Jharkhand’s Clean Energy Transition — Challenges and Pathways
Jai Shekhar, Harshit Vallecha (Initiative for Sustainable Energy Policy)
The state of Jharkhand is rich in coal reserves, but is also gifted with natural resources like solar and biomass. Despite this wealth of energy sources, the state has not been able to achieve universal energy access, particularly in rural and remote areas. A significant limitation in providing reliable energy access in rural villages is Jharkhand’s inability to utilize renewable sources at par with its potential. The state’s leadership requires a clean energy pathway to utilize its renewable energy resources to meet the energy demand of domestic and industrial consumers.
Researchers at the Initiative for Sustainable Energy Policy (ISEP) interacted with multiple stakeholders working in Jharkhand’s energy space. Through various interviews, they concluded that the need for clean energy integration in the state is imperative. Moreover, they identified various challenges faced in implementing clean energy solutions to replace the state’s aging fleet of thermal power plants. After a detailed review of Jharkhand’s development policies, development initiatives and status reports, the research group created two practical implementation frameworks to constructively mitigate the transitional challenges faced by the state’s leadership.
Transitional challenges and necessary development interventions
Jharkhand’s problems within the energy sector lie in its history as a coal rich state. Impediments such as poorly integrated innovation policies and lack of coordination between multiple government activities have plagued the state’s clean energy transition. Not only are domestic industries in Jharkhand not utilizing the clean energy as per their potential, but they are also reluctant to adopt renewable energy based solutions due to intermittency of source, retrofitting challenges and lack of government incentives. The prioritization of coal-based power development has pushed back development within the renewable and decentralized energy space.
The government of Jharkhand should employ a comprehensive framework to attract investment and develop renewable energy infrastructure. The more prominent industries in the states should create pathways to consume higher values of renewable energy. The procurement of clean energy would also support the state’s distribution companies in fulfilling their renewable purchase obligations (RPO) compliances. Parallelly, the government should push local authorities to partner with grassroot-level organizations working in the state to drive development in the decentralized energy space. In this context, we recommend two frameworks that are tailored to act as working solutions for the state’s existing transitioning challenges.
Framework 1: Promoting Off-grid Energy in the State
It is evident that the national grid cannot reach every household due to multiple geographical constraints. Close interactions with grassroot-level development organizations suggest that rural communities were unable to access a reliable source of electricity primarily due to the large power outages through the underdeveloped central electricity grid. Since power is a fundamental development resource, integrating off-grid energy in the state’s rural and peri-urban regions could potentially support the development of underserved livelihoods.
An aggressive campaign to promote off-grid energy must be enabled in Jharkhand. This would involve improving coordination between Jharkhand Renewable Energy Development Agency (JREDA) and the state distribution companies (DISCOMs) to improve social understanding on off-grid energy solutions through strategic awareness drives. State-wide implementation techniques could also be coupled with a mechanism to link co-existing mini-grids to the national grid. State regulators and energy experts point that mini-grids can be a more efficient and quicker route to providing access to a sizable number of consumers but will require a robust policy framework. While this would lead to an increased off-grid capacity of the state, political hurdles and the lack of public awareness can be an implementational hurdle.
Financial support mechanisms and a plan to improve skill development in the state will have to be created. In a scenario where the government invests and installs a plant in a village, it is necessary that the plant meets the village’s power requirements and is self-sustainable. Integrating renewable energy in a financially feasible way can only be supported by locally trained individuals. These individuals would act as the on-ground workforce integrating technology into communities. Moreover, their presence at the time of installation would help build a trustworthy narrative with locals in the state.
A potential pathway towards expedited renewable energy generation would be to leverage the high solar potential of the state using rooftop solar. The state has over 1,300 registered MSMEs, 1,200 high schools, and many other public buildings that can be utilized to develop rooftop solar infrastructure. The project could be supported by the ongoing national mission of developing rooftop solar in partnership with the government of Jharkhand. Result-based financing models or end-user subsidies can be employed to enhance investor traction. These financing schemes have been highly successful in various developing nations of Africa, especially in the off-grid space.
Framework 2: Proposing renewable energy integration in heavy industries and innovation in the energy space
Despite higher energy consumption in most industrial units, renewable energy utilization is relatively low as per the estimated potential. Thermal power plants are one of the most polluting industries in Jharkhand. So, innovative strategies must be used to substitute coal/gas-based thermal power plants with clean energy through a long-term commitment and vision. In this regard, an integrated coal-solar hybrid thermal power plant could be a way to reduce dependency on fossil fuel vis-à-vis renewables. Under this technology, solar and coal are used to generate separate but parallel steam paths to drive a common turbine for generating electricity. The concept of hybrid thermal plants could be fine-tuned at the time of design and planning. Experts suggest that a new hybrid thermal plant could achieve a solar utilization share as high as 40 per cent.
The development could involve securing large financials from the government, which may take additional time given the historical track record of most public entities. To mitigate this, state officials could encourage public-private partnership within the renewable energy sector. This would help reduce the fiscal and logistic burden on the state. While a sizable fiscal package may benefit development, R&D (research & development) in state-specific DRE technologies that are tailored to meet the specific needs of people in Jharkhand can help last-stage implementation.
To enhance project financing, stronger public-private partnerships need to be encouraged by JREDA and the state government. Such partnerships should initially favour private organizations to increase the potential of the renewable energy (RE) market in Jharkhand. Moreover, this would increase off-grid financing within the state, leading to improved livelihoods and increased job opportunities for underserved communities in rural regions of the state.
The development could be aided by introducing policy interventions limiting the use of coal-based power in the state. Multiple RE rich states in India, such as Maharashtra and Madhya Pradesh, have introduced a technical minimum for thermal plants within the state. The intervention limits coal-based power plants in the state to account for just 65 percent of daily power demand, thereby allowing renewable power to be utilized more effectively. While this helps fulfil RPO obligations and reduces the probability of curtailment, it also improves cash flow into the RE sector, allowing investors to realize the potential of the market.
Way Forward
Mandating streamlined frameworks at the state level to attract private investors is critical for bringing in enough financial investment. The frameworks must ensure that the government, consumers and independent power providers mutually benefit from investments in clean technology. That said, integrating clean energy in the state will prove to be an economical energy source in the long term and act as a national asset in the nation’s drive to reduce carbon emissions drastically.
