Green Solutions for Telecom Towers: Part II

Green Solutions for Telecom Towers: Part II

Green Solutions for Telecom Towers: Part II

© 2013 Essential Energy India Private Limited Green Solutions for Telecom Towers: Part II Solar Photovoltaic Applications Essential Energy India Pvt Limited July 2013

© 2013 Essential Energy India Private Limited 2 Contents 1 INTRODUCTION 3 2 SOLAR PHOTOVOLTAIC TECHNOLOGY (SPV) OVERVIEW 3 2.1 Solar photovoltaic applications 4 2.2 Components of solar photovoltaic systems 4 2.3 Efficiency of solar photovoltaic panels 5 2.4 Geographic considerations for photovoltaic applications 6 2.5 Advantages and challenges of solar photovoltaic technology 7 3 SOLAR PHOTOVOLTAIC SOLUTIONS FOR TELECOM TOWERS 7 3.1 Solution design considerations 9 3.2 Opportunities and challenges of moving to solar technology in the India telecom industry 9 3.3 Government initiatives 11 3.4 Green energy mandate for telecom towers 12 4 CASE STUDIES 12 4.1 Case study 1 13 4.1.1 Site location 13 4.1.2 Site description 13 4.1.3 Site economics 15 4.2 Case study 2 17 4.2.1 Site location 17 4.2.2 Site description 17 4.2.3 Site economics 19 4.3 Challenges on the ground 20 5 FUTURE OF SOLAR PHOTOVOLTAIC TECHNOLOGY FOR TELECOM 21

© 2013 Essential Energy India Private Limited 3 1 Introduction Energy saving is a key sustainability focus for the Indian telecom industry today. This is especially true in rural areas where energy consumption contributes to 70% of the total network operating cost 1 . In urban areas, the energy cost for network operation ranges between 15-30% 2 . This expenditure on energy as a result of the lack of grid availability highlights a potential barrier to telecom industry growth, especially regarding the expansion of rural teledensity which sits at 40.81% compared to teledensity in urban areas of 146.15% 3 .

It is estimated that in India almost 70% of telecom towers are located in areas with more than eight hours of grid outage and almost 20% are located in off-grid areas 4 . This uncertainty in power availability has compelled infrastructure providers to use diesel generators to ensure a continuous supply of power. Annually more than 2.6 billion litres of diesel are consumed to operate telecom towers, resulting in the emission of 7 million metric tonnes of CO2 5 . Given the deregulation of diesel prices and the need to reduce carbon emissions, it has become imperative for the industry to evaluate all alternative options in order to improve network operation and to reduce energy costs.

Several efforts have been made to optimise energy costs, such as converting indoor base transceiver stations (BTS) to outdoor ones in order to eliminate air conditioning on site, installing energy-efficient equipment and also using clean energy sources to power the sites. Among them, using clean energy sources for power has the potential to resolve the three key needs of the telecom industry, namely: reduction in diesel usage; expansion of telecom infrastructure to off-grid areas; and reduction in carbon emissions. Clean-energy technologies are well supported by the Indian Government’s subsidy policy 6 .

While clean energy technologies such as solar photovoltaic, wind turbines, biomass power and fuel cells have undergone trials at telecom sites, the majority of these trials have been with solar photovoltaic technology.

This white paper discusses two real-time telecom tower sites using solar photovoltaic technology. The discussion includes an overview of the solution configuration and the economic case which includes OPEX comparisons before and after the deployment of the solar photovoltaic solution. The challenges for large- scale, on ground adoption are also evaluated. 2 Solar Photovoltaic Technology (SPV) Overview Solar photovoltaic technology uses the light (photons) from the sun to produce DC electricity. As shown in figure 1, a photovoltaic cell is a light-sensitive semiconductor device which, when exposed to sunlight, releases electrons to produce DC current.

