Distributed solar photovoltaics landscape in Uttar Pradesh, India: Lessons for transition to decentralised rural electrification
Highlights
- Transition to decentralised solar electricity in rural areas remains inchoate.
- Business models should reflect the needs of rural poor for rapid solar PV adoption.
- Policy shifts are needed to supplement grid with decentralised solar PV.
- Sustained success lies in decentralised electrification monitored centrally.
Abstract
The energy poverty cycle continues to pose a major challenge for governments in emerging economies. Electrification has typically been delivered through centralised generation and distribution that has not always afforded equitable or efficient access. Decentralised solar technologies are fast approaching financial parity and have certain environmental advantages over grid extension, especially in rural and remote societies. We explore the emergence of decentralised energy systems in the state of Uttar Pradesh, India’s most populated state with notable energy access and equity challenges. We suggest future electrification policies and strategies should be based on the principles of diversity in technology use, localised implementation and centralised planning and enforcement to address energy poverty conundrum in the state of Uttar Pradesh or similar economies.
Keywords
Decentralised solar photovoltaicRural electrificationSolar policiesTransitionUttar Pradesh
Abbreviations
FiTsFeed-in TariffsGHIGlobal Horizontal IrradianceJNNSMJawaharlal Nehru National Solar MissionPVPhotovoltaicUPNEDAUttar Pradesh New and Renewable Energy Development Agency
1. Introduction
Sustainable energy is considered as the golden thread that connects economic progress, social development and environmental protection [[1], [2], [3]]. Despite wider recognition and known benefits of sustainable and reliable energy, access to electricity in rural and remote areas of many countries continues to be low. In areas where access has been provided the reliability of supply continues to be an ongoing and serious concern. Globally and across all levels of government, a greater momentum is needed if the United Nations sustainable development goals (SDG) are to be achieved to attain universal access to energy by 2030 and to address global climate change [4]. Decentralised1 solar photovoltaic technologies have emerged as one of the promising solutions to address energy provision and environmental concerns in an affordable and sustainable manner. In this paper, we refer to decentralised solar electricity generation and storage (as and where applicable) that distributes electricity on a local scale and is not connected to the main grid. It includes pico-solar and solar home systems, solar micro-grids (below 10 kW) and solar mini-grids (10 kW and above). However, these technologies, in most cases, are not employed as mainstream electrification options in many countries and their adoption, especially in rural communities is progressing slowly.
To explore the challenges and opportunities facing the uptake of decentralised solar electricity, we turn to India as a case study. It is the third-largest electricity producer in the world aggregating an installed capacity of 356 GW within which thermal power is the dominant electricity source [5]. As a nation it has a forward and ambitious energy policy that connected half a billion people to the main grid between 2000 and 2016 [6]. Nonetheless, about 300 million people remained un-electrified as per official records. Without a doubt, providing electricity is a socio-economic and environmental challenge made even greater in India because of its size, population and demographics. For rural, remote and most often poor communities, this is a particular challenge and to this end the government of India has developed and implemented varying levels of success through a number of rural electrification programs. These have included the Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) launched in December 2014 by subsuming the earlier rural electrification programme, the Rajiv Gandhi Grameen Vidyutikaran Yojana [7]. In April 2018, the government passed a significant milestone that saw grid-connected power delivered to all its census villages, as recognised by the Office of the Register General and Census Commissioner, yet leaving around 30 million households without electricity. Recognising village level electrification scheme would not address provision of electricity at the household level, the government launched the Saubhagya programmes in October 2017 alongside DDUGJY [8]. As a result, in April 2019, the government reported that 99.9% of those 30 million households had some degree of electrification [9]. These initiatives have largely been designed around extending the reach of the central grid system although they have supported off-grid options, such as stand-alone mini-grids or solar home systems, for villages in inaccessible areas or where grid connection is economically unfeasible.
Concurrently, India has committed to increase its non-fossil fuel based energy sources as part of its nationally determined contribution submitted to the United Nations Framework Convention on Climate Change. Renewable electricity generation sources funded under the Jawaharlal Nehru National Solar Mission (JNNSM), aims to increase non-fossil fuel based source for electricity generation to 40% by 2030 [10,11].
The current energy policy mantra is often framed around power for all and within this an assumed or at least aspiration uninterrupted supply. From a socio-economic perspective, this aspiration for rural electrification is presently self-limited due to current system capacity and the household capacity to pay, that implies policies must shift beyond connectivity as connection does not mean reliable supply [12]. The capability of distribution companies (also referred to as DISCOMs) to supply reliable power is already at or beyond capacity and anticipated to become far more challenging due to high number of connections enabled under various policies such as under Saubhagya [13]. Many households drop out or have their grid supply disconnected due to an inability to pay the minimum amount to the DISCOMs. This is particularly problematic in rural areas due to compounding factors of the high number of households whose income is at or below the poverty line, the infrastructure challenges associated with unreliable supply, high transmission losses, and governance challenges linked to revenue collection and illegal connections (power pilferage), when combined impact the commercial viability of distribution companies. To overcome some of these challenges, many studies have identified that off-grid solar electricity can support electricity distribution companies to meet local peak hour demand in rural areas with a higher environmental performance [14,15]. From a socio-technical perspective, decentralised systems can be employed to complement or fill the remaining gaps in the national and state electricity systems to improve reliability to the already connected households and provide access to households without electricity and trapped within the energy poverty cycle [16]. Economically, financing arrangements, including direct subsidies, can be tailored to support low-income households [17]. Therefore, a comprehensive strategy enabling use of appropriate technologies through operationally efficient business models delivering affordable and high-quality supply can bring socio-economic benefits [18] of electricity to rural communities.
