Sunday, April 02, 2006

DESI Power

"Desi" is Hindi word for "from the country" or "from the homeland" (Des = country or homeland). It is often used (by Indians) as a slang for other Indians in the US. DESI Power is a company back home in India, that has given another meaning to the word Desi.

DESI stands for "Decentralized Energy Systems India" Pvt. Ltd. The company provides decentralized power to remote villages and semi-urban areas using biomass fueled power plants. Currently the company targets two different markets:

  • Small scale industries in semi-urban areas which depend on diesel generators for power (due to unreliable grid electricity supply)
  • Remote villages which have not been electrified or lack reliable supply.
For the small scale industries the company provides services to retrofit existing diesel generator sets to run on dual fuel mode using biomass gasification. The incentives for the company are reduced fuel costs due to low cost of biomass, reliable supply and increased productivity.

I find the second part of the company's mission more interesting. While targeting the remote rural market, the company has adopted a socially responsible approach which makes very good business sense too. It aims to establish Independent Rural Power Producers (IRPPs) which will be small scale power generation plants based on biomass gasification (for now) and other alternative energy sources such as solar and wind in future. Read more...
... DesiPower's business model for Independent Rural Power Producers involves building, operating and later on transferring decentralized power stations to the villagers. The building of IRPPs is integrated with the establishment of profitable local small scale industries, businesses and agro-forestry owned by the villagers. For commercial success, the power plant has to sell as much electricity as it can generate and the villagers have to produce and sell as much of their products as they can in the village and at neighbouring market places. The mutual dependence is further strengthened through, on the one hand, the generation of additional income from the supply of agro-residues and other biomass to the power plant and, on the other, by the continuing extension services and training provided by DesiPower's cluster centre. (Read more about their business model)
To develop this business model, the company seeks partnerships with local organizations such as NGOs operating in the area. The local partners help in promoting small scale industries in the rural area. With the help of reliable power supply provided by DESI power, these industries can become a source of employment and income to the rural community. The rural community also benefits from the sale of biomass to DESI power.

So far DESI power has built 10 such plants operating on biomass gasification. Out of them, three are of the IRPP model and are based in villages in Bihar, Orissa and Madhya Pradesh states. The plant in Madhya Pradesh is based in near Orchaa. At this location, the NGO - Development Alternatives - has started a center which runs small scale industries and provides training and employment to the rural community. The center utilizes the power generated by the 100kW biomass gasifier based power plant operated by DESI power. The biomass fuel is a locally available grass - "Ipunia", which previously had no economic value and grows in marshy land not suitable for agriculture. The center runs a paper making unit and low cost building materials (briquettes) unit and provides employment for 130 people. Here is a BBC article about the Orchaa plant.

The IRPP model adopted by DESI power is a sustainable and socially-ecologically responsible approach. Furthermore, these small renewable energy power plants can also sell Certified Emission Reductions under the Clean Development Mechanism put in place by the Kyoto protocol. In January 2005 DESI power sold 3150 tonnes of certified CO2 reductions to the Davos Climate Alliance (to partly compensate for the emission of greenhouse gases caused by dignitaries and world leaders who attended the Davos World Economic Forum). The proceeds from the sale contributed towards cost of a power plant based on the IRPP model in Bihar.

A significant portion of Indian population is based in rural areas and many of these areas don't have access to reliable power. I had written a post on Transmogrified about decentralized energy production in India. In that post I had argued that there is a huge market for such systems based on renewable alternative sources, which remains largely untapped. At the end of the post I had wondered that if such a market is "money lying on the sidewalk", why isn't someone picking it up?. With companies like DESI power, I guess I we know that someone is picking it up.

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2 comments:

Nari said...

I found this information very useful. Thanks
-Nari

Transmogrifier said...

Thanks Nari. Hope you keep visiting back. The blog has been dormant for a long time but I am working on a few interesting posts. So keep checking.