A paradigm shift

Agricultural policies remain an important determinant of the direction in which the Indian economy will go. India is one of the world's largest users of groundwater for irrigation. An enormous amount of electricity is required to pump out water to irrigate the fields which produce the food grains, fruits, and vegetables we all consume.

Agricultural subsidies are a significant part of the total subsidy matrix within which the electricity (groundwater irrigation) subsidy is the most important. Subsidies for electricity use in the agricultural sector in India were about Rs 1,10,391 crores in FY 2019 as per the Ministry of Power. The situation is more or less the same in most states. For instance, the International Institute for Sustainable Development (IISD) estimates that electricity subsidies account for approximately 46 per cent of total agriculture subsidies in Haryana. Consequently, State finances are under strain. In such a scenario, the use of solar power in the agriculture sector can help ease both demand and supply pressures. India has nearly 30 million agricultural pumps installed, out of which almost 10 million are diesel-based as DISCOMs are not able to energize all agriculture pumps. What if solar energy could power these pumps? The farmers would save expenditure on the diesel agri-pumps and get almost free solar power. This also becomes one more step towards the aim of doubling farm incomes, a goal frequently reiterated by the government.

In July 2018, the Government of Haryana had sought technical assistance and guidance from World Bank to operationalize its vision. A World Bank team reviewed the past experiences of grid-connected solar pumps and analysed the available secondary data. As per the said report, Haryana has more than 605,000 agricultural tube well connections, with another 40,000 farmers waiting to get grid connection, which has further increased to nearly 84,537 connections till December 31, 2018. In addition, there are about 3,50,000 diesel pumps. The 6,05,000 electric pump sets consume an estimated 857.1 crore kWh (units) of electricity i.e. average of 14,160 kWh per pump per annum. Further, the electricity supply to farmers is highly subsidized and, on average, farmers pay only Rs 0.11/kWh against a cost of supply of Rs 7.34/kWh.

Why do I say solar power is almost free? Have a look at the economics created by the innovative Component B of the Prime Minister's Kisan Urja Suraksha Evam Utthan Mahaabhiyan, or the PM-KUSUM scheme under the Ministry of New and Renewable Energy. The cost of a typical agri-pump of 7.5 hp capacity is about Rs 3.4 lacs (in 2020-21), of which Govt. of India subsidises 30 per cent. In Haryana, the state government bears another 45 per cent while the farmer pays 25 per cent of the total cost. The average annual subsidy on one agri-pump in Haryana is about Rs one lakh and therefore, the entire cost of the pump will be recovered in four years accounting for interest and other costs etc.

After these four years, the state government need not spend any money on electricity subsidy and the farmer need not spend any money on fuel. The solar pump and the solar panel are designed to last for 25 years. Coupled with the added benefit of replacing old inefficient pumps with energy-efficient pumps (which use much less energy for the same water discharge), this scheme is a game-changer, indeed.

Component-B of PM-KUSUM aims to install 20 lakh stand-alone solar agriculture pumps in India. The target for Haryana is 50,000 pumps. Haryana is one of the pioneer states in the adoption of the PM-KUSUM scheme. It installed 15,000 agricultural pumps in 2020-21 (the highest for any state in India) with a capacity of 105 MW and plans to install 22,000 more in FY 2021-22. As per a study by the New and Renewable Energy Department of Haryana, these 15,000 pumps will generate 94.5 million units of electricity every year and save Rs 69.17 crores of agricultural subsidy from the exchequer every year for the next 25 years. The icing on the cake is the prevention of the release of 75,600 tonnes of carbon dioxide in the atmosphere.

This is an important step towards meeting our Intended Nationally Determined Contribution (INDC), under which India has committed to increasing the share of installed capacity of electric power from non-fossil-fuel sources to 40 per cent by 2030. This was one of the commitments which India made at the Paris Climate Convention in 2015. Its goal is to limit global warming to well below two, preferably to 1.5 degrees Celsius, compared to pre-industrial levels.

The farmers are happy as they get power in the daytime obviating the need to go to the fields in the night to water the plants; they get eight to 10 hours of free, clean power every day, and save on the expenses on polluting diesel pumps. They can look at a mobile app and know how many hours the pump worked, how much water was discharged, and even how much carbon they saved going into the air.

The above scenario is a paradigm shift being created in agriculture by Component B of the PM-KUSUM scheme which is planned for off-grid agri-pumps, i.e. those which are not connected to the electricity grid. Component A of the scheme offers an advantage of another kind to those who would like to install solar power plants on their barren agricultural land. Under this component, solar or other renewable energy-based power plants (REPP) of capacity 500 kW to 2 MW will be set up by individual farmers, cooperatives, panchayats, or Farmer Producer Organisations (FPOs). The PM-KUSUM scheme will give them a 30 per cent subsidy and the state DISCOMs will purchase the power so generated. The target of setting up 10,000 MW of decentralized ground or stilt mounted grid-connected solar or other RE based power plants for India is an ambitious but achievable target.

Under the third component C, farmers can have their entire solar feeders energized by solar power. They can use the amount they need and can sell the balance power to the DISCOMs. Solarisation of 15 lakh grid-connected agriculture pumps throughout India as proposed can change the landscape of the agricultural power situation in India. All three components of the scheme aim to add a solar capacity of 30,800 MW by 2022 with the total Central Financial Support of Rs. 34,035 crores.

While large scale solar power generation projects are being installed in India to achieve the ambitious target of 100 GW of solar power generation by 2022, PM-KUSUM aims to simultaneously develop decentralized solar energy. Incidentally, one of the chief advantages of solar energy is in decentralized use such as in agriculture, as it obviates the need for heavy and costly switchgear and transmission equipment.

The solarisation of India's agriculture has picked up the pace at a crucial phase in India's growth story when electricity consumption is set to rise given the expectations of broad-based growth of the Indian economy. The technology focus and the economics of this programme suggest that it may be a turning point on multiple fronts of increasing farmers income, generating clean energy, reducing subsidies and meeting climate change goals. The challenge, however, is to bring the stakeholders together so that they can take this idea to the remotest corners of the immense expanse of the agricultural fields of India.

The writer is Secretary, Department of New and Renewable Energy, Govt of Haryana. Views expressed are personal