129 -9.7
Eastern 87,927 84,017 -3910 -4.4 13,220 12,384 -836 -6.3
North- 9,332 8,296 -1036 -11.1 1,760 1,445 -315 -17.9
Eastern

Region Peak Peak Peak % Peak Met Peak %

Requirement Availabilit Deficit Demand (MW) Deficit
(MU) y (MU) (MW) (MW)
(MU)

Northern 271,068 237575 -33493 -12.4 40000 33220 -6780 -17.0

Western 262768 236334 -26434 -10.1 40210 34732 -5478 -13.6
Southern 232907 200192 -32715 -14.1 34224 28450 -5774 -16.9
Eastern 98451 101707 3256 3.3 16202 16568 366 2.3
North- 11662 8199 -3463 -29.7 1957 1,679 -278 -14.2
Eastern
All India 876856 784006 -92849 -10.6 126951 111533 -15418 -12.1
It may be seen that the anticipated energy and peaking shortage in the country
would be 10.6% and 12.1% respectively. The peaking shortage would prevail in all
the regions except Eastern region varying from 13.6% in the Western region to 17.0%
in the Northern Region. Eastern Region is expected to be in comfortable position in
terms of peak. There would be surplus energy of 3.3% in the Eastern region.
1. All other regions would face energy shortage varying from 10.1% in the Western
region to 29.7% in the North-Eastern region.
2. All the regions in the country namely Northern, Western, Southern, Eastern and
North-Eastern continued to experience energy as well as peak power shortage of
varying magnitude on an overall basis, although there were short-term surpluses
depending on the season or time of day. The surplus power was sold to deficit
states or consumers either through bilateral contracts, power exchanges or traders.
The energy shortage varied from 4.4% in the Eastern region to 13.7% in the
Western region.
b) Per capita consumption and electricity demand by sector. (Fig.3.2, Table 3.6)

48
c) Progress of Rural electrification in India
From the time of independence, Government of India and State Electricity Boards
have given priority for rural electrification and the phenomenal growth is evident
from Fig. 3.3 to Fig.3.7, Tables 3.3 to Tables 3.6 and appendix I to appendix III.

Fig. 3.2.Electricity demand by sector and by region in 2007 (Source: CEA 2009)
Table 3.6 Per capita energy consumption and T&D, AT&C losses

Year Per capita consumption(kWh) T&D AT & C

(As per U.N. methodology) losses Losses
2002-03 566.7 32.54 32.54
2003-04 592.0 32.53 34.78
2004-05 612.5 31.25 34.33
2005-06 631.5 30.42 34.54
2006-07 671.9 28.61 32.07
2007-08 704.2 26.91 Not available

49
Fig. 3.3 Villages electrified (old definition) Fig. 3.4 Rural household’s connection
59
60 55
48
50
42
40 35
30 27 26

20
10
% share

0
1950-51
1960-61
1970-71
1980-81
1990-91
2000-01
2009-10
Agriculture Industry
Service Trans.7 others

Fig. 3.5 Share of sectors in GDP Fig. 3.6 Annual energy Generation and Growth Rate

Fig. 3.7 Features of Regional grids

50
• It may be seen that the hydro rich States having run of river schemes on the
Himalayan rivers viz. Himachal Pradesh, Jammu & Kashmir, and Uttarakhand are
surplus in energy during monsoon period, while they would face severe shortage
conditions during the winter low inflow months when the generation from hydro
schemes dwindles to the minimum. The constituent states/UT of Delhi, Himachal
Pradesh, Dadra & Nagar Haveli and Sikkim shall have both peaking and energy
surplus on annual basis.(Fig 3.7,Table 3.7)

• The State of Chhattisgarh, Karnataka, Pondicherry, Mizoram and Tripura would

have surplus in terms of energy whereas Orissa will be in comfortable position in
terms of peak on annual basis. All other States in the country would have electricity
shortages of varying degrees both in term of energy and peaking.(Table 3.8)
• Overall transmission and distribution losses vary from min.16% to
max.43%.(Table 3.8)

Table 3.7 Generation of Electricity on 31, March, 2010(Source: CEA)

51
 Table 3.8 Transmission and Distribution losses

Table 3.9 All India energy consumption utilities (source: CEA)

52
 Table 3.10 All India energy consumption domestic utilities (source: CEA)

Table 3.11 All India energy consumption commercial utilities (source: CEA)

Table 3.12.Financial Performance of 20 Major States

Particulars 2005-06 2006-07 2007-08 2008-09 2009-10
Energy Sold (MU) 3,51,200 3,90,232 4,29,709 4,69,427 5,25,140
Energy Sold/ Energy Available (%) 65.40 65.41 72.42 74.72 76.27
Sales Revenue (Rs.00crore) 1014 1173 1321 1542 1777
Commercial Loss (Rs.00crore) 208 284 338 409 384
Ave. cost of supply (Paise/KWh) 368 391 405 433 429
Average tariff (Paise/KWh) 289 301 308 329 338

140
Gross subsidy/unit[paise/unit]

120

100

80

60

40

20

0
1996-97 1997-98 1998-99 1999-00 1000-01 2001-02

Fig. 3.8.Electricity usage for lighting (WB report) Fig. 3.9.Gross subsidy

53
3.4 Status of Rural Electrification (as on 31-3-2011)
Table 3.13 Status of Rural Electrification as on 31-3-2011(Source: REC)
Total Number of villages 5, 87,258
Villages electrified 5,08,515
Villages to be electrified 78,743
Total number of households 13, 82, 71, 559
Electrified households 6, 42, 63, 719 -- (43.5%)
Un electrified households 7, 40, 07,840 -- (53.5%)
Energy consumption per capita 631kWh
Rural electricity consumption per capita 60kWh
Urban electricity consumption per capita 240kWh

Table 3.14 Transmission Sector as on 31-10- 2009 (Source; CEA)

Transmission lines Central sector State sector Inter State Total

(circuit kilo-meter)
765kV 2863 409 ---- 3272
400kV 61,491 27,970 3,272 92,704
220kV 10,119 115,172 151 125,442
±500kV HVDC lines 5,848 1,504 -- 7352
Sub Stations(MVA)
765kV 4500 --- --- 4500
400kV 57,965 56,072 -- 114,037
220kV 4,776 178,609 800 184,185
±500kV HVDC 7,000 1,700 -- 8,700
converter terminal
Government of India has setup Rural Electric Corporation in July 1969, to
stimulate the process of rural electrification. Electrical power sector was recognized
as one of the Millennium Development Goals in 2000, for the upliftment of the
masses and poverty alleviation. The Five Year Plans of Government of India, World
Bank, International Monitory Fund etc have identified this socially relevant sector and
initiated several measures like Electricity Act 2003, Deregulation, Unbundling,
RGGVY, Independent Power Producers (IPP) and Electricity Regulatory Commission
etc.
Table 3.15.Distribution Sector as on 31-10- 2009 (Source; CEA)
Region 33kV 22/20kV 15/11 kV 6.6kV 3.3/2.2 kV Up to 500V
Northern 71,381 5579 598,408 -- 46 917,056
Western 74,962 29,830 612,157 1,852 -- 1,202,137
Southern 50,465 37,112 541,299 -- 19 1,671,796
Eastern 32,668 50 223,362 4,452 62 3,616,731
North-Eastern 8,486 --- 67,332 -- -- 85,795
TOTAL 237,962 72,751 2,042,558 6304 127 7,493,515

54
 A Rural Electric Supply Technology Mission, under Ministry of Power with
representatives from other Ministries Rural Development, New and Renewable
Energy, organizations like CSIR, BHEL, etc started its operation in September 2002.
The purpose of REST Mission is to accelerate electrification to meet the goal of
‘Power for All by 2012’. The mission is also to identify technologies that could be
used in providing affordable and reliable power supply to rural areas and effect
implementation through distributed generation schemes, wherever feasible. The
purpose is to provide electrification of remaining ‘one lakh villages and one crore
household’.
Previously, “a village was deemed to be electrified if electricity is used in the
inhabited locality, within the revenue boundary of the village for any purpose what so
ever”. (Fig 3.10)
Ministry of New and Renewable Energy modified this definition on 29 Sept.2006.
“In accordance with the approved definition of village electrification, remote
villages/hamlets will be deemed to be electrified if a minimum of 10% of the
households are provided with electricity is also made available for community
facilities and for dalit bastis (habitants) of the village if any.”
600 20
500
15
lakh villages

400
300 10
Millions

200 5
100
0
0
2
61
66
74
79
88
90
97
1956

2010

51 56 61 66 71 76 81 87 4 10

Fig. 3.10 Progress of rural electrification in India

3.5 Governance of Rural electrification

Electric power is instrumental for development, both in urban and rural sectors.
RE forms the most important part of plans for the progress of India. Electric supply
companies (fig 3.11) have a mammoth task of supplying energy to all.

55
 Ministry of Rural Ministry of Power Ministry of New and
Policies, coordinates, Renewable Energy
development
monitors RE Policy, monitors

Equity/subsidy

Rural Electrification IREDA

Grants for Corporation
Rural Finances, decentralised
Investments generation

Energy Department Rural cooperatives SEB

Policy, coordinates, monitors Rural distribution, supply All aspects of rural
distribution and supply

Grants and subsidised debt

Fig. 3.11 Governance of Rural Electrification

Energy supply in rural sector has always been given low priority. Also, as per
definition of an electrified village, only bare minimum need of rural households is
taken into consideration. The ever increasing demand continuously outstrips the
generation, transmission and distribution capacities in India.
The problems such as high transmission and distribution losses, frequent
disruption in supply of grid power, practical difficulties and financially not viable of
extending grid to remote and inaccessible areas, dispersed population in small villages
resulting in low peak loads, poor financial health of the SEBs, etc. are plaguing the
rural electrification program in India.
Rural areas are connected to tail end of transmission and distribution system, and
in the absence of variety of customers, the power lines in rural areas operate at very
low and highly uneconomical load factor. Hence, rural electrification programs tend
to be characterized by scattered low-income consumers, high upfront equipment costs
and thus decentralized electricity supply grids that are gradually being extended.
These are regarded as the main reasons for low rate of rural electrification.
Another common problem for rural electrification in India is that grid extension
projects are often undertaken for political reasons rather than on the basis of
economically rational decision-making. Centralized power sector policy in India is
characterized by many other limitations such as poor demand side management,

56
leakages, theft of power, political and bureaucratic interference in decision-making
and management, and power tariff not permitting differentiated rates for peak and off-
peak consumption. As a result, most of the electricity boards in India are running
under losses (Table 3.12).
Most villages in India have access to grid; only 43.5% of the households have
connected to electricity due to low levels of cash income. At a minimum, all used it
for lighting, space cooling and watching TV. Lighting alone makes a dramatic
difference when it comes to the ability to do household chores during the evening
hours and reading for education and leisure.
3.6 Rural Energy pattern- a case study
To study the energy pattern of a village a survey was conducted in a village,
Nuggikeri (Dharwad Taluk), Karnataka State, in South India.
Water heating is carried out by firewood (85%) followed by crop waste (35%);
Cooking is carried by firewood (80%) followed by LPG (45%) and crop waste (40%).
It is to be noted that electricity is not used for any of these purposes. The end use
analysis of electricity for the same village is shown in Fig.3.12 to Fig.3.14 and Table
3.16 and 3.17. (Excluding the irrigation pump sets).
Survey study reveals that electricity is mainly used for lighting and
entertainment apart from the irrigation purposes. The observation of the survey
indicates the importance is to be given for RE.

cooking water heating 100 100

100 90 80
85
80
80 55
60
60 50
45 35 35
40 40
35
40
25
20 20
1.5
0 0

Fig. 3.12 Energy resource of rural dwellings (%) Fig. 3.13 End use analysis (%)

57
 Table 3.16 Average Monthly consumption of energy in Nuggikeri village per family

Sl. Source of Average usage %age of house %age of house

No Energy per hold use for hold for water
house hold / cooking heating
month
1 LPG (Kg) 2 100 17.4
2 Kerosene (Lt) 4.22 83.9 42.6
3 Firewood (Kg) 202 84.7 84.7
4 Crop waste 41.5 81.3 71.5
(Kg)
5 Biogas (m3) -- 1.6 1.3

Table 3.17 Average Monthly consumption of energy in Nuggikeri village per family

Energy Resources MJ Kg Oil Eq. Calories % Efficiency

Firewood (kg) 202 3232 75.952 775680 15
Crop waste (kg) 41.5 560.25 13.197 134460 --
Kerosene (Lit) 4.22 147.7 3.477 35448 35
LPG (kg) 2 90 2.118 21600 60
Electricity (kWh) 15 54 1.275 12900 75
End Use Analysis
120 106.4
5.5%
6.5% Light 100
75.952
8% Entertainment
80
39% 60
IP Set
11%
40
19.6
Fan 13.197
20 3.477
2.7 2.118 1.2752
0.8
Grinding & Water 0
heating wood crop kerosene LPG electricity
Others waste
30%
Nuggikeri National ave.
Fig. 3.14 Energy consumption/capita/ family at Nuggikeri and National ave.

3.7 State Electricity Boards

The Ministry of Power of the Government of India provides overall guidance to
the sector. Central Electricity Regulatory Commission is empowered to regulate the
sector at the national level, including central power utilities in accordance with the
Electricity Regulatory Commission Act, 1998. (Fig. 3.19)The central power utilities
own and operate 30% of the country's total generation capacity, while SEBs and EDs
have 59% of the total.

58
Generation Transmission Distribution Consumption

SEBs SEBs SEBs

Cusps Power Grid Distribution End consumer

Co

Private Private
IPPs
utilities Licensees

Captive Open Captive

Consumer

Power Trading

rporation

Fig. 3.16 Organization of the Power Industry

3.7.1 Power sector reforms

During the last two decades, the electric power sector has been subject to
substantial changes including regulation, market formation and structure, technology
mix, and political aspects. Power sector reforms were initiated in 1990 with the
unbundling of the SEBs, enactment of the Electricity Act 2003; National Electricity
Policy (NEP) etc. have created a strong policy framework to ensure investment in all
sectors.
A) Electricity Act 2003: The Electricity Act 2003 has made many new provisions in
the area of generation, transmission and distribution.
• The generation has been liberalized and de‐licensed up to a certain extent.
• Electricity is now being treated as a commodity and trading has been identified as
an important activity for a competitive electricity market.
• The Act has facilitated development of an efficient and customer‐oriented
distribution system.

59
B) National Electricity Policy (NEP):
• The policy envisages power for all by 2012 rural electrification and reduction in
T&D losses, better cost recovery, improved financial support and greater private
sector participation.
• It urges utilities to use state‐of‐the‐art technologies for management, operation
and control.
C) Accelerated Power Development and Reform Program (APDRP): The APDRP is a
striving central government initiative in the distribution segment launched in the year
2001, with the main objectives:
• reducing AT&C losses
• improving quality of supply of power
• increasing revenue collection
• improving consumer satisfaction.
To avail the advantages of the program, it has been made compulsory for all the
states to fulfill the eligibility criteria set by the central government.
D) Funding Mechanism:
• Accelerated Power Development and Reform Program (APDRP)
• Rajiv Gandhi Grameen Vidyutikaran Yojana(RGGVY)
• Power Finance Corporation (PFC), Rural Electrification Corporation Limited
• International agencies - World Bank, Asian Development Bank (ADB), etc.
• The commercial banks have also extended credit to the distribution companies
3.7.2 Status of Electricity Boards (Fig 3.17 to Fig.3.26)

Other s
5%

Nucl ear
3%

Hydr o
26%

Ther mal
66%

Fig. 3.17 Electricity generation Fig. 3.18 Electricity generation

60
 40
25
20.5
35 18
20
% losses

Percentage
30 15 13
11.5 11.7
25 10 7.3 7.8 7.3

20 5

0
1992-93 1996-97 200-01 2004-05

T & D loss A T & C loss pow er shortage peak pow er shortage

Fig. 3.19 Aggregate Trans. & Commercial losses Fig. 3.20 Power shortage

15000
10000
5000
0
1 2 3 4 5 6 7 8 9 101112131415

Fig.3.21 Commercial losses Fig. 3.22 Villages electrified from 1995-2005

140

120

100

80

60

40

20

0
1996-97 1997-98 1998-99 1999-00 1000-01 2001-02

Fig. 3.23 Energy available (%) Fig. 3.24 Gross subsidy Paise /unit

61
 south grid
8%
collection
state grid
24%
8%
33 kv
10%

11kv
10%

LT dist
40%

Fig. 3.25 Ave. Losses from Gen to utility Fig. 3.26 Ave. % interruptions & CHL
a) Generation of electricity indicate that 56.5% of electricity by state governments.
(Fig 3.17).
b) Higher i.e. 69% of this is by thermal generation followed by others 29 %.(
Fig.3.18)
c) Aggregate technical and commercial losses are crossing 30 % (Fig. 3.19).
Transmission and Distribution losses are high in 11 kV and 440 V distribution
network. Hence peak to peak voltage is 256 volt instead of 415 volt. Farmers are
compelled to go for higher capacity pump sets, leading to frequent motor burnouts,
distribution transformer failures.(Fig.3.25,Fig 3.26)
d) Available transmission capacity currently is almost fully committed to existing
generators and there is little surplus capacity. For additional uses require
modification of transmission lines.
e) Commercial losses increased to above 24000 Crores. (Fig. 3.21) Grid extension to
rural areas typically ranges from $ 8,000-$ 10,000 per kilometer, not including the
cost of materials, which adds an additional $ 7,000. This high cost, coupled with
low capacity utilization of such grids due to very small loads, makes extension
economically unviable to utilities. Thirteen out of Nineteen State Electricity
Boards incurred heavy financial losses in 2010.
f) SEBs reluctant for rural electrification process mainly due to high transmission
and distribution losses and low Economic Rate of Return. Hence drastic reduction
in number of villages electrified (Fig.3.22). However energisation of pump sets is
still increasing.
g) Only 70% of energy supplied is billed; Contribution of electricity generation
towards agriculture is increasing above 30% but Revenue Return is 2.5%.

62
h) Subsidies introduced to promote economic development and initial impact was
small and could be funded through government budgets. However over the year’s
element of subsidy increased manifold (Fig 3.23). Rather subsidies led to negative
consequences and many unintended effects, more difficult to phase out.
i) National average cost of generation is Rs. 3.50 per unit and average realization is
Rs. 2.50 per unit.
j) Peak shortage of power 11% and energy shortage 7.5%.
3.8 Electrical Transmission and Distribution Network
Electrical transmission and distribution is the weakest link of India’s power
supply chain as it faces substantial technical losses and commercial losses of
electricity averaging 33.7% of total generation in 2006-07 with variations by state as
illustrated in Table 3.14, 3.15 and Fig. 3.25, 3.27, 3.28. These losses are among the
highest in the world.

Fig. 3.27 T&D Losses in the world Fig. 3.28 T&D losses area in India (IEA 2010)

3.9 Power Sector Reforms and RE

Primary objective of power sector reforms is to achieve overall efficiencies in the
performance of generation, transmission and distribution, improve financial viability,
reduce the dependence on power utilities on government, reduction in transmission
&distribution losses, control of theft and pilferage and provide quality service to
various consumers at an affordable price. Thus by reforms rural electrification
problems are effectively addressed. Following are the impacts observed in rural
electrification sector due to power sector reforms-

63
a) Private sector participation is increased to 12% from mere 1% during 1990 to
2011. Isolated grids are established in remote and inaccessible areas with solar
photovoltaic, mini/micro hydal, wind farms.
b) Power shortage reduced to 11.7% due to measures taken by stake holders.
c) Average technical and commercial losses are found to increase above 30%,
because of SEBs included commercial loss to get subsidy benefits.
d) Per capita consumption was 238 kWh in 1990 to 704 kWh in 2011 i.e. increased
by 294%.
e) Subsidies did not benefit eighty percent of farmers (less than 1 hectare of land) and
do not possess pump sets. Thus power subsidies benefited only rich class people.
(Rajadhyaksha committee report)
f) State Electricity Boards started giving the quality electricity supply.
g) Increase of electricity unit cost from Rs. 1.1 per unit in 1991-92 to Rs.4.29 in
2009-10 is mainly due to cost of fuel, establishment.
h) Average farmer pays about 10% of the cost of supply and average domestic
consumer pays less than 60% of the cost of supply.
i) Rural committees are involved in bill collection and hence Economic Rate of
Return doubled.
j) Costs for agriculture and residential households are far below the actual supply
costs, (fig 3.29) where as electricity price to commercial and industrial consumers
is cross subsidised by above cost prices.
144
140
% 124
s c 120
u o
100
p s 83
p t 80
l 55
60
y
40
20 12

0
domestic commercial agriculture industrial Average

Fig. 3.29 Recovery Cost of utilities

64
 Power sector reforms have positively influenced the rural electrification programs
but still not kept in pace with the growing demand.
3.10 Specific challenges
The creation of franchisees for the management of local power distribution in
rural settings is requirement under the RGGVY. Because these structures reduce
commercial losses through more efficient billing and revenue collection, they ensure
stable delivery of electricity. Franchisees can be different legal entities, such as
NGOs, co-operatives or individual entrepreneurs. Franchisees are particularly
effective in the management of electricity provision and recovery as they are in close
contact with the targeted communities, and this has led to a stronger sense of
ownership of the electrification process.
a) Management and reduction of losses
Illegal hooking is still rampant in India, particularly in the rural villages, are
difficult to control. Indian government made a fundamental amendment to the
Electricity Act of 1910, rendering theft of electricity a heavily penalised criminal
offence. Moreover, under the RGGVY, to prevent illegal hooking and so reduce
commercial, transmission and distribution losses, high-voltage distribution systems
(HVDS) are being installed. Through HVDS, the voltage profile is also improved and
electricity supply is more reliable. Corruption and mismanagement of funds have also
been plaguing the system, which has caused the RGGVY to progress unevenly in the
states.
b) Participation of local communities for operation and maintenance
Under the Remote Village Electrification (RVE) programme of the MNRE,
effective operation, maintenance and sustainability of the projects is the responsibility
of the state governments. The participation of the local community is sought at the
inception of the project and efforts are made to ensure at least 15 years of operation
and maintenance. However, as renewable energy systems develop rapidly, there are
often an insufficient number of trained workers who know how to maintain and
operate systems like PV.
c) Progress monitoring and maintenance
A Three-Tier Quality Monitoring Mechanism for the projects under the RGGVY
has been put in place (MoP 2009). For the first tier, a project implementing agency

65
works with a third-party inspection agency to ascertain that all the materials used in
the projects and workmanship are conform to specifications. The REC is responsible
for the second tier and will inspect works and materials. In the third tier, independent
evaluators will be contracted by the MoP for random evaluations (1% of villages) of
the supply and construction of the projects. The RVE also encourages the setting-up
of annual maintenance contracts with a minimum 10-year warranty which includes
the replacement of parts or components such as batteries, electronics, lamps, bulbs,
etc. to secure proper and sustained energy supply services. After the AMCs expire,
revenues could also be used to cover maintenance and repair expenses or replacement
of spare parts and defective components.
3.11 International Experiences
Several countries in the world like US, UK, China, Egypt, South Africa,
Cambodia, Nepal, Srilanka, Philippines, Mexico, and New Zealand etc. started rural
electrification programs from 1970s. However the situations and the complexities of
Argentina and Bangladesh are similar to Indian conditions.
3.11.1 Argentina
Prior to restructuring in 1992, the electrical industry in Argentina suffered from
lack of investment, resulting in low availability of generation capacity; widening gap
between demand and supply; poor tariff policies; dependence on government for
financial support; frequent power interruptions; non-paying customers; illegal
connections; increase in technical and non-technical losses, overstaffing; a
demotivated work force; inefficiency and poor consumer service. The electricity
industry consists of 6 public enterprises constituting 74% of generation capacity,
several utility companies owned by provincial governments, a number of cooperatives
and small captive-generators. The National transmission network inter-connected the
State grids. The key elements are-
a) The industry was privatized and unbundled with large number of generation,
distribution and transmission companies. Reforms provided for tariff reforms; new
regulatory framework under which these company’s functions were separated and
initiating privatization of state owned agencies. The privatization followed the joint
venture route initially as 51% share by private sector, government retaining about
39% share and 10% for employees.

