Industrial growth of India has been severely hobbled by the lack of power production capacity. The state under greatest power stress is the new state of Telangana. ‘Telangana has been facing acute shortage of power as AP government has denied about 1,980 MW of its share so far,’ declared the chief minister. It seems the state is spending Rs 5 crores a day to buy power to meet essential needs. Several of its power stations are suffering outage. It is unlikely that the Seemaandhra government will honour its electric power sharing obligations, since a power crunch will limit the state’s financial resources available for social schemes. The technical problems of electricity generation are compounded by party political rivalry induced by the prospects of winning the next assembly elections.
To increase generating capacity by another 20,000 MW in the next few years is a daunting task, especially for a cash-strapped state. Several parallel strategies may be followed simultaneously. The late Professor AKN Reddy’s work may be revisited in which he showed that renovation and efficiency improvement of existing thermal plants could almost double production throughout the country. A spectacular increase in power production can also be achieved in Telangana by following the innovative solar route, since the state is blessed with the highest solar direct irradiation.
Solar energy units are modular enabling cautious financial beginnings to be increased exponentially under successful conditions. Since few villages require more than 5KW of power, rural demand-side management of energy can optimize reliable supply by installing off-grid [photovoltaic] PV units to size. Home lighting can be provided through energy-saving LED systems, such as those developed by world-renowned expert, Prof. Dave Irvine-Halliday, now based out of Hyderabad. The other important rural need for power is to energise pumpsets. However, deep bore pumping is wasteful, both of water and power. It would be best to integrate this need with community watershed development to raise the water table, and use drip irrigation and SRI cultivation methods to reduce water requirements to less than half, even for water intensive crops like rice.
Since the plant-load factor for PV solar systems is necessarily limited to around 20%, as they are dependent on sunshine hours, industrial needs could be met with the newly developed Concentrated Solar Power [CSP] systems, which use mirrors to focus sunlight, and convert water into steam to turn turbines. The giant CSP 377MW Ivanpah station in California, rated to produce over a billion units a year, focuses light on a receiver tower, where water is turned into steam for the thermal station below. Spain is dotted with dozens of smaller CSP power stations which use parabolic troughs to heat the fluid passing through a pipe at their focal point. To meet energy needs at night, molten salt storage, from which heat can be drawn during non-sunlight hours, is used to drive the turbines. Denmark’s Aalborg and Norway’s NEST companies have developed a radical new technology utilising special concrete with embedded steel heat exchangers that are expected to work even better. Whatever the technology preference, it powers conventional thermal power stations without using polluting fossil fuels, or the very dangerous and extremely expensive nuclear fuel system. Piyush Goyal has the distinction of being the first minister to question the need for nuclear power, which despite several decades of expensive development has accounted for no more than 1% of the country’s energy consumption.
With central government help, the Telangana government can invite bids from established CSP companies, such as the American Bright Source, Danish Aalborg, or Spain’s Abengoa and Acciona. It would be in the interest of these companies to offer competing bids to take advantage of Telangana’s sunshine days.
The price of solar power has fallen dramatically and uniquely to a fraction of its original cost, since it was first used in the Sputnik satellite. With further developments, there is little doubt even among pessimists that it will be the cheapest source of power in the future. However, at present it is still more than thrice as expensive as fossil fuel power. If the government takes the long view, and health and climate change factors into consideration, solar power stations of the magnitude of Ivanpah are viable even today. If we take into account the opportunity costs of not developing India’s vast resources of low-calorific coal for valuable petrochemicals, there is no question but we should switch from coal to solar to produce electricity.
Last year India imported 75% of its crude oil needs, and the import bill stood at $150 billion. The present bonanza of politically depressed oil prices at less than $75 a barrel cannot last, since this dip in price was just a lesson the USA and Saudi Arabia wanted to teach Iran and Russia, where production costs are much higher. When oil prices come back to over $100 a barrel, India’s current account deficit will continue to soar. Around half of the imports go to the transport sector, and 80% of the oil is consumed by vehicles on roads. Diesel, which is subsidised, and accounts for the great bulk of the imports, caused a loss of around Rs 140,000 crores last year!
It is high time India, as a member of BRICS, followed Brazil’s successful example and switched to ethanol as fuel for road vehicles. Almost all Brazilian vehicles use ethanol, and some run on nothing else. Ethanol was Henry Ford’s first fuel of choice, but the dirt cheap price of crude oil from the Middle East a hundred years ago made petrol the main fuel. Since ethanol and petrol are easily miscible the cars on the road can immediately use a 20% mixture without difficulty or loss of power. Major car manufacturers such as General Motors have models that run purely on ethanol.
Indian ethanol is derived from sugarcane, the second most important commercial crop after cotton. Around four crore farmers produce anywhere from 250 million tonnes to even 350 million tonnes of cane in a good year. However, when there is a glut of sugar in the market, prices get depressed, sugar factories stop buying cane and farmers lose. The cyclical nature of the industry can be changed if a policy is created to encourage sugar factories to increase ethanol production. At present from every tonne of cane about 7 to 10 litres of liquor are produced as a by-product which can be converted to ethanol fuel at little cost. Even 100 litres can be produced from a tonne of cane if production is switched completely to ethanol when demand for sugar is low. It would be a win-win situation for the government, farmers, the sugar industry, and even vehicle owners, for domestic ethanol will drive down fuel prices.
So far government has failed to offer a competitive price for ethanol compared to the liquor industry which is the main buyer of liquor from sugar factories. Government’s hesitation to push forward such a policy is caused by obstruction from the liquor lobby which provides more than 30% of excise revenue. While the cost of potable liquor will certainly go up if India pushes forward an aggressive ethanol policy, the sugar factories ability to increase production will stabilize prices in the near future and the liquor industry will not be the loser.
There is no single simple solution for the energy crunch. A package of several policies must be pursued simultaneously. Demand side management is a vital necessity of the energy requirements of the various sectors, industry, domestic urban and rural, and agricultural. These demands must be disaggregated on the basis of location and size, and independent solutions found for all of them utilizing various energy sources and technologies. Piyush Goyal has said the present government does not ‘operate in silos.’ Several ministries must collaborate actively if affordable and reliable solutions are to be found to energize India’s future growth.