RENEWABLE ENERGY- COOPERATIVE OPPORTUNITY

1. RENEWABLE ENERGY- COOPERATIVE OPPORTUNITY Geneva November 19th 2009

2. Energy need • Energy is the basic requirement for contemplating work in urban as well as rural areas. • More than 2 Billion people Worldwide are unable to obtain clear and safe fuels. • Mostly rural peoples of developing countries don’t have access to electricity. • Barrier that blocks the opportunity is rural household income, less consumption and logistics. • Gap between urban and rural population is getting bigger. • State of development is indicated by the energy consumption pattern.

3. Energy use and Human development – Indian stand in global context Japan US Demand for energy is growing at the rate of 3.6% per annum over the past 30 years. UN Human Development Index – Global context

4. 100 years ago it looked like a bright idea 100 years from now it may be the only solution RE 25 years from now Millions of buildings will become power plants through source of Renewable energy Renewable energy – Pillar of Third revolution

5. Dr. APJ Abdul Kalam Former President of India Independence Day Speech, 2005 Voice of National leaders Increase the power generated through renewable energy sources from 5% to 25%. We must achieve Energy Independence by 2030.

6. Cooperative and Rural India • Cooperative – key to India’s rural resurgence • Cooperative prevail from Vedic age • Cooperative movement started in 1904 • First Credit society cooperative act facilitated in 1912 • Cooperative movement signifies strength of Indian Democracy-105 years of development • Power, irrigation, rural masses and cooperatives are strongly interlinked.

7. Pt. Jawaharlal Nehru,First Prime Minister of India Loyal and efficient work in a great cause, even though it may not be immediately recognized, ultimately bears fruit.

8. Cooperatives strength in India • No. of societies – 504,000 • Member in cooperatives society – 239 Million members • Coverage area – 100% villages • Rural household – 67% • Presence in hamlets with population of less than 200 peoples. • Employees working in cooperative sector – 15.47 Million • Self employed peoples – More than 14.39 Million Hard to find that any family in villages of India is not linked with cooperatives.

9. Functional areas & major cooperatives Text Credit Input Supply Power Generation Marketing Fuel production Existing & Emerging areas Insurance Agro Processing Service sector Consumer goods IFFCO has played laudable role in protecting environment IFFCO and AMUL are major cooperatives having enough technical capabilities and proficient management to diversify in businesses.

10. Energy shortage Rural economy Improvement De- urbanization Reduction Of Greenhouse gas Road to sustainable development Renewable Energy is the best solution Fossil fuels are not the answer • India’s share in CO2 emission is 1.1 Tonne/capita much less than World average of 4.8 Tonne CO2/capita

11. Cooperatives and Renewable energy Worldwide • Wind cooperatives of Denmark is a nationwide movement and has more than 100,000 family members. • Middlegrunden cooperative of Denmark operates the World’s largest offshore wind farm outside Copenhagen harbor. • Wind cooperatives also have their presence in 24 US states, Germany and Netherlands. • Alaska Village Electric Cooperative (AVEC) in Anchorage provides electricity to 53 small native villages. • La Sociedad Cooperativa Popular Limitada (SCPL) of Argentina owns the largest wind power park in South America.

12. Power Generation capacity and Renewable energy share

13. Renewable Energy Potential in India • Decentralized power generation through renewable energy is a viable alternative

14. Renewable Energy through Cooperatives • 742 Million people live in rural household. • Villages electrified till now are 497,297 • Around 400 million people doesn’t have access to electricity. • 100,000 village waiting for electrification. • Grid extension not feasible in 18,000 remote villages - Mostly villages of Arunachal Pradesh, Orissa, Bihar, Tripura and Rajasthan are in this category. • Power consumption in rural areas rising with Compound Annual Growth rate (CAGR) of 7.3% • No. of pump sets for irrigation – 19,594,000 • No. of pump set energized till date for irrigation – 16,031,060

15. Mode of energy production Gas supply Power generation Heat Supply Liquid fuel Household biogas Large & medium livestock farms biogas Small hydropower Wind power Photovoltaic Biomass Geothermal Solar water heater Solar stove Geothermal Ethanol Bio-diesel

16. RE mode & estimated generation cost

17. Government favoring Investment Policy benefits Rajiv Gandhi Gramin Vidyutikaran Yojna Policies in common • Capital Interest subsidy • Accelerated depreciation • Nil/ concessional excise & custom duty • Income tax benefits • Preferential tariff rates • 90% Capital Subsidy • Local taxes borne by state authorities • Guarantee by govt. for a minimum daily supply of 6-8 hours of electricity. • Given that Cooperatives can afford the initial investment without compromising financial security, renewable energy is an ideal alternative over conventional fuels.

18. Challenges in advancing Renewable energy Supply Technology Maintenance Investment Solar products are costly. Govt. support may be required initially. Maintenance is costly. Ministry of New and Renewable Energy guidelines bind suppliers by legal contract Most of the equipments are imported. Government is promoting indigenous development. Selection of technology. Extensive Prefeasibility study to be done for selection of RE source.

19. 3.8 Million hectare 20 MW/sq. km 1,52,360 MW 328.72 Million hectare Availability of land Land required for solar plants (considering Load factor of 20%) Potential for solar power India present power Generation capacity India land area • Land required for solar power is hardly 1% of total land area of India. Present installed capacity can be easily met by solar power alone. • Cooperatives can also effectively utilize land for growing of biomass fuel crops.

20. Power requirement & Investment Investment required to provide power in all villages – US $ 134 Billion Cost per MW installation – US $ 2.1 Million Power requirement in all villages – 64,000 MW Total villages in India – 638,365 Power requirement per village -100 KW

21. Possible surplus generation by Cooperatives in India • Surplus power through renewable energy source can be sent back to the grid.

22. Hurdles before cooperatives 1 2 3 Lack of Project management expertise at Village level. High capital cost require huge funds. Technical expertise at Village level.

23. Hurdles.. 4 5 Cost of generation as compared to generation cost through fossil fuel. Lack of awareness about existing schemes, benefits available and policies.

24. Possible solutions Apex society will Integrate existing cooperatives to provide service for all type of credits, information and technical help. Apex society will intensify linkages with NGO’s, Panchayat, Govt. bodies, World bank, Asian development bank etc. Set up of Apex society Apex society will select village, technology and set up village electric cooperatives in each village. Apex society will establish the policy framework in line with government methodology and will create awareness. Maintaining small microfinance facility to meet the high up front cost Engaging users on long-term basis.

25. Cooperatives can bridge the gap There is enormous opportunities and challenges in the path of Clean & Green energy. Cooperatives have to play a leading role in 21st century by way of commercially viable and efficient efforts for Sustainable development of their members in rural areas by way of alternate energy. I would invite cooperatives to join in this Global efforts.

26. Conclusion Given the international climate of awareness of global warming and other environmental impacts caused by imprudent energy use, the times is right for cooperatives to develop a cohesive program to extend renewable energy to rural communities A renewable energy village through cooperatives will break the poverty-environment nexus identified as a source and symptom of underdevelopment in rural India.

27. Thank you! Dr. U S Awasthi Managing Director Indian Farmers Fertiliser Cooperative Limited IFFCO SADAN C-1 District Centre, Saket Place, New Delhi – 110017 usawasthi@iffco.nic.in