66
b) An independent Regulatory framework was created.
c) Distribution segment was split into three companies and sold on 15 year contract.
d) Transmission was brought under one company, and sold on terms similar to the
distribution companies.
e) Wholesale competition is permitted as in UK.
f) The central dispatch authority arranges the dispatch of power so that they will have
automatic access to the transmission system.
g) Retail competition is allowed with large customers.
h) Price cap regulation is implemented for transmission and captive customers.
i) Restructuring brought about efficiency in the system and also downward trend in
the tariff.
In order to enhance monitor the restructuring and privatization programme, the
Government agreed to retain some debt of the utilities with itself, which was offset
partially, with the funds received from the sale of utilities assets.
3.11.2 Bangladesh
The state owned Bangladesh Power Development Board (BPDP) was sole
generation, transmission and distribution authority in Bangladesh prior to the
establishment of Rural Electrification Board (REB) in 1978.The progress was not
very satisfactory under BPDP. Hence the government adopted the cooperative
concept to implement rural electrification program covering the entire rural areas of
the country in phases. Pilli Biddut Samity (PBS-Rural Electric Cooperative) is the
core unit that runs the cooperatives and supplies electricity to rural areas. The
consumers of the PBS are the owners of the system and are governed by a Board of
directors, elected from among the consumers to run the system in a democratic, yet
cost effective manner. Presently there are 55 PBSs with 27 lakh consumers nearly 15
percent of the consumers in 28,000 electrified villages. Rural Electric concept found
to be suitable to socio-economic reality of the country. The business of a PBS runs on
no-loss no-profit basis. The Board as a regulatory body continuously monitors and
accesses the engineering, financial and management aspects of PBS and ensures that
the standards set by the Board is achieved. The PBSs are not directly involved in the
implementation phase but takes over the system after construction and remain
responsible for its management, operation and maintenance. The routine operational

67
activities of PBS like meter reading, meter checking, bill collection etc. is run by
hired staff. Key elements of power sector reforms are-
a) In Bangladesh 80 percent population live in villages and belong to below poverty
level. The participation of the poor is ensured through cooperative principle.
Energy consumer in PBS area has to be member of cooperative.
b) Initial investment comes from donor loan and is nominal.
c) Transmission and distribution losses of about 16% much lower than BPDP of 30%.
d) Loss due to pilferage is distributed among the consumers, so it is not a revenue
loss.
e) User-friendly ‘one point’ customer service.
f) Bill collection rate is about 95% and also, there exists transparency and
accountability in these cooperatives.
Cooperative model is a success story due to the system being technically sound;
its overall operation is transparent; there is accountability and pricing is just
reasonable and is constantly monitored. PBS is becoming self-sufficient and
achieving sustainable growth. The successful international experiences could serve as
a guideline to India either fully or partly. India has to form its own policies, suited to
its conditions, taking into consideration the experiences of other countries as useful
guidelines.
Conclusions
The power sector is characterized by growing demand supply gap, inherent
inefficiencies, distorted pricing mechanisms, weak institutional structure,
environmental unsustainability and socio-political influences. The future economic
development trajectory is likely to result in rapid and accelerated growth in energy
demand, with attendant shortages and problems.
The growing energy consumption is likely to lead to increasing emissions of
gases, compounding the pollution problems at the local level and increasing GHG
emissions. For instance, a long term projection of the business-as-usual scenario over
a forty year period (1995-2035) indicates that energy consumption shall treble;
electricity generation shall rise by 5.4 times; coal shall continue to be the main source
of fuel; the carbon emission shall go up by 3.6 times; and the carbon intensity shall
increase. Therefore, it is imperative to develop and promote alternative energy

68
sources that can lead to sustainability of the energy system. Although at present the
contribution of renewable electricity is small, the capabilities promise the flexibility
for responding to emerging economic, socio-environmental and sustainable
development needs.
Government of India is committed for improving energy services in rural areas
since access to electricity in itself with well being. Rural electrification is an old
challenge with news ways. Any delay in reforming the sector will only make it much
more difficult to tackle the task later. Thus for speedy implementation of the reforms
require the following recommendations-
• All successful rural electrification programs have developed their own systems for
ranking or prioritizing areas for obtaining a supply. Capital investment costs, level
of local contributions, number and density of consumers and the likely demand for
the electricity are among the factors considered.
• Successful rural electrification programs indicate that both large and small
companies must follow certain principles. Rural families find the initial connection
costs a far greater barrier than paying monthly electricity bills. Hence reducing
initial charges or spreading payments over several years even if it means charging
more per unit of electricity, allows many more low-income, rural families to obtain
supply.
• Smaller companies that concentrate solely on electricity may be better able to
address India’s rural electrification problems, including low loads, low household
connections rates, subsidies for agricultural consumers, poor consumer service and
inadequate bill collection. Many small rural electric cooperatives are providing
better services. Development of cooperative, user associations, NGOs, private rural
electrification is a worthwhile goal.
• As restructuring of state power utilities is gaining momentum, appropriate
institutional frameworks and incentives needs to be created to ensure that rural
electrification expands in ways that are sustainable.
• Successful rural electrification programs have strongly emphasized covering their
costs. Smaller, more flexible companies might encourage day time use of
electricity in rural commerce and industries, encourage more people to connect to

69
 the systems, involve local leaders in bill collection to lower costs, and provide flat
rates for minimal service.
Development of community based, cooperative, Non-Governmental Organizations
and private companies provides more responsive service to consumers. Rural Electric
Corporation has so far promoted and financed 41 Rural Electric cooperatives in India,
spread over 13 States. Presently 14 are in operation and 23 societies (3 in Rajasthan, 8
in Madhya Pradesh, 3 in Chhattisgarh, 3 in Tamil Nadu, 1 in Gujarat, 4 in Andhra
Pradesh and 1 in West Bengal) have since been taken over by the respective SEBs and
4 societies (one each in the States of UP, Bihar, Orissa and J&K) stand liquidated due
to lack of visionary people, political will, and resistance from State Electricity Board
employees. Fourteen Cooperative Societies presently in operation are located in the
States of Andhra Pradesh (5), Madhya Pradesh (6), Maharashtra (1), Karnataka (1)
and West Bengal (1).

70
CHAPTER 4

RURAL LOAD PROFILE IN INDIA

4.1 Review of Literature
4.1.1 Feeder modeling
The cost of rural electrification is high and, as a result, the utilities are reluctant to
extend their services in the rural areas. The onus of providing electricity to rural area
in such circumstances falls finally on the government or government owned utilities.
Due to high cost and significantly low benefit, the Benefit Cost Ratio is considerably
low and sometimes less than unity in case of rural electrification schemes. a very
simple method of controlling the cost of the rural electrification in one hand and at the
same time improving the benefit for the utility. (Nava Raj Karki 2004)
Extension of the power grid to rural and remote locations in a country has to be
considered after detailed evaluation of technical, economic and social implications.
Application of conventional, economic, analytical technique to evaluate proposed by
rural distribution system in oil importing developing country environment is dealt. (D
J T Siyambalapitiya 1991)
A well rural distribution design minimizing the losses, voltage drop, and cost,
while providing an optimum level of reliability, discussed and the general
characteristics of the systems at the primary and secondary voltage levels are
presented (H.V.Nguyen 2000). Overall, the analyses indicated a number of
advantages that the US single phase distribution system has for rural applications.
Besides the fact that system costs and losses are reduced, there are several other
characteristics that make this system preferable to European designs. The main
emphasis is placed on rural applications since the analysis is being focused on
developing countries throughout the world.
The distribution losses can be reduced by proper selection of transformers,
feeders, proper re-organization of distribution network, placing the shunt capacitor in
appropriate places. The distribution companies should be ready for initial investment
keeping in view of future savings in energy. High voltage distribution systems should
be implemented at a faster rate. Training of the operating personal would result in

71
improved system operation. (K.V.S. Ramachandra Murthy and M. Ramalinga Raju
2009)
As energy prices and the costs of building new generating facilities continue to
increase, electric utilities have started looking for ways to reduce system losses. The
secondary distribution system is under scrutiny due to the large number of distribution
transformers and high secondary load currents. The secondary distribution system is
modeled in terms of a few secondary circuit archetypes. The power demand of each
load is derived from actual energy consumption. A computer software using
Microsoft Excel has been developed to calculate the losses for all transformer
secondary circuits in the pilot area, including energy losses in the service drops,
secondary lines, and transformers; thus, the circuits with the greatest losses are
identified for further study. (Calib A. et al. 2007) The applications of the proposed
secondary distribution model and load characterization on the economic analysis and
design of secondary circuits are also presented.
A study from books and local electricity distribution authority standards shows
that in a rural electricity consumer it is possible and appropriate to find the best
possible location for the transformer and measurement equipment. Therefore it could
be also possible to find a more economical solution on building materials concerning
its daily use energy losses. After the analysis of all the load characteristics and its
localisation in the property, a design philosophy and a computational program were
developed. (R. S. da Cunha 2004). The program gives the best transformer location
obtained from the location of individual load centers, the load demands and their
individual power factors. The program also gives the property average power factor,
and the minimum power and location for the transformer to be used. The correct
wiring is also an output in order to calculate global economic aspects of the electrical
installation as a whole. An interesting aspect of this approach is the possibility of the
design of new installations and the possibility of optimisation in rural electrical
systems already in use.
Energy losses in distribution systems are generally estimated rather than
measured, because of inadequate metering in these systems and also due to the high
cost of data collection. These estimations are generally based on some rules of thumb.
(P. S. Nagendra Rao 2006) The results of a joint investigation undertaken in

72
collaboration with a local utility to study this issue. (Table 4.1and 4.2) Based on data
collected from feeders specially instrumented for this purpose, true losses in some
primary and secondary feeders are obtained. These losses are compared with the
estimated losses obtained by the methods presently in use. In view of the large
discrepancies observed between measured and estimated values, two new schemes for
estimating losses in primary and secondary distribution networks have been
developed. The measured values are used to highlight the reliability of the new
estimation methods.
Table 4.1 Monthly measured Values Table 4.2 Transformer loss
Month Feeder input Energy loss
Distribution Energy for
(kWh) (%)
Transformer March 2001 Loss (%)
Jan 923409 19.75
Name (kWh)
Feb 942696 25.79
Mdodi 15998 11.8
Mar 888984 40.05
Aboddi 1 27423 10.7
April 705177 23.64
Aboddi 2 17170 9.0
May 898704 23.62
Kdoddi 4030 4.6
June 952533 28.48
Total 64621 10.14
July 918828 24.14
Aug 588987 20.19
Sept 656991 24.05
Total 24.94
Eastern Power Distribution Corporation Limited, of Andhra Pradesh State
in India has been implementing some methods to reduce technical losses on rural
distribution feeders. Statistical Data of two years on 80 rural distribution feeders of
Visakhapatnam district has been analyzed and the results were presented. Field survey
has been conducted to assess the exact conditions of feeder loading and distribution
system configurations. The Rural distribution feeders considered predominantly
supply the agricultural loads. Month wise cumulative percentage energy loss, power
factor, length of line and line capacity were taken into consideration for analysis. Data
of some sample feeders was presented. Suggestions were given for further
improvement of efficiency of the system and reduction of losses based on simulation
studies carried out.

4.1.2 Power quality issues

The quality of service provided rural electric customers can be improved with the
accurate modeling and analysis of a distribution feeder. With the use of an analysis

73
program developed for a personal computer, it is possible for an engineer to solve
existing feeder voltage profile and loss problems and to plan feeder additions that will
improve the quality of service to the customers with reduced losses to the cooperative.
The accurate model of a distribution feeder and its devices that are incorporated into a
radial distribution analysis program developed for the personal computer is dealt with.
An example rural distribution feeder is modeled (W. H. Kersting and W. H. Phillips
1992). He demonstrated the use of program to solve typical design and operational
problems.
The occurrence of power supply anomalies (e.g., voltage sags, surges and swells,
sustained under and over voltages, etc.) originating on the secondary side of rural
facilities and high utilization voltage levels can often damage and/or disrupt rural
computerized processes, electric equipment and interrupt loads, a costly issue for rural
society. Frequency and duration of voltage sags, swells and surges posed by rural
customers and reveal the statistical characteristics of the utlisation voltage levels at
rural sites are analysed by Don O. Koval (2003). The answers to these questions will
be based on the national survey results of the frequency and duration of voltage sags
and surges at rural sites monitored at their utilization voltage levels. The survey
results provide a knowledge base for monitoring, operating electric equipment,
designing and utilizing power quality mitigating technologies in rural electric
environments.
Planned islanding application or intentional islanding is an early utility adaptation
of the microgrid concept that is being promoted by major utilities around the world.
The main objective of planned islanding projects in Canada is to enhance customer-
based power supply reliability on rural feeders by utilizing an appropriately located
independent power producer. Farid Katiraei et al. (2008) considered the process of
planned islanding and the necessary steps that need to be taken in order to lead to
successful projects. Some of the current experiences from Canadian utilities in this
area are investigated and the additional requirements, in terms of equipment and
system studies, which are needed in order to plan for the operation of a planned island
project, are discussed. A case of planned islanding on rural feeders with multiple
distributed generation units is also investigated, which represents the target of future
projects in this area.

74
 A study of three-year of rural electric distribution system for power quality at the
low-side bus of distribution substations is done. (James C. Worley 2006). Data from
85 substations was used. The results of analysis of the data will be discussed in detail
along with their implication to improving power quality on rural systems. Besides
studying what influences the number of voltage sags, the correlation between the
voltage sag index (SARFI) and interruption frequency index (SAIFI) was also
investigated. A very strong correlation of an inverse relationship between the two was
seen. This implies that by only concentrating on improving power quality one can
increase the number of system interruptions. The discussion will explore what further
studies are needed to find means to improve one without degrading the other.
A methodology for the evaluation and improvement of supply reliability indices
presented. (Jose A. Rosendo et al. 2008). Based on statistical failure rates associated
to each individual component, and other recorded information, such as restoration and
reparation times, expected reliability indices related with the number and duration of
interruptions are obtained for a feeder or set of feeders within a given area. If the
resulting indices are not satisfactory, they can be improved by implementing several
corrective actions, such as the addition of protecting devices or the modification of the
feeder topology.

Network planning methods will be changed in future because of the economic

regulation and importance of reliability of electricity distribution. Usually rural area
networks are carried out with overhead lines but overhead lines are vulnerable to
faults caused by the weather and therefore new strategies are needed to develop rural
area networks. Reliability increasing actions could be profitable if interruptions are
taken into account as outage costs. With the advanced reliability analysis tool, the
effect of different strategies of rural area network development can be studied. The
calculations show that traditional strategies are no longer profitable. In future climate
change and major storms might have bigger influence on the reliability of electricity
distribution. (Mika Marttila et al. 2009). He made a study of the impact of major
storms and some calculations have been made with different climate change
scenarios.

75
 Continuity of supply is playing an increasingly important part in our everyday
lives, and has generally raised the user’s expectation of the quality of supply.
Customer minutes lost per year is becoming a critically important criterion for rural
people by which Electrical Supply Companies are judged. Previously unnoticeable
power interruptions are now highlighted to the user and can result in problems. (J. S.
Stewart 1997)

Power supply utilities offer a variety of measures that can reduce energy
consumption and consumer energy expenses. To mitigate the acute shortage of power
in the country, utilities are faced with the challenge to enhance end-use efficiency and
manage the power demands of the country for sustainable and environment-friendly
development. (Arup Sinha et al. 2011)

4.1.3 Cost analysis

The technical and economic feasibility of different systems is highly dependent on

a diverse set of design criteria: local energy demands (daily, seasonal); available
renewable resources (quantity and quality); location relative to conventional fuel
supplies and/or grid power; plus how these factors may vary overtime. Dynamics
among technical and institutional aspects are key factors, as understand the relative
economic value of staged electric service introductions.(S. R. Connors 2007) He
identified and assessed key design factors towards the deployment of electricity
services.

A tool for calculating the electrification cost over a period of 20 years (investment
costs and yearly costs) for the different mentioned strategies allowing choosing the
less expensive strategy. Afterwards the second step is the optimization of the chosen
structure solved a dynamic programming algorithm. (D. Thirault 2003)

The energy supply cost to the rural loads includes the capacity and operating costs
of generation, transmission and distribution and these costs are compared with energy
supply from renewable sources of energy for their economic viability. (Satish
Sabharwal 1990) He suggested a new method that determines the contribution of rural

76
loads to the system peak demand. Due to low load and high T&D losses in the rural
areas, the costs are higher for rural loads than the urban loads (Table 4.3).
The cost comparisons are performed for four categories of rural loads-water
pumping, LT industries, domestic/commercial and street lighting. The comparison
also includes the hill districts, plains and electrified and un-electrified villages.
1) In electrified villages the distribution network already exists, 10% -15% extra
capacity which can be used for additional loads.
a. Distribution cost for extending available grid line in unelectrified plain village
areas is Rs 55/kW/ year estimated.
b. Distribution cost for extending available grid line in an unelectrified hilly and
inaccessible village area in an unelectrified village is Rs 152/kW/year estimated.
2) Load factor and All India annuitized costs (Rs) in 2000 are available in Table 4.3
and Table 4.4.
Table 4.3 End use Load factor Table 4.4 All India annuitized costs in Rs. 2000

Annuitized generation capacity 1,286 to 1,458

End use Load cost
Factor Annuitized generation capacity for 1 890 to 2 143
(%) peak demand cost
Pumping 10.4 Annuitized T&D cost 793 to 901
LT 11.4 T&D loss factor 1.7
industries Annuitized supply cost to LT rural 4,006 to 4 544
Domestic/ 11.4 peak load
Commercial Annuitized supply cost to LT 1,294 to 1468
Street light 22.8 Rural connected load

3) Cost reduction in rural electrification study presents a variety of options for

reducing the cost of grid extension includes: using higher voltages, using higher
quality poles to reduce life-cycle costs, wider use of single -phase distribution,
considering the life-cycle costs of transformers rather than the initial capital cost,
properly sizing and placing transformers, considering alternative pole designs,
standardizing materials and designs, implementing quality assurance programs,
developing manuals and specifications for staking and design and using small
transformers to serve small load centers adjacent to MV lines.

77
4.2 Features of Rural Electrical Loads
The United Nations Millennium Development Goals at UN in 2000 set clear and
ambitious target for improving conditions of around 2 billion people, who do not have
access to adequate clean water supplies, electric lighting, primary health care and
education and other basic services. India has 742 million people live in villages and
280 million (census 2011) are still below poverty line.
 The primary objective of the GoI in its drive for rural electrification is to ensure
increased agricultural output by providing reliable power for irrigation pumps,
involving mostly ground water pumping by individual farmers. Agricultural
pumping currently accounts for about 17% of India’s total annual electrical energy
demand.
 Secondary objectives are the provision for domestic, commercial and rural
industrial consumers in the villages to improve employment possibilities and the
quality of life in rural areas.
Electrical demand in the rural sector is characterised by a low annual utilization of
the connected load. This, together with the long and scattered distribution lines for
small scale irrigation pump sets, is the major reason for the high cost of electricity
supply. Thus the features of rural electrical loads are as follows:
 Dispersed loads require long medium voltage lines.
 Unreliable supply of about 6-8 hours per day and phase imbalance.
 Average rural load varies from 5kW to 25kW per village and load factor around 0.2.
(Average demand/Maximum demand) (Table 4.3)
 Rural grids are often weak and high peak loads and relatively large inductive loads
can occur.
 Low load factor due to dominant domestic consumption in particular lighting and
absence of industrial demand.
 Low quality of power supply, scheduled and unscheduled load shedding, and low
voltage and frequency fluctuations adversely affected agricultural, domestic and
industrial consumers.
 Expensive billing procedures and control of illegal connections.

