Oorja: Combating energy poverty and empowering rural communities

Following on from their seminar this term we asked Clementine and Philip, two PhD students here at Imperial College London, to write us a post on their work with Oorja. You can also download the slides from their talk [pdf] from the Energy Futures Lab website.

Oorja’s biomass and solar-powered smart mini-grids aim to provide reliable and affordable power to rural communities in India. The social enterprise was founded in 2015 by Clementine Chambon, now a final-year PhD student in the Chemical Engineering department at Imperial College, and Amit Saraogi, an Indian social entrepreneur. Prior to piloting in early 2017, Oorja has undertaken significant energy demand analysis together with Philip Sandwell, a PhD student in the Department of Physics whose research focuses on the techno-economics and CO2 mitigation potential of solar PV technologies for rural electrification.

Oorja, Empowering communities

Achieving universal energy access by 2030 and providing access to modern energy services to 1.3 billion people, while also securing sufficient levels of growth in energy consumption to enable economic development, is undoubtedly a challenging task. India alone has over 450 million people without access to reliable electricity, over 150 million of whom are concentrated in the state of Uttar Pradesh. As the vast majority of the energy-impoverished are bottom-of-the-pyramid (BoP) consumers living in rural areas, we must find a sustainable and low-carbon model for the production and distribution of energy to rural consumers. This opens a significant opportunity for decentralised energy solutions, such as mini-grids powered by renewable energy sources.

Oorja believes in a market-tailored distributed energy solution that directly engages the rural communities in producing their own clean energy.  This is not only a feasible path to universal energy access but also a model that fosters local economic development and has significant potential to mitigate carbon emissions.

Clementine Chambon working with the local community
Clementine Chambon working with the local community

The lack of accurate and easily accessible data regarding the energy use of rural consumers is a major hindrance towards understanding user needs, which in turn limits investment in rural electrification. Most rural electrification studies have revolved around technological issues, while the socio-cultural aspects of users’ needs have not received the attention they deserve. As a result, Oorja has teamed up with Imperial College researcher Philip Sandwell, a PhD student with expertise in techno-economics and energy demand analysis for rural electrification. Together they aim to understand the needs and behaviour of rural energy users in Uttar Pradesh, prior to selecting an optimized system to meet their energy needs through a micro-grid.

In this post, through an interview with the Philip Sandwell and Oorja’s co-founders, Amit Saraogi and Clementine Chambon, we will explain how Oorja plans to contribute to universal electrification.

What is Oorja doing to accelerate universal energy access?

Amit Saraogi in the field
Amit Saraogi in the field

We believe that access to energy is fundamental to human and economic development; Oorja’s mission is to use locally available crop waste and solar energy as resources to power rural communities. We are deploying hybrid biomass and solar-powered mini-grids that will provide reliable and affordable electricity for commercial use and household lighting. To make the proposition financially sustainable and scalable, Oorja’s commercial focus will be on powering local micro-enterprises and cottage industries, which have a higher requirement for reliable electricity that can constitute an ‘anchor load’ for the micro-grid systems. This enables us to cross-subsidize low-income households in nearby villages so that everyone can benefit from clean energy access.

We plan to pilot our operations in Uttar Pradesh, a densely populated state in northern India, but our model is easily replicable and can be adapted to any developing country that has the pre-conditions of rural energy poverty and available crop waste.

Why are micro-grids an ideal solution for rural electrification in India?

As over 85% of the energy-impoverished live in rural or remote areas, the traditional method of extending the national electricity grid for rural electrification is often not cost-effective. Mini-grid technologies are one of the supply technologies that can provide decentralised, distributed and democratized energy supply, with the capability to meet residential, commercial and community needs, from basic lighting to use of energy-intensive appliances for productive uses. Micro-grids can therefore play an instrumental role in poverty alleviation, balancing affordability and reliability, whilst also favouring local micro-enterprise development, creation of jobs and livelihood opportunities within communities.

The democratization of energy through local generation is especially important in rural settings in developing countries such as India. It ensures affordability and scalability, and it can also facilitate local micro-enterprise development, creating jobs and increasing the income of communities.

Can you elaborate on Oorja’s community-owned model?

