Worth their Salt: How Clean Energy is Powering a Breakthrough Opportunity for Saltpan Farmers in Gujarat's Desert - Part 1
NRDC has partnered with SEWA to increase off-grid energy access to clean energy and improve the lives of saltpan farmers working in salt flats. This new case study released by NRDC and SEWA, Worth Their Salt: Draft Case Study for Clean Energy Access in the Salt Marshes of Gujarat, measures the potential benefits, including cost savings, in the transition from diesel pumps to more efficient solar pumps, along with the payback period after which the upfront cost of the solar pumps is recouped. The pilots featured in the case study show that the transition from diesel to solar-powered pumps is viable and that clean energy provides many opportunities beyond just major cost savings for the agarias - including social, political, environmental and climate benefits.
NRDC and SEWA held a roundtable last week in Gujarat with national and state government officials, financiers and equipment providers. As described in Part 2 of this blog series, discussions centered on the financing opportunities to scale the featured pilot programs for a greater number of agarias who harvest salt in the Little Rann of Kutch desert.
The scale of opportunity is enormous. As many as 43,000 agarias bore wells and pump brackish salt water (brine) in remote salt flats located in the Little Rann of Kutch, far from modern grid-connected electricity. The agarias work long days in the desert, depending on diesel fuel to power their water pumps. With volatile diesel prices and little savings, agarias spend up to 40% of their annual revenue procuring diesel for the next salt production season. India's abundant solar energy potential, with nearly 300 sunny days and high solar radiation, coupled with falling prices of solar photovoltaic panels offer a powerful clean energy solution to power pumps in rural off-grid areas, including the desert and villages where the agarias work and live.
Agaria family in Little Rann of Kutch, 2015. (c) Bhaskar Deol, NRDC
Pilot Projects Demonstrate Viability of Clean Energy Access Opportunity
As featured in the case study, pioneering renewable energy pilot projects carried out by SEWA have demonstrated how the saltpan farmers can dramatically increase their annual savings by switching from diesel to solar-powered pumps.
SEWA Solar Pilot Project Phase 1: In 2013, SEWA initiated its first pilot project to support the use of solar-powered pumps to reduce agarias' fuel costs. Being the first program of its kind, SEWA collaborated with Jaypee Solar, a local provider of solar PV systems, to install solar systems designed for brine pumping applications. Fourteen agarias purchased solar pumping systems constituting a 1 kilowatt (kW) solar PV system coupled with a one horsepower AC motor to demonstrate the clean energy technology in action and build awareness of its socioeconomic benefits.
SEWA Solar Pilot Project Phase 2: Expanding on these previous efforts, SEWA collaborated with SunEdison, a U.S. based renewable energy company, and the World Bank in the second phase of the pilot program. In January 2015, 200 solar-powered water pumps were distributed to agarias in the Little Rann of Kutch through the United Nation's Sustainable Energy For All (SE4ALL) initiative. The second phase of this pilot offers a real-world vendor financing model for scaling similar pilot programs, which is featured in the case study.
NRDC and SEWA partnered to measure the cost savings and financial and technical feasibility of interested agarias' transition from diesel to solar-powered pumps through these SEWA pilot projects. The analysis of the SEWA pilots offers compelling results: a solar PV based system can boost annual savings to Rs. 83,000 (~ $1,310) - a 161% increase in annual savings as compared to agarias utilizing diesel-powered pumps.
The pilot projects also offered a compelling payback period. Assuming a solar PV system was purchased with a 12% interest rate loan to replace a diesel-powered mechanical pump, a farmer would be able to pay back the loan in 38 months (3 years, 2 months).
By using a hybrid system that utilizes both solar PV and diesel to power the pump, agarias can increase their annual earnings to Rs. 52,800 (~ $830) per saltpan - a 66% increase in annual savings as compared to agarias using a diesel mechanical pump.
Bhavnaben is one agaria who has purchased solar panels to power her water pump through the SEWA pilot project and sends one of her children to private school with the extra savings availble since she no longer buys as much diesel. (c) Bhaskar Deol, NRDC
Solar pumps used in the pilot projects also demonstrated higher efficiency and reliability, enabling agarias to increase their harvested salt output, pursue other income-earning activities, and power other household items when the solar pumps are not needed for pumping brine. The results show that utilizing clean and affordable solar pumps can lead to livelihood improvements through enabling increased productivity, economic independence, and better health and educational opportunities for agaria families.
Enabling the switch to solar-powered pumps also aligns with the central government's goals of providing 24/7 energy access to the over 300 million people who still lack access to a reliable electricity source in India. Another government goal, achieving India's goal of 100 gigawatts (GW) of solar energy by 2022 through the National Solar Mission, includes an off-grid solar target. Reducing reliance on imports of foreign fossil fuels and reducing the need for costly diesel subsidies are additional benefits for policymakers to take into account. Moreover, because solar energy does not emit greenhouse gases or other air polluting toxins, replacing diesel with solar power can provide significant climate and health benefits for people's health and the environment. In fact, NRDC and SEWA's analysis estimates that the avoided air pollution from diesel combustion by replacing the existing diesel water pumps with solar and hybrid solar/diesel water pumps can potentially avoid up to 115,000 tonnes of carbon dioxide (CO2) emissions from the salt marshes of Gujarat.
The two innovative pilot projects reveal the remarkable economic, social, and environmental opportunities created by switching from diesel to solar-powered pumps. With targeted financial solutions, these pilot projects could be scaled up, providing clean energy access for a greater number of the 43,000 agarias harvesting the majority of India's salt. As the case study makes clear, with greater savings from using solar energy, these farmers can improve their economic status and the technology they use. Access to clean and affordable sources of energy can lead to critical improvements in livelihoods across communities in Little Rann of Kutch and the environment while tackling the global issue of climate change.