UNCTAD Expert Meeting: Green and Renewable Technologies...

9.02.2010 UNCTAD_GENEVA_HariSharan 1

D.E.S.I Power™

Poverty, Energy and Climate Change:Employment and Power Partnership Program

Hari Sharanhari.sharan@desipower.com

UNCTAD Expert Meeting: Green and Renewable Technologies

as Energy Solutions for Rural Development

D.E.S.I Power™

Why are new energy and power solutions imperative in the

Industrialised as well as the Third World ?

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Global ReasonsDwindling Reserves of Fossil Fuels.

Severe External Impacts of Fossil Fuel Combustion.Unaffordable Life Styles and Wasteful Consumption.

High Risk of Climate Change. Third World Reasons

The current energy and power policies have not worked for billions in the

Third World.Conventional Rural Electrification, linked to

the Centralised Power Sector Is a failure in the rural areas in the Third World

D.E.S.I Power™

Even today300-400 million people in India

and 1.6 billion people world widehave no access to

any form of modern commercial energy.

HUGE D I S P A R I T I E Sin

Energy ConsumptionIncome

Carbon-Emissions

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DISPARITIES in ENERGY CONSUMPTIONPer Capita Electricity Consumption kWh / year (2003)

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DISPARITIES in ENERGY CONSUMPTION in INDIA

Per capita consumption of electricity in 2004

- 500 1,000 1,500 2,000 2,500

Nagaland

Manipur

Karnataka

Orissa

Punjab

All India average consumption

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DISPARITIES in INCOME in INDIA

Estimated Income Distribution

Total Population: 1166 Mio.

24 2025

11.7 104.9 116.6 349.8 466.4 116.6 Population Mio

Income Distribution 2008

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DISPARITIES in C-EMISSIONSTotal Historical Emissions to 2000.

Russia

China UK

S. Afri

Brazil

Indonesia

Countries

Total Historical Emissions to 2000

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Total C-Emissions to 2050 with a Convergence Target of 1.5 t-CO2/ cap

Total Historical and Future Emissions

to 2050 for C-Convergence

100000

120000

140000

Russia

China UK

S. Afri

Brazil

Indonesia

Countries

Total Historical and Future Emissions to 2050 under Convergence Regime

D.E.S.I Power™

Centralised Rural Electrificationhas Failed Third World Villages

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A New Energy Paradigm Needed for the Third World:Centralised and Decentralised Sectors should have their own framework to function as equal partners.

The centralised power sector should serve primarily the industrial, infrastructure and urban sectors.

The decentralised power sector, primarily based on renewable sources, should serve the rural and peri-

urban areas.

An level playing field should be provided for the decentralised power sector.

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A Systemic Approach is Needed to Make A New Energy Paradigm

Succeed

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Breaking the viciousvicious cycle of rural poverty with electricity as the driving force for sustainable rural livelihoods

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ENERGY

•Biomass: residues / generation•Bio‐fuels: food vs. fuel•Land use: food, shelter, energy •Energy services:water pumping / rechargingcooking/lighting/drinking water

•Saving GHG emissions

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An Example:DESI Power’s 100 Village

Employment and Power Programin Araria District, Bihar.

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1. 100 Village Program registered under CDM forcarbon trading.

2. Wins WB Development Market Place Award.3. 3 plants financed and functioning in new

villages.4. Loads still inadequate for profitability.5. Biomass supply & management being

stabilised.6. Management Training Centre DESI_MANTRA

set up and functioning.

Phase 1/100 Village EmPower Partnership Program

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Ipomea Field in Orchha

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Growing Ipomea and Daincha in Baharbari

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Growing Daincha in Other Villages

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An Example of Energy Service Business under the EmPower Partnership Model

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Phase 2/100 Village ProgramCOURSE CORRECTION BASED ON PHASE 1 EXPERIENCE

1. 10 to 20 villages depending on funds.2. Business plans finalised for micro-enterprises,

new business units and energy / water services.

3. Biomass growing, supply and processing now a Business Unit.

4. Diversifying engine supply and support services underway.

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Phase 2/100 Village Program (continued)

5. Won Tech Museum - Accenture Technology Innovation Award ($50’000).

6. Agreement with SBI for direct bank loans to villagers for micro enterprises and businesses.

7. Raising investment finance: several alternatives packages under discussion.

8. Village data collection and project planning underway.

Implementation Plans for Phase 2 Ready

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- 4 8 12Operational Years

Plant Load Factor (%)

BASIS for ACHIEVING PROFITABILTY

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1.Dividendcanstarttobepaidafterthe4thyear. 2. Equityinvestorscanexitaftera minimuperiod of 6 years with an agreed p3.Thetotalcumulativeamountofdividend+retainedearningsover10 yearscan bebetween 180 - 220% % of the equ

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Forms of Investment1. Local Commitment Investment: Villagers and local

entrepreneurs to ensure local participation and commitment.

2. Carbon Footprint Investment in exchange for CERs to compensate for Investor’s GHG emissions.

3. Socially Responsible Investment: Long term equity or loan with a fair return on financial, social and ecological parameters.

4. Up-Front Carbon Investment: Paying for a part of the anticipated CERs as an advance to built the project.

5. Commercial loans with or without social and ecological bonus.

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169000

Bank Loan Lacs

External Equity Lcs CERs: Estimated generation over 12 yearstCO2

Income from CERs % Equity

Investment in Power Plants and BiomassProcessing. Lacs

Income from CERs, Lacs

Investment in Capacity Building, Training andRunning Cluster Centres for 12 years, Lacs

Investment in Business Units, Lacs

Total Investment Lacs

Subsidy.Lacs

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SUMMARISE

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Innovations Make The EmPower Partnership Program Successful

1. Making Complex RETs reliable for villages and manageable by local staff.

2. Integrating electricity supply and creating local demand: both profitable.

3. Creating non-agricltural jobs in micro-enterprises, businesses, and energy and water services.

4. Building partnerships with villagers: organisations, infrastructure, capacity building and training, with focus on women (DESI MANTRA).

5. Cluster Centres: continuing extension services and performance audit.

6. New financing mechanisms: integrating carbon credits and making non-government village projects bankable.

D.E.S.I Power™

Thank you

UNCTAD Expert Meeting: Green and Renewable Technologies...

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