1 Adoption of Green Technology and Safety of Wireless Network by Milan Jain (Sr. Research Eng. – Converged Network, TRAI) 2 Adoption of Green Technology and Safety of Wireless Network by Milan Jain (Sr. Research Eng. – Converged Network, TRAI) 3 http://www.indiatelecomonline.com/topics/telecom-statistics/ 4 http://www.gsma.com/mobilefordevelopment/wp-content/uploads/2012/05/Energy- for-the-Telecom-Towers-India-Market-Sizing-and- Forecasting-September-2010.pdf 5 Assumption – 2.1 litres. Diesel usage per hour and 8 hours of outage per day for 4,25,000 towers 6 http://www.solar-apps.com/Revised-Capital-Subsidy-and-Benchmark-cost-of-the -SPV-system.pdf

© 2013 Essential Energy India Private Limited 4 Figure 1: Electricity generation in a solar photovoltaic cell Electron flow Hole Flow Sunlight Solar Photovoltaic Panel nSilicon pSilicon 2.1 Solar photovoltaic applications Solar photovoltaic technology can be used as either a stand-alone, grid-connected or hybrid solution. The table below summarises the description of each type of application. Table 1: Three types of solar photovoltaic applications Solar photovoltaic applications Description Stand-alone This type of application requires the equivalent level of backup energy storage to ensure power supply when sunshine is unavailable.

Grid-connected In this application, energy is fed back from the photovoltaic module to the grid.

Hybrid This is a combination of photovoltaic arrays and other energy sources such as hybrids with wind turbines, biomass power, fuel cells and diesel generators. 2.2 Components of solar photovoltaic systems Solar photovoltaic cells, modules, panels, strings and arrays Solar photovoltaic cells are the building blocks of a solar photovoltaic system. Each photovoltaic cell circuit is packaged in a protective laminate to avoid moisture and corrosion. Solar photovoltaic modules consist of photovoltaic cell circuits and are connected in series and/or parallel to produce the required currents.

Solar photovoltaic panels are the assembly of modules and are wired in series to form an installable unit.

A number of panels are connected in series and are termed as a solar photovoltaic string.

© 2013 Essential Energy India Private Limited 5 Solar photovoltaic arrays are a group of strings which form the complete power generation unit. Figure 2 illustrates a solar cell, module, array and string structure. Figure 2: Structure of a photovoltaic system 7 Solar Module Solar Cell Solar Panel Solar String Solar Photovoltaic Fuses Solar Array Charge controller A charge controller regulates the voltage and current output from the solar panels as required by the battery and the load. It also keeps the batteries protected from overcharging and discharging. Battery bank The battery bank is used as storage providing the source of power during non-sunshine hours.

Battery capacity is measured in Ampere-hours (Ah) at a constant discharge rate. A wide range of batteries can be used in solar photovoltaic configurations. Lead-acid and valve-regulated lead-acid (VRLA) gel batteries are most commonly used across telecom sites in India.

2.3 Efficiency of solar photovoltaic panels The efficiency of a solar photovoltaic system varies and depends on the grade of the photovoltaic material used. The table below summarises the various types of solar photovoltaic materials and their respective efficiencies. Table 2: Current range of efficiencies for different solar photovoltaic technologies 8 Wafer-based c-Si Thin films Single Crystalline (sc-Si) Multi Crystalline (mc-Si) Amorphous Silicon (a- Si); Micro-morph Silicon (a-Si/μc-Si) Cadmium-Telluride (CdTe) Copper-Indium-Diselenide (CIS) / Copper-Indium- Gallium- Diselenide (CIGS) 14-20% 13-15% 6-9% 9-11% 10-12% 7 http://www1.cooperbussmann.com/pdf/9df1f7ec-8c62-4210-8cf8-9504927394f0.pdf 8 http://www.iea.org/publications/freepublications/publication/pv_roadmap.pdf

© 2013 Essential Energy India Private Limited 6 2.4 Geographic considerations for photovoltaic applications Geographic parameters including daily average energy incidents, the duration and availability of sunshine and also solar power density across different geographic locations, influence the scope of solar photovoltaic deployment. Table 3 provides facts on solar radiation in India. Table 3: Geographic considerations of solar photovoltaic applications in India 9 Parameters Availabilities Daily average energy incidents 4-7kWhr/m2 Solar power density across India See solar map of India (figure 3) Duration of quality sunshine per day Approximately 5 hours Number of days with quality sunshine 300 The figure below shows the solar power density across India which maps the performance and deployment feasibility of solar photovoltaic solution Figure 3: Solar power density in India 10,11 9 http://en.wikipedia.org/wiki/Solar_power_in_India 10 http://en.wikipedia.org/wiki/File:Solar_Resource_Map_of_India.png 11 Map presents annual average of solar power density

© 2013 Essential Energy India Private Limited 7 2.5 Advantages and challenges of solar photovoltaic technology Solar photovoltaic technology has some limitations which make its mass adoption challenging. These include high initial levels of capital investment, the requirement for large deployment areas, dependency on sunshine availability and configuration of storage capacity. Table 4 provides a broad overview of some of the basic advantages and challenges of solar photovoltaic applications. Table 4: Advantages and challenges of solar photovoltaic technology Parameters Advantages Challenges Emissions Zero None Space requirement None Footprint requirement @10 square meter/kW.

