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Off-Grid Rural Electrification Experiences from South Asia

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Off-Grid Rural Electrification Experiences from South Asia Energy for Sustainable Development 15 (2011) 266–276 Contents lists available at ScienceDirect Energy for Sustainable Development Off-grid rural electrification experiences from South Asia: Status and best practices Debajit Palit ⁎, Akanksha Chaurey 1 Decentralised Electricity Solutions Division, The Energy and Resources Institute, IHC Complex, Lodhi Road, New Delhi 110 003, India article info abstract Article history: South Asia accounts for 42% of the global population without access to electricity. Such a situation continues to Received 15 January 2011 exist despite several initiatives and policies to support electrification efforts by the respective country Revised 6 July 2011 governments. The challenges to enhance electricity access are manifold including technical, financial, Accepted 7 July 2011 institutional and governance barriers. This paper makes a modest attempt, based on extensive literature Available online 6 August 2011 review, to highlight the rural electrification situation at the regional and country level in South Asia. The paper also does a comparative analysis to exploit cross learning potential and suggest specific boosters that could Keywords: fi Energy access serve as input for policy evaluation, review and improvements to assist future electri cation efforts in the Off-grid region. We focussed on renewable energy based mini-grids and stand-alone systems and also covered Rural electrification conventional grid extension. The paper raised some pertinent issues and attempted to find solutions to these South Asia issues. The household connection needs to be improved considerably through a targeted approach and innovative micro-lending model. At the same time the electricity supply also needs to be enhanced, such as through distributed power projects utilizing locally available renewable resources, to ensure that connected households continue to receive electricity and that supply constraints do not inhibit extending electrification to new areas. Developing a regulatory mechanism to extend the tariff fixation for mini-grid projects and providing cross-subsidies to ensure long term sustainability of such projects are highlighted. Finally, economic linkages, access to credit and institutional arrangements also need to be organized appropriately, especially for off-grid RE to facilitate successful outcomes. © 2011 International Energy Initiative. Published by Elsevier Inc. All rights reserved. Introduction in South Asian countries,2 especially focussing on off-grid3 electrifica- tion. It examines the current RE trends at the regional level and at the The importance of rural electrification (RE) in bringing about both same time comprehensively captures the development in India, direct and indirect social and economic benefits for communities, Bangladesh, Nepal and Sri Lanka, where RE has been relatively ranging from incremental livelihood leading to reduced poverty to significant. Based on the review, we attempt a comparative analysis to better facility for health and education has been well documented exploit the cross learning potential, both at the country and region level, (Bastakoti, 2006; DFID, 2002; ESMAP, 2002; GNESD, 2007; NRECA, and suggest specific boosters that could serve as inputs for policy 2002; Zomers, 2003). The benefits of RE through grid extension are evaluation, review and improvements to assist future electrification also realized in off-grid situations, even though the amount of power efforts for improving the access. The categories studied include made available by such systems are smaller and the services provided technology, delivery models, policy and regulatory architecture, local more basic (World Bank, 2008). While there is available literature (Bhattacharyya, 2006; Dubash, and Bradley, 2005; Khan, 2003; Krishnaswamy, 2010; Mainali and 2 South Asia Region consists of eight countries: Afghanistan, Bangladesh, Bhutan, Silveira, 2011; Shrestha et al., 2004; TERI, 2009a), analyzing the RE at the India, Maldives, Nepal, Pakistan and Sri Lanka. 