Our model is to franchise the robust and easy-to-operate plants to local micro-entrepreneurs and women’s self-help groups, who will own and operate them and sell the end-products to local consumers. Oorja will build and maintain these power plants and assist the franchisees with repairs, safety inspection, training of staff that run the plant, access to finance and other business services. This will reduce the cost of operations, reduce payback periods for positive cash flows and allow us to scale up operations rapidly by replicating our solution across many districts and Indian states.

This community-owned business model relies on the existing networks and positions of trust of micro-franchisees within the community. They will establish the last-mile linkages and integrate participation of women along the entire value chain. Our goal is to leverage energy provision as a catalyst for socio-economic development to alleviate poverty, improve education and health, empower women and tackle climate change.

Clemetine and Amit

Tell us more about the technologies you will deploy.

We are deploying smart AC micro-grids powered by a hybrid combination of biomass gasification and solar PV to generate, store and transmit reliable and affordable electricity. Each plant, with a total capacity of 25-40 kWe, will provide electricity to 40-60 micro-enterprises and 80-120 households within a 3 km radius. We will also install solar-powered DC nano-grids (1-5 kWp capacity) to provide electricity to farmers for irrigation pumps, replacing diesel pumps which are expensive to operate.

We plan to pilot using commercial solar PV technologies and biomass gasifiers developed and tested in the rural Indian market for the last 20 years by our technical partner, DESI Power. In the long term, we aim to form R&D partnerships with UK and Indian institutions to optimise gasifiers and gas engine performance and efficiency for a scale of <50 kW and valorization of by-products of biochar and waste heat for various applications.

Clementine consulting with the local community
Clementine consulting with the local community

How does one go about sizing a micro-grid? Do you use quantitative or qualitative data?

As a company co-founded and run by a development practitioner and a bioenergy researcher, we understand well the importance of robust data for planning, execution and measurement of impact of our interventions. As part of our site selection process, we visited remote off-grid and under-electrified villages in Uttar Pradesh and Bihar and collected baseline and energy demand data to understand the demographics and standard of living of these communities and estimate the potential demand profile of low-income households, academic and health institutions, and small businesses. This is key to deciding the capacity of the plant to install, the energy price that households and businesses can afford, the payment methods preferred by them, and the community development projects that we can undertake.

Our most recent work, led by Phil Sandwell, uses data from over 50 household interviews to establish the basic and aspirational energy demand in low-income households in Uttar Pradesh. By enquiring about the appliances present in each home and the duration and time of day of their use, we can develop load profiles and use them to estimate total consumption for a typical village. The findings will be published shortly – watch this space!

In another project we are undertaking, we are installing smart meters that can meter power consumption in grid-connected small and medium enterprises, schools, dispensaries and households in Uttar Pradesh. These smart meters collect instantaneous data about the power consumption of an entire shop or households, which is then sent remotely by GPRS. The data collected by the smart meters can then be fed back into a computational model to calculate average demand of businesses, and compared with the data collected from interviews. We believe this work will enable us to have a clearer picture of demand diversity and help us in designing the most optimal, reliable and cost-effective decentralised energy systems.

What stage are you at now and what are your future plans?

We are currently preparing for pilot implementation. Over the last year, we have selected a site, ensured biomass availability, conducted energy access surveys and analysed demand, affordability, preferred payment methods and willingness to adopt our services. We have used the energy demand data to feed into techno-economic models to set electricity tariffs.

We already have buy-in from communities who would like to be electrified during our pilot in Bahraich District, Uttar Pradesh. We’ve also identified several micro-entrepreneurs who would be interested in purchasing Oorja plants, and have also met with the State Energy Minister who has extended financial support in the form of subsidies covering 30% of capital costs.

Right now, we are actively engaged in raising seed investment, stakeholder engagement and building a robust supply chain to bring our solution to market. In the next 6 months (July-Dec 2016) we will be working closely with our technical partners to deploy and commission a ~25 kW hybrid plant and recruit and train operational staff. We envisage that commissioning of the first plant will take place in early 2017.

Following completion of our pilot, we will have data from a specific site to validate our business model, optimise electricity tariffs, refine financial projections and ascertain the payback time and return on investment for micro-entrepreneurs to whom we will then start to sell/lease the next plants. This will allow us to scale up our operations and we anticipate receiving debt and equity investments to reach our goal of franchising 100 hybrid plants by 2022.

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