Within India, the state of Uttar Pradesh provides a good case study to more deeply explore the challenges of electrification and the potential for decentralised solar electricity within India and to offer broader insights to other energy nations embarking on comprehensive energy provision and transition agendas. Uttar Pradesh is the most populous state in India and had one of the highest levels of households without electricity (approximately 13 million or 40% of households [9]) until December 2018 when they were reportedly connected to the grid. Rural areas in the state still experience the most unreliable and poor quality of electricity supply, with an average of 13.5 h of power cuts per month and prolonged periods of low voltage in grid-connected villages [19]. Prior to 2016, decentralised power especially mini-grid segment was operating outside any formal national or state policy framework, presenting various uncertainties for emerging businesses. It also represented a distinctive characteristic of traditional centralised generation and distribution energy system that are seen not only in India but worldwide. Within India, Uttar Pradesh was the first state to develop a solar mini-grid policy and regulation for mini-grid, as part of the devolved responsibilities to state government arising from the national government’s tariff policy framework of 2016. While there is ample literature reviewing the development of solar power in India, both at the national and sub-national level [[20], [21], [22], [23], [24], [25], [26], [27], [28]], there has been no previous scholarly attempt to analyse the experiences of off-grid solar PV development in the state of Uttar Pradesh. In particular, Uttar Pradesh was chosen as a case study for four reasons: i) high solar insolation in the state (Table 1), ii) extremely low per capita consumption and residential energy consumption implying energy poverty, iii) a number of private start-ups that have potential to emerge into successful solar energy enterprises [29,30], and iv) Uttar Pradesh represents a state that is in its early stages of energy transition that has a legacy policy and technical infrastructure inertia towards centralised generation and distribution. This paper fills a gap in the literature concerning India’s energy transition taking UP as an example. For instance, specific findings for Uttar Pradesh can support national and state level policymakers and private enterprises to pursue more targeted interventions in short to medium term. The lessons drawn from Uttar Pradesh can illustrate how electricity can be provided as a joint responsibility.
Table 1. Solar profile of Uttar Pradesh (Source: [50]; VEDAS, https://vedas.sac.gov.in/vedas/).
| Average Maximum Temperature | 31.8 °C |
| Average Minimum Temperature | 18.5 °C |
| Solar Panel Tilt Angle | 24° [Summer: 4°, Winter: 43°] |
| Annual Global Insolation | 2150 (kWh/m sq.) |
| Capacity Utilization Factor (CUF) | 14.2 (%) |
| Direct Normal Irradiance (DNI) | 1090 (kWh/m2/year) |
| Diffused Horizontal Irradiance (DHI) | 809 (kWh/m2/year) |
| GHI Solar Potential (MW) |
1615 (kWh/m2/year) 22800 |
Framed within the energy poverty cycle, the energy transition being undertaken in Uttar Pradesh has characteristic of and relevance to other nations and states as it struggles to overcome the embedded inertia of dominant socio-technical systems that presents barriers to household choice and business development of decentralised solar power. Therefore, learnings gained from Uttar Pradesh will resonate across provinces and nations in the region and in sub-Saharan Africa to address unmet electricity needs. Importantly, the research also investigates insights into the energy poverty dilemma. It outlines the complexities [31,32] of providing centralised grid-based electricity to rural communities and its limitations [13,33]. It also presents, through Uttar Pradesh, a case study as to the dynamics of the energy policy ecosystem, in this case focusing on state-level decentralised solar PV and its role in meeting electricity aspirations of a geographically, socially and economically diverse society.
The key questions addressed in this paper are framed on decentralised energy policy in Uttar Pradesh that examines: the state of the decentralised policy framework and their progress and then how decentralised solar PV can support Uttar Pradesh to meet universal electricity access sustainably and thus address the energy poverty cycle through sustainable energy transitions. The paper is organised as follows: Section 2 discusses the methodology for the review, Section 3 provides a critical analysis of major solar PV policies and off-grid solar programs in Uttar Pradesh. Section 4 identifies and discusses the gaps and barriers, and section 5 suggests future recommendations followed by conclusions in section 6.
2. Methods
The aim of this review is to consolidate learnings from past and ongoing decentralised solar programs in Uttar Pradesh and underpin how they can inform clean energy transition to support dual objectives of last mile connectivity and low carbon development. A grounded theory approach [34] was employed in the paper that included the triangulation of published literature, government data and reports with interviews involving state and national energy policy experts and practitioners. The use of grounded theory approach is suitable methodology for our analysis as it involves understanding complex and interlinked interplay of technology, policy and society, and captures the evolutionary nature of energy transition [[35], [36], [37]]. The use of grounded theory also allows a continuous review and comparison of the dataset [38] and offers a close link between dataset and related concepts that helps to keep the relationships and underlying meanings intact [39]. Lastly, the use of the grounded theory approach is suitable in this review as our research inquiries combined knowledge from literature with views of area-specific experts that guided us to construct location or region-specific findings and recommendations. The method was designed to reveal insights and provide directions for decentralised energy reform. Information from scholarly literature and published books was collected through Google Scholar, SCOPUS and Science Direct. Although these sources are major publisher of energy research, there are other sources of literature on energy. Therefore, manual Google searches were used to broaden the search scope especially to obtain grey literature containing information on public (annual reports of electricity-related ministries and reports from statistical department and ‘NITI Ayog’) planning and private solar programs. The scholarly literature was especially reviewed through Scopus database queried with search strings comprising of individual phrases and various combinations of terms ‘barriers’ ‘challenges’ ‘decentralised’ ‘distributed’ ‘development’ ‘policies’ ‘photovoltaic’ ‘off grid’ ‘solar’ ‘mini-grids’ ‘microgrids’ ‘rural electrification’ ‘solar’ and ‘Uttar Pradesh’. Peer-reviewed literature searches were refined to select literature from20102 and onwards to present the recent developments in this sector. A manual systematic review and critical examination of literature was performed in the context of deploying distributed solar PV to rural areas representing a large unmet electricity market. The review methodology is summarised in Fig. 1.
Fig. 1. Summary of review methodology.
A qualitative approach was adopted for data collection. Data collected from expert semi-structured interviews involving energy researchers, consultants, public officers working with state electricity companies and financial institutions. Questions were orientated around uncovering barriers and seeking recommendations to progress decentralised energy solutions. Seventeen interviews were undertaken between April to May 2016. The sampling criteria were based on purposeful sampling design [40] with interviews were manually recorded and the quality of data entry was checked against the original text for accuracy. Relevant questions from interviews were imported into QSR NVivo 11 software database program for qualitative analysis. Interview questions reflected on key insights derived from literature as a sequential process to identify deeper connections and understanding of evidence-based policy. Results from interviews were summarised with outcome of literature review and views of few participants were used as direct quotes to emphasise key findings.
3. Energy scenario in Uttar Pradesh – case in review
Uttar Pradesh has a land area of 243,286 km2 divided into 75 districts (Fig. 2). Coal contributes over 72% of the generation capacity of the state [5]. Uttar Pradesh, despite being the third-biggest contributor to the Indian economy, has 29% of its population living below the poverty line [41]. The regional and social disparities in Uttar Pradesh are startlingly high, and the state has been consistently rated low on human development and poverty indicators [[42], [43], [44], [45]].
Fig. 2. Solar resource (GHI) and districts in Uttar Pradesh.
