Distributed RE Start-Ups Left out to Participate in Schemes Like KUSUM: CLEAN

The eligibility criteria of government scheme KUSUM has been the biggest deterrent for the Distributed RE start-ups to participate in the tendering process

The latest report by Delhi-based non-government organization Clean Energy Access Network or CLEAN provided some pretty interesting insights about the Decentralized renewable energy (DRE) and mall- and medium-sized enterprises doing business in the space. Spread over four chapters and 27 impactful case studies, CLEAN report captured the state of the DRE sector in India in a nutshell.

Almost 10 million solar lamps and lanterns were sold in India in the calendar years 2017 and 2018, up from 6.38 million in 2016. This is nearly 40% of the estimated global market for solar lighting solutions.

Deployment of solar lanterns, solar home systems, and solar pumps
Deployment of solar lanterns, solar home systems, and solar pumps

DRE enterprises have been successful in providing basic clean energy solutions like solar lanterns and solar home systems. 17.5 Lakh standalone solar powered pumps are set to be deployed under the scheme. The report says, “the main challenge as highlighted by the members surveyed indicates that the eligibility criteria for participation of firms in the KUSUM tenders has not provided equal space for early stage start-ups.”

Over 43 lakh customers are being served by 43 CLEAN member enterprises surveyed. 45% of the members surveyed reported that they have been profitable last year and 57% were able to raise capital in the past. A summary of investment taking place in the sector is highlighted below:

An extensive DRE job census survey conducted by Power for All and CEEW reported creation of 95,000 direct formal jobs and 210,000 informal jobs 2017/18. 4,354 full-time jobs and 2,556 part-time jobs were created by 43 CLEAN member enterprises surveyed.

DRE enterprises have expressed their concerns on the need for a stronger policy and financial environment to help their businesses flourish and cater to the energy needs of those with limited access to it. 78% of the respondents have evolved and changed their business models and offerings as a result of government initiatives.

Other Highlights:

Think Tank estimates that the market potential of the DRE sector in India to be in the range of USD 100 billion.

Standardization, testing, and benchmarking are necessary for acceptance of the consumers and the DRE market to grow.

An overview of the deployment of DRE technologies of the enterprises participated in the survey is presented. Mini-grid practitioners have expressed their desire to have a comprehensive mini-grid policy, explaining the role and scope of mini-grid operators in partnership with local discoms.

DRE enterprises have identified new market areas (shown in the figure). Productive-use applications such as solar thermal applications, solar pumps for irrigation, solar refrigerators, solar sewing machines, and solar charkhas, clean cooking applications for households and community kitchens are some of the prospective market segments.

The sentiments of enterprises on challenges and opportunities are also covered in the report. While the government’s grid extension and LPG distribution initiatives have challenged DRE businesses, they have also opened new, underserved areas/regions for DRE businesses to tap and grow. Their perspective on the future of the DRE market is found to be positive, given the gaps identified and opportunities against the same

The use of DRE applications in other areas such as food processing, health care, and agriculture has been adequately covered. Tailormade DRE solutions that go beyond the usual lighting and clean cooking solutions have been able to capture the attention of a large range of consumers.

The report brings forth the strong linkages of DRE solutions with SDG 1 (No Poverty), SDG 3 (Good Health and Well Being), SDG 4 (Quality Education), and SDG 8 (Decent Work and Economic Growth).

To read the report in more detail, click here

To read ‘The State of the Decentralized Renewable Energy Sector in India’ report click here

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