CAPEX Recent drop in panel price due to mass manufacturing and technology innovation Requires high storage capacity, hence the additional battery cost increases the CAPEX. OPEX No fuel required Regular panel cleaning is required to maintain optimum efficiency. Sunshine availability Average 300 days annually Some geographic locations in India have a prolonged monsoon season and hence less availability of sunshine. Solution configuration Easily integrated into hybrid solution Intermittent sunshine availability requires equipment automation to optimise solar photovoltaic usage. A higher capacity solution leads to a higher CAPEX investment.

Storage Enough sunshine to charge the battery in high solar density (4- 7kWh/m 2 ) areas High battery capacity is required in areas with less solar power density (less than 4 kWh/m 2 ). 3 Solar Photovoltaic Solutions for Telecom Towers Enabling distributed power generation and emission-free operation makes solar photovoltaic technology a desired option for backup power. However, the dependency on sunshine and the average space requirement of 10 square metres for a 1kWp panel 12 limits the scope of deployment. In recent trials, the two types of applications deployed at telecom tower sites are stand-alone and hybrid solar photovoltaic.

The application types were chosen based on the site load profile, grid outage scenarios, 12 Solar Opportunities in Telecom by Sai Ram Prasad, CTO, Bharti Infratel, Solar Directory 2012

© 2013 Essential Energy India Private Limited 8 space availability at the site and other configuration aspects including average sunshine availability throughout the trial and the power storage configuration for non-sunshine hours. The illustration in figure 4 describes the stand-alone system and figure 5 details the hybrid application using solar photovoltaic technology. Hybrid applications can be developed by combining solar photovoltaic technology with various energy sources such as wind turbines, biomass gasifiers, fuel cells and diesel generators. Using an augmented battery bank is not considered to be a hybrid solution; instead it is a part of the solar photovoltaic solution.

Figure 4: Stand-alone solar photovoltaic application Charge Controller Battery Bank DC Load AC Load Inverter Solar Panel Figure 5: Hybrid solar photovoltaic application Charge Controller Battery Bank DC Load AC Load Inverter Solar Panel Electrical Grid

© 2013 Essential Energy India Private Limited 9 3.1 Solution design considerations The solution design is based on the availability of sunshine in a particular geographic region. Table 5 provides a theoretical approach to solution design and describes the parameters for solution design consideration. Table 5: Factors influencing solar photovoltaic solution design Parameters Description Load A detailed site load profile is required to design the total panel capacity.

Efficiency losses Efficiency losses of the various tower site equipment influence solar panel capacity. Solar photovoltaic technology as an energy source needs the capacity to support the BTS load after considering the losses of the battery, charge controller and other auxiliary loads. Energy incident The availability of daily average energy incidents of 4-6 hours duration largely impacts the energy output per panel. This determines the panel capacity at the site. Efficiency of solar photovoltaic panels  Panel capacity  Panel size The efficiency of different panel sizes influences the total solution footprint.

Also the number of panels required to meet the energy demand is determined by panel efficiency.

Battery configuration  Charging current limitation  Battery output voltage  required (Ah) The charging current limitation of a given battery is fixed and based on its specification. Battery capacity is designed according to the duration and availability of sunshine and charging current limitation, especially when solar is the only source of battery charging. 3.2 Opportunities and challenges of solar photovoltaic technology adoption in the Indian telecom industry Solar photovoltaic technology has come to be economically viable for different applications over the last few years as a result of technology maturity, the scale of adoption, mass manufacturing and innovation.

Solar photovoltaic prices have reduced by 65% since 2001 and 73% since 200713. The trend in price fall is represented in figure 6 below.

