The farming sector alone offers a potential $40bn
marketplace, thanks to rice transplanting, pesticide spraying and grain
harvesting – says the Council on Energy, Environment and Water thinktank.
Rural Indian communities, and particularly farmers,
represent a $50 billion clean energy innovation opportunity, according to a
report by the Council on Energy, Environment and Water (CEEW)
thinktank, with agriculture alone offering a potential $40bn marketplace.
India’s non-farming rural sector offers an opportunity worth
more than $13 billion, with clean energy innovations offering the chance to
transform activities such as spinning, weaving, milling, refrigeration and
heating.
In farming, clean energy has the potential to mechanize
activities including irrigation, fertilizer application, seed-sowing, and a
temperature controlled supply chain. It could reduce input costs and improve
agricultural productivity.
Lack of reliable electricity is the biggest hurdle to
India’s more than four million rural micro-enterprises. Clean energy-powered,
energy-efficient machines could help meet demand and significantly boost rural
businesses such as automobile repair shops; beauty salons; beedi cigarette,
furniture and jewelry making; post-harvest processing; poultry farming;
restaurants and tailoring.
Current scenario
The CEEW study – supported by the GoodEnergies Foundation
– found only around 20 clean energy innovations for livelihoods exist in India.
These include solar pumps, milk chillers, milking machines, sewing
machines, spinning wheels, looms, cold storage and knapsack sprayers.
The deployment of most of these technologies is limited to a
few hundreds, among millions of farmers and rural enterprises in India’s
600,000 villages.
A high upfront cost, low and fragmented rural demand and a
paucity of long-term debt for customers remain major challenges to realize
market potential.
Dr Arunabha Ghosh, Chief Executive of the CEEW, highlights in the study that most of the clean energy
innovations deployed in rural India – except solar-powered irrigation systems –
are at an early, pre-commercial stage, and generate limited revenues.
Key to success
“Scaling up [clean energy innovation] deployment needs [a]
robust support ecosystem, enabling large pilots for such technologies to prove
their commercial viability and unlock support from investors, policymakers and
financiers,” Dr Ghosh writes.
From a technical perspective, cost and efficiency
improvements are a priority.
The farming sector is more difficult to reach due to low
utilization rates of agricultural equipment and the high capital expenditure of
clean energy solutions, according to the CEEW study.
Clean energy solutions for agriculture could be made
economically viable by reducing battery costs and developing cost-effective,
super-efficient and small motors. Energy efficiency could play a critical role
in making such solutions economically viable.
Impact on the economy
Clean energy innovations could boost India’s rural economy
by providing reliable energy access to farmers and micro-enterprises. This
would not only create new livelihood opportunities but also improve
productivity, product value, and incomes.
Sanchit Waray – Programme Associate at the CEEW and lead
author of the study – writes: “Clean energy and energy efficiency innovations
could complement the government’s household electrification efforts under
the Saubhagya scheme by bridging gaps in electricity
supply and powering rural income generating activities. By increasing rural
incomes, these innovations could become the catalyst for improving household
energy consumption, further amplifying the effectiveness of Saubhagya.”
The Saubhagya scheme aims to electrify all Indian households
and is only two months short of the December deadline set by Prime Minister
Narendra Modi to achieve its ambitious target.
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