78
 Farmers go for higher capacity pumps use capacitors/or phase converters leading to
higher energy consumption.
 Poor quality of power increases their cost due to frequent motor burnouts,
interruptions due to transformer burnouts, unscheduled power cuts.
4.3 Rural Load Profile - a study
Rural distribution systems are characterized by having only one path for power to
flow from the source/distribution substation to each customer. A typical distribution
system will consist of one or more distribution substations with each substation
consisting of one or more feeders. A study of urban, periurban (with partial urban and
rural connections) and rural feeders of Dharwad is carried from 1stJanuary 2009 to
31st December 2009, are shown in the Fig. 4.2 to Fig. 4.7 and Table 4.5.

4
1200000
3.5
1000000 3
2.5
800000
2
MW
kWhr

600000
1.5

400000 1
0.5
200000
0
0
May
March
Jan

July

Oct
Sept

Dec
April

June
Feb

Aug

Nov

urban periurban rural urban periurban rural

Fig. 4.2 Energy consumption Fig. 4.3 Peak load

60 24

50 20

40 16
hours

hour

30 12

20 8

10 4

0 0

urban periurban rural urban periurban rural

Fig. 4.4 Unscheduled load shedding Fig. 4.5 Peak load

79
 800

700

600 80
70
500
60
400 50
40
300 30
20
200 10
100
0
0

urban peri-urban rural Urban Periurban Rural

Fig. 4.6 Three phase supply Fig. 4.7 Number of Interruptions

Table 4.5 Urban, periurban and rural feeder details

Distribution Distribution Average
Feeders Types Length Transformer transformer Max Load
(km) Centers centers per km (MW)
UAS Urban 17.84 7818 438.22 1.82
Yerikoppa Periurban 44.68 1033 23.11 0.7167
(a villages & urban)
Uppinbetageri Rural-I, 8 villages 49.15 4890 99.49 1.433

Amminbhavi Rural - II, 3 villages 39 5681 145.67 1.181

Hebballi Rural-III, 12 villages 60.12 4941 82.18 1.271

a. Variation of urban load 128%, peri-urban 150% and rural 366%.
b. Frequency and duration of using irrigation pump sets increases during summer due
to decreased underground water table. Constant energy consumption is found in
urban and peri-urban because of dependency on electricity.
c. Peak load is constant throughout the year in urban; It varies in rural by 700%.
d. Scheduled load shedding hours are high in urban during rainy seasons of July and
August; during April and June for rural feeder.
e. Rainy season has more unscheduled power outages due to heavy wind, rains and
more time required for restoring power in rural feeder.
f. Peak load time is constant in urban 20.00 hours but varies from 11 hour to 20 hour
for rural feeder depending upon load shedding period.
g. Three phase supply is available for 20 hours per day in urban and periurban;
whereas 8 hours per day in rural.

80
h. Density of distribution transformer centers per km is higher i.e. 438.22 for urban
feeders compared with 23.11 in rural due to concentrated electrical loads.
4.4 Rural Feeders- a case study
Rural electrical loads consist of domestic lighting, irrigation pump sets, rural
industries, water supply, streetlights and education. Several causes of rural power
supply disturbances and interruptions can originate within the utility primary
distribution and /or within the customer’s service networks. Three different rural
feeders of Dharwad are also studied to know the different parameters from Fig 4.8 to
Fig. 4.18 and Table 4.6.

Fig. 4.8 Map of distribution feeder for Dharwad

I II III
1200000
1000000
300
800000
250
600000
200
400000
150
100
200000
50
0
0

observed predicted-least square

Fig. 4.9 Monthly consumption (kWh) Fig. 4.10 Three supply hours

81
 I II III I II

300 300
250 250
200 200
150 150
100 100
50 50
0 0

Fig 4.11 Single phase supply yearly hours Fig 4.12 Load shedding yearly hours

75 70
60
50 50
40
25
kW

30
0 20
10
0
I II III 1 3 5 7 9 11 13 15 17 19 21 23

Fig 4.13 No. of interruptions hrs Fig.4.14 Rural load pattern of village
(10,Sept.2009)

2%3% 1%5%
11%
13%

17%
57%
27%
64%

Domestic BJKJ IP sets Industry Others domestic BJKJ IP sets industry others

Fig 4.15 Consumers of feeder -I Fig 4.16 Consumers of feeder-II

82
 1200000
1% 3%
12% 1000000
800000
600000
55%
400000
29%
200000

kWhr
0
1 2 3 4 5 6 7 8 9 10 11 12
month
Domestic BJKJ IP sets Industr Others
obser model-I model-II

Fig. 4.17 Consumers of feeder-III Fig. 4.18 Load profile of feeder-I (least square)
 Monthly energy consumption is high from January to April during summer. It
decreases during July to August during rainy season. Again increasing trend from
November onwards.
 Scheduled load shedding pattern is cyclic in nature for one week. Thus peak hour
load is shifting depending upon load shedding pattern.
 An average supply of three-phase supply of 8.60 hours, single-phase supply of 8.25
hours and power outages of 7.11 hours per day is observed.
 Average number of interruptions is high for more length feeder III (Hebballii).
 Load pattern of a day indicates first (medium) peak at 8.00 hours and
second(lowest) at 13.00 hours due to pump sets operation and maximum peak at
21.00 hours due to lighting.
 Electricity supply was not available for 2600(average) hours in 2009 due to several
reasons like, unscheduled load shedding, lack of staff, etc.
Table 4.6 Rural distribution feeder interruptions in 2009

Hours Hours Hours

Feeders / hours No Supply Single phase Three phase
supply supply
Year per day Year per day Year per day
I-UppinBetgeri 2519.42 6.921 3049.6 8.37 3166.98 8.7
II-Amminbhavi 2596.22 7.132 3023.4 8.33 3116.36 8.56
III-Hebballii 2686.48 7.38 2935.82 8.06 3113.37 8.55

83
Table 4.7 Details of feeders UppinBetgeri -I, Amminbhavi-II and Hebballii –III

Rural feeder I II III

UppinBetgeri Amminbhavi Hebballii
Population 24644 15685 26136
Total houses 4290 2833 4793
Electrified houses 2663 2328 4235
Un-electrified houses 1627 505 558
(37.92%) (17.82%) (11.64%)
Residential 3763 2326 4370
LT-3(I) 134 38 37
LT-3(ii) 12 81 70
0-5HP 27 2 15
Above 5 HP 48 32 64
Street light 21 15 17
water works 41 11 48

84
CHAPTER 5

RENEWABLES IN INDIA

5.1 Review of Literature

Provision of electricity to rural areas is considered uneconomical by many utility
companies, because of the low consumption and poor load factors. On the other hand,
renewable energy sources, such as solar, wind and mini-hydro, are suitable for
supplying small loads operating independently. Also, they are, in most cases,
available in abundance in rural areas. The main disadvantage of such sources is the
initially high capital costs of the energy conversion equipment, and the variable power
output. However, if appropriately applied individually or in combination, renewable
energy sources have the potential to be cost-effective sources for some of the rural
loads. An assessment of mini-hydro and solar energy sources shows that the energy
unit cost decreases with increasing load factor and it is lower for the mini-hydro
sources. In areas where grid supply is uneconomical or not available mini-hydro
sources can be used to supply groups of households while solar energy sources are
more suitable for supplying individual households. (N.M.Ijumba 1996)
Low load factors, long distribution lines with low load densities and the associated
high transmission and distribution losses in most rural areas of India make many of
the rural electrification programs economically unattractive. Decentralised energy
technologies based on local resource availability can be a viable alternative to rural
electrification through the extension of the grid. The cost of grid electricity to the end
user is quantified ( Sinha and Kandpal 1993) and compared with the cost of electricity
from decentralised energy systems to obtain the specific distances from the grid, the
level of demand, and the load factor conditions, under which using decentralised
energy systems for rural India makes economic sense. It is found that for small and
isolated villages with low load factors, decentralised energy technologies make sense.
An example on the application of the long term marginal cost concept to decide on the
viabilities of two options for rural electricity is dealt with.
Rural electrification within the Caribbean has mainly centered on the extension of
grid supplies due to the relatively short distances involved, while the use of renewable
resources has remained experimental. However, grid extensions are not always viable

85
for some communities due to either their small size or location. (T. Chambers 2006) A
software tool that is being developed for application in the design of suitable power
generation systems for small isolated rural loads based on standalone wind-diesel
hybrid systems. Inputs to the program include the expected annual load profile, site-
specific data on the renewable resource and diesel generator operating costs. The
software applies dynamic programming techniques to arrive at a suitable selection of
diesel generators and corresponding annual operating cost for given load and
renewable resource profiles.
Development of Renewable Energy Sources (RES) is necessary for the sustainable
development of a country due to depleting fossil fuel level, climbing fossil fuel prices
across the world and more recently pressure for reduction in emission level. In India,
several schemes and policies are launched by the government to support the use of
RES to achieve energy security and self-sufficiency. S. N. Singh (2009) discussed the
present scenario and future prospects of RES in India. Various schemes such as
financial assistance, tax holiday, etc. for promoting RES development and utilization
are also discussed. The present situation is seen to be very promising and favorable
for RES in India. Although at present the contribution of renewable energy is small
but future developments might make RES technology more competitive to displace
conventional energy sources. Prospects for RES are steadily improving in India
towards a great future. It is destined to take a leading role in the global renewable
energy movement aiming towards sustainable development. The strategy for
achieving these enhanced goals will mainly depend on the active participation of all
players i.e. from government agencies to NGOs, from manufactures to R&D
institutions, from financial institution to developers and of course a new breed of
energy entrepreneurs.
There are still some rural communities in the world where there are no medium to
large electrical energy transmission systems. The state of electrical transmission
systems in different countries depends heavily on whether the economy is developing
or industrialised. The total world electrical energy usage today is 18 TW-hr (1 Trillion
Watt hour = 1012 Whr). Total electrical loads are forecasted to rise to over 30 TW-hr
by 2030 but this estimate could be low. Solar resources are great enough and high-
efficiency multi-junction PV concentrating solar power tracking systems could

86
convert enough sunlight into electrical energy to meet forecasted world electrical load
growth (Stephen W. Jordan and Tugrul Daim 2011).
China is still a developing country by world standard but her industrial and
economic growth is developing at an unprecedented rate. This has resulted in huge
consumption of electrical energy, a large percentage of it being produced by fossil
fuels. Over-reliance on fossil fuels has caused concerns on a global scale and China is
under great pressure to cut down greenhouse gas production. Increased deployment of
renewable energy resources on a national scale provides a feasible solution to address
environmental issues and to increase energy security. The pros and cons of various
renewable technologies are discussed. ( Tze-Fun Chan and Lei Lai 2011).
There is a temptation to compare future potential growth of PV to wind energy
since PV seems to be on a development curve similar to wind power but about 10
years behind wind on a cost and capacity basis. While this appears to be true, there are
some big differences between wind power and PV energy.
1. Wind has evolved mainly into a bulk power resource rather than a distributed
generation resource –i.e, wind turbines are installed in large wind farms that are on
the order of 100 MW or larger and interconnected to the grid at the transmission
system level. At this system level, wind must compete with bulk power market
prices of 2-5 cents per kilowatt-hour. On the other hand, solar PV energy is more
likely to remain a distributed generation resource connected in much smaller
increments well under 1 MW at the distribution feeder or customer level. The retail
value of electricity at this level is 6-20 cents per kWh.
2. Even though PV appears to be 10 years behind wind power on a cost basis, since it
is competing in a higher price market, it actually is much closer to reaching a
competitive cost point than is widely recognised. PV only needs to get to about 12
cents per kilowatt-hour to see huge market growth at current retail utility prices.
3. PV energy is much more compatible than wind energy with urban and suburban
environments due to zoning restrictions and aesthetics. It is also more easily
integrated into residential and commercial building designs.
For these reasons, once market conditions are ready, PV is much more likely to
see explosive growth in the mainstream consumer market than wind power ever will.
However, the consumer market that PV is targeting is much less predictable than the

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bulk power market associated with wind power. The consumer market is as much
driven by consumer preferences as it is by economics (Philip P. Barker and James M.
Bing 2005).
A characterization procedure for crystalline silicon PV modules has been
developed (E. Caamafio 2000), which can be used for quality control purposes by
local laboratories of countries where PV Rural Electrification actions are being
implemented. The method is simple both in the measurement and processing phases.
It relies on the performance of outdoor measurements using basic equipment and
reference PV modules as sensors for the operation conditions. Results are referenced
to the Standard Test Conditions and have uncertainty smaller than ±5% for a PV
module maximum power determination which is good enough to be considered within
the frame of contractual procedures. No other specific equipment (variable loads,
etc.), is required. Results are referenced to STC with the following uncertainties:
±2.5% for short-circuit current, ±1.5% for open-circuit voltage and ± l % for the fill
factor parameter, leading to ±5% for the PV module maximum power determination.
Progress of the implementation phase of the Luz Solar program-utility initiative
for rural electrification using photovoltaic is dealt with. (A.S.A.C. Diniz 2002) reports
This program has been specifically designed as a larger-scale use of photovoltaic by
CEMIG-Energetic Company of Minas Gerais, in collaboration with state and federal
governments. The analysis is based upon 8 years CEMIG’s experience with PV,
which has shown that this technology can be both reliable and cost effective in
remote, rural areas-as well in urban environments. The main objective has been to
find an energy and lively alternative to grid connection for dispersed rural
communities. Starting July, 2002, electric utilities in Brazil will be obliged to electrify
the entire area it serves. PV will facilitate the access of lower-income people to
lighting, communication, as well as education. The major conclusion of this 8 year
CEMIG investment is that an adequate service infrastructure is required to make
projects viable mainly characterised by a technical network that will embrace the
whole area. This network will guarantee the system’s technical performance, system
design, qualified technical performance, and will also avoid a lack of ongoing and
unrealised user expectations. The Luz Solar program has benefited from the lessons

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learned during these solar-electricity experiences, avoiding potential failures in the
sustainability model.
In the present study, a solar (PV) home power system integrating with
conventional DG sets has been proposed(S. N. Singh 2010) for a grid deprived areas
for rural India. The main objective of this scheme is optimal design of a solar (PV)
powered power supply system to produce green power and reduce the use of
conventional DG sets resulting in reduced cost of operation and maintenance. The
cost of logistic by minimising diesel runtime and fuel consumption thus will have a
better impact on environment. The prototype unit for daily load energy requirement
varying from 1200-1800Wh of a rural home has been developed. Performance tests
were carried out for quality of power and efficiency of the converter system.
Table 5.1 Cost evaluation of PV with Diesel-Generator set
Diesel Generator Cost (Rs) Cost of PV system (Rs)
Fuel Cost X Month 14000 PV 4 X 75 Wp 30000
Rs 1000 X 8=8000 Inverter 300 VA 5000
Rs 1500 X 4 = 6000 Battery 2 X 80Ah 10000
Operational Maintenance 12000 Maintenance 500
Rs 1000 X 12= 12000 Misc. Expenses 4000
Total 26000 Total 49500
Payback period=PV cost/DG cost= 2 years (maximum)
Different technological options available for DG, their current status and evaluates
them based on the cost of generation and future potential in India are dealt with. The
non-renewable options considered are internal combustion engines fuelled by diesel,
natural gas and micro turbines and fuel cells fired by natural gas. The renewable
technologies considered are wind, solar photovoltaic, biomass gasification and
bagasse cogeneration. The cost of generation is dependent on the load factor and the
discount rate. Gas engines and Bagasse based cogeneration are found to be the most
cost effective DG options while wind and biomass gasifier fired engines are viable
under certain conditions. PEM Fuel cells and micro turbines based on natural gas need
a few demonstrations projects and cost reductions before becoming viable. A strategy
involving pilot projects, tracking of costs and dissemination of information is likely to
result in DG meeting 10% of India’s power needs by 2012. (Rangan Banerjee 2006)
He calculated annulised cost of generation of different DG options depending upon

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the load factor. (Table 5.2) For some of the renewable options the system load factor
is constrained by the supply availability.
Table 5.2 Renewable options with load factor and Cost, D=Demonstration,
I=Indigenous, C=commercially available, N=Not constrained by supply
Technology LF Unit cost Remarks
status- (Rs/kWh)
capacity factor
Non- renewable
Diesel C,I-N 0.5 5.10 Existing base of more than
0.8 4.85 10,000MW as back up
Gas engine C-N 0.5 2.62 Relative price of natural
0.8 2.29 gas
Micro turbine D-N 0.5 3.24 Technology still in
fuelled by 0.8 2.82 progress
natural gas
Fuel cell D-N 0.5 6.64 Technology demonstration
fuelled 0.8 4.68 required
by natural gas
Renewable
wind C-I, 13% max 0.2 8.71 installed
0.3 5.84
PV C-I, 25% max 0.25 17 installed
Biomass C-N 0.5 3.16 installed
gasifier
Gas engine 0.8 2.59
Bio mass- C-I 50% 0.5 2.40 installed
cogeneration 0.6 2.27
Hybrid renewable energy systems are becoming attractive for remote areas power
generation applications due to advances in renewable energy technologies and
increase in the oil price. (Abdullah H. Al-Badi 2009) A feasibility study of wind
penetration into an existing diesel power plant of an isolated Duqum area in the
Sultanate of Oman. HOMER software has been used to perform the study for the
hybrid system with no battery storage. For Wind speed less than 5m/s the existing
diesel plant seems to be is the only feasible solution over the range of fuel prices used
in the simulation. Moreover, the proposed hybrid system becomes feasible at wind
speeds of more than 6 m/s and a diesel cost of 0.368 US $/L or more, which is the
current diesel cost in Duqum.
The decentralized power is characterised by generation of power nearer to the
demand centers, focusing mainly on meeting local energy needs. It can function either

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in the presence of grid, where it can feed the surplus power generated to the grid, or as
an independent/stand-alone isolated system exclusively meeting the local demands of
remote locations. Further, decentralized power is also classified on the basis of type of
energy resources used-non-renewable and renewable. These classifications along with
a plethora of technological alternatives have made the whole prioritization process of
decentralized power quite complicated for decision making. There is abundant
literature, which has discussed various approaches that have been used to support
decision making under such complex situations. With such a felt need 102 articles
were reviewed and features of several technological alternatives available for
decentralized power, the studies on modeling and analysis of economic,
environmental and technological feasibilities of both grid-connected (GC) and stand-
alone (SA) systems as decentralized power options are elaborated(Deepak
Paramashivan Kaundinya et al.2009).Salient features of grid connection and stand
alone systems-
Grid connected systems:
• Centralised generation depending upon mainly fossil fuels and operation capacity
determined by the supply.
• Grid acts as a battery with an unlimited storage and hence takes care of daily /
seasonal load variations; overall efficiency is better.
• Connectivity to the grid enables large scale systems and operates at high plant load
factors. This improves economic viability of operation.
• Operates on higher scales of MW and hence used for centralised or dense load
making the system efficient.
• High cost of transmission and distribution when extended to remote places.
• Depletion of fossil fuel, emission of obnoxious gases rising concerns about the
climate change and other health hazards.
Stand alone systems:
• Decentralised system and operate at few kW
• Suitable for remote locations where grid cannot penetrate and there is no other
source of energy.
• Need storage system like battery for storage of electricity produced during off-peak
demand periods.

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• Need based and operational capacity is matched on the demand.
• System output varies with time, seasonal variations and sometimes not available for
throughout the year.
• Ideal for low plant load factor
• Easily accessible, environmentally benign, sustainable and reliable energy supply
for small and medium loads.
5.2 Renewable energy in India
The term “renewable energy” comes from natural resources such as sunlight,
wind, rain, tides, and geothermal heat, which are renewable (naturally replenished).
There are various forms of renewable energy, deriving directly or indirectly from the
sun, or from heat generated deep within the earth. They include energy generated
from solar, wind, biomass, geothermal, hydropower and ocean resources, solid
biomass, biogas and liquid biofuels. (Fig.5.1)

Renewable and Waste

Electricity-only Renewable source Renewable sources

Renewable without stock with Stock changes
sources and changes (Group III)
Technologies (Group II) • Industrial wastes
(Group I) • Geothermal • Municipal solid
• Hydro • Solar thermal waste
• Wind • Solid biomass
• Ocean • Biogas
• Solar PV • Liquid bio fuels

Fig. 5.1 Renewable and waste classification (Source: IEA Manual 2005. pp116)
• Group I-products which need to be transformed into electricity in order to be
captured (such as hydro or solar photovoltaic).
• Group II-products which are produced and then can be input for multiple uses in
the transformation and final consumption sectors (such as geothermal or solar
thermal); because of their nature these products cannot be stored in a conventional
sense and therefore are products for which no stock change data can be reported.
• Group III-products which are produced and used for multiple purposes in the
transformation and final consumption sectors (such as wastes, fuel wood, biogas

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 and liquid biofuels); because of their nature they can be stored in a conventional
sense and are products for which stock change data can be reported.
Four seems particularly promising for rural electrification in India: small
hydropower, wind, biomass and solar and they share several characteristics such as:
• RES are capital-intensive, with low running costs. Relatively high capital
requirements are a major obstacle in India, where finance is expensive. All except
biomass have no fuel costs at all, so running costs are essentially just maintenance.
While biomass does require fuel much of this is available on a non-cash basis.
• RES are relatively unfamiliar technologies. While many of the technologies,
particularly in the case of hydro, have existed for a long time, they tend to be less
familiar and are thus seen as more risky.
• RES do not rely on outside fuel supply and preferred for more remote applications.
• In some cases they are relatively benign in terms of local impacts on the
environment, though some hydro and biomass use can have significant impacts.
• RES produce very low GHG emissions, even considered over the whole life cycle.
• RES have tended to be more expensive on a per kilowatt hour (kWh) basis than
conventional energy sources. However, technology improvement and economies of
scale have brought costs down dramatically over recent decades. (WEA 2000)
India is one of the few countries to have a ministry dedicated to renewable energy
promotion-the Ministry for New and Renewable Energy (MNRE) and the present
status of Renewable Energy Programme/ Systems up to 31.08.2011(Table 5.3) Since
its formation, the MNRE (previously MNES) has launched one of the world’s largest
and most ambitious programs on renewable energy and has been successful in
generating about 12% of renewable energy mix. Renewable energy is well positioned
to play a critical role in addressing this growing energy demand for the following
reasons:
Table 5.3 Renewable Energy Systems on 31-8-2011
Renewable Energy Programme/ Systems Target Achieve Total Cumulative
for ment achievement achievement
2011- during 2011-12 up to
12 Aug,’11 31.08.2011
I. Power from renewables:
A. Grid-interactive power ( MW)
Wind Power 2400 266.00 833.00 14989.00

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 Small Hydro Power 350 21.00 111.30 3153.93
Biomass Power 460 25.00 86.50 1083.60
Bagasse Cogeneration 12.5- 111.50 1779.03
Waste to Power -Urban 1.20 1.20 20.20

-Industrial 25 - - 53.46
Solar Power (SPV) 200 8.50 46.16
Total 3435 325.70 1152.00 21125.38

B. Off-grid/ captive power ( in MWeq)

Waste to Energy -Urban - - 3.50
-Industrial 15.00 0.75 10.18 72.30
Biomass(non-bagasse) Cogeneration 80.00 2.55 31.99 327.95
Biomass Gasifiers -Rural 3.00 0.72 1.20 15.55
- Industrial 10.00 2.96 4.50 125.88
Aero-Generators/Hybrid systems 0.50 - 0.12 1.24
SPV Systems (>1kW) 20.00 0.42 3.50 72.50
Water mills/micro hydal(No.s) 400 143 143 1818
Total 128.50 7.40 51.49 618.92
II. Remote village electrification
Remote Villages provided with RES 500 688 742 8846
III. Other renewable energy systems
Family Biogas Plants (Number in lakhs) 1.50 .07 .12 44.16
Solar Water Heating, Collector Area 0.60 0.04 0.20 4.67
(Million sq.m)
• India has abundant, untapped renewable energy resources, including a large land
mass that receives among the highest solar irradiation in the world, a long coastline
and high wind velocities that provide ample opportunities for both land-based and
offshore wind farms, significant annual production of biomass, and numerous
rivers and waterways that have potential for hydropower.
• India’s use of its indigenous renewable resources will reduce its dependence on
imported expensive fossil fuels.
• Increased competition for limited fossil resources is projected to push prices up,
while increased deployment of renewable technologies pushes prices down in line
with technology improvements and economies of scale.
• As a distributed and scalable resource, renewable energy technologies are well
suited to meet the need for power in remote areas that lack grid and road
infrastructure.