The electricity distribution infrastructure across Uttar Pradesh is subjected to high aggregate technical and commercial losses (21%–35%) [46]. The contributing factors explaining these losses include dilapidated electricity lines, inefficient transformers, theft of electricity through illegal hooking and financially ailing state distribution companies. In many parts of the state, particularly remote villages, grid extension to villages and households therein have been neither technologically nor economically feasible [[47], [48], [49]] despite government extending the grid to such places. This presents the state government with a three-fold set of interconnected challenges: (1) How to meet rising electricity demands and expectations within which it can address the energy poverty cycle? (2) How to supply reliable and quality electricity while improving financial sustainability of DISCOMs? and (3) How to supply electricity sustainably that will also address carbon emissions reduction target?
Decentralised solar energy presents a distinctive opportunity to fill this gap. Uttar Pradesh has abundant solar energy for generating solar power [50] and these optimum conditions are present across all months of the year (Table 1) [51].
3.1. Status and policy development on solar PV in Uttar Pradesh
In India, the national Ministry of Power in collaboration with the state governments has responsibility for the development and implementation of energy policies relating to generation, transmission and distribution of electricity [35]. Off-grid and grid-connected solar PV projects provide a minor contribution (about 5%) to the state’s electricity generation. The majority (over 80%) of grid-connected solar installation in Uttar Pradesh have been directly funded through the national JNNSM program that has supported a manifold increase from 143 MW in 2015 to 902 MW in 2019 [52,53]. The decentralised solar sector is largely driven by private sector enterprises operating in the state. The development of the decentralised solar segment is led by mini-grids with an aggregate capacity of about 3 MW in the state [54]. There is, however, spectrum of off-grid solar PV delivery options ranging from pico-solar, low to high capacity SHS, and microgrids. These decentralised technology options do not have grid interactivity and operate independently. Their deployment involves two paths: i) private enterprises sales of the solar home system supported by government subsidies, and rural bank financing to consumers; and ii) sales to the government through tenders and private developers often enabled through government subsidies. In addition, a Pay As You Go’ (PAYG) enterprises (SIMPA Network) and a mini-grid operators (OMC Power) operate in the state that do not rely on any form of government support.
Although off-grid programs and mini-grid policy analysis is a key focus of this review, the PV policies for grid-tied solar are briefly discussed to provide the context of state government driven solar policy development which is relatively new. In 2013, the state government announced its first solar policy followed by other policies in subsequent years, designed to enable large and small-scale grid, and off-grid PV systems (Table 2). A key element of these policies was to facilitate the project approval via a single window clearance, lower transaction costs, ease market entry barriers and create effective monitoring frameworks through the Empowered Committee. In practice, however, these attributes have been unable to overcome the institutional, technical and social inertias leading to installed capacities falling well short of anticipated targets. This also implies that the planning and implementation of state-sponsored projects are somewhat disconnected. Specifically, project management is slow, and monitoring and review of systems are haphazard that arguably result in slow project development and commissioning, and inferring a lack of appropriate governance structures necessary to shift the existing electricity mix to a more sustainable pathway [55].
Table 2. Solar policies in Uttar Pradesh. Source: [57].
| Uttar Pradesh Solar Policy – 2013 | Rooftop Solar Photovoltaic Power Plant Policy (Uttar Pradesh) – 2014 | Solar Policy 2017 | |
| Objective (s) | To provide solar-based electricity generation through private investments | To promote utilisation at least 25% of the available plinth area of institutional buildings. To promote net energy metering (for up to 50 KW) and net energy billing (for over 50 KW). |
Increasing installed capacity of solar generation to achieve 8% solar renewable purchase obligations by 2022 |
| Technology | Large-scale (minimum 5 MW) solar power plants | Institutional level rooftop solar photovoltaic. | Institutional level utility scale and Solar Rooftop |
| Target | 500 MW by 31 March 2017 | 20 MW (10 MW each for public and private institutions) installation by March 2017. | 10,700 MW (including 6400 MW utility-scale and 4300 MW rooftop solar projects) by 2022 |
| Financial viability | Provisions to sell power to UP Power Corporation Limited (through compulsory competitive) the third party (without a bidding process) or could use for the captive purposes. | Annual budgetary support to suitable public owned institutions. | Not specified |
| Governance | Competitive bidding. Single window clearance facilitated by the nodal agency (UPNEDA). Empanelment of system integrators, identification of possible installation sites, support metering and grid connectivity for solar adoption, and collaborate with Uttar Pradesh Electricity Regulatory Commission (UPERC) (for rooftop solar photovoltaic). Empowered committee to address implementation hurdles |
||
| Achievements (aggregated through to 2017) | Commissioned – 90 MW grid-connected solar power projects Under development – 410 MW [58]. |
An aggregate capacity of rooftop solar systems: Commissioned – 0.982 MW (on government buildings) 2.7 MW (on private buildings). Under development −2.2 MW and 7.3 MW on the public and private institutions respectively [58]. |
N/A |
| Issues | Solar parks lacking grid infrastructure. Transmission and commercial losses due to outdated infrastructure. Problems acquiring land for solar parks |
Confusion on the subsidy and technical specifications. Interconnectivity with the grid was subjected to consideration and approval by the UPERC causing delays. Implementation was highly dependent on distribution companies. |
|
3.1.1. Policies for grid-tied solar
In mid-2017, the state government consolidated the 2013 solar and 2014 rooftop policies under a new solar policy (Table 2) and annexed India’s maiden mini-grid policy to bring solar development in the state under single policy framework. The new policy also aimed to attain outstanding targets under both the 2013 solar and 2014 rooftop policies. Structurally the newer policy was designed to align with and scaffold into the national solar energy policy arena to facilitate installation of 10,700 MW of solar power allocated to Uttar Pradesh under JNNSM [56]. The new policy was retrospectively enforced from November-2017 for five years [57].
3.1.2. Solar mini-grid policy
The solar mini-grid policy was released in 2016 to support the construction of small-scale renewable power generating systems, mini-grids, that also facilitate local distribution to offer ‘last mile’ connectivity [59]. This policy targets projects delivering up to 500 kW in regions with no or limited grid-based supply and can deliver a minimum 8 h of supply.
The mini-grid policy offers two implementation pathways either through a more open market approach or through government-linked subsidies. Under the market-driven approach, developers have the flexibility to choose technology, project location, services terms (no necessity of minimum supply) and can charge a mutually agreed rate from consumers in the absence of the subsidy. The downside of this structure is that it may result in higher tariffs, establish monopolies and ultimately making power unaffordable for poor households already captured within the energy poverty cycle [60,61]. Under the government-controlled scheme, a 30% subsidy is offered to the industry but comes with tied obligations including the ability to specify the technology, location, types of service and tariff rates. While this pathway is designed to overcome the shortcomings of the market-driven approach, it has been observed the tariff rates do not provide sufficient commercial incentive and in turn market viability for private sector investment [61]. As a result, commercial mini-grid operators are not opting for projects through the subsidy route, despite the provision in the policy to set up tariff for higher loads [62].
