Solar Agricultural Feeders in Maharashtra

Agriculture is the main source of livelihood in rural India, contributing to food security. Two-thirds of the total irrigated area in India uses groundwater pumping, powered by more than 2 crore electric and 75 lakh diesel pumps. Thus, agriculture is a major consumer of electricity, accounting for nearly one-fifth of the total consumption in the country. In many states, this is much higher at one fourth or one-third of the state’s total consumption. Access to groundwater depends on reliable and affordable electricity supply. This is an important issue as it concerns livelihoods of the rural poor and food security of the country. Since the 1970s, agriculture in many states has been receiving electricity at either low tariffs or for free. Much of this supply is un-metered. Subsidized supply has played a key role in the growth of groundwater irrigation and agriculture production. Due to the lower tariff and poor revenue collection, agricultural sales are often seen as a major reason for the financial losses of distribution companies (discoms). Part of this loss is then recovered through higher tariffs for other consumers such as industry and commercial (called cross-subsidy), and the remaining through direct subsidy from the state governments. Because it is seen as a loss-making sector, agriculture often gets poor quality supply leading to problems such as frequent pump burnouts and power failures. Restoring supply takes a lot of time and so does getting new connections. Further, the supply is unreliable and often available during late nights. All these factors make farmers distrustful of discoms and both of them are caught in a low level equilibrium. Electricity demand for agriculture is expected to double in the next 10 years and as the average cost of supply keeps increasing, the problem of agriculture subsidies will become worse. Unless new ideas are tried out, the quality of electricity supply to agriculture will worsen. Any solution must first provide reliable, adequate day-time electricity supply to farmers at reasonable tariff, leading to a gradual increase in the mutual trust between the discom and the farmer. This should also reduce the subsidy requirement for it to be truly scalable across the country. Further, the long standing and vexed nature of the agriculture–electricity issue means that solutions should also be flexible enough to incorporate the ground realities of the state in question. Three ongoing developments in the power sector allow for an exciting possibility. One, low-cost electricity from solar photovoltaics, at Rs 2.75– Rs 3 per unit and at a fixed price contract for 25 years due to absence of any fuels is already a reality. Second, states have to exponentially increase their solar procurement to fulfill the national mandate of increasing the use of solar power through the instrument of solar purchase obligations. Both these developments mean a cost-effective increase in the share of renewables, thereby enhancing energy security and contributing to climate mitigation. Finally, the electricity grid has reached every village in India and agriculture feeder separation, where lines carrying electricity to pumps and villages are physically separated, has progressed significantly, with nearly two-thirds of the target completed. Budgetary support for complete feeder separation is already earmarked under the Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) scheme of the Government of India (GoI).

Innovative Scheme

An innovative programme taking advantage of these developments has started in Maharashtra under the aegis of the ‘Chief Minister’s solar agriculture feeder programme’. A solar agriculture feeder is essentially a 1–10 MW community-scale solar PV power plant, which is interconnected to the 33/11 kV sub-station.

A 1-MW solar plant can support around 350, 5 hp pumps and requires around 5 acres of land to set up. The plant can be set up in few months and there is no change at the farmer’s end. Pumps need not be changed and farmers do not have to take responsibility of installation and operation. All the pumps connected to the separated agriculture feeder will be given reliable day-time electricity for 8–10 hours between 8 a.m. and 6 p.m. When solar generation is low, maybe due to cloud cover, balance electricity can be drawn from the electricity grid. Alternatively, when pumping demand is low, maybe during rains, excess solar electricity will flow back to the grid. This allows for optimal sizing of the power plants. Project developers are selected through a competitive-bidding process and the entire electricity would be bought by the discom through a 25-year contract. The discom would continue to distribute the electricity to farmers on concerned feeders. The policy has notified that Maharashtra Electricity Distribution Company Ltd (MSEDCL) and Maharashtra State Power Generating Company (MahaGenco), both would be the implementing agencies. To ease project development, state government land near substations can be made available on lease at nominal rate. Lease of private land is also possible under the policy. Finally, groups of farmers can also develop projects through bidding process and sign PPA with MSEDCL.

The major advantages of this approach are that apart from ensuring day-time reliable power for the farmers, it requires no capital subsidy from the government. Rather, it is cost-effective in comparison to the existing supply from the centralized grid, thereby enabling reduction in subsidy. Additionally, no new large transmission lines are needed, which has become a bottleneck for various large-scale wind and solar power tenders. Further, since load being served will primarily be only during generation hours (day-time) coupled with the value of geographic diversity unlike large centralized solar parks, this minimizes the grid integration costs of such a form of distributed solar development. Deployment is possible under the existing regulatory framework, and the generation also qualifies for Solar RPO of the participating discom.

Finally, this approach will also provide jobs to local youth in construction, operation, and maintenance of the plant. More significantly, these jobs will be geographically distributed across the state. After demonstrating the benefits of this approach, future programmes could link deployment of such solar feeders to reduce unauthorized use/connections, improve metering and tariff recovery, energy efficient pumps, water saving approaches, etc. Currently, solar plants with overall capacity of around 2,500–3,000 MW are under various stages of tendering and implementation under this scheme in Maharashtra. This is equivalent to supplying solar power to 8–10 lakh pumps, or 20%–25% of the pumps in Maharashtra. As of December 2018, nearly 10,000 farmers are already getting reliable daytime power under this scheme and the discom is planning to scale this significantly beyond initial target of 7.5 lakh in next three to five years.

Article courtesy- Mr Ashwin Gambhir and Mr Shantanu Dixit, Prayas (Energy Group).