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 • Renewable energy technologies offer the possibility of providing electricity
services to the poor and urban areas; while addressing India’s greenhouse gas
(GHG) concerns and goals.
Considering the limitations of conventional centralised power sector policy, many
researchers are highly optimistic about decentralised power generation with
renewable energy source. Powerful forces are driving a similarly rapid transition to
distributed electric generation, where the power plant shifts from a large remote
station to rooftops, basements, backyards, or driveways.
5.3 Sources of renewable energy for rural electrification
5.3.1 Small Hydro power
The hydroelectric power refers to the energy produced from water (rainfall
flowing into rivers, etc) and it is the oldest renewable energy technique known to the
mankind for mechanical energy conversion as well as electricity generation. Hydro
power projects (Fig 5.2) are generally categorized in two segments i.e. small and large
hydro. In India, hydro projects up to 25 MW station capacities have been categorized
as Small Hydro Power (SHP) projects.
Table 5.4 Classification of hydro projects

Class Station Capacity in kW

Micro Hydro Up to 100
Mini Hydro 101 to 2000
Small Hydro 2001 to 25000

Fig. 5.2 Existing Hydro capacities

While Ministry of Power, Government of India is responsible for large hydro
projects, the mandate for the subject small hydro power (up to 25 MW) is given to
MNRE. Small hydropower accounts for some 3153.93 MW (Fig.5.4) and are further
classified as in Table 5.4.The main advantages of SHP are, technologically mature,
easy to maintain, reliable and has low operating costs. The investment costs for small

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rural and remote hydro power projects in India vary between Rs 1, 24,310-Rs 2,
33,335 per kW.
This includes the cost of power evacuation and distribution system (Nouni et al.
2005). At a discount rate of 12%, the energy delivery cost ranges from Rs.3/kWh up
to around Rs.9/kWh, dependent on the plant load factors. Seasonal variation in water
flow and under utilization of the produced electricity can threaten the viability of
hydro plants. Traditional approaches have suffered barriers to environmental factors
like:
• Building a dam across a river floods the land that would otherwise be available for
use, alters the landscape, affects the local community that would have lived and
worked on the flooded land, alters the character of the river.
• Diverting a river affects the nature of the countryside and does not lend itself to use
on a large scale.
• Permanent complete or partial blockage of a river for energy conversion is adversely
affected by variations in flow.
• Building large/medium-scale hydro power plants can be polluting and damaging to
surrounding ecosystems. Changing the course of waterways can also have a
detrimental effect on human communities, agriculture and ecosystems further
downstream.
• Hydro projects can also be unreliable during prolonged droughts and dry seasons
when rivers dry up or reduce in volume.
5.3.2 Wind Energy
India is already a leader in wind energy production. It is the fifth-largest wind
power producer in the world, behind Germany, Spain, United States, and China. India
is surpassed only by Germany as one of the world's fastest growing markets for wind
energy. (Fig 5.3 to Fig 5.5)

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 Fig. 5.3 Wind Energy map Fig. 5.4 Regional wind resources (Arora et al. 2010)

Fig. 5.5 Existing wind resources

Small systems can use battery storage to provide power on demand, but larger
applications off-grid will use some combination of solar, biomass, and/or diesel to
ensure a more consistent output. An estimated 80% of the value chain is located in the
country, and the Indian wind industry has an annual production capacity of about 500
MW per year because of the following factors:
• It is environment friendly, clean and safe energy resources.
• It has the lowest gestation period as compared to conventional energy.
• Equipment erection and commissioning involve only a few months.
• There is no fuel consumption, hence low operating and maintenance costs.
• The capital cost is comparable with conventional power plants. For a wind farm
the capital cost ranges between 4.5 Crores to 5.5 Crores, depending on the site and
the wind electric generator selected for installation.

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 Among the renewable technologies considered wind energy is growing
significantly because of the supportive policy environment. For sites where the
capacity factor is 30% or more, wind is competitive at present prices. Even though the
comparison shows a price of Rs. 5.84/ kWh, the accelerated depreciation and tax
benefits provided make it a viable investment even at a selling price of Rs. 3/kWh
along with the challenges:
• Wind machines must be located where strong, dependable winds are available most
of the time.
• Winds do not blow strongly enough to produce power at all the time, energy from
wind machines is considered intermittent. Hence utility companies can use it for
only part of their total energy needs.
• Wind towers and turbine blades are subject to damage from high winds and lighting.
Rotating parts, which are located high off the ground can be difficult and expensive
to repair.
• Electricity produced by wind power sometimes fluctuates in voltage and power
factor, which can cause difficulties in linking its power to a utility system.
Most of the wind energy deployment is grid connected. Due to supply variations it
is less suited to off-grid stand alone generation. However, when considered part of a
hybrid system, alongside diesel, biomass or solar generation, wind turbines can be
economically appealing.
• As of 31,August 2011 the installed capacity of wind power in India was 14989.31
MW (Table 5.3). States with wind power capacity are Tamil Nadu, Maharashtra,
Karnataka, Gujarat and Rajasthan.
• Total potential for wind power in India was estimated by the Centre for Wind
energy technology (C-Wet) at 48.5 GW.
• Government of India has announced generation-based incentive of Rs 0.50 per unit
of electricity from wind power projects, subject to maximum of Rs 6.2 million per
MW to increase investor base.
• Wind Energy Outlook 2009, also indicates that wind energy can provide up to
24% of India’s power needs by 2030, while creating 213,000 green jobs and
cutting 5.5 billion tons of CO2 emissions.

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 • Government of India is planning to infuse around Rs.600 billion in next few years
under 11th five year plan in this industry, which will boost the growth of this
sector.
5.3.3 Biomass energy
Biomass includes solid biomass (organic, non-fossil material of biological
origins), biogas (principally methane and CO2 produced by anaerobic digestion of
biomass and combusted to produce heat and/or power), liquid biofuels (bio-based
liquid fuel from biomass transformation), and municipal waste (wastes produced by
the residential, commercial and public services sectors and incinerated).
The most successful forms of biomass are sugar cane bagasse in agriculture, pulp
and paper residues in forestry and manure in livestock residues. Biomass may be used
in a number of ways to produce energy and most common methods are: combustion,
gasification, fermentation and anaerobic digestion. India is very rich in biomass (Fig
5.6 and Table 5.3).

Fig. 5.6 existing biomass capacity

• It does not suffer from intermittency and can therefore be used as a basis for power
on demand without need for additional storage or backup technology.
• It offers substantial advantages for rural communities, which are mainly engaged
in agriculture. Most villages have a ready supply of agricultural residue that can be
used as fuel, although there are complex social questions of ownership of this
resource, particularly where village commons are involved. Agricultural residue
can be traded on part-barter basis for electricity; an important advantage over
commercial fuels in communities that are poor in cash.

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 • Fuel supply plays a crucial role in determining the financial viability and
sustainability of biomass gasifier power plants. Competition with food produce
makes biomass a potentially contentious fuel supply, precluding the dedicated use
of existing farmland for biomass production (Ravindranath et al. 2005).
Mismanagement or unforeseen shortages of managed crops can put pressure on
forests or common property resources and can threaten the viability of distributed
power plants.
Rural India has an abundance of wasteland and marginal farmland. Successful
projects have helped local communities to effectively utilise energy plantations or
common land for the growing of suitable biomass fuel crops. Agricultural residuals
can supplement fuel crops for small-scale gasification plants. Where the community
can regulate the use of scarce ground water, farmers can grow cash crops and drought
sensitive crops.
For small-scale electrification, particularly community loads in rural areas,
biomass gasification represent a sustainable and relatively low cost option for
fulfilling basic electricity needs. Past studies have put the typical cost per unit
between Rs.2.5 per kWh and Rs.7.5 per kWh, with cost sensitive to load factor and
fuel availability (Nouni et al. 2007). Biomass gasifiers operating dedicated gas
engines is a DG option that is almost cost effective and seems suited for rural areas.
5.3.4 Solar Energy
India is the world’s seventh-largest producer of solar photovoltaic cells and also
exports. India has huge solar potential because of its location between the Tropic of
Cancer and the Equator. The average daily solar radiation varies between 4 kWh per
sq.m to 7 kWh per sq.m for different parts of the country. There are on an average 270
to 300 clear sunny days in a year. Thus, it receives about 5,000 trillion kWh of solar
energy in a year. (MNES 2005)
PV cells find applications in individual home rooftop systems, community street
lights, community water pumping and areas where the terrain makes it difficult to
access the power grid. PV cells produce DC power directly from sunlight and the
efficiency of cells with single crystal silicon is about 13%-17%. High efficiency cells
with concentrators are being manufactured which can operate with low sunlight
intensities. However, for small-scale applications, particularly in remote areas, this

100
becomes cost-competitive. Their lack of moving parts also means that they require
little maintenance, though they do require batteries in order to deliver power on
demand.
• India is among top 5 countries in the world with potential for solar energy day time
production peak coincides with peak electricity demand making solar ideal
supplement to grid.
• Solar energy generation in India broadly falls into Solar Thermal Energy and Solar
Photovoltaic Systems
• High Capital Costs of solar power plants (Rs.17 Cr /MW and Rs.4 Cr for thermal)
and generation cost (Rs.13.45-Rs.18.44 per kWh) historically restricted its growth
versus thermal power; however things are fast changing in the last few years.
• As of 31,Aug 2011, grid interactive solar photovoltaic power plants, with
aggregate capacity of 46.16 MW, and off-grid 72.50MW, installed in the
India.(Table 5.3)
5.3.5 Off-grid generation based on diesel
Entrepreneurs are operating diesel-based electricity provision in small towns and
rural areas as a back-up supply to the grid. Diesel generation sets are in widespread
use for off-grid power due to followings:
• The technology is a familiar one, with large established vendors for both the
generators and the fuel.
• Compared with alternatives such a renewables, a relatively low proportion of the
life cycle cost is upfront capital (Table 5.5)
Table 5.5 Cost of diesel generation on site (Source: Framework from
CDM project in Renewable Energy MNRE report, May, 2009. pp 128)
Diesel Price Rs.34.86 / litre
Electrical energy produced in diesel-generator set 3.2 kWh/litre
per quantity of diesel used(kWh/litre)
Cost of power generation by diesel-generator set Rs.10.89 /kWh
Cost of Power from grid supply Rs.3.5 /kWh
• Maintenance and repair skills are widely available in both cities and rural
communities.
• They can provide high-quality AC power on demand.
To weigh against this, diesel presents a number of challenges:

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 • Large-scale use adds to India’s growing dependency on oil imports and foreign
ex-chequer.
• Diesel engines emit noxious fumes, as well as carbon dioxide.
5.3.6 Comparison of options
Table 5.6 Renewable options for India (Source: MNRE)
Technology Application Pros Cons
Small Water pumps Mills Allows for income Noxious emissions
biomass Refrigeration Generating activities,
Lighting Base load operation,
Continuous operation
possible
Mini-hydro Mills Long life, High Site-specific,
Lighting reliability, Intermittent,
Communication Allows for income Water availability
Generating activities
Wind Lighting and No fuel cost Expensive batteries,
Communication, Intermittent energy services
Mills, Pumps
PV/Solar Lighting and No fuel cost High capital costs,
electronic equipments High cost of batteries
and replacement

Table 5.7 Comparison of renewable options for India (Chaurey et al. 2005 p20)
RES Degree Penetrat Advantages Disadvantages Minimum Cost
of ion requirement $/kW
maturity
Small High Medium Low capital and sites are For 1kW, 30m 2500-
Hydro maintenance cost, inaccessible, head is, then 3000
Minimum very less power minimum flow
Maintenance, in lean period rate is 4
Low cost litre/sec2
Solar PV High High availability of High initial cost, Minimum 7335-
mini grid resource, Replacement of 4-5kWh per 7780
O& M minimum, batteries square meter
Local manufacturing insolation
of components,
Environment
friendly,
Biomass Medium Low Low cost of Community 1.5-2kg of
gasifier Installation, Local mobilization biomass for 2225-
manufacturing of needed producing one 2250
components, unit of energy
Low energy cost
Wind High Medium - - Start up wind 2225-
mills Speed of 2250
2.5-3 m/s

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 Table 5.8 Options for rural electrification in India (Ref: Christopher Joshi Hansen &
John Bower Oxford Institute for Energy Studies EL 05 October 2003)
Suitable % age Approx. cost
Options Efficiency [Rs/ kWh] Influencing Factors
SHS 13-18 10-12 on site generation, modular in size, battery
life
Diesel 15-25 10-15 availability, escalating fuel cost,
environmental concerns
Wind 25 4-8 seasonal ,bulk power source, away from
load, medium wind profile low plant load
factor
Biomass 15-20 2 -4 availability, maintenance
Grid -- 5 voltage profile, Consumers Hours loss

Table 5.9 Renewable energy lower bound on installed capacity scenario of India
(Source: National Energy Map for India: Technology Vision 2030.TERI)

2006-07 2011-12 2016-17 2021-22 2031-32

SHP(GW) 2 8 8 8 8
Business-as-usual
SHP(GW) 2 8 10 10 10
Aggressive
SPV GWp 0.5 0.14 0.39 1.04 7.46
Biomass(GW) 0.25 0.5 1.00 2.00 8.0

Thus, India enjoys abundant potential to all of the renewable energies.

5.4 Solar for India
The advantages of decentralised electricity generation are numerous: avoiding
reliance on state utilities, decreased reliance on fossil fuel-based electricity generation
and direct employment opportunities within the villages, the sites of equipment and
operation. Hence power planners are forced to think of supplementary/ alternative
electrical energy supplies to these areas. Indian conditions are best suited for solar
energy because of -
• Availability of solar energy for about 270 to 300 days in a year (Fig. 5.7 to
Fig.5.13).
• Reduction in the cost of PV cell from Rs.1000 in 1998 to Rs.170-200 per watt in
2011.
• No transmission and distribution losses.
• Solar energy has less geographical limitation.

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• Customer is the owner of his own power-generating system.
• No fuel cost is involved and the production of power is environmentally friendly.
• Suited for roof top generation, generation at site and hence proximity to utilities.
• Proven technology of panel, battery and controller.
• PV systems are durable with little maintenance.

Fig. 5.7 World solar insolation data NASA

Fig. 5.8 Annual mean daily global solar radiations in India (Ref: MNRE report)

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 Table 5.10 Solar radiations in the regions of India

Solar Insolation CUF (%) States

level
(kWh /sq.m/day)
6.0 and above 18.97 and above Rajasthan, parts of J&K (Leh)
5.75 18.18 Parts of Gujarat, M.P.
5.50 17.39 Parts of A.P., Tamil Nadu,
Karnataka,
West Bengal, Bihar
5.25 and less 16.60 and less Rest of India

Fig. 5.9 Direct Normal Solar Resource Fig. 5.10 Global Horizontal Solar Resource

Fig. 5.11 Average Insolation levels Fig. 5.12 Average Insolation

levels in four different regions of India in Karnataka during winter

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 Fig. 5.13 Average Insolation levels in Karnataka during summer and monsoon
(Source: Ramachandra T.V., Shruthi B.V., (2007), Spatial mapping of renewable
energy potential, Renewable and Sustainable Energy Reviews, 11, 1460-1480)
5.4.1 Photo Voltaics
The term photovoltaic’s derives from the Greek word "phos" meaning light and
the word "volt" (named by Alessandro Volta). Photovoltaic is a science, which
examines light-electricity conversion, respectively, photon energy-electric current
conversion. Both direct and diffuse solar radiations take part of the process.
• 1839- Edmond Becquerel accidentally discovered photovoltaic effect when he was
working on solid-state physics.
• 1878-Adam and Day presented a paper on photovoltaic effect and in 1883 Fxitz
fabricated the first thin film solar cell.
• 1941- Ohl fabricated silicon PV cell but that was very inefficient and in 1954 Bell
labs Chopin, Fuller, Pearson fabricated PV cell with efficiency of 6%.
• 1958 -PV cell was used as a backup power source in satellite Vanguard-1 and this
extended the life of satellite for about 6 years.
The light to current conversion takes place within solar cells. There are many
competing technologies such as thin film, mono crystalline, polysilicon, and
amorphous and concentrating solar power, etc. (Fig 5.14)
A photovoltaic module is the basic element of each photovoltaic system. It
consists of many jointly connected solar cells. Most commercial modules consist of
36 or of 72 cells. Solar cells are connected and placed between a tedlar plate on the
bottom and a tempered glass on the top. Placed between the solar cells and the glass

106
there is a thin ethylene vinyl acetate (EVA) thermoplastic polymer foil. Solar cells are
interconnected with thin contacts on the upper side of the semiconductor material.

Solar Photovoltaics

Crystalline Concentrating Thin film

• Mono PV • CdTe
• Poly • CIGS
• CIS
• Amorphous Si
Fig. 5.14 Solar Energy cell Technologies
The typical crystalline modules power ranges from several W to up to 150 W/module
due to the following factors:
1. Environment friendly as they do not emit gaseous and liquid pollutants.
2. Can be easily transported, assembled and installed in remote areas.
3. Produce DC electricity that can be stored in batteries.
4. Zero fuel usage and Noise free.
5. Robust, reliable, weather proof and having long life of 25 years with proper
maintenance.
6. Solar energy has the high energy density of 15mWp/cm3 commercially available
energy.
Despite these advantages PV system has following challenges:
• High capital cost, makes the system cost-prohibitive.
• Few types of devices can be operating using PV.
• PV systems being less competitive compared to other sources and are not suitable
source for meeting large loads.
• Higher potential of these systems is mainly in remote rural areas where grid
connection is not cost effective.
Advances in photovoltaic module technology, inverters, system installation
practices, and design standards are improving the performance of PV systems and
have led to PV becoming established as a strongly competitive energy source for off-
grid energy applications. PV is also on the cusp of becoming competitive in grid
connected configurations and is currently experiencing strong growth in this type of

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application. Substantially reduced PV module cost and higher module efficiency
compared to products of just a decade ago are playing a key role in this expansion.
The introduction of modern inverters that are more efficient, have higher reliability,
and improved utility system interface features are also facilitating market growth.
Overall, PV energy costs have fallen by a factor of about 2 over the past decade and
the prospects for continued improvement are strong.
PV modules can be purchased currently for only 2.5 to 6 dollars per watt and since
systems are being installed for 6-12 dollars per watt, clearly there are significant other
balance-of-system factors that impact the total system cost. In fact, on a 25 year life
cycle basis, inverter costs may contribute nearly as much as PV module costs since
they need to be replaced 2-3 times over the 25 year lifecycle. As module costs have
improved, there is pressure building to reduce the costs in the balance of the system
components. Inverter suppliers need to reduce the prices of their products from the
current typical $0.5-1.0 per watt to less than $0.25 per watt.
5.4.2 PV for a rural home
The average energy consumption of a household is influenced by much factors-
like construction, size of house, climate, season, and size of family (census 2001
average 5.3 persons per house in rural area with 3 rooms).
• Arid regions in India receive plentiful solar radiation (Ave. solar insolation is 5
kWh per sq. m) with the potential availability of 20 MW per square kilometer
(source: IREDA)
• Availability of solar insolation in Dharwad, (Karnataka state) rural indicates that
there is ample scope for using PV in rural areas (fig 5.12 and fig.5.13)
• Government of India provides central financial assistance (CFA) for remote village
electrification programs as per No15/6/2006-07-RVE (Table 5.11).
Table 5.11 Central Financial assistance for remote village electrification programs
(Source: Government of India notification No.15/6/2006-07-RVE)
Home lighting Specifications General Special
Models Category category
States(Rs) States(Rs)
Model-I 18Wp module, 2 light 5895 6165
Model-II 37Wp module, 4 light 11250 11250

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• Electric lighting (up to 200 times brighter than kerosene lamp) directly improves
the quality of life. It allows children to study in the evening and women to gain
some precious time for them or to extend income generating work into the evening
hours.
• It is logical to operate a small unit delivering rated output when the load demand is
light. Then as load increases another unit is connected with the one already in
operation. This keeps the plant loaded up to their rated capacity and increases
efficiency of operation. Several smaller units are more reliable than a large single
unit and additional units can be installed as and when required with the growth of
load on power station.
•Fig. 5.15 is an illustration of the multi-sectoral linkages of solar PV influence on
quality of life in off-grid rural communities and also indicates some social and
economic benefits that may accrue to rural beneficiaries. (UNDP 2004)

Education Environmental Health

Extended period of study, Reduction in indoor smoke Extended period of
educational facilities and per capita CO2 emission health services

Enterprise, additional
Social cohesion &security Solar PV income generation
Rural Micro-enterprise,
Entertainment, safety Electrification employment generation

Information, access to TV Politics and policy Agro based activities

& radio, telephone Global partnership and industries

Fig. 5.15 Energy quality of life in off-grid rural areas

 In order to show data on the different dimensions of energy-poverty, some
indicators could be identified and selected taking into consideration the social,
economic and environmental dimensions of sustainable development and goals
relating to education, health, information, agriculture and microenterprises. (Fig
5.16)
 Fig. 5.17 presents the time variation of cumulative number of solar home lighting
systems and reduction in cost installed in India (MNES 2008).

