The heavy reliance on diesel has made the telecom segment a front-runner among diesel parity driven solar markets in India. Installation of solar on telecom towers is rapidly increasing. For an overview, download our latest India Solar Handbook [download here].

• Consumption of diesel in telecom towers is over 3 billion liters annually
• The Department of Telecom (DoT) has mandated the usage of renewable energy in 50% of the telecom towers in the rural areas and 20% in urban areas by 2015
• Solar installation on telecom towers has reached 30 MW with average project size of 5-6 kW

Telecom towers are second only to Indian railways in terms of diesel consumption in India. Currently, 40% of installed towers are situated in regions with less than 12 hours of grid supply on average.[1] Annual consumption of diesel in telecom towers is over 3 billion liters.[2] The DoT has set renewable energy technology targets for telecom towers. Operators are obligated to switch 50% of the telecom sites in the rural areas and 20% of telecom sites in urban areas to a renewable technology by 2015.

Power and fuel costs account for 30-40% of the operator network cost.[3] With pilferage, the cost is even higher. Enforcement of the regulation will lead to a reduction of 540 million liters of diesel consumption annually.[4] At current diesel prices of INR 56/liter, this regulation will theoretically result in annual saving of over INR 8 billion at current levels.[5] Upfront cost, maintenance challenges, security of installations and the high requirements for reliability of power have been the key constraints, hampering the growth of this segment.

Solar is the most fitting renewable energy technology for telecom towers. Cumulative solar installation on telecom towers was 30 MW by 2013. Over 5,000 telecom towers have installed solar systems with an average project size of 5-6 kW.[6] Cumulative installed capacity is expected to grow at a CAGR of 78% till 2016. The addressable market is also rising fast: India is expected to have one million telecom towers by 2017. The diesel prices are set to rise further as the new government has already voiced its concern over the current subsidy scheme and import bills.

Projected cumulative solar projects in telecom sector (MW)[7]

[1] Tata Strategic Management Group, Green Telecom Towers – An Attractive Option for a Sustainable Tomorrow; bit.ly/1jkYrIR

[2] Greenpeace: Enabling Clean Talking; bit.ly/1lSXTps

[3] ATKearney: The Rise of the Tower Business; bit.ly/PcvnX7

[4] Greenpeace: Enabling Clean Talking; bit.ly/1lSXTps

[5] A diesel generator typically generates 3-4 kWh/liter and usage of solar system will likely result in savings on INR 4-5/kWh.

[6] BRIDGE TO INDIA market analysis

[7] BRIDGE TO INDIA market analysis

Mudit Jain is a consultant at BRIDGE TO INDIA.