An overarching critique of the mini-grid policy is that it has not fully integrated within the energy policy ecosystem nor is it compatible within the national electricity infrastructure. The policy offers short-term opportunities to supply electricity to villages awaiting centralised electricity infrastructure. However, when positioned as a long-term and permanent solution, current technical and accounting standards do not support mini-grids thus rendering them as a financial risk to both the public and private sector [54,61]. Therefore, there remains outstanding governance issues that impact on the fate of mini-grids including establishing technical standards to allow integration of the power between the mini-grid with the central grid, and setting accounting standards that appropriately and transparently value mini-grids incorporating depreciation to support long-term prospects of mini-grids [61,63].
3.2. State initiatives and development of decentralised solar PV
Since 2013, Uttar Pradesh has prioritised and supported decentralised policy approaches for solar PV with solar projects implemented [52,64] through the Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA). The social benefits of this policy reform is evident with PV systems leading to a decrease in the monthly kerosene consumption, improved study duration of children, and eased pressures on household chores through the benefits of solar PV electricity and additional lighting [49,65,66]. In this sub-section, we discuss the state government policy and program ecosystem that support decentralised solar power programs.
3.2.1. Government-funded mini-grids
Decentralised solar mini-grids are supported by public financing in the state through two concurrent programs: state government-funded projects (prospectively under mini-grid policy of 2016) and the national government’s decentralised distributed generation scheme [67]. One of the initial interventions by the state government was to deploy 250 KW solar mini-grid to un-electrified villages of Fakirpur and Chanduahar in Kannauj district that supplied electricity to 417 households [68]. Within such government projects a range of socio-technological challenges have arisen highlighting broader policy and governance issues including a lack of performance measurement systems and frameworks; the absence of monitoring and maintenance systems [69], poor staff training and community education on the use of the facilities; and that the project design that lacked flexibility to accommodate increasing demands [70].
3.2.2. Off-grid solar power pack and solar streetlight programs
In 2012, the Uttar Pradesh government launched two flagship schemes promoting off-grid solar to integrate decentralised solar electricity solutions for the poor living in underdeveloped villages. The Dr Ram Manohar Lohia Samagra Gram Vikas Yojana (RMLSGVY) scheme delivered a total of 42,181 solar home systems in the period 2012 to 2014 across 27 districts [67] with 99,353 solar home systems planned for 2016–17 [58]. The Janeshwar Mishra Yojna (JMY) scheme was designed to provide free solar home systems to 10 low-income families per village from 1000 Janeshwar Mishra villages across 72 districts. In 2014–15, 10,000 households benefited from the program [71] and 11,250 solar power packs were planned for 2016–17 [58].
Between 2014 and 2016, the state government also installed 114,987 LED-based solar street lighting for public places under both schemes [58]. Under the RMLSGVY scheme, solar streetlights were installed in un-electrified villages located over 3 km from the main grid and with populations over 500, while solar streetlights were installed in 8 public places under the JMY scheme [67]. Installation of solar street lights in public places has helped public awareness of solar lighting and convenience to villagers during the night [72]. However, complete data on installations, locations, overall performance, quality of power service, and the socio-economic impact of both schemes are not publicly available. This represents an opportunity for the state government and others to strengthen the institutional governance around such schemes given the clear public and private benefits that are likely to have accrued.
3.2.3. Solar pumps
Agriculture is the primary occupation of almost 70% of the population in rural Uttar Pradesh, and more than 90% of small and marginal farmers rely on this for their livelihood [58]. Supporting the agriculture sector with electricity is a priority for both the national and the state government. From a policy and economic standpoint, the focus on agricultural electricity assistance has shifted from the more costly diesel solutions to decentralised solar pumps for irrigation. Solar pumps are supported by a 45% and 30% subsidy from state and national governments respectively (Table 3). The state agriculture department implements this scheme and farmers can obtain solar pumps from UPNEDA approved firms. A total of 14696 solar pumping systems (2HP, 3 HP and 5 HP capacity) were deployed by October 2018 [73]. These highly subsidised (75% of the capital cost) solar pumps have helped farmers with timely irrigation and in turn supported improved agricultural production that would otherwise not be possible through the unreliable grid supply seen in the State [74].
Table 3. Subsidy benefit on solar pumps. Source [67].
| Solar pumping system | Contribution of Farmer (USD/unit) | Contribution from state government (USD/unit) | Contribution from national government (MNRE) (USD/unit) | Cost declared by UPNEDA (USD/unit) |
|---|---|---|---|---|
| 1800W (2HP) surface solar pump | 831 | 1302 | 1191 | 3324 |
| 3000 W (3HP) submersible solar pump | 1616 | 2693 | 1675 | 5985 |
| 4800 (5HP) submersible solar pump | 3663 | 1429 | 2234 | 7325 |
3.2.4. Clean water and electricity provision for primary schools
Decentralised photovoltaic technology applications are employed by the state government to deliver basic health and education services for school-aged children in rural areas. Under this initiative, the Uttar Pradesh government has a program to install solar reverse osmosis (RO) water plants to provide access to clean drinking water and electricity to power fans in primary schools. Under this scheme, a school receives a 1.1 KW solar power plant fitted with 1 R.O. water plant, a 1HP D.C. submersible pump and five fans [67]. Between 2014 and 2016, 301 systems were installed and 200 systems were planned for 2016–17 [58].
3.3. Rural bank supported solar home lighting system (SHS) installations
Rural banks in India mainly drive rural financial inclusion and provide finance to farmers and small businesses for rural development. These banks have high social acceptance and expertise in rural financing and in turn actively sponsor various projects including solar home systems that improve living standards of rural communities [75] Rural banks in Uttar Pradesh have supported the adoption of solar home systems by raising awareness of the technology and schemes, offering financing including flexible repayments, and establishing partnerships with solar PV service providers [76]. Public sector banks in rural areas facilitate SHS financing by participating in the capital subsidy cum-refinance scheme under JNNSM [77]. Some rural banks have been instrumental in initiating SHS programs (e.g. Aryavart Gramin Bank, Kashi Gomti Samyut Gramin Bank and Prathama Bank) and have partnered with TATA BP (one of the largest integrated solar companies in India) to deploy 80,000 solar home lighting systems using consumer finance [[78], [79], [80], [81]]. These programs have provided a foundation to off-grid solar PV applications in rural areas, familiarising local communities, and setting a stage for the wider diffusion of the technology and creation of markets. However, financing of solar home systems by rural banks has declined after subsidy discontinuation by the central government in India [82].