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 1000
1000 0.4
820 0.35
800
0.3
610
600 0.25
420 0.2
400 300 0.15
210
136109 0.1
200 88 70 56
45 0.05
0 0

Rs/watt

million hhs
980002040608101214161820
years

Fig. 5.16 Conceptual frame works Fig.5.17 SPV Cost Reduction and Increase (India)

Table 5.12 Projected values of cumulative SHS, installed power and CER
Year SS OS SS OS CER CER
million million MWp MWp SS million OS million
2008 0.6 1.8 22.1 66.0 0.1 0.4
2012 2.0 5.9 75.1 219.7 0.5 1.4
2016 6.7 18.3 247.8 675.5 1.6 4.4
2020 15.6 37.4 575.8 1384.2 3.7 9.0

Fig. 5.18 Cumulative numbers of SHS

OS (Optimistic scenario), SS (Standard Scenario), CER (Certified Emission Reduction)

 Pallav Purohit (2007) estimated the time variation of cumulative number of

installation of SHS lighting systems in India using Logistic model as in table 5.12
and fig 5.18.
• As per the fuel cycle analysis, Green House Gas Emissions are very low for RES.
(Table 5.13)

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 Table 5.13 Green House Gas Emissions
(Source: John Holdren Kirk Smith, World Energy Assessment, UNDP, 2001)
CO2 CO2 g/kWh
g/kWh
Coal Conventional 960 -1300 Biomass 37-166
Advanced Coal 800-860 PV 30-150
Oil 690-870 Hydro-electric 2-410
Gas 460-1230 Wind 11-75
Nuclear 9-100

The main barriers to large penetration of PVSHS consists of-

a. Intermittent nature of the solar energy resource.
b. High initial investment and still higher costs of these systems to the end users as
compared to their conventional counterparts.
c. Lack of strong marketing network and excellent market-support infrastructure.
d. Poor access to adequate financial resources including working capital and lack of
innovative financing mechanism including micro and retail financing.
e. The market for SPV home lighting systems is currently supply driven as user’s
needs have not been fully addressed by the suppliers.
f. Emphasis is more on technology development rather than product development to
effectively meet the user’s need.
g. Access to these products is currently poor and rural reach has not been impressive
so far.
h. Awareness level of the benefits of PVSHS is low (Purohit and Kandpal 2005).
5.4.3 Factors considered for PV panel erection
For maximum daily output, PV modules should be exposed to the sun for as much
of the day as possible, with southern exposure during the peak sun hours of 10 am to 3
pm.
• Southern exposure must be free from obstructions such as trees, mountains and
buildings that might shade the modules.
• The unobstructed southern exposure must also have appropriate terrain &
sufficient space to install the PV system.
• Solar panels are fixed with no sun tracking facility and the charge controller is
simple ON/OFF type with no Maximum power point tracking facility.

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 • Several environments have detrimental effects on the long term performance
capability of solar cell arrays like high wind, snow, ice loading, and corrosion by
moisture, high temperature and air born contaminants.
• In case of SHS supply for households, each family will be responsible to manage
and monitor its own loads within the available source rather than metering every
house. This can lead to much better energy management and saving.
• To increase insights into the use of solar PV in households, monitoring and
evaluation activities are required, using as main instruments, data loggers &
household surveys. Monitoring needs to be continued after solar home system
projects end.
• Batteries and fluorescent lights are the two components with the most frequent
failures in solar home systems. Protection of the battery can be enhanced by
improved charge regulators, which are currently of simple design. To enhance
product quality, improved designs of fluorescent lights, inverters and charge
regulators need to be developed.
The experience with the use of renewable energy sources has so far delivered
mixed results. Larger scale deployment of renewable energy technologies for rural
energy has been prevented and hindered by a range of barriers, even where
technologies exhibit with economic advantages. Indeed across past programmes and
policies, a range of social, political and institutional constraints are often cited as key
determinants in the dissemination of modern energy technologies in developing
countries and similarly across India.

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CHAPTER 6

FEASIBILITY STUDY OF SOLAR HOME SYSTEMS

6.1 Review of Literature

Chapin and his colleagues at the Bell Laboratories in Murray Hills, New Jersey
announced in 1954 first cell working on solar light. This first silicon device, called a
solar cell for its ability to convert solar radiation directly into d c electricity, had a 4%
conversion efficiency, which was soon improved to 6% and then to 11 %. In the very
next year, a small solar cell powered rural telephone carrier system was put into
operation in Americus, Georgia, in the United States.
Early applications of solar cells (PV) devices were in space beginning in 1958.
(Ref.1.1.1). Almost every space mission under taken by the United States and the
former Soviet Union was powered by PV. These include fly-by missions past Venus,
Moon, Mars, and Jupiter the early communication satellites and the Skylab manned
space station. Stimulated by the dramatic happenings in the global energy scene since
the first oil embargo of 1973 and with the investment of significant private and
government funding in the United States and elsewhere, PV has grown to become one
of the more promising renewable energy technologies with a potential to impact the
future electric power generation mix.
China is rapidly emerging as an important player in the global photovoltaic
market. By adopting a technology innovation systems framework of analysis,(Ying
Guo et al. 2009) identifies the technological and institutional actors and relations of
the innovation systems for SPV in China and assesses the extent to which these are
likely to encourage or constrain the technological development and the market
diffusion of this technology. Policy lessons can be derived for the management of
innovation in the energy sector and helps understanding of how such innovation could
contribute to economic development.
Low-carbon off-grid electrification for rural areas is becoming increasingly
popular in developed nations such as the UK. However, many developing countries
have been electrifying their rural areas in this way for decades. Case study fieldwork
in Nepal and findings from UK-based research will be used to examine how
developed nations can learn from the experience of developing countries with regards

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the institutional environment and delivery approach adopted in renewable energy off-
grid rural electrification. (Annabel Yadoo and Heather Cruickshank 2010) He dealt
with a clearer institutional framework and more direct external assistance during
project development is advised. External coordinators should also engage the
community in a mobilization process a priori to help alleviate internal conflicts of
interest that could later impede a project.
The performance test results of SHS according to IEC 62124: Photovoltaic Stand-
alone System-Design verification is carried out.( Xinjing Zou and Li Bian 2010). The
performance test evaluates solar home systems in the several aspects such as battery
usable capacity, functional test, recovery test, system balance point, days of
autonomy, etc. The results show that unreasonable design is a main reason to cause
failure. The other reasons are considered as battery quality problem, inappropriate
setting for controller and controller quality problems.
India is a highly diverse country with regard to its electrification status, covering
all from well developed cities to rural areas without access to electricity. It has
identified renewable energy sources as the long-term solution for future energy and
progressing in the direction of electrifying the unreachable pockets. The prospects of
sustainable energy and off-grid options, rural electrification, smart grids and various
policy and regulatory affairs of India are dealt. The role of existing technologies,
automation, and communication for sustainable development is explained. A roadmap
to fulfill the urban and rural needs for sustainable future is presented. (V. S. K.
Murthy Balijepalli and S. A. Khaparde 2011)
It is known that the important factor for photovoltaic system is cost of a system,
and because of several kinds of the photovoltaic array we have the right to elect the
best array with the best efficiency. The popular types of materials are crystalline and
thin films, which have differences in terms of light absorption efficiency, energy
conversion efficiency, manufacturing technology and cost of production. Different
kinds of crystalline materials like a mono-crystalline, polycrystalline are available.
The generated current and generated power by the photovoltaic array is calculated. (
Hadi Nabipour Afrouzi et al. 2011) according to daily solar irradiation in the case
study of Malaysia. Think over generated power of each array's and also according to
required energy for a typically building, the number of photovoltaic array is estimated

114
then the cost of the solar array is calculated. System is simulated by MATLAB
software, and the results are discussed. The simulation is about sizing in order to
select the best array for photovoltaic system to have a optimize system according to
size of the system.
People living in extreme poverty may not be able to afford donated solar home
lighting systems. These systems improve quality of life but they may not lift people
out of poverty. Users must participate in savings programs, maintain savings
themselves, or be able to arrange credit to pay for substantial future costs, such as
battery replacement. However, some households cannot always afford to buy
traditional lighting sources. In these cases, the solar home system may increase their
energy cost burdens or force the systems to fail when components need replacement.
Before implementing home lighting programs in poor communities, sponsors must
realistically assess household’s ability to pay the ongoing system costs necessary. If
households will not be saving money by using solar lighting, the development agenda
should be reviewed to determine if the provision of electricity is the most urgent need
(H. J. Corsair 2009).
6.2 Solar Radiation Estimation
• The estimation of solar energy at the earth’s surface is an important study in the
present scenario to meet the energy requirement from green energy sources.
• In India, only India Meteorological Department (IMD) Pune provides data for
quite few stations, which is considered as the base data for research
purposes.(Fig.6.1)
• The network activity on radiation measurements is increased to the present level of
45 stations. The parameters measured vary from station to station, through global
solar radiation is the common parameter monitored at almost all the stations. The
very important components like the direct solar irradiance, diffuse solar irradiance
and the net terrestrial radiant energy are not measured at many of the stations.
Direct solar irradiation is measured at 21 stations whereas the diffuse irradiances
are monitored at 23 locations. The net terrestrial radiant energy is measured at 12
stations only. However, hourly data of measured irradiance is not available, even
for those stations where measurement has already been done.

115
 Fig. 6.1 solar radiation measurement centers in India (IMD)
 MNRE has already started from February 2011, many initiatives like
Automatic Solar Radiation Monitoring Systems (ASRMS) in 51 different
places of India (Ref.8.2).
6.3 Simulation approach
Despite all the available solar technologies and the opportunity to reduce energy
demand, solar energy systems are less preferred in rural areas today. According to the
IEA report, the lack of technical knowledge among engineers is one of the main
barriers. In fact, several challenges faced by engineers during the presizing e.g., the
complexity and uncertainty of estimating the PV performance.
The most efficient approach to optimise the system performance is through
mathematical modeling. The mathematical model maps the abstract real world into a
world of comprehendible and interpretable numbers. The decision support systems
based on the models can be used to optimise the system operation, to design a
favourable design and operational characteristics of the energy system. Modeling and
policy formation activities complement each other.
The aim of the present study is to help engineers to acquire an idea of the potential
of PV as an energy source. A preliminary study of the existing and available 13
softwares has been made, which indicates that most existing PV estimation software
are focused on electricity generation prediction and cater more for engineers and
researchers.(Appendix IV)

116
• HOMER, RET screen, Hybrid2, NREL SAM, C.SP-r, Solar GIS and INSEL, are
generic software packages mainly developed for hybrid system optimization and
cost analysis. These tools support resource side calculations and they can be used for
solar energy and PV production level estimations. Free availability is the main
advantage of all these tools.
• PVSYST, Solar Design Tool, PV F-chart, Solar Pro, PV Design Pro, PV*SOL basic,
and PV*Sol Expert are PV system design tools that are specifically designed for an
urban/rural applications. Due to their three dimensional CAD environment, they are
capable of considering the effects of the surrounding obstacles in their calculations.
Salient Features of PVSYST
The PVSYST software package is more suitable for the detail design phase when
the system components are going to be chosen to have the highest possible outcome.
Also the estimated production of electrical energy is more accurate in this tool. (Arbi
Gharakhani Siraki and Pragasen Pillay 2008)
The tool is based on a simulation database built using PVSYST and underlies
research considering PV technology parameters and local climatic conditions of India.
PVSYST is a PC software package for the study, sizing, simulation and data analysis
of complete PV systems. It is suitable for grid-connected, stand-alone, pumping and
DC-grid (public transport) systems, and offers an extensive meteorological and PV-
components database. This software is oriented towards engineers, researchers, and
holds very helpful tools for education.
1) Location details are specified in terms of longitude, latitude and altitude
The Meteonorm software (version 5.0, 2003, Version 6.0, June 2007, 6.1, 2009)
provides basically monthly meteorological data for any location on the earth. These
are based on more than 7700 well-established meteo station data, from which about
1500 (named "stations") avail of Irradiance measurements. Data for any location on
the earth, specified by its geographic coordinates, may be obtained by interpolation
between measuring stations, taking altitude and region typology into account. In this
software:
• "Stations" design the meteorological stations which avail of irradiance
measurements.

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• 'WMO/OMM" is the meteorological stations recording many parameters, but which
don't avail of irradiance data.
• "Towns" are a set of some main big cities, for which the data are interpolated.
The PVSYST database includes only "Stations" with well-measured irradiations.
Meteonorm provides its data in monthly values and in hourly values. The hourly data
are built by a stochastic model, quite similar to the "Synthetic Hourly Generation"
performed in PVSYST. These data may also be directly imported in PVSYST.
Moreover Meteonorm proposes other prestations like irradiance computation on tilted
planes, but these are not useful in PVSYST, which uses its own models. Meteonorm
often gives lower values than the average. This means that simulations with default
values in PVSYST will be rather conservative, and give prudent results for the final
yield of the customer’s systems.
As meteo hourly basis, the programme uses binary files with a special format for
PVSYST, and characterised by the extension ".MET". The meteo file includes a
complete geographical site object, followed by hourly values of the meteo parameter,
that is horizontal global and diffuse irradiations, ambient temperature, and, if
available, wind velocity.
The data are recorded for whole days (0H ... 23H). Step labels are referred to the
beginning of the interval (i.e. the 12 h label corresponds to the 12-13 h interval).
When importing own measurements, the meteo file can be restricted to limited
periods, and even have full-days holes. In this case the date is included in each record
on the file. Generation of synthetic hourly values from monthly metro values of global
irradiation and temperature is done. The physical basis of this generator follows
directives of Meteonorm’95 using Aguiar/Collares-Pereira et al. and Scartezzini
algorithms.
2) Meteorological data are often available for several individual years, and
aggregating them for obtaining an average situation is not straightforward. Only
Monthly meteo values may be averaged, as the seasonal distribution is not very
different from one year to another one. Hourly or Daily values cannot be averaged. It
would not make any sense to construct an average year by aggregating each day of
different years, mixing sunny and cloudy days. This would result is a time series with
only mean days, without neither clear nor bad days, which has no physical meaning.

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The right way for obtaining average conditions for hourly data is the construction of
Design Reference Years (DRY), which should obey statistical constraints and is a
matter of specialists.
3) The annual available irradiation [kWh/m²/year] is relevant for PV grid systems, as
the PV output is quasi-linear with the solar energy input. For stand-alone systems, the
monthly distribution may also be of interest, but comparisons would require much
more complex statistical methods.
4) The button "Show optimization" opens a little tool which shows the winter yield
according to the plane orientation. For stand-alone systems, the plane orientation
should optimise according to the worst conditions, i.e. for winter irradiance.
5) Defining the user's needs, from a domestic use point of view- consumption and use
conditions.
• the required autonomy in the absence of sun-which determines the battery pack
capacity
• the required “ Loss-of-Load probability”(P LOL) and the planned system voltage
These parameters lead to the determination of the array nominal power (i.e. the
installed STC power according to the manufacturer specifications), and the battery
pack capacity. Graph shows the potentially available solar energy, along with the
user's needs, the average state of charge of the battery (low values could lead to a
quicker deterioration of the batteries), and PLOL monthly distribution. The table
holds all monthly values, including then needed back-up energy, an approximate
economic evaluation and energy price.

6) When sizing a PV stand-alone system, the basic constraints are the availability of
solar energy during the year, and the satisfaction of the user's needs. The problem to
be solved is the optimisation of the size of the photovoltaic generator and the storage
capacity, subjected to criteria which may take on different weights depending on the
use:
• Reliability of the supply: in a domestic installation, this may be overcome with a
small back-up generator i.e. measured as the "Loss of Load" Probability ("P LOL").
• Investment and maintenance costs: should take into consideration the cost of the PV
generator, the initial cost of the batteries, as well as that of their maintenance and
replacement. The high price of the kWh used necessitates a highly detailed study of
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 the real user's needs, and the use of specific appliances that are highly economical
regarding to energy consumption.
• Durability: the cost of the batteries is closely related to the quality of the batteries
chosen, as well as their longevity, which is itself dependent on the conditions of use
(average state of charge, cycling, depth of discharge, temperature).
7) Battery Voltage Choice: In a stand-alone PV system with direct coupling to the
user the battery voltage determines the distribution voltage. Three days autonomy
for battery is used in this study, assuming that the voltage regulation is 30%
Table 6.1 Battery voltage with appliances
12V: little systems 24V: medium size 48V: special industrial/
for lighting and TV fridge and appliances agricultural use
Max power < 300 W < 1000 W < 3 kW
current 25 A 42 A 62 A
Inverter < 1 kW < 5 kW < 15 kW
6.4 Demography of India

Fig. 6.2 Map of India Fig. 6.3 Map of Karnataka

The population of India was about 1.027 billion in 2001 as per Census 2001.The
average number of members per household is 5.15 in rural areas and 4.47 in urban
areas. Out of 10 households, seven in India are in the rural areas. Of the every 100
households in the rural areas, 36 are pucca houses, 43 are semi-pucca houses, and the
rest are kuchcha houses. Plinth level of the house, that is, the height of ground floor of

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 the house from the land on which the building is constructed is zero for 36% of the
rural and 32% of the urban households.
On an average, a rural household occupies 38 square meter of floor area and an
urban household occupies 37 sq. meters. The poorest segment, that is, households in
the lowest monthly per capita consumption expenditure class of less than 225 rupees
in rural areas, occupy 31 sq. meters of floor area and those in urban slums, 29 sq.
meters. About 30% of the dwelling units in rural and 4% in urban areas do not have
basic facilities like drinking water, electricity for lighting, and a toilet. (Source:
National Energy Map for India: Technology Vision 2030.TERI)
6.4.1 Preliminary design (Ref. Fig 5.8 to fig.5.13)
Table 6.2 latitude and longitudes
India Karnataka Dharwad
Latitude North Equator 60 44’ and 350 30’ 110 30’ and 180 30’ 150 27’
Longitude East 680 7’ and 970 25’ 740 and 780 30’ 750 05’

Fig. 6.4 Map of Dharwad Fig. 6.5 Map of Dharwad

Fig. 6.6 plane clear sky global radiation Fig. 6.7 clear day model for latitude

121
 Fig. 6.8 solar path horizontal Fig. 6.9 solar path polar

Fig. 6.10 Clearness Index Fig. 6.11 Clearness index clear day model

Fig. 6.12 Yearly Global radiations Fig. 6.13 Yearly Global radiations

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 Fig. 6.14 Sun’s height with time Fig. 6.15 Sun’s height with month

Fig. 6.15 solar energy generation Fig. 6.16 solar energy generation
Preliminary design is an approximate estimation of the energy yield based on few
parameters like location etc. (Fig 6.2 to Fig. 6.16)

6.4.2 Number of panels for a rural home

A SHS consists of PV module that charges a battery bank, charge controller and an
inverter (Fig.6.18). The charge controller which is an integral part of the SHS controls
the energy inflow and outflow into and from the battery bank. SHS are ideally suited
for domestic lighting and small power applications.
A Rural house comprises of mainly lighting load, TV, Tape recorder, radio.
Electricity consumption has been estimated for electrified areas, with use varying
from 0.33 kWh per household per day for landless households to 0.84 kWh per
household per day in larger landholdings for lighting purposes (Census 2001). Thus
we take kWh per day as 0.58. (Table 6.3)

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 7
6
5
kWh/sq.m/day

4
3
2
1
0
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
NASA 5.34 6 6.45 6.44 6.27 4.69 4.2 4.33 4.92 4.95 5.07 5.01
PV Syst 5.9 6.4 6.5 6.1 5.5 4.1 3.4 3.6 4.7 5.7 5.6 5.3

Fig. 6.17 Monthly Averaged Insolation Incident on a Horizontal Surface at Dharwad

(kWh/sq.m/day) 22-year Ave: 5.30. kWh /sq.m/day
(Ref: NASA-SSE, Atmospheric Science Data Centre and PVSYST)

6 0.8
0.6
kWh/sq.m/day

4
0.4
2
0.2
0 0

Fig. 6.18 The stand-alone PV system Fig. 6.19 Average insolation and cloud area
1 1
0.8
radiation[kWh/sq.mt
monthly mean solar

0.5
0.6
0.4
0.2
]

0 0
0 2 4 6 8 10 12 14 16 18 20 22 24
kWh

Time of day 1 3 5 7 9 11 13 15 17 19 21 23
Max Min time of day

Fig. 6.20 max. and min.solar radiation Fig. 6.21 load pattern and solar generation
Table 6.3 Average load of a household (without irrigation pump set)
(Ramachandra et al. 2000)
Utility watt hour Total [Whr]
Lamps (three) 40 2.5 300
Tape/Radio 20 3 60
TV 80 3 240