3 “ ” individual country level, no recent comparative analyses exist at the The term off-grid is taken here to mean any power generation that does not depend on connection to the high-voltage transmission network. This may include South Asian regional level for cross learning by the countries. This paper mini-grids set up to serve isolated communities as well as stand alone systems to serve seeks to do an extensive review of available literature on the status of RE individual houses. A mini-grid is an electricity distribution network operating typically below 11 kV, providing electricity to a localized community and derives electricity from a diverse range of small local generators using both fossil fuels (diesel, gas) and renewable energy technologies with or without its own storage (batteries). Stand- alone power supply systems only cover the needs of one household (user) and include solar home systems, individual solar lanterns, etc. However, that one system serves ⁎ Corresponding author. Tel.: +91 11 2468 2100; fax: +91 11 2468 2144. one user does not mean that the system is necessarily owned by the user as lanterns E-mail addresses: [email protected] (D. Palit), [email protected] (A. Chaurey). recharged from solar charging stations and taken on rent or SHS on lease are also 1 Tel.: +91 11 2468 2100; fax: +91 11 2468 2144. considered here as individual systems. 0973-0826/$ – see front matter © 2011 International Energy Initiative. Published by Elsevier Inc. All rights reserved. doi:10.1016/j.esd.2011.07.004 D. Palit, A. Chaurey / Energy for Sustainable Development 15 (2011) 266–276 267 Table 1 Rural electricity access in South Asia (as of 2009). Country Total populationa (millions) Population without electricityb (millions) Rural electrificationb (%) Per capita GDP PPPa US $ Afghanistan 28.4 23.8 12.0 600 Bangladesh 156 95.7 28.0 1300 Bhutan 0.69 0.2 40.0 4100 India 1166 403.7 52.5 2500 Nepal 28.5 16.5 52.5 1000 Pakistan 176 68.0 46.0 2400 Sri Lanka 213 4.7 75.0 3900 a www.indexmundi.com. b IEA (2010). http://www.worldenergyoutlook.org/database_electricity/electricity_access_database.htmN. participation and financing. As data availability on off-grid electrifica- Review of rural electrification experiences in selected countries tion is often limited, the review is selective. India With the largest rural population in the world, India continues to Current rural electrification trends in South Asia face a huge RE challenge. Though the government has been making conscious efforts since the beginning of planned economic develop- The current level of household electrification in the rural areas of ment in the country in 1951 to make substantial improvements to the the region is around 50%, leaving some 612 million people without electricity infrastructure in terms of availability and accessibility, the electricity (IEA, 2010)(Table 1). While the figure serves as a common household electrification level and power availability is still far below denominator to the problem, there exists wide disparity in RE in South the world average. Low household electrification level may reflect the Asia. Sri Lanka has a RE rate of 75%,4 higher than the global average fact that historically the level of electrification has been measured as a (65.1%), while only 15% of the rural population in Afghanistan have percentage of electrified villages with extension of the grid to any access. Although the percentage of population with electricity access point within the revenue boundary of a village, irrespective of has increased during the last decade, there seems to be no significant whether any household is getting connected or not. In fact, some decrease in the absolute number of people without electricity. This researchers argue that electrification as a part of the green revolution could be due to the fact that rural population has expanded at roughly in agriculture was the main driver for RE (Bhattacharyya, 2006; the same pace as electrification in many countries. Another reason Krishnaswamy, 2010). However, the Government of India adopted a could be because of de-electrification5 of villages, especially in India, new definition of village electrification8 in 2004 and many villages due to poor or no supply of electricity to such areas, although officially that were previously considered electrified now fall by definition into such villages remain electrified. the un-electrified category. Of the total population without electricity access in the region, Currently, only seven states have achieved 100% village electrifica- many reside in isolated communities, such as islands, forests fringes tion, and five of these states are smaller ones. Though officially Andhra and hilly settlements. These communities are generally small, Pradesh and Tamil Nadu are considered to have achieved complete consisting of low-income households — with characteristics that village electrification, reports from the TERI field study indicate that may be economically unattractive to electricity distribution compa- there are many hamlets and forest fringe villages in these states where nies or even government electrification program that usually any form of electricity, on-grid or off-grid, is yet to reach. The off-grid prioritizes the allocation of the scarce resources. A substantial section electrification, primarily undertaken under the Remote Village Electri- of the un-served consumers are also found in mainstream rural and fication (RVE) Program, covers only about 1.5% of the total electrified peri-urban areas, already connected
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