Roundtable on
Renewable Energy 
for Sustainable Development:
Opportunities, Barriers & Solutions
August 17, 2001
India Habitat Centre, New Delhi

Development Alternatives organised a one day Roundtable on "Renewable Energy for Sustainable Development: Opportunities, Barriers & Solutions", on August 17, 2001 at the India Habitat Centre, New Delhi, as a part of the GEP-CCS project of the USAID, being implemented by The Louis Berger Group Inc. Development Alternatives is a major partner in this programme. The objective of the Roundtable was to identify opportunities, barriers and solutions for large-scale renewable energy development, keeping in view the environmental and social benefits of the renewable energy. The deliberations during the roundtable looked at technical, financing, policy barriers effecting the growth of this sector and possible solutions to these. The recommendations when implemented will help all the major stakeholders such as the Government of India, project developers, financial institutions, technology providers, NGOs and communities and will contribute in sustainable development of the country.

Inaugural Session:

In his welcome address Dr. Ashok Khosla, President, Development Alternatives emphasized that this roundtable should not be like another business as usual meetings on renewable energy issues. He mentioned that it would be useful to discuss ‘what should be done’ by Government, NGOs,

Project Developers & other stakeholders to accelerate the promotion of renewable energy in India by removing barriers and finding cost effective solutions to the issues. He briefed about the framework of the Roundtable and said that the meeting would be successful if at the end of the day the participants have identified a definite plan of action and have worked towards its follow-up.

Mr. Ron Sissem, Chief of Party, The Louis Berger Group Inc. (LBG), in his welcome note stressed on the practitioners’ participation to make the event successful. He mentioned that in the GEP-CCS project, emphasis is on energy as the key sector for GHG emission mitigation. The project is aimed at delivering information and technical assistance to diversify stakeholders’ activity for mitigation of GHG emission.

Mr. Richard Edwards, Director Energy Environment and Enterprise, USAID in his welcome remarks stressed on the benefits of the renewable energy to fulfill the energy requirements of the rural masses, its contribution in enterprise development & livelihood creation in rural areas and its contribution in GHG emission reductions and sustainable development of the country. This would require a good business model. He also discussed the fundamental issue in Power Sector and maintained that renewables being decentralized systems help in rural development. He appreciated Development Alternatives’ effort in this sector and gave a brief outline of USAID future focus like promotion of mini/micro-hydel and biomass based power generation.

Dr. N. H. Ravindranath, IISC, Bangalore presented the keynote address on ‘Renewable Energy for Accelerated Rural Development’. He described the linkages between renewable energy technologies and rural development, rural energy needs and its features, current strategies for renewable energy. He also pointed out the limitations of current approach and institutional issues in promotion of renewable energy technologies. He further discussed a case study on a Bio-energy Project in Karnataka, funded by UNDP-GEF-ICEF-MNES-Govt. of Karnataka, and its contribution in promotion of renewable energy for total socio-economic development of the region.

Shri A. K. Mangotra, Jt. Secretary, MNES, in his inaugural address described the significant achievements in renewable energy sector in India. He emphasised on the efforts required to fulfill the gap between the planned renewable energy development (10% of the total grid energy) and current status (3% of the total grid energy). In India 80,000 villages are required to be electrified. He proposed that electrification in 18,000 villages that are not accessible should to be done through renewable energy. He appreciated Development Alternatives’ role in providing an enabling environment towards promotion of renewable energy in India for sustainable development. He emphasised the need of capacity building among different stakeholders in renewable energy sector and a level playing field. He also talked about the developments in COP 6- II towards CDM and its impacts on renewable energy development.

Technical Sessions I:
Identification of Opportunities & Barriers - Stakeholders’ Experiences

The objective of this session was to identify the opportunities and barriers facing the renewable energy sector. The session consisted of two activities – i) a series of presentations by the renewable practitioners and ii) a working group exercise to identify the opportunities and barriers. Dr. Khosla introduced the moderators Mr. S. Patara and Dr. Aditi Haldar, who ware to take care of the participatory process of identifying the issues and their solutions.

Dr. Ashok Khosla brought to the fore a few issues facing the renewable energy industry in order to set the stage for this session. He talked about the experience of DESI Power project towards commercialization of renewable energy. He stressed on commercial viability of the renewable energy technologies. According to him the energy policies should have commitment for renewable energy development e.g. state electricity boards should provide for third party purchase of power generated. He pointed out that nothing actually happened on ground till now despite government’s top priority in rural energy sector. He mentioned that various subsidies prevailing in energy sector at times result in decelerating renewable energy development.

Mr. K. Sudhakar, Director, M/s R R Bioenergy Ltd., presented the experience of his organization in developing Bio-mass Gassification project based on IGCC technology. The project has taken into consideration all possible issues like resource availability, socio-economic viability etc. He also described the greater social impact of the project in the area (West Godavari District of Andhra Pradesh). Despite all the positive factors in the project he is facing a number of constraints since there is no capacity available in the country to evaluate the innovations in the technology. The very innovative technology also poses lack of confidence among the investors. Issues like constant devaluation of rupees etc. also pose a challenge.

Mr. Subir Nathak, Managing Director, Market Dynamics Pvt. Ltd., shared his experience on mainstreaming renewable energy. The organisation is active in the Solar PV and Solar thermal sector and is facing considerable problems as this sector has not really come up with economically viable technologies compared to conventional energy and other renewable energy technologies. He referred to the targeted contribution of renewable energy in total energy generation. Some of the barriers that his project faced are lack of infrastructure and training, lack of awareness and old mind-set of people.