Accounting for system losses due to dust 10% and voltage drop of 0.5%,

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Wattage required = 580X 10.5% =609 Whr
Ampere= 609/ (6 Hrs X12V) =8.45 [4.5+1.5=6 effective charging hours]
Battery size required for 3 days autonomy =580 X 3/ (0.8X12volt) =181.5,-i, e. 3
Thus, 75 Wp, 4.4 Amp, 12 volt, 2 panels in parallel, and three batteries of 60Ahr are
required.
PV panels generate kWh per day=6 hrs X 2 panels X 75 Wp=0.9 kWh
PV panels generate 297 kWh per year [207.9kg coal reduction] in 330 days and
7425 kWh in 25 years [5717.25kg coal reduction].
(Specific fuel consumption of Indian coal is 0.7kg per kWh)
Electricity generated in 25 years is (150Wp X 300days X 25 yrs) 1.125 MW.
I=4.4Amp, V=17 Volt, P=75Wp
6.4.3 Cost
A) Panels=75 Wp x 2 panels X 125 Rs. per Wp = Rs.18750
Batteries 60 Ampere-hour=3XRs 5500 per battery=Rs.16500
Charge controller=Rs.500, Wiring=Rs.3000, Inverter=Rs.7000
Total cost=Rs.52800, Maintenance cost=Rs.100 per year
In 25 years of life cycle battery changing cost=3 times X 3 batteries X 5500 Rs. per
battery = Rs.49500
Life cycle cost=Rs. 27750+25 X 100+49500=Rs.79750
B) Subsidy given by MNRE= (Rs.81 per Wp) X 150=Rs.12150
Hence cost borne by consumer= Rs.79750 – Rs.12150=Rs. 67600
Cost per kWh=67600/7425=Rs. 9.1 (for 25 years)
Cost Rs. 9.93 with 50% subsidy reduced and Rs. 10.74 without subsidy.
Cost of Grid supply
Cost per unit paid for grid electricity (Chakrabarti et al. 2002) = Rs. 5.00
Annual power required=0.840X 365=306 units (0.840 kWh maximum)
Total annual amount to be paid for grid electricity=5x306= Rs. 1530
Cost of conventional grid for 25 years=1530 X 25=Rs. 38250
Cost of UPS with battery backup is included=7000+3X5500 =Rs. 23500
(To increase the reliability and to improve the power quality)
Hence total cost of the grid=23500+38250=Rs. 61750
Cost per kWh=61750/ 25X306 = Rs. 8.07 (Rs.9.29 for 0.6kWh)

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24 grid pv diesel
23.07
20
18.07
16 13.8 17.4
15.6
12
12 13.07
9.1
8 8.07 9.1 9.1
9.1
4

0
5 10 15 20
Fig. 6.22 Comparison of unit Cost (Rs.) with distance (km) (Diesel cost: Rs. 37/L)
 SHS cost is economically viable alternative to grid cost after a distance of 5.9375
km away from the grid.
Assumptions (Ref.5.4.3)
• Solar panels are fixed with no sun tracking facility.
• The charge controllers are simple ON/OFF type without maximum power tracking
facility .Battery charge controllers and inverters are built in modules of PVSYST.
• The system has 3 days autonomy and panel has 25 year life span.
• The percentage increase of unit in grid cost per year about to 15 percent is not
considered.
6.5 Technical feasibility
6.5.1 Project design

Fig. 6.23 Sun’s height Fig. 6.24 Shed tilt optimisation

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Fig. 6.25 shed mutual shading Fig. 6.26 Shed tilt optimisation shading

Fig. 6.27 Daily array output Fig. 6.28 Ref. incident energy in collector plane

Fig. 6.29 Synthetic data generated Fig. 6.30 Hourly meteorological data

127
 Fig. 6.31 Normalised production Fig. 6.32 Normalised production and loss factors

Fig. 6.33 Performance ratio and solar fraction Fig. 6.34 state of charge daily

Fig. 6.35 Clearness index Fig. 6.36 Energy data

128
 Fig. 6.37 PV array characteristics Fig. 6.38 stand alone project load detail

Fig.6.39 Project report Fig.6.40 Characteristics of PV module

Table 6.4 Normalised performance coefficients Table 6.5 Losses in PV system

129
Table 6.6 Battery operation and performance Table 6.7 Meteo and incident energy

6.5.2 Economic considerations

Table 6.8 with interest 5%, 100 % subsidy Table 6.9 with 5% loan, 100 % subsidy

Fig. 6.41 with 50% subsidy, 5% loan Table 6.10 with 50% subsidy

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Table 6.11 without subsidy, loan, and taxes Fig. 6.42 with 75% subsidy, without loan

25
21.7
20
18.6
15 15.5
Rs/kWh

12.4
10 9.29
10.74 10.34 9.93
9.52 9.1
5

0
0 50 100
% subsidy

PV syst calculated

Fig.6.43 with 25% subsidy, no loan Fig. 6.44 comparison of PVSYST with calculated
Project design gives detailed hourly simulations, performances of PV module,
inverter and battery, and optimised economic aspects according to user needs.
6.5.3 Savings from PV System-away from Grid
Actual unit consumed=0.840 kWh/day X 30 days=25.2 kWh/month
Actual Cost of grid supply=0.840 kWh/day X 365 X 5Rs/kWh =Rs 126 /month and
Rs. 1533 /year.
For Solar panel=150 Wp X 6 hour X 0 .8 X 30 days=21.6 kWh/month
(Assuming 20% reduction due to cloud, shading and others)
Sharing of solar with respect to grid (21.6/25.2) is 85.71%
Thus, it saves (0.8571 X 126 X 12) Rs 1295.93 per year.

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Assuming 4% inflation rate and for 25 years, total Cumulative saving is Rs
40142.02.(Table 6.12)
Table 6.12 Grid cost saving due to PV away from grid in 25 years
Year Inflation Saving Year Inflation Saving Year Inflation Saving
(%) (Rs.) (%) (Rs) (%) (Rs.)
1 1.04 1347.84 10 1.4 1814.4 19 1.76 2280.96
2 1.08 139968 11 1.44 1866.2 21 1.8 2332.8
3 1.12 1451.5 12 1.48 1918 22 1.84 2384.6
4 1.16 1503.3 13 1.52 1969.9 23 1.88 2436.48
5 1.20 1555.2 14 1.56 2021.76 24 1.92 2488.32
6 1.24 1607.04 15 1.6 2073.6 25 1.96 2540.16
7 1.28 1658.88 16 1.64 2125.4
8 1.32 1710.72 17 1.68 2177.2
9 1.36 1762.56 18 1.72 2229.1

Projected escalating cost of grid Electricity for 25 years, 15% per year for Rs.
1530/year base is Rs. 1061785. (Table 6.13) Also it provides non-pollutant, reliable
electric energy without customer hour loss. Thus for villages far away from grid, SHS
is the technically feasible economically viable, aesthetically acceptable, environment
friendly options.
Conclusions
1) With continuous advancements in the research of materials, production processes
and techniques, the environmental implications of the life cycle of PV systems are
likely to improve.
Table 6.13 Projected grid cost for 25 years
Yr Inflation Approximate Yr Inflation Approximate Yr Inflation Approximate
(%) Grid Cost (%) Grid Cost (%) Grid Cost
(Rs.) (Rs.) (Rs.)
1 1.15 1795.5 10 2.5 3825 19 3.85 5890.5
2 1.30 1989 11 2.65 4054.5 21 4 6732
3 1.45 2218.5 12 2.8 4284 22 4.15 6349.5
4 1.60 2448 13 2.95 4513.5 23 4.3 6579
5 1.75 2677.5 14 3.1 4743 24 4.45 6808.5
6 1.90 2907 15 3.25 4972.5 25 4.6 7038
7 2.05 3136.5 16 3.4 5202
8 2.2 3366 17 3.55 5431.5
9 2.35 3595.5 18 3.7 5661
2) SHS are being promoted and disseminated by government to meet lighting needs
of villages. These SHS can contribute directly to reduction in carbon emissions in
India in two ways - first by replacing kerosene-based lighting in around 67 million
households and secondly by avoiding the carbon-intensive grid extension to less
inhabited villages.

132
3) Emerging trends in decentralized PV systems for rural electrification continue to
hold relevance at local levels on account of the key challenges of ensuring energy
security to all communities such as-
• Improving household electrification level in electrified villages where households
are scattered and grid extension is not very feasible.
• Pre-electrifying villages which are likely to be electrified in near future for
introducing basic electricity services initially and subsequently facilitating load
growth for making grid extension viable in future.
• Augmenting the electricity supply in electrified villages for achieving better
healthcare, education and community services by providing dedicated PV systems.
• Managing the periods of low demand such as street lights, compound lighting in
the night in institutions/campuses where large diesel generator sets run for daytime
peak loads.
• In addition to the above market drivers, there are a few emerging trends in related
technologies which are expected to fuel the growth of decentralized PV systems.
India ranks 7th in the worldwide for PV cell production. GoI provides all the
facilities to 9 manufacturers of solar cells, 21 of PV modules, 60 companies
engaged in assembly and 43.6% of their products are exported.(Fig.6.45)

50 43.6
45
40
35
30
25
20 14.8 15.3
15 8.4
10 6.8 4.5 3.5 3.2
5
0

Fig.6.45 Share of PV market in India during 2009

(Source;Indian Semiconductor Association Report 2010)
Concessional duty import of raw materials, components, solar cells, PV modules
and systems is permitted. Most of the PV products are exempted from excise duty and
80% accelerated depreciation can be availed during the first year. Of several
distributed generation technologies, small-scale (kWp range) roof-top PV systems are
feasible and most suitable. In Indian context, PV based distributed generation;

133
including roof-top PV systems has tremendous potential in rural and peri-urban areas
where availability of roof-space in houses is not a constraint. Hence it is necessary to
make policy approach towards addressing the challenges of rural electrification.
A generalized approach to assess suitability of standalone and grid connected
systems at a given location, based on techno-economic-financial-environmental
feasibility does not find adequate coverage. If data pertaining to system costs,
operation, maintenance and other relevant cost details are made available along with
the learning from the case studies, the economic-financial assessment objective could
be easily accomplished. It is found that the techno-economic assessment of grid-
connected systems and stand-alone systems is restricted to annualized life cycle
costing methods. Successful implementation of standalone projects under CDM
requires devising suitable policy measures after taking cognizance of local support,
institutional barriers and other social factors. This necessitates combined efforts from
policy makers and modeling experts to study the systems collectively with other allied
interdisciplinary sciences, for a clear representation of the energy problem and
effective implementation of the solutions.

134
CHAPTER 7
ECONOMIC ASPECTS
Solar systems are characterised by high initial cost and low operational costs as
compared with the relatively low initial cost and high operating costs of conventional
systems. The comparison between these systems is based only on direct monetary
outlay of the user ignoring non-economic factors like social, environmental, status
value, freedom from utility grid etc. Following are the three main approaches used for
comparing the relative costs of the solar and conventional systems-
a) Energy payback Time(EPBT)
b) Net Present Value(NPV)
c) Life Cycle Cost(LCC)
7.1 Energy Pay Back Time (EPBT)
Most solar cells and modules used today are crystalline silicon. Both single-crystal
and multicrystalline silicon are used in large wafers of purified silicon. Purifying and
crystallizing the silicon are the most energy-intensive parts of the solar-cell
manufacturing process. Other aspects of silicon-cell and module processing that add
to the energy input include: cutting the silicon into wafers, processing the wafers into
cells, assembling the cells into modules (including encapsulation), and overhead
energy use for the manufacturing facilities.
Today’s PV industry generally recrystallizes any of several types of off-grade
silicon from the microelectronics industry and estimates for the energy used to purify
and crystallize silicon vary widely. Hence energy payback calculations are not
straight-forward. Until the PV industry begins to make its own silicon, which it could
do in the near future, calculating payback for crystalline PV requires certain
assumptions.
To calculate payback, Dutch researcher Alsema reviewed previous energy
analyses and did not include the energy that originally went into crystallizing
microelectronics scrap. His best estimates of electricity used to make frameless PV
were-600 kWh/m2 for single crystal silicon modules and 420 kWh/m2 for
multicrystalline silicon.
Assuming 12% conversion efficiency (standard conditions) and 1700 kWh/m2 per
year of available sunlight energy (the U.S. average is 1800); Alsema calculated a

135
payback of about 4 years for current multicrystalline-silicon PV systems. Projecting
10 years into the future, he assumes a solar-grade silicon feedstock and 14%
efficiency, dropping energy payback to about 2 years. (Fig. 7.1)
Other recent calculations support Alsema’s figures. Based on a solar-grade
feedstock, Japanese researchers Kato et al. calculated a multi-crystalline payback of
about 2 years (adjusted for the U.S. solar resource). Palz and Zibetta also calculated
an energy payback of about 2 years for current multicrystalline-silicon PV. For single-
crystal silicon, which Alsema did not calculate, Kato calculated a payback of 3 years
when he did not charge for off-grade feedstock. Knapp and Jester studied an actual
manufacturing facility and found that, for single-crystal-silicon modules, the actual
energy payback time is 3.3 years. This includes the energy to make the aluminum
frame and the energy to purify and crystallize the silicon.
Energy payback time (Karl E. Knapp 2010) is one method adopted by several
analysts in characterizing the energy sustainability of various technologies. It is the
energy analog to financial payback, defined as the time necessary for a photovoltaic
panel to generate the energy equivalent to that used to produce it. This investigation
focuses on the energy payback time for both single-crystalline silicon ("sc-Si") and
thin film copper indium diselenide ("CIS") photovoltaic modules as manufactured by
Siemens Solar Industries ("SSI"). Two parameters determine the EPBT are (1)
Production and (2) Implementation. The energy needed to produce a product (specific
energy) includes both the energy consumed directly by the manufacturer during
processing and the energy embodied in the incoming raw. (Source; NREL)
Implementation refers primarily to location, which determines the solar insolation
and therefore the electrical output of the PV panel but could extend to installation
details (fixed tilt or tracking, grid-connected or stand-alone, etc.) or balance of system
(BOS) requirements such as mounting structure, inverter, or batteries. Figure 7.2
shows lines of constant payback times with the vertical axis being specific energy and
the horizontal axis is energy generation rate for 1700 kWh/m2/year. The energy
payback time is computed from-

EPBT= (Specific Energy) / (Energy Generation Rate)

136
 The payback time for today’s production photovoltaic technology is substantially
less than its expected lifetime. With a module lifetime of 25 years, the panels analysed
here will produce nine to seventeen times the energy used in its production. The
effects of the other components of a photovoltaic system can be significant relative to
the module payoff itself, most notably in systems requiring batteries. Including life-
cycle energy balances in both module production and BOS design are necessary to
claim sustainability. (Table 7.1)

Fig.7.1 Energy Pay back Fig. 7.2 Specific Energy and Energy Generation Rate

Table 7.1 Energy Pay Back Time

1.Single crystalline-Si production Ingot Cell Module Total EPBT

2MWp/month kWhe/kWp
Process 1382 850 510 2742 1.6
Indirect Mat’ 1 36 412 -- 448 0.3
Direct mat’1 1884 1 523 2408 1.4
Total 3302 1264 1032 5598 3.3
EPBT (years) 1.9 0.7 0.6 3.3
2.CIS(copper indium (di)selenide)
Pre-Pilot15kWp/month kWhe/kWp Cell Module Other Total EPBT
Process 6949 1966 6192 15107 8.9
Indirect Mat’ 1 111 - - 111 0.1
Direct Mat’1 369 940 - 1308 0.8
Total 7429 2906 6192 16527 9.7

137
 EPBT (years) 4.4 1.7 3.6 9.7
3.CIS production Cell Module Other Total EPBT
200kWp/month kWhe/kWp
Process 958 147 619 1725 1
Indirect Mat’ 1 36 - - 36 0.02
Direct Mat’1 369 940 - 1308 0.8
Total 1363 1087 619 3070 1.8
EPBT (years) 0.8 0.64 0.36 1.8
Some determinants of the energy payback for alternative energy technologies are
controllable by the manufacturers and some are not. There is a long-term
sustainability ideal that say is to be done, to reduce the energy burden imposed by
new technologies.
Energy payback time is a time in which the energy input during the PV system
life-cycle is compensated by electricity generated by the PV system excluding life
time of PV system.
EPBT = Input / (Output /year)
Example for a CdTe PV module (Table 7.2 and Fig 7.3)
Table 7.2 Energy payback Time
E input= Cumulative Energy LCA 12236MJprim/kWp
Irradiation 1700kWh/m2.year
Performance ratio (IEC 61724) 0.75
Generated electricity 1275kWh/kWp
Efficiency electricity supply 11.4MJprim/ kWp. Year
Avoided Energy 1275 X 11.4=14535MJprim/ kWp. Yr
Energy Payback Time 12236/14535=0.84 years

Fig.7.3 Roof top generation EPBT

138
7.2 Net Present Value (NPV)
To determine about the fuel savings over life time of the system and comparing it
with the time value of the investment- with money from hand and with money on loan
are the two approaches. This is more complex than payback, but provides better
information. It may be unclear what payback period is acceptable, but NPV provides
the actual cost value of completing a project.
NPV also recognizes the time value of money. While this fact is obvious to most
people, explicitly accounting for it in calculations is foreign to many homeowners.
This analysis includes the calculation of NPV for sample solar systems. But the result
is highly dependent on the discount rate used. (Fig 7.4)

INPUTS

Resource Data
OUTPUTS
 Solar Insolation
 Wind speed System Performance
 ambient temperature
Load data  Energy production
 Energy storage
 Appliance  Resource seasonal
Energy
 uction
Daily usage Economic Performance
System Configuration Evaluation  NPV
 PV  Levilised Energy Cost
 Wind  Sensitivity Testing
 Balance of system  System price
Cost  System efficiency
Economic  Equipment life time
 Installation
 Operation Evaluation
 Maintenance
Finance

 Discount rate
 Tariff
Policy

 Incentives
 Social benefits

Fig 7.4 Rural Renewable Energy Analysis and Design model

139
7.3 Life Cycle Cost (LCC) (Ref. 6.5.2)
Solar life time cost includes capital costs, interest on the capital, fuel costs,
operating and maintenance costs, replacement cost of components, etc. over the useful
life of the system.LCC per kWh of the different technologies depends very much on
the number of kWh generated (number of households that consume electricity and the
amount of electricity that an individual household consumes).
If there is a main electric grid close by and there is sufficient energy demand,
extension of the electric grid is the most cost effective option, when compared to
other electrification options.SHS become competitive with grid extension, even a few
kilometers from the main electric grid with the cost of connection to the grid being the
most important parameter that determines the break-even point.
PV-minigrids are cost effective compared to SHS for systems that are larger than
approximately 10kWp if connections costs are low (less than P2000 average
connection cost), that are when the household density is high. The break-even point
depends very much on the average connection cost.
A Vigneswaran et al. (2008) carried out the cost comparison between amorphous
silicon (a-Si) and cadmium telluride (CdTe) technology for a stand-alone photovoltaic
system by applying LCC method of analysis. A simulation tool; RETScreen is used to
perform the financial analysis in setting up the stand-alone photovoltaic system for a
typical house with an occupancy of four persons. The analysis consists of the
photovoltaic cells cost per watt, efficiency and all factors contributing to the output
power generated from these cells include the balance of the system, the battery
storage, charge controller and inverter. From this investigation, although stand alone
photovoltaic system provides several advantages from the environmental viewpoint,
the major drawback is the fact that it costs ten times more than the cost of
conservative energy. The price of energy for a standalone photovoltaic system ranges
from RM (Ringgit Malaysia, 1RM=30Rs) 5.20/kWh for cadmium telluride to RM
5.32/kWh for amorphous silicon with an average of RM 5.26/kWh.
Sheeraz Kirmani et al. (2010) studied on a stand-alone PV system to provide the
required electricity for a single residential household in India. The complete design of
the suggested system is carried out, such that the site radiation data and the electrical
load data of a typical household in the considered site are taken into account during

140
the design steps. Also, the LCC analysis is conducted to assess the economic viability
of the system. The results of the study encouraged the use of the PV systems to
electrify the rural sites of India.
In remote sites that are too far from the Indian power grid, the PV installers are
encouraged to sell the electricity of their PV systems at a price not lower than
$0.74/kWh to earn a profit. It is to be noted, here, that although this price is very high
compared to the current unit cost of electricity in India ($0.1/kWh), this price will
drop to $0.49/kWh if the future initial cost of the PV modules drops to $0.1/W P. At
the same time, if the future unit cost of electricity in India becomes five times its
current value, due to the rapid increase in the conventional fuel prices, therefore PV
energy generation will be promising in the future household electrification in India,
due to its expected future lower unit electricity cost, efficiency increase, and clean
energy generation compared to the conventional utility grid.
The economic viability of a stand-alone solar photovoltaic PV system with the
most likely conventional alternative system, i.e. a diesel-powered system, has been
analysed for energy demand through sensitivity analysis using a life-cycle cost
computation by Mohanlal Kolhea et al. (2002). The sensitivity analysis allows
estimation of the comparative viability of PV against a conventional alternative
system based on particular country-specific parameters. The overall PV best and
worst case viability, as compared with a conventional diesel-powered system, have
been obtained from sensitivity analysis of the energy demand.
A life-cycle cost comparison of PV powered systems and diesel-powered system
has been carried out to give a first-order indication of when a PV system should be
considered for application. Sensitivity analysis has been given to explore the system
comparisons with base-case assumptions. The analysis has been carried out for the
energy demand for different key parameters, such as discount rate, diesel fuel cost,
diesel system lifetime, fuel escalation rate, solar insolation, PV array cost, reliability,
etc.
 Sensitivity to discount rate
It has been found that a PV system is economical compared to a diesel-powered
system up to an energy demand of 58 kWh/day with a 10% discount rate as base. At
discount rates of 15% and 20%, PV-powered systems are economically advantageous

