February 1, 2023

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Tata Power bets on microgrids for rural power supply in India

2 min read

Manoj Gupta has spent the past two years bouncing along the dusty roads of rural India, looking at solar panels.

The veteran of 107-year-old Tata Power, one of India’s oldest and biggest electricity distributors, is tasked with perfecting a type of solar power installation called a microgrid. Although microgrids are typically used in philanthropic projects, as chief executive of the newly created Tata Power Microgrid (TPMG) subsidiary, Gupta’s mandate is to create a commercial enterprise.

“Many would feel that this could only be a corporate social responsibility project,” Gupta said. He added that his boss, Tata Power managing director Praveer Sinha, had “stuck his neck out”.

As India hurries to meet ambitious energy transition targets, including generating 500GW of renewable energy by 2030, business empires Adani Group and Reliance Industries are investing billions in huge renewables projects — from factories to make green hydrogen to enormous solar power farms.

There is a long way to go. India relies on coal for 70 per cent of its power generation, and disruption to coal supplies caused blackouts in parts of India during a recent heatwave, underscoring the need for renewable energy to augment India’s electricity supply.

Tata Power also has industrial-scale solar projects, but its bet on microgrids sets it apart from rivals. It plans to scale up from 200 to 10,000 microgrids. Gupta said the two microgrids seen by the FT cost Rs5mn ($65,000) to build, but Tata Power said costs were subject to change and declined to give specific figures on total investment.

Abhishek Jain, a fellow at New Delhi-based Council on Energy, Environment and Water (CEEW) said Tata was “certainly at a much larger scale” than previous initiatives and breaking new ground by focusing “more on the productive applications in rural areas” rather than households. Nonetheless, “this is not going to be the most lucrative investment you can make”.

“The intention is…

2022-06-03 18:00:45

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