Decentralised renewable energy solutions offer great promises for healthcare facilities

Synopsis: In facilitating access to affordable RTPV electricity in public healthcare facilities, India can achieve the twin objective of greening the economy and transforming the healthcare infrastructure so that it can provide affordable health services.

Introduction

It has been a big challenge for our health infrastructure to deal with the novel coronavirus disease (COVID-19). Apprehension about a third wave of COVID-19 has many health institutions setting up their own oxygen plants within their premises.

But, the electricity cost of running these oxygen plants is around 70-80% of the running cost. 

Many health institutions have attempted setting up oxygen plants within their premises under the PPP mode (design-build-finance-operate-transfer). But electricity costs make these projects unviable and unable to compete with the far larger liquid medical oxygen plants. This has driven away private investors.

In the post-pandemic world, energy access interventions involving rooftop photovoltaics (RTPV) can help health facilities and enable them to become ‘atmanirbhar’ (self-reliant).

Why RTPV systems should be implemented?

The rationale behind adoption of RTPV systems is driven by the following factors:

i). Electricity cost savings: The RTPV system can produce significant savings for daytime electricity consumption. The state of Madhya Pradesh in mid-2018 discovered the electricity tariff for medical colleges under the RESCO model, a renewable energy service company to be around Re 1.74 / unit with 3% annual escalation (with subsidy support from the state and central governments) and Rs 2.18 / unit (without subsidy). These rates are a fraction of what medical colleges pay for grid-supplied electricity.

Electricity savings can be used to purchase medicines and for other necessary expenditures, as well as to strengthen the health infrastructure.

ii). Environmental benefits: RTPV systems would also result in environmental benefits. For instance: The project, mentioned above, results in approximately 7,187 tonnes of carbon dioxide emissions being reduced over the project life. This environmental gain would have been achieved by planting 12,345 trees.

iii). Generation of jobs: In a preliminary assessment published by the Union Ministry of Health and Family Welfare, the potential for RTPV in all district hospitals and medical colleges of our public healthcare system is estimated to be approximately 450 MW, entailing an investment of about Rs 1,575 crores and generating over 13,000 jobs locally.

What are some disadvantages of RTPV electricity systems?

The high initial cost of RTPV intervention is one of the reasons state governments overlook such investments, given the budgetary constraints of making significant capital expenditures.

What steps are being taken to offset high initial cost of RTPV systems?

NITI Aayog’s and the World Bank’s SuBaH initiative aims to bridge these gaps by demonstrating the OPEX / RESCO model to provide affordable RTPV electricity services to health facilities.

The health institutions or governments would therefore not have to make any investment whatsoever and would make savings from day one. The investment would be made by solar developers, who would recover their investment through the sale of power to the health institutions over the 25 years.

Efforts in demand aggregation planned under the initiative will optimise upfront costs and reduce the overall cost of energy services through economies of scale.

What is the way forward?

Cooperation between the private sector, the public sector and non-governmental organisations has proven crucial to the success of healthcare electrification, such as using the pay-as-you-go model in Rwanda, micro-grids anchored around the facilities and connected to staff housing in Madagascar and Lesotho. Such partnerships should be encouraged.

Source: This post is based on the article “Decentralized renewable energy solutions offer great promises for healthcare facilities” published in Down to Earth on 7th Oct 2021.