141
up to an energy demand of 40 and 30 kWh per day respectively. This shift in the
crossover occurs because of the nature of the PV and diesel cash flows, in terms of
recurring vs. capital costs. The base-case PV cash flow, on the other hand, is less
affected by cost escalation. The PV system also has recurring costs due to battery
replacements, so the LCC is sensitive to the discount rate.
 Sensitivity to diesel fuel cost
It has been observed that a PV system is economical up to an energy demand of
53 kWh per day for a diesel cost of Rs. 30 per litre. At a diesel cost of Rs. 20/litre, the
crossover occurs at energy demand of 38 kWh per day and at Rs. 10/litre, the PV is
cost-effective only up to 28 kWh per day. In India, the cost of diesel is highly
subsidised; if the Indian government were to remove the subsidy at the consumer end,
the cost of diesel would increase and the PV system would become more attractive. In
remote areas, the transportation cost of fuel doubles or even triples the cost of diesel.
 Sensitivity to diesel system lifetime
The lifetime of diesel-powered systems varies widely with the quality and
frequency of maintenance. The effect of diesel system lifetime on energy costs shows
that the PV system is economical up to an energy demand of 48 kWh per day for a
diesel system lifetime of 6 years. For a diesel system life of 3 years, the PV is
economical up to 60 kWh/day, and for 9 years, up to 42 kWh/day.
 Sensitivity to fuel escalation rate
It has been found that if the fuel escalation rate is 3% and above, the PV is more
favourable for the base-case assumptions. Fuel escalation mainly depends on the
international price of diesel, reserved foreign exchange of the country, etc.
 Sensitivity to solar insolation
The comparison of life-cycle costs of PV and diesel-powered systems over a range
of energy demands for different solar insolation shows that for solar insolation of 4
kWh/m2/day, the PV system remains cost-effective up to an energy demand of
53kWh/day. For solar insolation of 6 kWh/m2 /day, the PV is competitive up to
77kWh/day. If the solar insolation increases by 66%, the LCC of PV decreases by
30%. In India, solar insolation varies between 4 and 7 kWh/m2 and day.
 Sensitivity to PV array cost

142
 The life-cycle costs of PV and diesel-powered systems have been compared over a
range of energy demands and it has been found that for a PV array cost of Rs.150/Wp,
the PV is economical up to an energy demand of 50kWh/day, and for Rs. 300Wp, up
to 35kWh/day.
 Sensitivity to reliability of PV system
The reliability of a PV system mainly depends on its application. A comparison of
life-cycle costs of PV and diesel-powered systems over a range of energy demands for
different reliability levels has been carried out and showed that PV is economical up
to 43kWh/day for 99.5% reliability of the PV system; for 95% reliability it is
economical up to 72kWh/day. The LCC of a PV system is highly sensitive to its
reliability.
For the best-case PV viability, a low discount rate of 10%, a high fuel diesel cost
of Rs. 30/litre, a short diesel system lifetime of 3 years and solar extremes of the
ranges, i.e. a discount rate of 20%, diesel cost of Rs. 10/litre, a diesel system lifetime
of 9 years and solar insolation of 4kWh/m2/day. The economic viability of a stand-
alone PV system in comparison to the most likely conventional alternative system, i.e.
a diesel-powered system, has been analysed for energy demand through sensitivity
analysis. The analysis shows that PV powered systems are the lowest cost option at a
daily energy demand of up to 15 kWh even under unfavourable economic conditions.
When the economic parameters are more favourable, PV powered systems are
competitive up to 68 kWh/day. These comparisons are intended to give a first-order
indication of when a stand-alone PV system should be considered for application. As
the cost of PV systems decreases and diesel costs increase, the break-even points
occur at higher energy demand.
7.4 Recycling of PV Systems
1) Recycling of Crystalline Silicon PV Modules: It is conceivable that fully
functioning modules will be replaced with newer and better ones, and the replaced
ones will have to be recycled also. Considering these facts, by 2015/2020 economic
and efficient recycling methods for solar modules must be in place. (Table 7.3)
2) Recycling of Amorphous Silicon PV Modules: Schematic survey of thermal
process for solar module recycling is shown in Fig 7.6.

143
 Table 7.3 Materials contained in solar modules

Components Used materials Appr. mass

% age without frames
Glass(2-10mm) SiO2,Al2O3,Fe2O3,CaO, 30-65
MgO,Na2O,K2O,SO3
Transparent adhesive EVA, acryl ate (PVB) 5-10
(1-2mm)
Solar cell (200-400µm) silicon 5-10
Connection material Cu(Sn, Pb,Ag),Al(Mg,Si) 1
(0.04X 2-0.2 X5)
Metallisation Ag,SiO2,Cu,Ni,Al, Ti, Pd, Sn < 0.1
Antireflection Layer TiOx, SixNy >0.1
Doping B or Al, Ga, In, P or As, Sb
Cable 1.5-2.5mm2 Cu, PVC, rubber, Silicon, 1
PTFE
Connection Box PVC,PC,PET,ABS, 0-5
Cu, Brass, Steel, rubber
Sealing, gum Silicon, butyl, polysulfide, cy 0-10
Back side material Chlorofluorocarbon, 0-10
Polyester

Solar Module

Special furnace Separation of removed materials

Burning of all plastic
materials (5000C) Copper
Solar cells Glass
Gas decomposition Steel

(8000C) Chemical Aluminium

treatment m Glass
Metal
recycling Recycling
Purification of waste
Recycled
gases Aluminium
solar cell

Quality Silicon Recycling

Hazardous waste deposit
control

Wafer New manufacturing

of solar cells
Fig 7.6.Schematic thermal process for solar module recycling

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Conclusions
 Cost analysis of PV system module manufacturing involves energy in extraction of
silicon from raw material, preparing silicon wafers, making cell and PV module. Energy
required in this process is not included in the present study.
 Some feel that there should not even be cross subsidies and indeed no subsidies at
all to any category of consumers. The thinking is that, in an ideal world with perfect
markets, efficient use of an input like electricity requires that its price covers the
cost of production. However, the price of electricity must not be set on the basis of
the average cost of cheap plants constructed in the past. Demands for extra
electricity may require new plants. Thus, the price should cover the cost of a unit of
electricity from the next power plant, i.e., the long-run marginal cost of production,
that tends to be much higher.
 A crucial strategy in this context is to exploit the fact that consumers are more
concerned about their total expenditure on an input like electricity than its unit price.
So, if their expenditure stays the same, they will not mind paying more per unit
consumed. A higher tariff for the same expenditure means a lower consumption. But
this lower consumption must not lead to a decrease in the energy service that they
obtain. To achieve the same energy service with a lower consumption requires
efficiency improvements so that energy is used more efficiently. Thus, efficiency
improvements must be used to ensure that the resulting reduction of electricity
consumption offsets tariff increases so that there are no increases of consumers'
expenditures on electricity. Thus, the second guideline is that reduction of subsidies
and tariff increases must come after implementation of efficiency improvements so
as to offset expenditure increases.
 Since SHS are inaccessible to the rural poor, it is tempting to dismiss them as elite
energy sources. If, however, the purpose of SHS is, not merely to improve the
quality of life of the households, but to illuminate after-sundown activities that
augment income (example, weaving baskets), then the elitist characterisation may
not be applicable. Suppose that a one-light SHS permits a tribal household to weave
two extra baskets per evening to earn Rs.5 per basket and therefore (after paying for
materials) about Rs.250 per month. Then the income generated by the SHS more
than pays for the investment on the light. A similar case is that of a mobile vegetable

145
 vendor who can have two extra hours of sales. Thus, there are non-elitist niche
markets for SHS. This is because the income generated under illumination by the
SHS more than pays for the investment on the light.
 Another reason for cautioning against hasty judgments about the elitist or egalitarian
character of sources and devices derives from the well-known fact that technological
advances and organisational learning can bring about major cost reductions in the
case of emerging not-yet-mature technologies. The point is well illustrated by the
declining trend in the cost of PV modules. This means that decisions must be made
on the basis of future costs, rather than present costs that are bound to decline. The
implication is that declining costs can erode the elitist character of sources and end-
use devices and strengthen their egalitarian character.
 Grassroots rural development workers are preoccupied with the immediate problems
of the people with whom they work directly. As a result, they tend to choose
technological options that are available straightaway off-the-shelf. They use a very
high discount rate for their technological decisions being totally preoccupied with
the present. In contrast, technical experts are excited by technological possibilities.

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CHAPTER 8

CONCLUSIONS AND FUTURE DIRECTION

8.1 Observations
The cost of energy in the fossil fuel-based centralised power stations consists of
the generation, transmission and distribution costs, whereas in the decentralised power
generating system energy cost is primarily the generation cost. Conventional
centrally-managed approaches to electricity distribution have been expensive and
unsustainable and the financial analysis presented in this thesis makes the case for a
distributed approach in remote, rural areas using stand alone solar home system.
Experiences with rural electrification through renewable energies so far have
shown many positive aspects, as well challenges that need to be considered to avoid
them in future projects.
 It is found that after SHSs are installed, the electricity demand of the users usually
does not increase. They stick to the usual three to four lights, radio and a TV. In
general they do not have any purchasing power to buy more sophisticated
appliances and their lifestyle does not require them.
 Also it is expected that operation and maintenance worked best in indigenous
communities, where original social structures are still in place as opposed to
villages that have lost their traditional practices and institutional structures.
 Government subsidies are needed to electrify the poorest in the country, who
cannot afford to pay for the systems themselves.
Based on the studies of SHS rural electrification through solar energy provided the
following observations:
• Lack of awareness of solar energy technology necessitates demonstration of it to
rural people; this approach generates demand from nearby communities. In
supporting solar power generation in rural areas,
• Appropriate financial arrangements, which may include payment in installments,
fee for services and other suitable modes, are necessary for rural people to afford
the system.

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 • Technical training can enable users to do trouble shooting for minor problems such
as replacing fuses, adding distilled water, and replacing bulbs. This may avoid
technician calls and increase system reliability.
• Technician training is essential for developing local technical support, which can
also help make the project sustainable. Building local skills for the system’s
operation and maintenance, and ensuring locally produced and accessible
components are also important in developing support for this technology.
• Solar systems with different options should be available to consumers so they can
choose themselves according to their needs and financial capacity.
• For the electrification of rural markets through solar energy, local collective
management yields better results by reducing the risk of theft and nonpayment.
• Solar systems help in generating income, by extending working hours and creating
a convenient environment for business.
• Components/accessories of solar systems should be available locally so that the
users can buy them easily when required. This can increase acceptability of the
technology by users.
• Solar PV can integrated with wind, diesel, micro turbine for reliable operation,
with increase in the cost.
These impacts can mean that a developing country can more rapidly achieve the
millennium development goals.
8.2 Policy Initiatives and National Solar Mission
In recent times, India has been under the radar of western countries for its high
and increasing greenhouse gas emissions. Thanks to increasing pressure from the
West, the Indian Government is looking to explore opportunities in alternative energy
to reduce greenhouse gases. While countries such as China and United States have
ambitious targets to reduce greenhouse gases, India has just started laying foundation
for reducing emissions. Due to increasing demand for electricity and widening gap
between demand and supply, India has targeted 20GW of Solar Power by 2022 in its
Jawaharlal Nehru National Solar Mission (JNNSM).
Since solar power is at the introductory stage of its life cycle, Government
initiatives are expected to drive it until 2012. The Government of India realizing the
need for alternate sources of energy other than coal and oil has introduced many

148
schemes and incentives to support the growth of the Solar Energy Sector. Some
remarkable policies and targets are:
• 11th five year plan targets 50 MW of grid interactive solar power by 2012,
however, this target has been revised to 1000 MW by 2013
• 20 GW of Solar Power by 2022 (JNNSM)
• Increasing domestic photovoltaic module production to 4-5 GW by 2020
• Achieving grid parity for solar power in 2020(JNNSM)
• Funding of 20-25 percent of capital expenditure under the semiconductor policy.
• Generation based incentive at a tariff rate of approximately Rs 15 per kWh.
• Fund allocation for R&D activities and rural electrification programs.
Apart from the above, state level targets and schemes are also expected to benefit
the solar power sector. MNRE has already started many initiatives like Automatic
Solar Radiation Monitoring Systems (ASRMS) in different parts of India.

Table 8.1 Automatic Solar Radiation Monitoring Systems (ASRMS) by MNRE

Sl. No States ASRMS Sl. No States ASRMS

1 Rajasthan 12 8 Madhya Pradesh 3
2 Gujarat 11 9 Jammu & Kashmir 1
3 Tamilnadu 7 10 Chhattisgarh 1
4 Andhra Pradesh 6 11 Pondichery 1
5 Karnataka 5 12 Haryana 1
7 Maharashtra 3 Total 51
Each ASRMS consists of two towers of 1.5 m and 6 m tall each. The 1.5 m tall
tower houses a Solar Tracker equipped with Pyranometer, Pyranometer with Shaded
Ring and Pyrheliometer to measure solar parameters, such as, global, diffused and
direct radiation. The 6 m tall tower houses instruments measuring rainfall, ambient
temperature, atmospheric pressure, relative humidity, wind speed and direction. Each
ASRMS is totally powered by 160 Watt SPV Panels and consists of 13
equipments/instruments and records 37 parameters inclusive of both measured and
derived. The data from each ASRMS averaged to 10 minutes will be transmitted to a
Central Receiving Station established at C-WET, Chennai through GPRS mode. The
implementation of the project has started from February 2011 and all stations have
already been installed, completed and commissioned. The monthly average (daily)

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 wise data received from each ASRMS is available on C-WET website as test run. The
quality checking process of the data is on.
8.3 Conclusions
1. At the beginning of the twenty first century, human society faces two great
challenges: the transition towards a sustainable development, and the eradication
of poverty. Renewable energy sources can play an important role in overcoming
both challenges. The use of renewable energy sources for rural electrification in
developing countries is a paradigmatic example of this role. While the extension
of the electricity grid to those areas can be very costly, the use of off-grid, small-
scale renewable energy systems can provide electricity to remote rural areas at a
reasonable price. New electricity supplies will promote rural development in both
the short-term -by facilitating the development of new economic activities-and
the long term-by improving health and education services.
2. Government programs for rural electrification should coordinate their efforts with
other rural development initiatives so the new electricity supply creates
opportunities for the development of new economic activities. In addition, the
goals of these programs should be based not only on the number of rural
households with access to electricity but also on the quality of the electricity
service provided to them.
3. There is no standard solution for rural electrification projects. Each project needs
to be tailored to the local characteristics of the rural community in which the
project will be implemented. The assessment of available renewable energy
resources (solar radiation, wind speed, water flow rate, etc) will be key factors in
the selection of the technology to be used.
4. Apart from the availability of renewable resources, other important factors to
consider in the design of any rural electrification project are the high-priority
end-uses for the electricity, the income level of the community, the availability of
financial services, etc.
5. If rural electrification brings rural economic development as intended, the
electricity demand of the rural community may increase significantly after the
execution of the project. Consequently, the design of any rural electrification
project should include some degree of flexibility and modularity that allows the

150
 expansion of the system along with the growth of the demand at a minimum cost.
The project design should also include standards for the use of efficient
equipment by final consumers.
6. A solid management model is key factor for the long-term viability of rural
electrification projects. The management model must clearly define operation and
maintenance tasks and responsibilities. The participation of the local community
in these tasks, as well as the design of a tariff system that at least covers the costs
associated to them, are basic pillars of any sound management model.
7. To assure an efficient use of electricity and the involvement of the users in the
project, final users should always pay some tariff for the electricity service they
receive. In some cases, rural customers may be willing to pay a higher tariff than
expected due to the valuable benefits obtained from the new electricity service.
This is especially true when the electricity supply facilitates the development of
new economic activities, thus generating a new source of income for the
community.
8. A major obstacle to the widespread use of RES for rural electrification is their
comparatively high capital and installation costs. Nonetheless, owing to the
simplicity and reliability of these systems, operating and maintenance costs are
relatively low. This means that RES may appear as an attractive option under a
life-cycle cost analysis.
9. Typically, only the wealthiest residents of rural villages can afford to pay for the
RES with cash. The demand associated to this delivery model is therefore very
limited, but credit and rental options can expand the market significantly. The
fee-for-service arrangement tends to be strongly preferred by end users because it
eliminates the need to undertake a large capital investment. In addition, it
eliminates the risk to the end user of technical failure of the system, since it is in
the best interest of the company to ensure an appropriate maintenance of the
equipment.
10. Implementation of the project requires base line study, assessment of user needs,
standards in project, engineering design and optimisation of systems, regulatory
procedures, and construction of infrastructures, execution, evaluation and
monitoring.

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8.4 Power generation projections
In the blue map scenario of India, total power capacity would amount to 748 GW
(Giga watt). The full potential of biomass, geothermal, wind and tidal energy would
be used. For hydro, 51% of the potential would be developed. Total coal‐fired
capacity would be roughly at the current level, but almost all this capacity would be
equipped with carbon capture sequestration (CCS). For solar a significant expansion
is assumed, from near zero now to 191 GW.
By contrast, CEA/Verma (2008) projects capacity needs of 1335‐1854 GW by
2050. However, this assumes a much higher electricity demand (6698‐8679 TWh, vs.
4069 TWh). The difference is accounted for by a combination of much higher
economic growth rates (two‐thirds of the gap) and lower efficiency gains (one‐third)
compared to the ETP 2010 scenarios.

On a regional level, the blue map scenario projects the need for large capacity
additions in the regions of Delhi, Calcutta and Patna (Fig. 8.1). These are also those
regions with large installations of gas capacity. In the regions of Ahmadabad,
Mumbai, Trivandrum and Chennai, coal plants equipped with CCS should be located
close to CO2 storage sites. Most of the nuclear plants are built to exploit the available
cooling water resources along the coastline. Major installations of solar power plants
are projected for the regions of Bhopal, Calcutta and Delhi.

Fig. 8.1 Power capacities by region in the blue map scenario, 2050

152
 In the baseline scenario, India’s total CO2 emissions grow almost fivefold, from
1.34 Giga ton (Gt) in 2007 to 6.45 Gt in 2050. The drastic growth in electricity
demand combined with the reliance on coal for power generation leads to an increase
of CO2 emissions in the power sector from 0.75 Gt in 2007 to 2.87 Gt in 2050.
However, efficiency improvements in new coal power plants reduce the average CO2
intensity of electricity generation in the baseline scenario from 935 gm CO2/kWh in
2007 to 707 gm CO2/kWh in 2050.
In the BLUE Map Scenario, the global carbon price of USD 175/tCO2, which is
required to achieve the 50% reduction in global CO2 emissions by 2050, reduces the
total CO2 emissions of the Indian energy sector in 2050 by 73% compared to the
Baseline Scenario. Relative to 2007, this emission level in 2050 of 1.47 Gt
corresponds to a modest emission increase of 10%. India’s power sector gets
essentially decarbonised in the BLUE Map Scenario. The shift to nuclear, CCS and
solar power yields a dramatic decline in the average CO2 intensity of India’s power
generation from 935 gm CO2/kWh in 2007 to 79 gm CO2/kWh in 2050.
Solar is the feasible option with a large technical potential, and must be included
in the decarbonisation strategy for India. However, its use is starting from a very low
level of installed capacity and a much more ambitious approach is needed for both PV
and CSP. India needs to capitalise on solar investment opportunities in the short and
medium term.
8.5 Future Directions
Future research and development should account for the following issues:
a) Smart Photovoltaic Systems with Energy Management Systems: Hardware and
algorithms will need to be developed that incorporate communication protocols
used by EMS (Energy Management System) and utility distribution systems. When
hardware is available that can accept input from advanced utility distribution
systems and control loads and generation, algorithms can be developed that
optimize economic use of energy sources. The physical implementation of the
EMS may be incorporated within the PV system or may be a separate device,
depending on market forces. Small, limited-feature smart PV systems will likely
incorporate a simplified EMS function; larger and more configurable designs may
choose to create a separate EMS device.

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b) Reliability and Lifetime of Inverter/Controllers: Inverter hardware currently
available has an MTBF (Mean Time before Failure) of 5 to 10 years. Since the
MTBF of the PV modules that those inverters are connected to is closer to 20 to 30
years, inverters will have to be replaced once or twice during the life of the system.
Also, an inverter failure incurs a missed-opportunity cost for energy that was not
generated. Thus, increasing the usable life of inverters will most likely lead to
lower energy costs.
c) PV system reliability can be enhanced with hybrid systems like PV and wind, PV
and diesel, PV and micro turbine. However this increases the cost of system.
d) Additional Voltage Regulation Concepts: Interconnection policies such as
IEEE1547 strongly discourage voltage regulation by DG sources in the utility
distribution system. However, a cohesive technical and policy approach to
allowing voltage regulation by DG will need to be developed to handle projected
high-penetration scenarios. Slow regulation and fast regulation will both be needed
in high-penetration scenarios. Demonstrations of solid technical approaches for
voltage regulating DG will provide support for updated standards that will
streamline commercial product development and simplify utility interconnection.
e) Study of voltage profile on rural distribution feeders, allowable voltage drops both
at MV and LV lines, voltage drop calculations for unbalanced systems, balancing
the load between phases, loading of distribution transformers and correct sizing,
transient and steady state analysis of distribution lines connected to irrigation and
pump sets and future demand forecasting are the key factors for decision making.
f) Computer-based technological assessment tools in combination with material flow
analysis (MFA), substance flow analysis (SFA), life cycle assessment (LCA) finds
little reference in the literature. For a realistic estimate it is important to capture
uncertainty in systems and hence stochastic modeling and simulation studies have
to be encouraged in the field of energy studies. It is also clear from the literature
that SA systems do not enjoy the CDM support. It is therefore important to realize
the potential of SA systems in GHG emission reduction in developed countries and
their role in promoting sustainable rural development in developing countries.
g) Distribution-Level Intentional Islanding (Microgrid): Further development is
needed for control strategies to manage microgrids. This area is related to the grid-

154
 connected voltage regulation needs discussed earlier, but it will most likely need to
be augmented with communications to coordinate the transition between grid-
connected and isolated modes of operation. With smart grid technology the village
can become both buyer and supplier of electricity.
h) Optimize sizing of SHS according to requirements, the performance tests as
battery usable capacity, functional test, recovery test, system balance point, days of
autonomy, battery quality problem, inappropriate setting for controller and
controller quality problems, etc on real time basis are to be investigated.
i) Renewable energy laboratory’s breakthrough process creates nanoholes that trap
sunlight so that more photons can be converted into electricity; the millions of
holes create surface plasmons that account for the unusually high transmission in
the silver films. Low-cost nano-patterning process makes millions of holes in silver
film, boosting light- capturing qualities of organic solar cells manufactured in the
research laboratories are expected to make a breakthrough in cell efficiency.