13 http://thisisxy.com/blog/the-rise-of-green-mobile-telecom-towers

© 2013 Essential Energy India Private Limited 10 Figure 6: Price trend of solar photovoltaic modules, 2001 to 2012 14 This significant price reduction has redefined the economic viability of solar photovoltaic solutions for telecom applications and could accelerate the speed of adoption. According to the Telecom Regulatory Authority of India (TRAI), switching to solar will save $1.4 billion in operating expenses for telecom tower companies compared to the current diesel solution 15 . The table below shows solar photovoltaic deployment statistics by different telecom operators and infrastructure providers as of May 2013 16 .

A few recent examples/initiatives of solar photovoltaic adoption include Bharti Airtel’s plan for deploying 3000 solar photovoltaic sites, Idea Cellular’s intention for 200 solar hybrid installations and Vodafone’s target of deploying 150 solar photovoltaic sites (in addition to the 390 sites currently deployed by Vodafone) 17 .

Table 6: Adoption of solar photovoltaic applications for telecom towers18 (as per GSMA’s Green Deployment Tracker) Company Solar towers Bharti Infratel Ltd 1350 Vodafone Essar 390 Idea Cellular 100 Indus Towers 650 GTL Infrastructure 80 Total 2570 Though government subsidies, lower interest rates on loans and the significant reduction in solar panel prices are encouraging, there are more challenges that need to be addressed including optimal solution design for various energy management scenarios, seamless integration with other renewable energy 14 GTM Research, X&Y Partners analysis 15 http://www.ccaoi.in/UI/links/fwresearch/conceltation%20paper%203.pdf 16 http://www.gsma.com/mobilefordevelopment/programmes/green-power-for-mobile/ tracker 17 http://www.gsma.com/mobilefordevelopment/wp-content/uploads/2013/01/GPM-Bi- Annual-Report-January-2013.pdf 18 http://www.gsma.com/mobilefordevelopment/programmes/green-power-for-mobile/ tracker 0.5 1 1.5 2 2.5 3 3.5 4 2001 2007 Q32012 -65% -73%

© 2013 Essential Energy India Private Limited 11 technology (RET) solutions and optimal configuration of solar photovoltaic panels as well as appropriate storage and space requirements. 3.3 Government initiatives The Indian government is taking a multifaceted approach to accelerate energy security and to reduce the country’s dependency on fossil fuels. A few of the solar initiatives by various government bodies are outlined below: Jawaharlal Nehru National Solar Mission (JNNSM): This programme provides a comprehensive framework of solar power development in India. The Mission envisions 200 MW capacity of off-grid solar applications by the end of Phase-I (2013) and an overall installation of 2,200 MW by 2022.

Under this scheme, systems of up to 100 kWp will receive funding support from the government.

Ministry of New and Renewable Energy (MNRE): To encourage the usage of alternative and renewable energy sources, the MNRE provides the following support under the JNNSM scheme:  The MNRE announced its support for 400 telecom towers using solar photovoltaic technology 19  Operator and infrastructure provides wide distribution of 400 MNRE-supported towers across India  The MNRE provides up to INR 81.00/Wp to offset the project cost  In April 2011, the MNRE revised the capital subsidy and benchmarked the cost of solar photovoltaic systems 20 to account for solar panel cost reduction in recent years Table 7: Statistics of 400 solar powered towers supported by the MNRE in India Operators States Number of solar-powered towers Airtel Bihar 100 Indus Andhra Pradesh 100 GTL Infrastructure Uttar Pradesh 100 BSNL Across 12 states of India 100 Total 400 Universal Service Obligation Fund (USOF): To evaluate the viability of using renewable energy sources in the USO Fund projects, the USO Fund has collaborated with The Energy and Resources Institute (TERI) for the latter’s “Lighting a Billion Lives” 19 http://panchabuta.com/2011/08/22/400-telecom-towers-supported-in-pilot-proj ect-for-use-of-solar-photovoltaic-power-systems-by- mnre-for-fy11-in-india/ 20 http://www.solar-apps.com/Revised-Capital-Subsidy-and-Benchmark-cost-of-the -SPV-system.pdf

© 2013 Essential Energy India Private Limited 12 initiative. The aim is to provide additional mobile charging facilities for rural areas. The project will cover 5,000 villages across India over two years 21 . 3.4 Green energy mandate for telecom towers TRAI’s mandate requires that telecom companies should use renewable sources of energy to power at least 50% of rural telecom towers and 20% of urban telecom towers by 2015. By 2020, the telecom companies have to convert 75% of rural towers and 33% of urban towers to run on hybrid power 22 . The MNRE’s recent mandate to convert a minimum of 50,000 towers to solar photovoltaic technology 23 immediately is another step towards ensuring compliance for the adoption of clean energy.

