Potential and Challenges of Solar Irrigation in Bihar Michael Blunck Project Manager Indo-German Energy Programme (IGEN) New Delhi, 26 September, 2013 Page 1
Rural Energy under the Indo-German Energy Programme (IGEN) Page 2
IGEN Renewable Energy Component AREAS OF INTERVENTION MAIN FOCUS OBJECTIVE 1 2 3 4 Decentralized rural electrification Retailing of stand-alone RE products RE policy and RE promotion at union state level Policy dialogue at national level Replicable Business Models Enabling Environment, Scaling-up Improved Conditions for Renewable Energy in Rural Areas Page 3
Development / Piloting of Business Models Replication / Up-Scaling Political Framework / Support Programmes Solar Mini Grids in Uttar Pradesh Rural Electrification / Mini Grids Pine Needle Gasification, Uttarakhand Mini Grids in West Bengal Planned for 2014 Financial Viability of Biomass Gasification Improved Water-Mills, Uttarakhand Market Development for RE products Improved Stoves Bihar, WB, Uttarakhand SELCO Incubation Centre CDM PoA for Improved Cookstoves Solar Water Pumps, Bihar Cross-cutting Issues Facilitating Finance Involving Corporates Gender Page 4
The Potential for Solar Pumping in Bihar Page 5
Why is solar irrigation an attractive solution in Bihar? Good availability of ground water High water tables (2-5 m) Good water replenishment due to adequate rainfall. Conducive agriculture practices A third cropping cycle is possible in (March-June) due to high solar radiation High solar insulation 280-300 sunny days/year with average solar radiation of 5.04 5.42 kwh/sq. mtr Period of low radiation coincides with monsoon when solar pumps are not required. Lack of alternative energy sources Very limited access to reliable electricity High cost of diesel Page 6
Potential & Barriers Number of installed pumps in India: about 7,800 Potential in Bihar until 2022: 2,665 MWp (WISE) 11 million pumps (HWWI) Barriers to tap the existing potential for solar pumping for irrigation: Market-related barriers Regulatory barriers Technological barriers Page 7
How does a solar water pump look like? What area can I irrigate with it? Why would I take the risk of purchasing one? Hari Narayan Singh, farmer using a diesel pump Allauli village, Khagaria district Page 8
We can t afford the down payment necessary to purchase a 8 HP pump for our community. Harendra Singh, president of a community irrigation project, Lalpura village, Vishali district Page 9
The challenges in creating demand (I) Awareness People do not know the technology Consumers are more driven by technical specifications rather than the actual need. e.g. at the time of conversion from diesel to solar many farmers insist on 5 HP rather than on 2 HP pump. They fear that it may not be sufficient. Affordability Even with the government subsidy support, the upfront cost (10-30% of the total cost) of solar water pumps is too high. The savings on fuel compensate in the long run but do not seem attractive considering the immediate utility of the money they are investing. Page 10
The challenges in creating demand (II) Technical Know how The local mechanics and service person who considerably influence the buying decisions of farmers are not at all aware of the solar water pump technology and performance. Farmers do not know the quality of after sale service available. Brand Confidence Farmers are too risk averse when it comes to purchasing high value products from lesser known brands. There are not many brands that have farmers confidence in the sector. Page 11
Market-related Barriers Barriers Recommendations High Upfront Cost Innovative consumer and business finance mechanisms and products Smart subsidies Low awareness among farmers, financial institutions, public sector Strategic and systematic awareness campaigns for consumers and all stakeholders. Lack of maintenance services Development of local maintenance infrastructure Capacity building for local technicians Theft Portable pumps community/-owned systems Insurance products Page 12
Regulatory Barriers Barriers Maze of political responsibilities Lack of market oriented policies Recommendations Single Window approach Policies that facilitate long-term private engagement in the sector Concealed Tenancy and Small Landholdings Tenancy reforms Leasing mechanisms Group investments Page 13
Technological Barriers Barriers Lack of standardization and Quality Assurance Recommendations Standard products that cater to local needs Mechanisms to assure quality of products Page 14
GIZ Activities Page 15
Study on Potential and Challenges of Solar Water Pumping for Irrigation in Bihar Technology overview Potential and application of solar pumps in India Potential in Bihar Specific barriers and solutions for the application of solar pumps for irrigation in Bihar Page 16
Development Partnership with Claro Energy Pvt. Ltd. (I) Piloting 3 business models 4 HP submersible pump owner by a farmers cooperative; Pay-per-use 2 HP pump owned by a diesel entrepreneur 1 HP surface pump owned by an individual farmer Page 17
Development Partnership with Claro Energy Pvt. Ltd.(II) Capacity Building key stakeholders Training for bank managers: technology, financial viability of solar pumps Development of appropriate financial products with local banks Training of local entrepreneurs and technicians Awareness raising and information dissemination on state and national level Documentation of business models & lessons learned Video documentary Workshops Page 18
Planned activities Supporting the BREDA solar pumping programme Subsidy mechanisms, tender documents Capacity Building for BREDA staff and other key stakeholders Involvement of financial institutions Involvement of other departments, e.g. Agriculture, rural development Supporting the private sector Implementation of replicable pilot projects, business models; demonstration cluster Development of appropriate financial products with the financial sector Providing market information, e.g. on technologies, business models, and best practices Page 19
Thank you for your attention. For more information please visit www.igen-re.in As a federal enterprise, GIZ supports the German Government in achieving its objectives in the field of international cooperation for sustainable development. Published by Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH Registered offices, Bonn and Eschborn, Germany Indo-German Energy Programme B-5/2, Safdarjung Enclave New Delhi 110 029, India T +91 11 4949 5353 F +91 11 4949 5391 E Michael.Blunck@giz.de I www.giz.de Responsible Michael Blunck Photo credits GIZ/Claro Energy In cooperation with Ministry of New and Renewable Energy Government of India 24.10.2013 Page 20