Thinking Bottom-Up in Energy Networks

A village in Budaun in the Indian state Uttar Pradesh (image courtesy: Rural Spark ©)
“A bottom-up approach link and group elements of a system, from which a larger and more complex system with multiple layers emerges”

India’s status of rural electrification

India lacks a good infrastructure of electricity: Most villages are yet not electrified. The current ‘Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY)’ program, which is actually a compound stack of existing policies, aims to achieve 100% electrification of villages by 2019. Gee, wow you must think, that is amazing! However, there is little hope this is going to happen on time. The RGGVY program is in itself a little bit of a hoax.

“A village would be declared as electrified, if the number of households electrified is at least 10% of the total number of households in the village.”

A closer look into the program shows that 100% electrification of villages only means that the national electricity grid should have reached 100% of the villages, not 100% of the village households. The factoring in of a good, and stable electricity supply has not even been brought up. No, according to the Ministry of Power of India, a village would be declared as electrified, if

  1. Basic infrastructure such as Distribution Transformer and Distribution lines are provided
  2. Electricity is provided to public places
  3. The number of households electrified should be at least 10% of the total number of households in the village.

So while this is another great marketing stunt of the government, it forbiddingly hints at electricity access to a bare minimum; and this access is neither to an uninterrupted supply, nor the right voltage quality, nor for an affordable price. A low voltage means that you cannot run most of your devices. A high voltage means that your appliances might get destroyed. The huge sunk costs associated with a nationwide grid expansion throughout India might substantially increase the unit prices, putting the ‘affordable price paradox’ in jeopardy.

The view from a dark barn into a so called ‘dark village’ in Uttar Pradesh. A dark village has no electricity connection at all. (image source: personal repository)

So, what did we just observe here? This is a typical way of implementing a system top-down. The government, which qualifies as top-down organization, (but let’s put that aside for now), starts with a large vision of electrification and decomposes it into elements to get the job done. From the previous paragraph it is doubtful whether the job will be done soon in a cost-effective way.

BOTTOM-UP vs TOP-DOWN

Bottom-up is the opposite of top-down, and both are means of understanding and approaching a system.

Understandably, a Top-down starts with the bigger picture and decomposes its vital elements into sub-components, thus arriving at a micro-detailed state.

On the other hand, a bottom-up approach starts by linking and grouping the very basic elements of a system, from which a larger and more complex system with multiple layers emerges. This approaches are used to tackle a range of problems in organizations specialising from product design to scientific thought to energy development.

However, both these approaches often can and do exist for a single problem. This then means that they work towards each other and reach an outcome that is more effective and efficient than the one derived from using any single one of them. We will see in the following example on rural electrification in India why.

BOTTOM-UP ENERGY NETWORKS

You might now be wondering what a bottom-up approach might look like. Currently, Rural Spark, a company in India led by Indian and Dutch people together, are creating an energy network from the bottom-up. Entrepreneurs at the bottom of the pyramid (BoP) are building the network themselves. Rural Spark merely designs and delivers the basic elements that the network needs.

The Bottom of the Pyramid: around 2 billion people are living on less than 2 dollar per day (image created by Yvo Hunink)

These elements are supplied in energy kits, which would be at the disposal of a local entrepreneur called the Local Energy Supplier (LES). The LES finds in this kit a solar panel, rechargeable lamp batteries, rechargeable battery packs (also called cubes) and a charger controller to connect the solar panel to the aforementioned elements. The LES is also able to charge mobile phones and use LED bulbs to light up his local energy store.

Installation of one of the elements (solar panels) by local agents and entrepreneurs (image courtesy: Rural Spark ©)

All these elements can be rented out to other villagers, especially to people with the lowest income of all and are at the very base of the BoP. Crucial are the local agents in the village, like the two enterprising women Rina and Rita in one of our areas of operations in Bihar. They assist the Local Energy Suppliers in terms of payment collection, servicing and installation of the elements i.e. products.

“Electricity becomes available and affordable without needing the central grid per se”

Thus, electricity becomes available and affordable without needing the central grid per se. The LES himself functions as the grid while earning an income, making the system more cost-effective. On top of that, the LES can share energy surpluses with his fellow LES’s who might have a temporary shortage.

This ends up making up the network more reliable in the process. Of course, it does not have to stop here. The LES can also provide energy storage, mobile phone charging, light, etcetera, but the aspirations of the villagers are larger. Next to access to energy, there is impact on several other areas as well: it stimulates local communities to become more social, it fosters economic and rural development and also has positive impacts in terms of CO2 reduction.

Once the demand and income of the villagers grows, the LES can easily expand his system because it is only built of elements i.e. there is high modularity. At some point he can also support fans and televisions as needed. The beauty of all this is that it does not even involve wires at this stage, just a simple exchange of energy elements.

Due to the work of Local Energy Suppliers, light becomes available in an affordable way and replaces expensive and unsafe kerosene lamps. Safe cooking at night is no longer an aspiration but a reality. (image courtesy: Rural Spark ©)

TOP-DOWN and BOTTOM-UP TOGETHER

Once rural India understands that they are very able to create such energy networks within a village themselves, the next opportunity is ready to spring up. Lets call the networks of LES’s within the village the first layer. The second layer will emerge by connecting the villages with each other, most probably via wires and modern technologies like blockchain as explained by Yvo Hunink and internet of things for example. Villages could form microclusters to exchange and/or supply energy to each other. Now the most interesting and third layer shall arise: the village clusters could be connected to the main grid, if all the villages are reached by the grid as promised under the RGGVY program. The following movie explains this briefly:

Bottom-up and Top-down together in Rural Spark’s Energy Model

Now it wouldn’t matter that only 10% of the households are electrified, since that has already been taken care of from the bottom up. Most importantly, a connection can be made with the main grid, allowing exchange of energy on a larger scale.

CONCLUSION

A sufficient definition of a miracle would be these clusters of villages, powered by renewable energy sources, also supplying urban areas and thereby eliminating CO2-intensive coal and natural gas from the supply/demand equation. The challenge still remains in that an optimal outcome is reached only when bottom-up and top-down approaches work together.

There are however success stories of Rural Spark in Bihar, that have already reached the first layer where other organizations are also creating impact at the ground level in rural India. But most of these systems are stand alone, and not (yet) meant to be connected in turn to a second and third layer. Rural Spark thinks the future energy network should be a plug-and-play (lego time) network, and anyone should be able to connect their solutions regardless of its technology.

This article has been published first on Rethinking Economics India (REIN), the India arm of Rethinking Economics, as part of the blog series ‘Developing India: from the Bottom-Up’, which can be retrieved here. Furthermore, I would like to express my gratitude to Ramyaa Bommareddy, Yvo Hunink, Divya Jindal and Supriya Krishnan for their valuable contributions and suggestions.