Several proposals from the government have been rolled out for solar powered telecom sites such as Bharat Sanchar Nigam Limited’s (BSNL’s) tender for 15 telecom towers in Bihar24 and the Department of Telecommunications’ proposal for 2,200 telecom towers for security networks 25 .

The Tower and Infrastructure Providers’ Association’s (TAIPA) initiative of forming Renewable Energy Service Companies (RESCOs) provides a simplified ecosystem of energy management for telecom towers, whereby infrastructure providers have to pay a fee based on the actual usage of power with no upfront investment in capital. Thus far, high levels of capital investment and inability of a single renewable energy technology to provide a full range of solutions across all geographies in India make it a challenge for RESCOs to be successful 26 .

Due to these varied energy management scenarios, the Indian telecom industry is yet to benchmark the cost of operation for telecom towers.

4 Case Studies The two case studies below provide an insight into the practicalities and economics of solar photovoltaic technology implementation by providing actual data at the live sites. The discussion includes details of the solution configuration and economic comparisons of the “before and after” solar hybrid solution installation at both sites. 21 http://www.tele.net.in/telefocus/item/11111-telecom-outreach-key-role-of-th e-uso-fund 22 http://www.igovernment.in/site/telecom-towers-be-powered-renewable-energy 23 http://www.energynext.in/at-least-50000-mobile-towers-should-switch-to-sola r-mnre/ 24 Tender No.-25068/MS-O&M/CSPS/Non BSNL sites/12-13/06 25 http://www.ciol.com/ciol/news/187289/dot-seek-cabinet-approval-200-green-to wers 26 Intelligent Energy Ltd, Green Solutions for Telecom Towers: Part I, March 2013

© 2013 Essential Energy India Private Limited 13 4.1 Case study 1 4.1.1 Site location Table 8: Site description of case study 1 Site location Geographic location District: Kolar State: Karnataka Distance from Bangalore 72 km Average daily temperature 35°C 4.1.2 Site description Table 9: Site description of case study 1 Site description Units Values Site type - Outdoor Base transceiver station (BTS) - Outdoor Number of BTS - 1 BTS load kW 1 Grid electricity panel kVA 15 Grid power availability hrs/day 9 Battery bank Ah 300 Diesel generator kVA 15 Energy management before the solar photovoltaic hybrid installation Before the installation of the solar photovoltaic solution, the 15 hours of grid deficit was backed up by running a 15kVA diesel generator for 12 hours and the remaining 3 hours using a 300Ah battery.

Figure 7 illustrates the power supply schematic at the site.

© 2013 Essential Energy India Private Limited 14 Figure 7: Power supply schematic of backup power with diesel generator prior to solar hybrid installation of case study 1 300Ah Battery Bank 1kW BTS SMPS 15kVA EB Panel PIU 15kVA Diesel Generator Energy management after the solar photovoltaic hybrid installation In February 2012, a solar photovoltaic solution was installed at the site. The solution includes 3kW solar panels, a central controlling unit (CCU) and a 600Ah VRLA battery bank that supports the (on average) 14 hours of grid power outage per day. The static power conditioning unit (PCU) which replaces the earlier power interface unit (PIU) provides the additional hour of grid utilisation by managing grid voltage fluctuation.

This turnkey solution is provided by ALTA Energy, India.

The central controlling unit controls and monitors solar power utilisation, grid power utilisation and battery utilisation, as well as battery charging and discharging. The central controlling unit is programmed to prioritise the solar photovoltaic technology as a primary power source over all the other power sources. Hence, solar power is used when sunshine is available even if the grid power is available. The solution has an inbuilt data transfer unit (DTU) to store and transmit data for remote monitoring and sends SMS alerts through GPRS when service is required.

Since installation, the diesel generator has not been in use.

Figure 8 below illustrates the power supply schematic at the site.

