Renewed focus

But the next one year is crucial to renewable energy in India

Published: Tuesday 15 June 2004

-- THE renewable energy sector is witnessing activity like never before, domestically and internationally. More than 1,000 delegates will meet in Bonn at the renewables 2004 conference. The conference agenda is quite clear: work towards global targets, within which national governments should meet individual targets. The agenda is also fractious: for developing countries, yet another 'conditionality', another blow to economic progress. So emerges the question: can there be any concrete outcome at Bonn?

Closer home, things are in a flux. The Electricity Act 2003 is to be implemented. The National Electricity Plan and, under it, the national tariff policy are being shaped. On both counts, it is a critical phase for the renewables sector; decisions and policies in the next one year will articulate the sector's future.

Consider, first, the Electricity Act. Till recently in India, you could own a generating plant and produce electricity, but absurdly, you couldn't sell it; anyone wishing to do so had to deal with highly inefficient state electricity boards. The new Act, thankfully, de-licences power generation and allows sale. It will be a big boost to the stand-alone captive power stations in rural areas. Now it is up to the private sector -- vociferous in its desire to sell electricity -- to prove action speaks louder than words. In this scenario, renewables stand to gain the most.

The biggest complaint of renewable generators used to be about lack of a uniform tariff policy across states. Such a policy is the need of the hour. Policy-makers would do well to address it. Preferential tariffs for renewables will provide a big boost to the sector. Under the Act, state electricity regulators are required to fix a minimum percentage of electricity that is to be supplied, by a distribution licensee, from renewable sources. Another progressive decision. Regulators could emulate -- indeed go one step ahead of -- the nationally announced objective of having at least 10 per cent of additional power capacity, installed till 2012, from renewables.

Now consider the much-hyped national policy on renewables. How long will it take for the bureaucratic machinery to churn this out? About ten drafts of the policy have already been circulated and discussed. Last heard, the draft was ready to be considered by a group of ministers (see: "We have completely ignored our biomass sector"). But, as the top person at the ministry of non-conventional energy sources has revealed, the policy needs revision. It has nothing to say on India's vast biomass sector, and tapping this potential to generate renewable energy. The irritation is: till when is the only country in the world with a separate renewables ministry, to wait for a national renewables policy? The next one year will tell us.

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