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 Appendix I
Rural electrification as on 31-8-2011 (Source: Central Electrical Authority)
Total Village Un-
inhabite electrified as on Cumulative villages
electrified
States and d 31-03-10 achievement electrified as
No. village as
UTs villages as on 31-08- on 31-08-2010
on 31-08-
(2001 Numbers %age 2010 (%)
2010
census)
Andhra
1 26613 26613 100.0 26613 100.0 0
Pradesh
Arunachal
2 3863 2195 56.8 2195 56.8 1668
Pradesh
3 Assam 25124 51503 85.6 22185 88.3 2939
4 Bihar 39015 23914 61.3 26799 68.7 12216
5 Delhi 158 158 100.0 158 100.0 0
6 Jharkhand 29354 9119 31.1 9119 31.1 20235
7 Goa 347 347 100.0 347 100.0 0
8 Gujarat 18066 18015 99.7 18015 99.7 51
9 Haryana 6764 6764 100.0 6764 100.0 0
Himachal
10 17495 17183 98.2 17183 98.2 312
Pradesh
Jammu &
11 6417 6304 98.2 6304 98.2 113
Kashmir
12 Karnataka 27481 27458 99.9 27458 99.9 23
13 Kerala 1364 1364 100.0 1364 100.0 0
Madhya
14 52117 50231 96.4 50249 96.4 1868
Pradesh
15 Chhattisgarh 19744 19132 96.9 19132 96.9 612
16 Maharashtra 41095 36296 88.3 36296 88.3 4799
17 Manipur 2315 1997 86.3 1997 86.3 318
18 Meghalaya 5782 3428 59.3 3428 59.3 2354
19 Mizoram 707 570 80.6 570 80.6 137
20 Nagaland 1278 823 64.4 823 64.4 455
21 Orissa 47529 29735 62.6 29735 62.6 17794
22 Punjab 12278 12278 100.0 12278 100.0 0
23 Rajasthan 39753 28253 71.1 28525 71.8 11228
24 Sikkim 450 425 94.4 425 94.4 25

156
25 Tamil Nadu 15400 15400 100.0 15400 100.0 0
26 Tripura 858 491 57.2 491 57.2 367
27 Uttar Pradesh 97942 86450 88.3 86450 88.3 11492
28 Uttaranchal 15761 15309 97.1 15309 97.1 452
29 West Bengal 37945 37756 99.5 37760 (#) 99.5 185
Total (States) 593015 499511 84.2 503372 84.9 89643
Union Territories
1 A & N Island 501 336 67.1 336 67.1 165
2 Chandigarh 23 23 100.0 23 100.0 0
3 D &NHaveli 70 70 100.0 70 100.0 0
4 Daman, Diu 23 23 100.0 23 100.0 0
5 Lakshadweep 8 8 100.0 8 100.0 0
6 Pondicherry 92 92 100.0 92 100.0 0
Total (UTs) 717 552 77.0 552 77.0 165
Total 593732 500063 84.2 503924 84.9 89808

157
Appendix II

158
159
Appendix III

160
 Appendix IV

PV Systems Engineering Simulations

1)RET screen: free of charges

Basic Description: A decision support tool developed with the contribution of
numerous experts from the Canadian government, industry, and academia. The
software can be used worldwide to evaluate the energy production and savings, costs,
emission reductions, financial viability and risk for various types of Renewable-
energy and Energy-efficient Technologies (RETs).
Abilities: The software can model a wide variety of projects ranging from large scale
multi-array central power plants, to distributed power systems located on commercial
buildings and houses, to industrial remote wind-PV-generator-set hybrid power
supplies, to stand-alone battery storage systems for lighting. For agriculture and water
supply applications the daily and annual electricity use for water pumping can be
estimated using a convenient water pumping tool. The software (available in multiple
languages) also includes product, project and climate databases, and a detailed user
manual.
Outputs; Energy production and savings, costs, emission reductions, financial
viability and risk for central-grid, isolated-grid and off-grid photovoltaic (solar
electric) projects.
2) NREL Solar Advisor Model (SAM) : Free of Charge/ Open Source
Basic Description;; System energy output, peak and annual system efficiency,
Levilised cost of Electricity, SAM allows users to investigate the impact of variations
in physical, cost, and financial parameters to better understand their impact on key
figures of merit. Runs on TRNSYS engine
Abilities:The Solar Advisor Model evaluates several types of financing (from
residential to utility-scale) and a variety of technology-specific cost models for
several and, eventually, all Solar Energy Technologies Program (SETP) technologies.
The SETP technologies currently represented in SAM include concentrating solar
power (CSP) parabolic trough and dish-Sterling systems and photovoltaic (PV) flat
plate and concentrating technologies. SAM uses the total installed cost, which is the
sum of direct and indirect costs, to calculate the Levilised cost of energy. Because
how costs are assigned to each category does not affect the total installed cost, you
can either choose to distribute profit, overhead, shipping, and other costs among the
component categories (module, inverter, BOS, Installation) or include them as a
single value in the indirect category (miscellaneous
Outputs: system capital and operating and maintenance costs, and hourly system
production
3) C.SP-r 11.5: Free of Charge/ Open Source
Basic Description: ESP-r is an integrated modeling tool for the simulation of the
thermal, visual and acoustic performance of buildings and the assessment of the
energy use and gaseous emissions associated with the environmental control systems
and constructional materials. In undertaking its assessments, the system is equipped to
model heat, air, moisture and electrical power flows at user determined resolution.

161
Abilities: Building geometry can be defined via CAD tools, in-built CAD facilities or
click-on-grid or image. ESP-r supports a building representation of arbitrary
complexity (but most users work with models of 10-50 thermal zones. Models can be
exported to other assessments tools such as Energy Plus, Radiance (visual
simulations) or VRML worlds. As required, component networks can be defined to
represent, for example, HVAC systems, distributed fluid flow (for the building-side
air or plant-side working fluids) and electrical distribution systems. Alternatively,
users can use idealised environmental controls for early design-stage explorations
Outputs: An interactive result analysis module is used to provide many different
views of simulation results undertake a variety of performance appraisals and explore
the interactions between assessment domains. Tools are provided to enable the
construction of an Integrated Performance View which summarises performance over
a range of relevant criteria. The ranges of analyses are essentially unrestricted and
data can be exported to other analysis and graphing tools (but many users find they
rarely need to access spreadsheets.
4)SolarGIS – pvPlanner:
10x10 km region – 60 €; 300x300 km region – 280 €; Europe, Africa
Description: SolarGIS - pvPlanner is professional new generation online simulation
tool for site prospecting, prefeasibility and pre – design assessment, yield assessment
of photovoltaic roof systems or power plants with horizont editor.
Abilities: The simulation methods implement the latest knowledge and best-practices
in solar radiation and pv modelling. The recent (February 2011) IEA SHC Task 36
data inter-comparison activity, has independently confirmed that SolarGIS is the best
performing solar radiation database presently available on the market. PvPlanner is
based on this data source. Key features: Easy search of a location or roof, • Simulation
of various technology options • Fixed-mounted, single-axis and double-axis tracking,
• Module technologies - c-Si, a-Si, CIS/CIGS, CdTe, etc. • Simulation of angular
reflectivity and nonlinear response of PV modules to irradiance and temperature, •
User-selected inverter efficiency, DC and AC losses and availability. • New
generation interactive horizon editor. High-performance report-generation engine for
fast and standardised documentation of results.
Outputs: Complete PV report (example) in .pdf format. It contains :Site info, PV
system info, Geographic position, Global horizontal irradiation and air temperature –
climate reference, Global in-plane irradiation, PV electricity production in the start-
up, System looses and performance ratio.
5)INSEL: Free learning edition; 1500 Euro for full version; 500 Euro for minimum
version; 75 Euro for full version for students
Description: INSEL is a modular simulation environment used to understand, plan,
monitor, and visualize energy systems. INSEL is a general-purpose graphical
programming language, which can - in principle - solve any problem of computer
simulation. The application fields of INSEL cover the topics solar irradiance
simulation, photovoltaic and solar thermal applications.
Abilities: Whereas INSEL is the calculation engine to solve the mathematical model,
a commercial visualisation tool named HP VEE was chosen to graphically construct
the model in the first place. The core component of INSEL is the inselEngine which is
a full compiler that cans interpret and executes applications written in the INSEL
language or graphical preprocessors like HP VEE, for example. The core component

162
of INSEL is the inselEngine which is a full compiler that can interpret and execute
applications written in the INSEL language or graphical preprocessors like HP VEE,
for example user-programmable environment inselUB in which practically all fields
of engineering applications can be built in a very structured way. All standard
programming languages like Fortran, C++ are supported
Outputs: Includes a variety of graphical and numerical outputs that is either built-in
or can be user defined. These can entail different components of a PV system,
including but not limited to optimum PV module parameters and recommended
models, annual yield energy output, IV curves, cell temperature distribution and the
corresponding effect on the performance of the cell, array, and plant, efficiency
comparisons of fixed, 1-axis tracking, and 2-axis tracking, as well as efficiency gains
or losses for tilted fixed angles.
6) Solar DesignTool : free version, and an expert version with a monthly fee.
Description: SolarDesignTool is an online tool that solar professionals can use to
design solar electric grid-tied systems online. It offers two different ways to create a
PV system design. One method is for the user to supply a few basic design and site
parameters. The tool then generates a list of all possible system configurations for
those parameters. The user then selects a few of the generated configurations,
compares them, and then saves one or more of them to a project. The other method to
create a system is to use its System Builder. With this tool, the user specifies the
details of each array configuration. For example, to create a system with multiple
inverters, the user would first provide the temperature range, utility voltage, and then
add an inverter and array, which involves selecting an inverter, module, and string
configuration. The user would then repeat the process for each additional inverter.
Users can also define any number of roof faces and require that the system's array fit
within those defined areas.
Ability: Generate System Designs, String Sizing, System comparison, Array Layout
design.
OUTPUTs: List of all possible system configurations for supplied design parameters.
System comparison table, a summary report of the system. The report includes the
following data: Record low temperature and average high temperature of installation
site, STC DC output of array, PTC DC output of array, CEC output of array, number,
model names, and specs for inverters and modules, area of array, maximum AC
output current, dimensions of each roof face, and array layout, and distances of each
row of modules. It also includes basic schematics of the roof, including length and
width dimensions of the roof faces and layouts. The report is available in both HTML
and PDF formats.
7) PV F-Chart : $400.00 for single user, $600.00 for educational site
Description: PV F-CHART is a comprehensive photovoltaic system analysis and
design program. The program provides monthly-average performance estimates for
each hour of the day. The calculations are based upon methods developed at the
University of Wisconsin which use solar radiation usability to account for statistical
variation of radiation and the load.
Abilities: Can model utility interface systems, battery storage systems, and stand-
alone systems. Includes fixed, 1-axis, and 2-axis tracking as well as concentrators
tracking options. Comprises of weather data for over 300 locations, ability to include
additional weather data, fast execution, and hourly load profiles for each month,

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statistical load variation, buy/sell cost differences, time-of-day rates for buy/sell, life-
cycle economics with cash flow, and monthly parameter variation. Graphical and
numerical outputs come in both English and SI Units.
Outputs: System performance results, efficiency, load, economics summary, life
cycle costs, equipment costs, initial investments, solar fraction, etc
8) PVSYST: Trial version,~500 Euro for one machine license;~96 Euro for additional
machines
Description: PVSYST 4.33 is a PC software package for the study, sizing, simulation
and data analysis of complete PV systems. It is suitable for grid-connected, stand-
alone, pumping and DC-grid (public transport) systems, and offers an extensive
meteorological and PV-components database. This software is oriented towards
architects, engineers, and researchers, and holds very helpful tools for education. It
includes an extensive contextual Help, which explains in detail the procedures and the
models used
Ability: Tools include the meteo database management, with graphical displays or
tables of data. PVsyst includes a database of around 330 sites in the world. Since
PVsyst version 4.3 you can easily import meteo data from many popular
meteorological sources (Meteonorm, Satellite, US TMY2, Helioclim-2, WRDC,
NASA-SSE, PVGIS-ESRA, and the complete database of the RETscreen software).
Custom meteo files can be easily imported in any ASCII format (as for instance from
the NSRDB). The component database holds over 1750 PV modules, 650 inverters,
nearly 100 solar pumps and dozens of batteries or regulator models. Custom updates
of the database are very easy, on the basis of usual manufacturer data sheets
Output: Extensive output of solar geometry (sun paths, incidence angles, etc.); Clear
sky irradiation yields on tilted planes; Quick meteo calculations on tilted planes, with
horizon, sheds or sun-shields shadings; Transposition factor plots, for plane
orientation optimization; Generation of meteo hourly synthetic files from monthly
values; Hourly meteo plots, and calculations of irradiation on tilted planes, also with
on-graph comparison with clear day model; Various graphs of the component's
behaviour (PV modules, batteries, pumps); Electrical PV-array behaviour under
partial shadings, mismatch or double-orientation; Operating voltage optimisation tool.
9) TRNSYS: $2100 for educational use
Description: TRNSYS is a transient systems simulation program with a modular
structure. It recognizes a system description language in which the user specifies the
components that constitute the system and the manner in which they are connected
Ability: The modular nature of TRNSYS gives the program tremendous flexibility,
and facilitates the addition to the program of mathematical models not included in the
standard TRNSYS library. TRNSYS is well suited to detailed analyses of any system
whose behaviour is dependent on the passage of time. TRNSYS has become reference
software for researchers and engineers around the world. Main applications include:
solar systems (solar thermal and photovoltaic systems), low energy buildings and
HVAC systems, renewable energy systems, cogeneration, fuel cells
Output: Open-ended.
10) SolarPro
Description: Solar Pro is by Japanese company LaPlace a system that serves to
calculate power production of solar arrays subject to different physical and shadow
variations.

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Ability: Users can determine the influence of shade from buildings or objects, thus
allowing for optimal settings and module design. The system calculates the I-V curve
of solar cell modules accurately and quickly based on the electric characteristic for
each product of each company. The software calculates the amount of electricity
generated based on the altitude, longitude, and condition of the atmosphere at the
location of the solar cell allowing users to get precise results. Solar Pro quickly finds
out the necessary information on financial analysis of the PV system from power
calculations and input data of system cost
Output: I-V curve, power generation, life cycle analysis.
11) PV DesignPro-G:$249.00 for Solar Design Studio CD-ROM.
Description: PV Design Pro-G is a suite of Windows 95, 98, NT, and Win2000
compatible software designed to simulate photovoltaic energy system operation on an
hourly basis for one year, based on a user selected climate and system design. Three
versions of the PV-DesignPro program are included on the Solar Design Studio CD-
ROM: "PV-DesignPro-S" for standalone systems with battery storage, "PV-
DesignPro-G" for grid-connected systems with no battery storage, and "PV-
DesignPro-P" for water pumping systems.
Ability: The purpose of the programs are to aid in photovoltaic system design by
providing accurate and in-depth information on likely system power output and load
consumption, necessary backup power during the operation of the system, and the
financial impacts of installing the proposed system. PV-DesignPro is directed at
individuals who consider themselves as professional PV system designers and
researchers, but has been completed in such a way as to make it possible novice
designers to evaluate system designs.
Output: Solar Fraction charts, by month of the year; Battery states of charge by
month (maximum, average, minimum); Annual performance table (energy produced,
necessary backup, and states-of-charge); An Annual Energy Cost Analysis that
includes prospective cash-flows based on costs of purchased energy, and any sold PV
energy; A Lifecycle Cost Analysis that is a comprehensive pro-forma analysis of the
system design based on system cost, costs of backup energy, prices of sold energy,
maintenance and replacement costs, and the estimated life of the system. A rate of
return is calculated, as is an overall price per kWh of the system, and pay back years;
Charts can be viewed that cover every hour of the year and include battery SOC,
battery voltage, solar radiation on a horizontal surface, solar radiation on the array,
load and backup watts, panels efficiency, panel cell temperature, angles of incidence,
slope angle, and the azimuth angle.
12) PV*SOL basic: $398.00 for single user.
Description: PV*SOL basic was created to keep things fast and easy by being an
easy-to-use and intuitive user interface. The program is backed by Valentine
Software’s 20+ years of experience developing industry solar sales, design and
simulation tools.
Ability: Design systems containing up to 1,000 modules (up to 300kWp, depending
on the PV module size). Photo Plan allows you to put the PV array on a digital photo
of the customer’s house, while determining the roof size and pitch from digital photo.
Size systems based on installation area, digital photos of the home, customer loads or
desired kWp. Automatic inverter selection and string sizing, according to NEC
temperature requirements. Automatic calculation of cable sizes and losses. Select

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climate data via a map or ZIP code. Comprehensive financial analysis .Utility rates
and incentives for all major US solar markets, pre-selected by the project location.
Integrated database containing over 1,000 US climate locations, over 6,000 PV
modules and 1,200 inverters. Automatic internet updates keep the database up-to-date.
Output: Customer reports containing system information, production details, system
financials and photo realistic arrays.
• System production data • Reformatted reports with user definable fields, tables and
graphs
• Financial analysis • Array layout
• A digital image of the building with the array if using Photo plan
13) PV*SOL Expert:$1480
Description: The Dynamic Simulation Program with 3D Visualization and Detailed
Shade Analysis for PV Systems
Ability: PV*SOL Expert makes it possible to carry out a 3D visualization of PV
systems with shade calculation based on 3D objects. The program calculates the
frequency distribution of the shade onto the roof area caused by the objects entered in
the program. The results are shown in a graph. This makes it possible to reach a
preliminary decision about the roof area to be covered. The visualization in 3D mode
provides the user with vital information on the course of shade over a period of a day
or a year.
Output: Simulation of shading in 10 minute intervals, Yield simulation takes account
of the precise shading ratio for each module. Easy to use configuration of modules
with inverters, Automatic and manual PV module roof coverage, taking account of
restricted areas, Animated visualization of the course of shade for any point in time,
Visualization of annual irradiation reduction for each point of the PV area,
Optimization of PV module coverage and configuration corresponding to the shading
situation.

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 List of Publications

[1]Kamalapur G. D., Udaykumar R. Y. (2011). “Rural Electrification in India and

feasibility of Photo voltaic Solar Home Systems.” International Journal of
Electrical Power and Energy Systems, (IJEPES), Elsevier, March, Vol.33, Issue 3,
pp594-599.

[2]G.D. Kamalapur, S.B. Karjagi, Udaykumar R. Y. (2006). “Strategies for

sustainable Rural Electrification in Indian context.” Journal of Electrical Systems,
(JES), March, Vol.3, Issue 10, pp39-47.

[3]G. D. Kamalapur, Udaykumar R.Y. (2012). “Rural Electrification in the Changing

paradigm of Power Sector Reforms in India.” International Journal of Electrical
and Computer Engineering, (IJECE), Feb.Vol.2, Issue 2.

[4]G. D. Kamalapur, Udaykumar R.Y. (2011). “People’s participation in rural

electrification -a successful case.” Journal on Energy Systems Springer, Dec.Vol.1,
Issue 2.

[5]G.D. Kamalapur, S.B. Karjagi, Udaykumar R. Y. (2008). “People's Participation in

Rural Electrification- A Successful Case.” Proceedings of First International
Conference on Emerging Trends in Engineering and Technology, IEEE Xplore,
Nagpur, 16-18, July. pp945-949.

[6]G. D. Kamalapur, Udaykumar R.Y. (2010). “Electrification in rural areas of India

and consideration of SHS.” Proceedings of International Conference on Industrial
and Information Systems(ICIIS), NITK Surathkal, July, 29- Aug.1, 2010, pp596-
601. Indexed at IEEE Xplore.

[7]G.D. Kamalapur, S.B. Karjagi, Udaykumar R. Y. (2010). “Village electrification

in deep rural areas of India and PV SHS.”Proceedings of International Conference
on Advances in Energy Conversion Technologies (ICAECT), MIT, Manipal, 7-10,
Jan.pp1-6.

[8]G.D. Kamalapur, S.B. Karjagi, Udaykumar R. Y. (2005). “Rural Electricity

Distribution Systems in India-Issues.” Proceedings of IEE National Conference on
Power Engineering Practices and Energy Management(PEPEM), Patiala, 28-29
Jan.pp131-133.

[9] G.D. Kamalapur, S.B. Karjagi, Udaykumar R. Y. (2008). “Strategies for

sustainable Rural Electrification.” Electrical India, vol 48, No4 April, pp74-84.

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[10]G.D. Kamalapur, S.B. Karjagi, Udaykumar R. Y. (2006). “Electrical Energy
Conservation in India- Achievements and objectives.” Proceedings of
International Conference on Control, Automation, Communication and Energy
Conservation-2009, 4-6 June, Kongu College of Engineering, Erode
(Tamilnadu). Indexed at IEEE Xplore.

[11] G.D. Kamalapur, Udaykumar R. Y. (2010) “Need and Challenges of Electrical

Energy Conservation in India.” Proceedings of 34th National Systems Conference
NSC-2010.” 10-12 Dec. NITK Surathkal, Karnataka.

[12] G.D. Kamalapur. (2005). “Design of Thee phase Induction Motor Higher output
from Lower Frame.” Proceedings of National Conference on Recent Trends in
Electrical Engineering-05, 29-30, Aug. KSRCT College Tiruchengode,
Tamilnadu.

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 CURRICULUM VITAE
Sri Kamalapur Gopalkrishna Dhruvaraj is in teaching profession from last 28
years. He is a graduate in B. E. (Electrical) from Karnataka University Dharwad and
Post Graduate M. E. (Control Systems) from Shivaji University Kolhapur. His fields
of interest are Control Systems, Rural Electrification and Energy Conservation.
Presently he is Professor in the Department of Electrical Engineering at S. D. M.
College of Engineering and Technology, Dharwad.

Address:
Professor
Department of Electrical and Electronics Engineering
S D M College of Engineering & Technology
DHARWAD -580 002
(Karnataka state) INDIA
E-mail: gdkpur9@gmail.com
Phone: Office: 0836-2447465 – (ext) 8148, Residence: 0836-2444144

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