3.4. Private off-grid solar PV enterprises and entrepreneurs in Uttar Pradesh
Private sector-driven innovative off-grid solar energy service delivery models (Table 4) have connected and provided the basic electricity load to otherwise unserved rural populations in Uttar Pradesh [62,83,84]. These enterprises are supported by funding from international and domestic philanthropic organisations and more recently commercial investors. When compared to government off-grid PV projects, Palit and Malhotra found privately run solar DC micro-grid plants (TERI, MGP and Minda) demonstrated better operational management including user training, ongoing maintenance and tariff collection compliance [49]. This may suggest philanthropic and private sector investment could play a greater role both as a provider of systems and their ongoing maintenance. Successful examples such as MGP (providing solar electricity services to over 300,000 people) demonstrate that locally rooted private entrepreneurs can profitably provide reliable electricity access in rural areas [85,86]. However, privately run off-grid solar businesses still face the dual challenge to secure the necessary finance to start and scaling-up their business, and then sustain necessary operating capital to ensure their long-term financial viability [87]. While long-term government commitment is needed to create enabling environment to address these financial barriers, entrepreneurs should continue to focus on innovation, better customer focus and improved operational performance to serve their consumers, that in turn sustain their business [88]. Similarly, clean energy transition in the state warrants government to collaborate with entrepreneurs to strengthen the acceptance of decentralised solar projects and their role in the electricity market in rural India [89].
Table 4. Decentralised solar PV enterprises in rural Uttar Pradesh. Source: Authors’ compilation based on [54,84,90].
| Private enterprises | Technology | Size | Business model | Revenue collection | Other features |
|---|---|---|---|---|---|
| OMC Power | Minigrid | Over 25 kW | Build-operate-own-maintain (BOOM), (Anchor loads and fee for service from consumers) |
Manual by agents | Commercial and telecom towers in rural areas as anchor clients. Excess power generated from plant supplied to rural households within 3–5 km radius. 2-9 lights or other products based on consumer need charging fixed tariff from US$2.5 to 11/month. Local job creation by hiring village level entrepreneur. |
| Mera Gaon Power | Solar PV Microgrid | 240 W | BOOM, fee for service | Field collection agents | Quick installations at low capital costs Each plant costs less than US$1000 Charges a tariff of INR 25 (US$0.4)/week powering two LED lights and a mobile charging point for 7H/day 80% revenue collection rate |
| Naturetech Infra | Microgrid | 1–3 kW solar AC microgrid | BOOM, fee for service | Recharge agents and SMS based prepaid metering | Basic lighting and non-lighting products (charging point for mobile charging/TV/Fan) for 24 h) Tariff – US$25 one-time connection fee plus US$5 per month (US$0.50–0.67 per unit) Cloud-based recharge and remote monitoring |
| Simpa Networks | SHS | 20–40 W per household | “Pay As You Go” involved an initial down payment and then prepaid payments based on consumption until paid in full |
Smart meters | US$350 Cash payments at payment points in a village (INR 600–750 or USD 8–10 per month). Notifications sent to mobile phone (at the payment point) |
| Boond | SHS Lanterns | 20–200 W DC | Loan from partner rural banks and microfinance institutions | Sales agents | US$130 – 1000 Lighting and other DC appliances. Sales agents (village level entrepreneurs) collect down payment, and rural banks deal with the rest of the payment/interest utilises consumer subsidies provided by MNRE through NABARD |
4. Discussion
The policy and program ecosystem within Uttar Pradesh advancing off-grid systems can be framed around two themes, tackling the energy poverty as a socio-economic outcome and advancing techno-political outcomes to address the structural inequality of electricity provision. The geographic, demographic and technological challenges facing this state have parallels across most other jurisdictions in India and arguably apply to many emerging countries as they seek to advance the standard of living, meet ever-increasing energy demands and concurrently addressing international climate change obligations. At the juncture of these three issues lies the value of decentralised and sustainable energy solutions.
Off-grid PV systems represent an inflection point within energy transformation from the national to household scales. Policies and programs are grappling with the legacy of traditional fossil fuel-based generation and centralised distribution systems, and how new technologies can pave the way for new commerce, higher standards of living and support inter and intra-generational environmental benefits. The transition tensions are evident within the 2017 draft National Energy Policy (NEP) that envisions a continued expansion of thermal power capacity from 125 GW in 2012 to 441 GW in 2040 and remains relatively silent on growth pathway and a long-term role for decentralised solutions [91]. State government policies and programs, such as those in Uttar Pradesh, provide a more progressive, nuanced and balanced approach. What is missing, however, is any clear and consistent vertical integration between national and state policies to coordinate and report the impact and momentum of energy policy reforms. This may be attributable to an absence of a sound governance framework to support the policy uptake, audit and report on the implementation and provide a mechanism for iterative review and improvement.
One of the more notable features within the Indian electricity system and that within Uttar Pradesh is the continued emphasis on centralised and government regulated electricity generation and distribution system. This is despite the immense geographic and technological challenges and in turn significant costs to bring power to all households.
Many independent studies have advocated for an integrated (central and off-grid) electrification approach [90,92] yet this remains beholden to traditional electricity planning ideologies. Such lack of political commitment for decentralised systems is arguably due to the absence of a proven business model for addressing challenges associated with planning, management, distribution and maintenance of these decentralised systems. Presently national and state energy transition has embraced larger scale and grid-connected PV systems that in itself is a turning point in relation to supporting new technology, yet off-grid solar assigned only minor financial support from the governments. Private sector involvement within a decentralised energy system requires both regulatory oversight and cost-competitive technologies, both of which require further evolution.
4.1. Challenges to the dissemination of off-grid systems and ways forward
In the specific context of Uttar Pradesh, key challenges based on literature (e.g. Refs. [49,54,90]) and identified from expert interviews reveal eight main themes, as discussed below. While these have emerged as central to Uttar Pradesh, they resonate with other states in India and similar emerging economies.