© 2013 Essential Energy India Private Limited 15 Figure 8: Power supply schematic, with solar photovoltaic installation for case study 1 600Ah Battery Bank 1kW BTS SMPS MPPT CCU 15kVA EB Panel PCU ALL DC BOX 3kW Solar Panel Table 10: Solution configuration of case study 1 Components Units Value Solar panel capacity kWp 3 PCU kVA 15 Solar maximum power point tracker controller (MPPT) kW 5 SMPS kW 6 Battery capacity Ah 600 4.1.3 Site economics OPEX comparison Table 11 shows the monthly savings over the traditional diesel solution for backup power for the telecom tower after the solar photovoltaic solution was installed.

Evaluated in the comparison are cost of the grid, cost of fuel for the diesel generator and operation and maintenance of the hybrid solution. Table 11: OPEX comparison of the “before and after” solar photovoltaic hybrid installation for case study 1 27 Components Units Before solar hybrid After solar hybrid Cost of grid consumption INR/day 99 69 Diesel cost INR/day 1186 0 Maintenance cost INR/day 159 37 Total OPEX INR/day 1444 116 Per unit OPEX INR/kWh 60 5 Savings per kWh is calculated to INR 55.00 27 All numbers are presented as actuals from site

© 2013 Essential Energy India Private Limited 16 Payback period calculations The solution costs INR 13,60,000. If the solution is financed for 120 months at 14% rate of interest, the monthly pay out for CAPEX is INR 21,116 which adds INR 5 per kWh. The graph in figure 9 compares the cost of energy of the solar photovoltaic solution with the diesel solution, considering an annual expenditure for diesel at various price points, installed capacity and operation and maintenance. Figure 9: Cash-flow projections in case study 1 The graph summarises the time frame of the realised return on investment for the installed solar photovoltaic solution in comparison with the yearly expenditure for the diesel solution.

Considering the plausible price points of diesel at INR 52.25 per litre28, INR 60 per litre and INR 70 per litre, the respective payback periods, including CAPEX investment, are plotted. The chart demonstrates that, at INR 52.25 per litre of diesel, the return on investment on solar photovoltaic can be realised after approximately 2.5 years of deployment. When the price is at INR 60 or 70 per litre, the return on investment of solar photovoltaic technology will be much faster, that is between 1 and 2 years. In this case, for every INR 10 increase in diesel price the time frame of the return on investment for the solar photovoltaic solution is reduced by approximately 6 months.

The savings resulting from the deployment of the solar photovoltaic system will result in an increase in free cash flow of INR 4,81,737 on an annual basis. In other words, the investment in the system will yield an IRR of 33% which is significantly higher than cost of capital (14%) and implies viability of the solution. This site has not received any capital subsidies for solar photovoltaic systems and hence such subsidies have not been used in the calculation.

28 Delhi diesel price in June 2013 INR 50.25 per litre, plus INR 2.00 logistic cost Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Payback period analysis for case study 1 Diesel @70.00 INR/ltr Diesel @60.00 INR/ltr Diesel @52.25 INR/ltr Solar Photovoltaic

© 2013 Essential Energy India Private Limited 17 4.2 Case study 2 4.2.1 Site location Table 12: Site location of case study 2 Site location Geographic location District: Tumkur State: Karnataka Distance from Bangalore 150 km Average daily temperature Minimum 18°C Maximum 35°C 4.2.2 Site description Table 13: Site description of case study 2 Site description Units Value Site type - Outdoor BTS - Outdoor Number of BTS - 3 BTS load kW 3 Grid power availability hrs/day 6 Energy management before the solar photovoltaic hybrid installation Before the installation of the hybrid solution, the site’s backup power requirement of 18 hours a day on average was fulfilled by a 20kVA diesel generator running for a minimum of 10 hours per day and the remaining 8 hours by three batteries each of 400Ah capacity, with one for each of the service providers’ BTSs.

