Smart Power India Creates New Opportunities for Rural Communities
April 15, 2015 was a landmark day for The Rockefeller Foundation. We launched Smart Power for Rural Development, an initiative that aims to bring electricity to 1,000 villages and 1 million Indians over the coming three years, in the states of Bihar and Uttar Pradesh. To achieve this ambitious goal, the Foundation will invest $75 million and incubate a new Indian-based, and Indian led organization, Smart Power India, that will play a key intermediating role among partners—including government, the private sector, community organizations, and energy service companies—creating a new and holistic ecosystem that drives mini-grid installations in rural villages.
This is the first time globally that The Rockefeller Foundation is moving into the rural electrification space, with the main and unique objective of spurring economic development by providing access to renewable and reliable electricity in rural areas, both for domestic and productive uses. The Foundation is deliberate in its focus on economic development and productive use, and most specifically views this work as an opportunity to capture and build upon the ingenuity and entrepreneurship that already exists within rural villages—ultimately building more inclusive economies within India. This initiative aligns closely with the Indian government’s vision of providing reliable power throughout the country, and of promoting higher levels of rural economic growth.
The launch was widely covered by the Indian media and was attended by important stakeholders including, Shri Piyush Goyal, minister of state for power, coal and new & renewable energy, other senior officials from national and state governments, heads of telecom infrastructure companies, energy service companies, research organizations, think tanks, and academia.
In an extempore and captivating speech, Shri Piyush Goyal expressed the need for an organization like Smart Power India, given that large parts of the country are still not sufficiently covered by the electricity grid. He expressed confidence that this initiative will have a powerful effect on the lives of rural communities and offered complete support by his Ministry to align with the roll out of this ambitious initiative.
Smart Power India will partner with energy service companies (ESCOs), telecom companies, technology firms, investors, NGOs, and the Indian government to help build the necessary ecosystem for successful, sustainable, and scalable mini-grids. The organization will have four distinct functions:
- Project development support;Business development;
- Business development;
- Load development and community engagement; and Policy and regulatory engagement.
- Policy and regulatory engagement.
The model is an innovative way to deliver clean energy by introducing anchor loads such as telecommunications towers that create base demand for purchasing power from the mini-grids. The financial incentives drive an energy service company operator to build large enough power plants that cater across household, micro-enterprise, and productive loads. Not only do the mini-grids provide market opportunities to investors, they also have the potential to integrate into the grid with the right policy support from government. We believe Smart Power India is the unique value proposition of this initiative—and know from the past two years of experience working on the ground in India that the only way to create a scalable and sustainable solution is to bring together all the key partners that may not have traditionally worked together before.
The statistics around change to people’s lives and communities when they gain access to energy are remarkable. Evidence shows that communities that get electrified have significant gains in terms of access to education, expanded opportunities for trade and enterprise, access to key information services, and improved healthcare services. Indeed, the provision of electricity can lead to roughly a 40 percent increase in household per capita income, all while improving public safety, education and health outcomes. But the Foundation wants even more than remarkable. We want transformative. This is why we are committed to building a model that is sustainable and scalable throughout India—because if done on a large scale, there is the potential to open up significant new opportunities for economic development, ultimately paving the way for a more inclusive economy.
We believe that the launch of Smart Power India is just the beginning for an initiative that will catalyze opportunities for millions of people—not just in India, but around the world.[ssba]