4.1.1. Ambiguous and absent standards and regulations
National standards and enabling regulations are required to support the integration of solar mini-grids to the main grid. Combined, decentralised and centralised generation can provide a more stable electricity supply, yet this will not succeed until a detailed and practical interconnectedness guideline is produced. For example, grid compatibility is not defined in regulation which can make it subjective for state-level agencies and may lead to variable compatibility standards. In 2013, Central Electricity Authority (CEA) released technical standards for grid connectivity that established requirements of grid-compatible off-grid rooftop infrastructure, but these standards are not clear about mini-grids [93]. Experts have opined that the adaptation of international standards for intentional islanding in Indian conditions can help mini-grids to support the main grid on unpredictable load shedding [94]. Also, technical standards do not exist to support the connection of single or multiple mini-grids to the main grid. While Uttar Pradesh developed the nation’s first mini grid policy in 2016, its impact to support this technology remains hampered by the absence of grid-enabling specifications. One reason offered by Palchak et al. is that existing transmission infrastructure requires substantial investment to support the additional capacity and until this resolved the government must resort to what may be seen as a passive resistance to integration [95] via the absence of enabling standards.
The absence of standards and regulations to accept electricity into the grid, small-scale systems are, in effect, isolated assets. This places a question as to their long-term financial viability particularly where the government prioritises a central generation and distribution system. While Uttar Pradesh’s mini-grid policy was first to offer measures to safeguard the longer-term fate of off-grid projects by supporting asset selling or selling the solar power to distribution companies after grid extension, these mechanisms are only effective if supported by adequate tariff structures. For feed-in tariffs (FiTs) to work and thus incentivise, investment they need to be flexible so as to reflect the actual costs; a function of remoteness, capital investment and maintenance [96]. Similarly, unambiguous terms for asset sale should be provided to clarify if distribution infrastructure would be considered in the purchase price to boost private investment.
4.1.2. Absence of consistency in tariff structure
Tariffs for the off-grid sector are unregulated that present two broader issues. First, the tariff agreements are subject to individual negotiation between operators and consumers that lead to different tariff structures within and among different microgrid or mini-grid operators [97]. As a result, consumers are inclined to believe they are paying more for electricity from decentralised solar systems when compared to the centralised grid supply or other operators. The Uttar Pradesh mini grid policy has attempted to address the tariff issues from a consumer side by capping tariff for basic supply at USD 0.097 per unit. However, a viable tariff for residential supply is suggested between USD 0.22 to 0.55 per unit [54], keeping mini-grid developers disengaged despite a 30% capital subsidy. Therefore, key policy challenge in the state is to find a balance in setting up a tariff rate that is viable for developers and devise a mechanism to make power affordable for rural consumers.
Secondly, the absence of a more nuanced policy approach on the FiTs3 for mini-grids also poses a challenge for private investment. The FiT for mini-grid should reflect actual costs that are a function of location (remoteness), capital investment and ongoing maintenance [96] to reinforce private investment. Moreover, as solar power and battery technology are becoming increasingly price competitive, this may negate the need for any form of feed-in tariff and enabling technical standards in effect circumventing the government’s centralised policy agenda, for at least those villages and households that can afford it.
4.1.3. Make electricity affordable to those in need
To break the energy poverty cycle, electricity must be both accessible and affordable. This requires targeted government subsidies based on need, capacity to pay and support a diversity of products and services to elevate household economic, health and educational outcomes. Subsidies can cover the difference between levelized cost of electricity supplied by the mini-grid and the capped tariff and make power affordable to below poverty line households. This can be achieved through the creation of a fund financed through a reduction or shifting the existing kerosene subsidy [17] and cross-subsidy mechanism [96]. With completion of Adhaar seeding4for all households, the subsidy amount can be paid easily to BPL households using direct benefit transfer mechanism.
Secondly, financial institutions must have enabling, not restrictive policies or lending practices that further disadvantage poor households [75,98]. Most evident is the higher credit terms for small loans that impose a greater proportional disadvantage to the poor. Where microfinancing can provide a more suitable lending pathway, systems must be scalable, where possible circumvent administrative burdens on customers that may have low literacy and educational levels and encourage philanthropic support. Where these three elements do not work in concert, the aims of equitable electricity access and affordability will remain outside the grasp of those in most need.
Lastly, the residential decentralised solar solutions even at smaller loads can support rural micro-enterprises (e.g. tailors, shoemakers, and handicraft worker) to extend their working hours which presently often ends at sunset. There is a big section of the rural population engaged in such micro businesses in UP that are currently dependent on diesel in the absence of reliable electricity supply [99]. Therefore, it presents an opportunity for private enterprises and/or financing institutions to prioritise and offer attractive schemes for such households as the additional incomes generated through these micro-enterprises makes lending for energy asset more viable. Similarly, mini-grid installations in rural and remote areas are good alternatives to meet electricity needs of schools, primary health centres and mini and micro enterprises, who otherwise rely on diesel generators. The provision of such anchor loads can enable a cost-effective supply and provide financial viability to mini-grids in rural settings. Reliable electricity supply to rural schools and health facilities can support a cascading effect in better service delivery and better human productivity outcomes in the long run [100]. In addition, a differential tariff structure towards households and other entities can be considered, as appropriate. Under such arrangement, the private sector can play a key role to enable these crucial public facilities within the village ecosystem.
4.1.4. Lack of ecosystem for affordable enterprise financing
Financing the decentralised solar enterprises is a function of the capacity (3Wp to 300Wp) and type (e.g. mini-grids or standalone solar home systems). Current financial options do little to differentiate the costs and risks associated with these technologies. Therefore, there exist opportunities to develop a suite of new and more tailored financing options that respond to the varying risks so supporting mini-grid developers through to standalone SHS distributors. Mini-grids are a type of infrastructure investment, not a commodity, which comprise fixed costs and function as a depreciating asset. This then lends an argument for longer-term loan agreements. Solar home systems, on the other hand, are more akin to a consumer appliance albeit with a potential for return, and would therefore have different loan risks and thus lending terms. For instance, many financing institutions consider solar mini-grids as a higher risk loan in the absence of a clear and enabling policy and regulatory framework compounded by financial institutions having a general lack of familiarity with the technology. Collectively these factors limit avenues of raising capital (debt) and eventually restrict the prospects securing of long-term capital [97]. Therefore, an opportunity exists to initiate dialogue between decentralised solar developers and financiers to reveal the barriers and opportunities within the financing process [101]. An interviewee suggested, national level reform is required to address such financing barriers and articulated that:
“A national mini grid policy that simplifies the time-consuming and complex process of capital access, and eases financing mechanisms to ensure availability of domestic debt, and getting foreign debt into the country, will go a long way towards creating a robust rural mini-grids network” (Entrepreneur, decentralised solar).