The diagram below represents the diesel generator power supply schematic at the site. Figure 10: Power supply schematic of backup power with diesel generator prior to solar hybrid installation in case study 2 SMPS 400Ah Battery Bank SMPS 400Ah Battery Bank SMPS 400Ah Battery Bank BTS 1 Bharti Airtel BTS 2 Vodafone BTS 3 BSNL Low Tension (LT) Panel for Power Distribution 20kVA Diesel Generator Energy Meter EB Panel

© 2013 Essential Energy India Private Limited 18 Energy management after the solar photovoltaic hybrid installation In May 2009, a solar hybrid solution was installed to meet the 18 hours of outage. The solar hybrid solution includes a 10kW solar photovoltaic panel, a 5kW wind turbine, a 22kW SMPS and a 2500Ah battery. The 400Ah battery bank also remains at each BTS. The battery was designed to ensure maximum energy storage and utilisation of solar hybrid power at the site. Figure 11 illustrates the power supply schematic at the site.

Figure 11: Power supply schematic after the solar hybrid solution installation in case study 2 Solar Photovoltaic Wind BTS 1 BTS 2 BTS 3 EB Panel Energy Meter Diesel Generator LT Panel 22kW SMPS Charge Control Unit 2500Ah Battery Bank As depicted in the diagram, both solar and wind power generators are connected to their respective charge controller units (CCUs) for optimal power transfer.

The following table provides configuration details of the solar hybrid solution. Table 14: Solar photovoltaic hybrid configuration in case study 2 Components Units Value Solar panel capacity kWp 10 Solar charge controller and maximum power point tracker kW 10 Wind turbine and charge controller kWp 5 Switch mode power supply kW 22 Battery capacity Ah 2500

© 2013 Essential Energy India Private Limited 19 On certain days, due to prolonged grid failure, lack of sunshine or total absence of wind, the diesel generator supports the backup power need. According to the site records, of the 18 hours of daily outage, on average almost 16 hours of backup power is provided by the solar hybrid solution and the remaining 2 hours by the diesel generator 29 . In comparison with case study 1, since the load is higher here, the possibility of using the solar hybrid solution as a stand-alone option reduces.

4.2.3 Site economics OPEX comparison Table 15 shows the monthly savings after the solar hybrid solution was installed.

Evaluated in the comparison are the cost of grid consumption, cost of fuel for the diesel generator and the operation and maintenance of the hybrid solution. Table 15: Comparison of OPEX for the “before and after” solar photovoltaic hybrid installation for case study 230 Components Units Before solar hybrid After solar hybrid Cost of grid consumption INR/day 263 269 Diesel cost INR/day 1138 354 Maintenance cost INR/day 379 441 Total OPEX INR/day 1781 1064 Per unit OPEX INR/kWh 25 15 Savings per kWh is calculated to INR 10 Payback period calculation The solution which includes solar panels, wind turbine, battery bank, two charge controller units and SMPS of capacities described in table 13 costs a total of approximately INR 27,00,000.

If the solution is financed for 120 months at the rate of 14% interest 31 , the monthly pay out for CAPEX is INR 42,200 which adds INR 25 per kWh. It should be noted that the solar solution design has not been optimised at this site. With optimisation, there is an opportunity to reduce the CAPEX investment.

The graph below compares the cost of providing backup power using the solar photovoltaic solution in comparison with a diesel-only solution at the various points of diesel price projection. 29 Based on site average actual data 30 All numbers are presented as actuals (March 2013) from site 31 60 months contract duration already completed and contract duration of 60 months likely to be extended as per discussions with BSNL

© 2013 Essential Energy India Private Limited 20 Figure 12: Cash-flow projection in case study 2 The graph summarises the time frame of the realised return on investment for the installed solar photovoltaic solution against the yearly expenditure of the diesel solution.

At the time of this evaluation, the price of diesel is INR 52.25 per litre 32 . Given that the deregulation of diesel prices is expected at any time, diesel at INR 60 per litre and INR 70.00 per litre is used in this analysis chart. From the chart it can be determined that with an increase of every INR 10 per litre in the price of diesel, the solar photovoltaic payback period reduces by approximately 2.5 years. However, for this 3kW site, at the current price of INR 52.25 per litre and without any subsidy from the government, the time frame of solar photovoltaic payback period is approximately 9 years.

The savings resulting from the deployment of the solar photovoltaic system will result in an increase in free cash flow of INR 2,61,456 on an annual basis. In other words, the investment in the system will yield an IRR of -1% which is significantly lowers than cost of capital (14%) and implies non-viability of the solution over the contract duration of 10 years. As a proof-of-concept site, this deployment received around 80% subsidy from the government, making the solution economically viable from the date of installation as shown in figure 12. 4.3 Challenges on the ground Due to the diversity of energy management scenarios, viability of the technology and maturity of the solution, adoption of renewable energy technology has multiple challenges before it can be adopted at large scale across the country.

