Saubhagya Scheme- Understanding ground realities and the way forward

Saubhagya Scheme- Understanding ground realities and the way forward


India is chasing the dream of 100 % rural household electrification to be achieved before April 2019. The efforts taken are humongous, especially after the roll-out of Pradhan Mantri Sahaj Bijli Har Ghar Yojana – popularized as the Saubhagya Scheme. The scheme was rolled out in September 2017, with an aim to electrify 3 crore households by March 2019. The total outlay of this scheme is around 16000 crores of which 14000 crores is allocated for rural household electrification. The earlier released Deen Dayal Upadhaya Gram Jyoti Yojana for electrification using microgrids came to a conclusion in April 2018.

Previous to Saubhagya, electrification was done and accounted at the village level. The major drawback was that even when only 10% of the village was electrified, the village was listed as electrified. This resulted in a large population remaining unelectrified especially in Bihar, Odisha, Uttar Pradesh, and Jharkhand. So, the Saubhagya scheme was rolled out to achieve household level electrification. However, the scheme is often critiqued by many as a number game especially as elections are around the corner.  However, this article is not a debate over the credibility of the numbers but is just sharing some stories and accounts around the installation of solar PV stand-alone systems implemented at over 500,000 households in 2018.

 Stand-alone Household Solar PV systems – the ground story

The Saubhagya Scheme is focussed at providing electricity supply to rural households and unelectrified urban households- through grid expansion, microgrids, and home lanterns and standalone home systems. Of the 30 million households to be electrified under the scheme less than 1 million were under the solar home lighting systems and the rest eligible households are to b electrified through grid expansion and interestingly in 2018 most of them have been tendered with Li-ion batteries.

There were instances when 9000 of the 10,000 supplied solar home lighting systems have failed in a particular village within a week of operation. Interestingly one of the villages was already electrified by a private microgrid player but still, it was re-electrified under the scheme. In another state, hundreds of these systems caught fire and started overheating within months of installation. Not all the State Nodal Agencies are perturbed by the early failures, as the tender documents have asked for five years’ replacement warranty for all standalone systems installed under the scheme. But the effective implementation of this requirement is a challenge at this scale, which could have been avoided with the effective specification of the batteries. The households are seldom aware of whom to contact in case of a failed lamp and doubtful of bearing the expenses for replacement/repair

The introduction of a new battery technology without much focus on performance parameters in the tendering document has allowed many not so recognized battery companies to participate in the bids and not surprisingly, these companies have submitted the lowest quotes. Lastly as noted by many tender participants and tendering authority, 40,000 INR was estimated the cost for a complete home lighting system with 200 W solar panel and 1 kWh of Li-ion battery with few accessories like a bulb and mobile chargers. However, many of the L1 participants quote over 20% less than this estimated price. Industry participants believe that such price is only possible if Li-ion packs of 1 kWh can be sold less than $230 per kWh, which was practically not possible as the market was buying such packs at a price of $280-300 per kWh.

The industry believes that some of the bad or used cells were also passed on through this scheme and in some cases, the battery packs were bought back from the villagers and sold in the urban markets. State Nodal Agencies have taken strict action against many such defaulters, however, such cases could be avoided in the future with higher technology and participation criteria in the tender documents. India Energy Storage Alliance mentions that over 600 MWh of Li-ion battery was sold through this scheme in just one year with pack size ranging from 20 Ah, 40 Ah to 100 Ah at 12.8 V and the alliance feels that it can contribute in better selection for upcoming schemes like solar pumps and induction cooking.

Can microgrids return after Saubhagaya?

Extending the existing grid to the nearest unelectrified village is the major electrification process under Saubhagya. 98% of the CAPEX allocation under the Saubhagya scheme is for this last mile connectivity. While this is a costlier option, for many remote cases, than the distribution of solar lanterns or the construction of microgrids, the government insists on this method as the problems arising from the operational failures of solar lamps or microgrids haven been stated as a key concern.

Under CES MICRO (Microgrid Initiative of Rural and Campus Opportunities), over 35 microgrids with different battery technologies were monitored at different phases of their life. The first analysis capacity of the battery (in terms of percentage) was recorded against the age of battery banks at these sites. As shown in the following figure, most of the batteries monitored under were operating below 80% of the rated capacity just after six months of installation. While during modeling capacity of over 80% is expected for at least 5 years of the life of the battery. Such degradation at off-grid solar plants has led to a general consensus that these systems do not work.