4.1.5. Improve energy governance structures and systems
The governance structures of national and state agencies constrain the implementation of off-grid systems. This originates from a lack of resources and poor implementation practices that contribute to a delay in project approvals and payment of subsidies [102]. Experts opine that the state nodal agency (UPNEDA) responsible for the identification of villages for electrification through mini-grids under the Decentralized Distributed Generation (DDG) system was neither efficient nor effective in identifying and supporting villages where mini-grids would be most effective. Therefore there remains opportunity for the state distribution companies to play a greater role to prioritise off-grid electricity [103]. This would draw on their understanding of the actual electrification status on the ground, the administrative capacity to determine what villages need should be prioritised for and what level of technical expertise is required for future integration of mini-grids [104,105]. The experts interviewed also indicated that the state nodal agency (UPNEDA) lacks technical expertise and needs to adopt modern management practices to achieve operational efficiency and may be captured by institutional and technological inertia. To address this gap, a participant recommended:
“the government should work closely with corporate consultants, domain experts and relevant partners to develop finance mechanisms, business models and practices that promote innovation, implementation and real-time tracking” (Head of a rural financial institution).
4.1.6. Inadequate social awareness and acceptance
Limited community awareness and a lack of information on technologies, costs and potential benefits of renewable energy pose serious barriers to the growth of decentralised PV in rural areas [[106], [107], [108]]. In Uttar Pradesh, awareness among the rural population on the use and benefits of solar technologies is low. Most importantly, commonly used mechanisms for information dissemination (print and electronic) on solar technology and financial support in the state is not effective as it could be due to the community’s limited access to these electronic medium and lower literacy. Rather rural communities also indicate that they favour village level informational (i.e. specifically relevant to them) as noted in expert interviews and demonstration camps to showcase technologies and their applications. One of the interviewees specified that:
“Localised community awareness methods could gradually build the confidence of rural communities in solar PV technology, and could be more effective (in fact better) than TV, radio and print advertisements” (Regional head in a rural financial institution).
4.1.7. What is free is not always valued
Free solar schemes, while a deliberate and decisive initiative to enable access to electricity for certain households in the state may have an unexpected policy consequence. This can include an ongoing perception of entitlement to free power. This entitlement can reduce the value of solar home schemes thus and impacting on the households willingness to invest themselves on maintenance. The endpoint of free electricity system entitlement is that once it requires replacement there will be a continual expectation of subsidised replacement [75,109]. This notion of energy entitlement presents a policy dilemma for the government as it seeks to support and enable both households captured within the energy poverty cycle and a nascent industry, while not creating a social expectation for free and ongoing power at the same time [110]. While subsidies provide legitimate support for this technology for below poverty line households, there are opportunities to structure subsidies within a longer-term socio-economic upliftment of both communities and new energy technologies that have combined direct and positive impacts on individual and household standard of living as well as local industry and enterprise. To this end alternate financing models, such as Pay As You Go should be considered for solar home systems over a free distribution model in order to support community buy-in and ipso facto, the long term maintenance and longevity of the solar PV systems.
4.1.8. Role of private sector in rapidly evolving rural electricity access in India
The government of India has reported that most households have electricity, however with ongoing population growth demand will continue as will the need for more reliable power. Electricity provision is still framed on the basis of extending grid connections that link centralised generation, largely run by the government. Within such government-controlled provision (grid extension), their role is pivotal to open the market to the private sector. This is where decentralised solar systems have utility to contribute to power reliability. The private sector has opportunities to leverage confidence and increase market demand for decentralised solar technology due to its superior reliability to bring it to the forefront of the electricity portfolio [90]. What is still critical for private sector operators is to become more proactive and decisive in identifying their synergy with main grid and reorient their business model according to target customers and market demand. For instance, mini-grid operators must shift their focus to offer services beyond lighting to be seen as an extension of main grid [111]. Partnerships with appropriate institutions (e.g. anchor load to state utilities) are key to enable and/or achieve viability and scalability of decentralised systems. For example, the mini-grid operators can align with provisions under Uttar Pradesh mini-grid regulation 2016 that allow them to operate as either micro-utilities or distribution franchisees of distribution companies taking off pressure from DISCOMs that are facing challenges of infrastructure maintenance and demand management in rural areas. Similarly, solar pump installers can increase their focus on supporting a community ownership model to offer more affordable systems that meet the operational and financial needs of households. Such partnerships might also serve to reduce risks and further support external financing prospects of solar firms.
In additions, solar home system companies have an opportunity to focus on two distinct customer segments: i) access to last mile; and ii) addressing power needs due to grid outage. For rural households there is a financial cost by way of connection and the ongoing purchase of electricity. Easy payment options bundled with maintenance services can support above poverty line customers to procure these systems. While below poverty line customers would require further support in paying upfront payment. This can be enabled through collaboration with either government or philanthropic institutions.
The private sector leadership is equally essential to make the distributed solar PV commercially viable and expand their distribution network that can be achieved through a strategic partnership with organisations that can complement energy enterprise in distribution or payment collection e.g. partnership between Simpa network and India post [30]. While above are important, enhancing quality of service and customer experience is far more crucial that ultimately enhance the longevity of these systems and gradual transition to high-energy use leading to productive outcomes. Therefore, private sector must strengthen customer engagement and services in rural context [112] within existing policy settings. A national or state level forum of decentralised practitioners and firms can certainly support to develop standards and metrics to adopt a consistent business strategy on enhancing services and customer experience.
5. Future recommendations and lessons for transition
Supporting economic activities and providing reliable supply are the two key objectives of energy policy in India, but it must be pursued under a third key pillar of environmental justice. This brings paradox for policymakers operating within the current carbon energy economy to maintain a balance in energy policies that justifies both human development linked to energy and environmental protection that is grounded on carbon pollution and climate change. The centralised coal-based generation and distribution systems have achieved significant socio-economic outcomes nationally and within Uttar Pradesh. However, this policy agenda is fast approaching its geographic, technological and financial limits. Clearly, there is a need for a substantial shift to cleaner and lower carbon generation systems. For this reason, policies must pivot towards decentralised off-grid and grid compatible systems. A shift towards decentralised PV systems with capacity to connect to a grid, will progress the sustainable development goals and environmental justice. In particular, enable energy equality for the millions of households already captured wholly or partially in the energy poverty cycle, and support the infrastructure that cannot reliably meet current or future demand [113]. State level policies can transition either in sync with the central government’s centralised priority or can operate dualistic policy agendas that support both centralised and decentralised approaches. A dual approach must however consider and be reflexive to poor grid reliability in rural areas and financially ailing distribution companies in the state. Building on literature and views from expert interviews we recommend a nested hierarchy of approaches that while specifically relevant to India and Uttar Pradesh have utility to other jurisdictions:
At the national level, we identify six areas of reforms:
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Construct policies that enable emerging renewable technologies, through flexible and incentivised taxation arrangements, that can attract and build private investment.
