Decentralised renewable solutions could aid rural energy transition

The Indian government has recently come out with a national framework for promoting decentralised renewable energy livelihood applications.
These applications have the potential to reduce and eventually eliminate the reliance of livelihood on diesel, particularly in rural settings, and can supplement the grid supply.
The framework could also support and incentivise the adoption of decentralised renewable energy livelihood technologies among women and other marginalised groups such as Scheduled Caste and Scheduled Tribes.

The Indian government has released a framework for decentralised renewable energy livelihood applications, to promote the use of these local systems that are powered by renewables and used to earn income. So far, India has been focused on mega renewable energy projects but there is a growing importance of the role of localised, livelihood-linked solutions in India’s energy transition.

The framework released by the Union Ministry of New and Renewable Energy (MNRE) in February 2021 notes that, in recent years, a variety of decentralised renewable energy (DRE) livelihood applications have been developed, “which are not only energy-efficient but also economically viable.”

The framework defines DRE livelihood applications as applications powered by renewable energy – solar, wind, micro-hydro, biomass – and their combinations that are used for earning livelihoods directly such as solar dryers, solar mills, solar or biomass powered cold storage/chiller, solar charkha and looms, small-scale biomass pellet-making machines.

“The modular design of such DRE livelihood applications ensures scalability without large investments. Besides, the energy efficiency of such solutions is also important, as it, in turn, enhances their economic viability by reducing the size of the generation and storage requirement,” observed the framework.

MNRE said it has been supporting off-grid renewable energy applications including solar street lights, standalone solar pumps, solar lamps, solar power packs, biogas plants and there are a number of “livelihood applications which can be integrated with DRE sources which not only provide clean and reliable energy but also help in increasing the productivity and income.”

It noted that various central government ministries that are implementing different schemes that support livelihood applications “directly or indirectly and integration of DRE sources will further promote the use of such applications.”

The framework aims to aid the development of an enabling ecosystem for the widespread adoption of decentralised renewable energy-based livelihood applications in the country. The ministry notes that the system will guide the states, central government ministries and other stakeholders in “formulating schemes and programmes for promotion of DRE livelihood applications”.

Vivek P. Adhia, India country director of the Institute for Sustainable Communities, told Mongabay-India that “the framework for the promotion of DRE addresses key challenges of market integrations, access to finance, technology standardisation and performance benchmarking.”

“This is expected to boost its role, within India’s energy transitions and bring in more trust, credibility and structure for DRE-led solutions. Hopefully, this will bring in major organised players and expand the pie exponentially,” said Adhia.

The sentiment is reflected in the framework as well. The framework states that DRE-powered livelihood solutions have the potential to reduce and eventually eliminate the reliance of livelihood on diesel, particularly in rural settings, and can supplement the grid supply. It says that apart from creating jobs, these applications would help in achieving Atma Nirbhar Bharat (self-reliant India – a key initiative of the Indian government).

“There are successful pilots and business models of DRE livelihood applications in agriculture, agro-processing, dairy, poultry, fisheries, tailoring, etc., which have been tested at the field level by various agencies and have the potential to be replicated in larger quantities. However, this is still only a small fraction of the overall spectrum of livelihood activities throughout India,” the framework said.

Read more: Subsidies for India’s renewable sector are falling, needs renewed support, says study

Scale-up available decentralised renewable energy applications

The government of India emphasises that there is a need to “scale up” as well as “support the development of new” DRE livelihood applications.

Currently, several ministries including the Union Ministry of Rural Development, Ministry of Women and Child Development, Ministry of Tribal Affairs, Ministry of Micro, Small & Medium Enterprises, Ministry of Textile, Ministry of Agriculture and Farmer Welfare, Ministry of Food Processing and Ministry of Health, are implementing various schemes that support livelihoods directly or indirectly.

“Integration of DRE livelihood applications with these schemes will promote the use of such applications,” noted the framework.

A solar water pump near Bela in Jehanabad district of Bihar. Photo by Manish Kumar/Mongabay.

The framework also includes DRE applications “operating in hybrid mode with the grid as long as the system is capable of running standalone in the off-grid mode as well.”

“Livelihood applications powered by mini/micro-grids are also within the scope of this framework, provided such livelihood appliances are energy-efficient and cost-effective. The applications with end-use in education and healthcare centres are also eligible under this framework, as these provide livelihoods to teachers/instructors and healthcare workers,” it said.

Abhishek Jain, Fellow and Director, Powering Livelihoods, Council on Energy, Environment and Water, said “in the chase of gigawatts and megawatts, we often forget that energy is a critical enabler of lives and livelihoods.”

“The policy framework to promote DRE solutions for livelihoods reminds us of the enabling role of energy and shows a pathway to leverage green technology for generating jobs and livelihoods. CEEW estimates a market upwards of $50 billion for the DRE-based livelihood solutions. The framework would be critical to realise that market potential and support a million jobs in the process,” said Jain.

The framework, meanwhile, also aims to enable a market-oriented ecosystem to attract the private sector investment for the development and deployment of reliable and affordable DRE based livelihood applications and unlocking easy access to end-user finance to increase adoption of DRE based livelihood solutions by linking them to existing financing schemes or through new innovative financial instruments.

The framework could also “support and incentivise the adoption of DRE livelihood technologies among women and other marginalised groups such as Scheduled Caste and Scheduled Tribes,” according to the ministry. Additionally, interventions such as assessment of demand, pilot and upscaling of DRE livelihood applications, access to finance, skill development and capacity building will promote the DRE-based livelihood applications.

It said a list of DRE livelihood applications will be developed in consultation with stakeholders, which will be updated regularly. The framework noted that pilots of new DRE livelihood applications can be taken up in various sectors such as textile, animal husbandry, agriculture, carpentry, pottery, cottage industry, black-smithy, food industry etc. with a focus on reliable and affordable DRE applications.

It noted that an inter-ministerial coordination committee on DRE-based livelihoods will be constituted under the chairmanship of the Secretary of the MNRE which will include members from other ministries such as agriculture, rural development, fisheries, tribal affairs, skill development, textiles, health and family welfare, science and technology. It will identify opportunities for convergence of programmes for supporting livelihoods through DRE-based applications, identify the gaps in energy access to livelihood applications, assess and decide sectoral interventions, and assess access to finance to entrepreneurs and consumers.