Opportunities in India for Finnish energy companies

Opportunities in India for Finnish energy companies

Sep 26, 2016
Renewables & smart grid
Energy production & distribution

There is plenty of untapped potential in the Indian electricity sector. The relevance of micro grids and Low Voltage Direct Current (LVDC) for the country has been stated by government officials as well as from the representatives of the energy industry, creating a promising business opportunity for Finnish companies.
India is pursuing one of the world's largest grid connected renewable energy programs. Integration of renewable resources requires smarter systems. Same fundamental applies to managing a rapidly growing capacity, which has more or less doubled during the last 10 years.

The utility electricity sector in India has a current capacity of 248.5 gigawatts (GW), making it the 4th largest in the world. Yet, the per capita consumption of electricity is one-fourth of the world average. In India, 79 million households are not electrified. Furthermore, millions of people face daily power cuts of several hours. Continued high rate of electricity growth is needed to support local economic growth and employment.

Ambitious initiative

For India, the goal is an electrification of all households, with power available for at least 8 hours per day, by 2017. India also aims to implement 8 smart grid pilot projects with an investment of USD 10 million.

Furthermore, The Power Grid Corporation of India Ltd has planned to invest USD 26 billion in energy storage technology during the next 5 years. In addition, the country strives to install 130 million smart meters by 2021.

In renewables, Ministry of New and Renewable Energy has a goal to add a capacity of 30 GW within the 12th Five Year Plan (2012-17). In medium to long-term, India's renewable energy goals are even more ambitious with an intention to have a capacity of 100 GW from solar power, 60 GW from wind, 10 GW from biomass and 5 GW from small hydro power by 2022.

Several value levers

For Finnish Companies, the business case in Indian smart grids is present in various sectors. The field splits to multiple fractions which all offer opportunities.

Firstly, accurate and timely meter reading enables an intervention for loss reduction. Secondly, rooftop solar power speeds up a shift to green energy and produces consumer cost savings in the long run. Thirdly, time-based pricing (TOU Tariff) helps the pricing system to be more dynamic. Fourthly, the Indian electric vehicle (EV) rollout requires a functional charging infrastructure – and its management. Fifthly, the Distribution Companies (DISCOMs) provide the anchor infrastructure for smart cities creating a need for value added services and new business models to self-finance these investments. Furthermore, a similar need for value added services is recognized with the large electricity consumers.

In addition, smart grid utilities require a variety of digital technologies such as analytics, mobility solutions and customer touchpoints.

Furthermore, distributed generation based on hybrid sources could provide a sustainable and cost effective power supply to the un-electrified Indian villages.

Option of negotiating smart grid projects with the campus owners (educational, Special Economic Zones, industrial parks, etc.) is a viable market entry option for smaller companies and company consortiums. Moreover, several large Public-Private Partnership smart grid projects present a true mega opportunity for the companies that already operate in the Indian market.

More information

Jussi Vanhanen, Program Director, Cleantech Finland, Finpro

Ching-Yi Wang, Program Coordinator, Cleantech Finland, Finpro

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