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Introduce a solar bond scheme to support investment and long-term debt capital to finance renewable and off-grid power systems. This draws on studies [114,115] that government institutions are better placed to secure finance due to their larger balance sheet, public guarantees, and reliable revenue sources.
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Implementing anchor-load based mini-grid business model under long-term partnership for operation and maintenance to sustainably support electricity needs of rural public services (health, education and communication) for advanced social outcomes.
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Define grid compatibility and develop uniform nationally binding and practical technical specifications and guidelines [116] to facilitate the integration of centralised and off-grid electricity generation systems. This should eliminate the locking out of many smaller decentralised systems to the grid.
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Recognise decentralised solar enterprises as Micro, Small & Medium Enterprises5 allowing linking to government programs (e.g. ‘Make in India’ scheme) and priority accreditation to become a DISCOM’s franchisee6 for ‘last mile’ connectivity.
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Developing mechanisms to promote peer to peer trading of energy from decentralised renewable systems using blockchain. Blockchain provides innovative trading platforms that enable transactions that are highly controlled and well monitored [117]. Such automated mechanism can address the key challenges of maintaining a large volume of decentralised systems to achieve grid resilience and reliable supply, and ultimately transition to the utility of the future.
At the state level, we see eight areas of reforms:
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Develop regulations to establish product standards and supply benchmarks e.g. mandatory supply duration in rural areas to ensure system reliability and trust of users in the technology.
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Establish a state-level business innovation fund to support entrepreneurs to bring to market new products including energy efficiency products that reduce capacity requirements and thus make solar products/services more affordable. Innovation is essential to achieve price parity with the grid.
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Form public-private partnerships, for example, a partnership with Pay As You Go enterprise to deploy solar home systems in suitable areas as a means to support investment rather than (or in addition to) the current subsidy systems or free distribution.
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Support direct benefit transfers of subsidies to extreme poor for electricity access and divert subsidy support from kerosene to decentralised solar system during the intervening period of achieving 24 × 7 power for all [17].
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Strengthen state nodal agency with technical and domain experts and the adoption of modern management practices to ensure appropriate technology deployment and promote cost-effective and centralised project planning, approval and coordination.
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Establish electronic project repository including an interface for private enterprises to establish a robust and reliable mechanism to track electricity generation (off-grid) and consumption (electricity access indicators at the household level) for transparent monitoring and reporting of projects and assessment of their impact.
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Develop guidelines to support a partnership between state technical institutions with private enterprises to develop local skills and capacity building programs to support the construction and maintenance of the new off-grid-electricity infrastructure in rural and remote communities.
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Private sector leadership to develop business strategies that enhance quality of supply and customer services by developing industry benchmarking for services.
Finally, the multidimensional nature of energy transition is complex in itself as it is guided by interaction and interplay of technical, economic, political and social parameter that often warrants structural changes [118]. The energy transition in Uttar Pradesh presents these complexities in the form of divide between government retaining its focus on centralised traditional energy generation and distribution, while the private sector initiatives on new forms of energy models continue to struggle to emerge into a dominant alternative. It indeed represents embedded paradox in policy choices for the government (meeting energy needs by maximising available resources versus reorganizing resources for decarbonisation of energy systems for sustainability), but it mainly shows inertia in the incumbent system and vested interests of various actors. The nascent and intermittent support from the government for emerging solar technologies and attempts to support private sector involvement appear unable to shift current practices from the traditional energy generation and distribution modes. Therefore, overarching transition pathways lies within the energy policy ecosystem that must integrate the network of actors and actions to concurrently address energy poverty cycle and shape sustainable energy transitions.
From the perspective of policymakers in developing world, it is also important to recognise that the pathway of socio-technical transition is ever more complex due to a compelling need for them to amend and adopt the principles of transition framework which were originally developed for shaping transition in developed economies [119]. While this analysis offers some recommendations for Uttar Pradesh, it also provides context-specific insights for transition pathway of rural communities to assist policymakers. For example, the policymakers must shift to policies that act as a bridging framework for diverse stakeholders to come together. Secondly, the prospective energy policies must have efficient governance frameworks that track and report on the expected impacts and offer opportunities for review. From our work, we summarise the following lessons that can contribute to the wider literature on energy transition in developing economies.
From the outset, energy planning must be based on a realistic assessment of techno-economic feasibility and capacity of existing infrastructure and systems and the socio-cultural acceptability and expectations at the community level to future energy needs. For nations not constrained by traditional and centralised energy generation and infrastructure, there is the opportunity to leapfrog directly to renewable electricity services. This can concurrently support the attainment of environmental, commercial and social justice outcomes as stated goals of the United Nations. Nations need to understand who is best placed to provide energy services and how. This can be framed around partnerships or agreements with industry but should be bound by strong regulatory settings to provide financial certainty to industry and customers, establish clear service standards and support strong governance systems including auditing, benchmarking and policy review.
Lastly, the energy development agencies at national and sub-national/state level must build capacity to host data repository of distributed programs, monitor progress and establish mechanisms to ensure the long-term operational viability of decentralised projects.
6. Concluding remarks
Uttar Pradesh provides a case study into the dynamics of national and state-based energy policy as it supports traditional electricity systems and infrastructures, grapples with new technologies and seeks to address the energy poverty cycle, rising electricity demands in the system already at capacity and international climate obligations. This article presents an account on the emergence and opportunities of grid-connected and off-grid solar power generation and its policy and infrastructure compatibility. It highlights the particular problems of the last mile population living in rural and remote areas that remain locked out from policies that have a centralised distribution focus. Electricity access directed to benefit low-income and remote populations must look beyond traditional centralised practices and typologies and offer greater avenues for locally generated and decentralised solar energy. It must also overcome the expectation that electricity is free that can emerge from reliance on subsidies. Given rural and remote populations have geographic, demographic, environmental and technological challenges, energy transition must adopt cooperative and coordinate public policy and private participatory responses. The energy poverty cycle cannot be solved with one solution rather must be supported by a nested and forward-looking policy and governance ecosystem.
Declaration of interest
The authors declare that they have no conflict of interest.
Funding
This work is supported by the “Australian Government Research Training Program Scholarship” received in 2016 and the department funding from the Department of Environmental Sciences, Macquarie University.
Acknowledgement
Authors are thankful to two anonymous reviewers for providing constructive and insightful feedback that helped to improve the paper.
Source: sciencedirect