Mr. V. R. Vijaykumar, Director, Ravi Enteck Ltd, briefed about the activities of his organisation in renewable energy sector. He discussed about a 5.5 MW biomass gassification project based on PRME gasifier technology for which the company is looking for a potential investor. He talked about different opportunities lying in small, medium & large scale applications of bio-mass like: rice mill application, poultry litter application, steel, cotton and sugar mill applications. He expressed that a high potential of technology adoption is existing in this sector. The barriers faced by them are in the form of technical validation of the dual fuel engine system and gas cleaning system. Due to small size of the project, the cost is also on the higher side. He also stressed on stable policies by SEBs to encourage more & more private participation. Reduction of import duty on technology & equipment is another need of the hour to make renewable energy viable.

Mr. Ajay Narayanan, Vice President, Infrastructure Development and Finance Company gave a brief introduction of his organisation and its activities in the renewable energy field. He mentioned that India is one of the largest market for renewable energy applications viz. co-generation, solar, wind etc. He described briefly the role of IREDA / MNES in financing renewable energy projects. International activities like climate change mitigation offer further opportunities for renewable energy development in the form of funds like GEF and PCF. On a macro level technology, finance & policy pose major barriers. There is no co-ordination between the conventional rural electrification programmes and decentralised renewable energy development activities in an area. Not including the environmental & social costs while pricing leads to price distortions. The role of the government should be that of the facilitator than it being the implementor and should encourage more & more private participation. Lack of capacity in the rural areas and inaccessibility of fund to the small entrepreneurs is a major problem. To overcome these barriers, he suggested to emphasise on reliable technical assessment, proper R & D activities, financial intermediation by local banks, Government focus on regulation of service provisions, formation of state level project development agency etc.

A realistic picture of the barriers faced by project developers & financial institutions emerged from these presentations. In order to receive more inputs on opportunities and barriers the question was put forward to a larger audience through a participatory exercise. The participants were divided among various stakeholder groups like

• Project Developers
• Financial Institutions
• Govt. and Public Bodies
• Non-governmental Organizations &
• International Development Agencies

The groups presented the opportunities & barriers as faced by respective groups. Some of the opportunities as identified by the participants are:

• Availability of abundant natural resources
• Large demand in rural areas which are mostly not connected with the grid
• Sustainable economic development using local resources
• Appropriate technologies for socio-economic development of communities
• Growth in ancillary projects
• Employment generation
• Growing innovative and co-financing schemes
• Mechanisms like CDM, to provide advanced technologies and funds
• Recent globalisation of the economy to provide a favourable environment for market based promotion of RETs

A lot of opportunities exist for renewable energy development in the country but despite serious government efforts and inputs, renewable energy development could not be realised on a large-scale. The participants shared the barriers faced by their groups; these could be clubbed into technological, financial and policy-institutional and social categories. Some of the barriers are given below, the detailed list is available in Annexure.

• Lack of established technologies
• Low conversion efficiency leading to high costs
• Lack of maintenance, service qualities and reliability
• Lack of proper documentation of projects

• Lack of availability of sufficient funds
• Difficult access to government programmes and financing agencies
• Price distortions between conventional and renewable energy

• Inconsistent SEB policies
• Intervention of government on procurement of international funds
• Lack of evaluation mechanism of new technologies with regulatory authorities
• Lack of good privatisation policy
• Lack of commitment from government and developers
• Lack of robust infrastructure to sustain products, operation and maintenance
• Multiplicity of decision making agencies in Central, State and Local levels
• Attitude and mindset of people – no beneficiary participation in planning and designing

Technical Sessions II :
Recommendations for Promotion of Renewable Energy in India

During this session, the participants were divided into following working groups on a random basis :

WG I - Technology
WG II - Finance
WG III - Policy, Institutional & Social – I
WG IV - Policy, Institutional & Social – II

The working groups deliberated among themselves to find the solutions to the barriers that were identified in the technical session – I. The solutions identified by the working groups were presented to the plenary. Annexure contains the detailed list of solutions. The list being a very exhaustive one, it was thought appropriate to pick up the most important and the most urgent ones to develop an action plan for them. The participants expressed their opinion through a voting exercise on identifying the issues that should be dealt with immediately. Following issues emerged as ones requiring immediate attention:

1. A Comprehensive National Renewable Energy Policy
2. Availability of Data-base of Technologies with a Nodal Agency which is easily accessible
3. Full-cost Accounting including environmental & social costs

The participants discussed among themselves how these issues could be addressed. The actions required to address these issues and the agencies taking lead for these were identified. Following Table summarizes the discussion.

The Roundtable came to the end with the participants expressing their views about this meet and the closing remarks by Mr. Ron Sissem and Dr. Ashok Khosla. Ron has expressed his thanks to all the participants for their effort to make the Roundtable a success with special gratitude to Development Alternatives for structuring the whole programme in a realistic way.

Dr. Khosla, in his concluding remarks congratulated Development Alternatives’ team to make the round table successful and achieve the goal. He also expressed the need of a proactive contribution by the organisations & individuals who have committed to participate in different activities, within specific time frame, to realise promotion of renewable energy in India.