Table 16 captures a few of the major challenges encountered by both test case sites. 32 Delhi diesel price in June 2013 INR 50.25 per litre, plus INR 2.00 logistic cost Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Pay back period analysis for case study 2 Diesel @ 70.00INR/ltr Diesel @ 60.00INR/ltr Diesel @ 52.25.00INR/ltr Solar photovoltaic with around 80% subsidies

© 2013 Essential Energy India Private Limited 21 Table 16: List of challenges faced by telecom infrastructure providers and RESCOs in deploying RET solutions at large scale Parameters Challenges Technology challenges  Seamless integration with other energy sources such as wind turbines, biomass and fuel cells  Configuration of off-grid applications  Complex system integration (configuration is not optimised for consumption) Design and configuration challenges  Prioritisation of solar photovoltaic technology among other available energy sources for frequent outages  Optimisation of solution configuration in terms capacity installed Deployment challenges  Higher foot print requirement  Optimum exposure to sunshine for the solar panel  Poor operation and maintenance services Scalability challenges  Capital intensive  Geographical limitation  Variety of energy management scenarios and flexibility of solution integration Economic challenges  High CAPEX  Replacement of batteries further increases the capital investment  Not enough encouragement by government to overcome the tipping point in the adoption of the technology at large scale 5 Future of Solar Photovoltaic Technology for Telecom In telecom, solar photovoltaic technology has experienced a better rate of adoption to date in comparison with other RETs.

Achieving optimal configuration is still a barrier for large-scale adoption of the solution. As shown in the case studies, telecom sites with lower load profiles benefit from solar photovoltaic technology installations from day one whereas for telecom sites with higher load profiles, it is difficult to justify the cost of capital investment required. The growing cost of diesel and relevant subsidies may tip the balance in favour of solar investment in some of these cases. For higher load profile sites, battery capacity is high thereby increasing capital investment and maintenance requirements.

At times, these sites have to fall back on diesel generators to supplement the gap left by the solar solution.

With innovative business models like the OPEX model solution where the initial capital investment is financed and the telecom tower owner pays only for the usage, the solar adoption rate can increase significantly. While solar offers a good solution for many telecom towers with lower load profiles, the deployment constraints at other towers make it necessary to evaluate the capabilities of alternative renewable energy technologies aside from solar, such as biomass power and fuel cells. The next edition of this whitepaper will discuss the practical and economic viabilities of these alternative technologies.

© 2013 Essential Energy India Private Limited 22 Intelligent Energy acknowledges the contribution of ALTA Energy India and all others, for sharing information and conducting primary research used in the development of this white paper. A special thanks to Mr P.K. Panigrahi, Sr. Dy. Director General (BW), DOT and Mr V.K. Hirna, Dy. Director General (Electrical), DOT for their support. About Intelligent Energy Intelligent Energy delivers efficient and clean energy technology for the global consumer electronics, automotive and stationary power markets – from compact energy packs for mobile devices, to power-trains for zero-emission vehicles, and stationary power units for the always-on infrastructure.

Our unique technology architecture is used by global blue chip companies to create differentiated, cost-efficient fuel cell power systems for mass market applications. It enables Intelligent Energy and our industry partners to solve the challenges of continuous power and productivity, by creating convenient everyday energy solutions to power your life. Intelligent Energy operates globally, with offices in the Americas, Europe and Asia. www.intelligent-energy.com About Essential Energy Essential Energy is a wholly owned subsidiary of Intelligent Energy Holdings, plc. Essential Energy was formed to address the growing gap between supply and demand in countries like India.

The large number of new innovative technologies and novel methods for delivery of energy from these technologies has created confusion among customers. Essential Energy was created to partner with such customers allowing them to meet their energy requirements in a responsible and economical manner.

We work with our customers to deliver efficient solutions and educate them to adopt energy modest loads while not compromising on their requirements. We are based out of Bangalore, India and have a team of experienced professionals with illustrious backgrounds in energy, finance and power systems engineering www.e2-india.com

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