How Centre's stress on solarising grid pumps will empower farmers

For 13 years till 2016, Padam Jain worked with Srijan, an NGO, in Bundi, Rajasthan, helping soybean farmers increase their production and income. He also helped establish a producer company of 2,300 women smallholder farmers there. Jain has installed a 5 horsepower (hp) solar pump at his small farm in Bundi, because of the long wait time for a grid connection. While he paid ₹2 lakh for the same, the remaining 60 per cent of the cost was shared by the central and state governments equally as part of the PM-Kusum programme.

Joint venture to cut cost

But, despite the large subsidy not every smallholder farmer in Rajasthan can afford solar pumps. So, Jain helped 19 farmers to form a cooperative of solar energy producers in Jamnagar. They supply power to the grid and draw from it to run their pumps. At the end of the year they have to pay or are paid for net usage. Under this innovation called the Suryashakti Kisan Yojana (SKY), farmers pay just five per cent of the cost of the pumps, solar panels and the microgrid (Nayara bore this as part of its corporate social responsibility). Sixty per cent of the cost is shared equally by the central and state governments. The remaining 35 per cent is a long-term loan contracted by the Gujarat government from Nabard, the agricultural refinance bank, at a low rate of interest.  Farmers are paid ₹7 unit of power supplied, of which ₹3.50 goes towards servicing the loan for seven years. For the remaining 18 years they are paid ₹3.50 per unit.

The Union Finance Ministry’s recent target to solarise 1.5 million grid-connected pumps (out of 20 million in the country) in the budget, subsumes schemes like SKY which has helped farmers tap electricity at a much subsidised rate.

How SKY works

For Gujarat’s power utilities to sign a power purchase agreement with a solar cooperative, all or a substantial number of farmers connected to a feeder must agree to be its members. Since the launch of SKY in 2017, 3,100 tubewells connected to 76 feeders have been solarised (Gujarat has 9,500 farm feeders and 1.6 million tubewells). They have generated 62.6 million units of power and consumed 23.4 million units.

The International Water Management Institute (IWMI) is behind this innovation. It is headquartered in Sri Lanka and has its India office in Anand, Gujarat. It is part of a consortium of international agricultural research institutions, called CGIAR. The two institutions that brought about the Green Revolution in maize, wheat and rice ─ Mexico’s CIMMYT and Manila-based International Rice Research Institute – are part of CGIAR. So is ICRISAT, headquartered in Hyderabad, which does research in dryland crops like chickpea. Early in the last decade, IWMI suggested the separation of the farm grid from the one supplying power to homes. The Gujarat government adopted it and called it ‘Jyotirgram’. When there was a single grid, farmers would run pumps with totas or capacitors to boost low-voltage electricity, depriving those down the line and running the risk of damaging their pumps. The rationing of good quality power under Jyotirgram for eight hours at night or during daytime, every alternate week has helped conserve groundwater. But farmers had to endure interrupted sleep, and occasional snake bites.

Dharmesh Thumbar, 40 of Junagadh says he has supplied 15,000 units of power to the grid and drawn 2,800 units for own use after solarising his electric water pump in July 2019. In the mornings and evenings, he draws more from the grid than he supplies to it, to irrigate four acres of groundnut and pigeon pea. He has a solar panel which can produce 18 units of power at peak capacity on clear sunny days. Thumbar depends on a 100-feet deep dug well for much of the irrigation. It has a 13 hp pump. He also draws water for three irrigations from January onwards from a 600-feet deep tubewell, which has a 15 hp pump. Though power is supplied from 7 am to 7 pm, Thumbar says he uses water judiciously so he can sell more surplus power.

In Keripura village of Kheda district, Jentime Gilbert Christian, 64, got a cheque for ₹2,261 for the solar power he sold during the first quarter of calendar 2019.  Of the 71 farmers connected to the Ozarala feeder, 51 have solarised their pumps. A retired malaria inspector at the Anand Municipal Corporation, Jentimebhai has an 8.5 hectare farm about 50 km from his house in the city. The daily commute costs him ₹2,300 a month in concessional bus fare and rickshaw charges. He grows cotton and castor. The two crops fetch him a net income of about ₹1.5 lakh a year which is just about enough for daily needs. Jentimebhai’s tubewell water is saline and can damage the soil. So he has an incentive to sell more of the solar power he produces.

Lucrative model

SKY was inspired by the Bundi Saur Urja Utpadak Sahakari Mandali or Bundi Solar Power Producers Cooperative in Kheda district. IWMI helped set it up. The nine farmers of the cooperative paid ₹8.4 lakh and in return got a system ─ pumps, solar panels, controllers, meters, a transformers and a 4.2 km grid ─ worth ₹68 lakh. They have signed a 25-year PPA with a state power utility and have pledged not to take grid connections for that duration. The first six members are being paid ₹4.63 a unit and have been supplying power since May 2016. The remaining three who started supplying from August 2017, get ₹3.24 a unit.  IWMI got the Tata group to pay them a groundwater conservation and green energy bonus of ₹2.50 a unit for two years.  A CGIAR research programme on climate change (CCAFS) gave the capital subsidy.

So far the Bundi cooperative has sold power worth ₹14.35 lakh. It has also sold irrigation services to farmers not owning tubewells worth ₹16 lakh. The diesel pump owners would charge ₹500 an hour. The cooperative drove 10 of them of them out of the market by pricing its services at ₹300 an hour.  One hour of irrigation requires 20 units (kWh), so the farmers earn ₹15 a unit, much more than the utility’s power buyback rates. And there is no smoke. The aquifers in Bundi are recharged by the Mahi river canal, so groundwater depletion is not an issue.

Need for more incentive to save water

Shah says the Gujarat government charges 60 paise a unit for farm power, which costs it about 10 times as much to supply. He says the government should offer around ₹5 a unit for farmers to have a greater incentive to conserve groundwater. If the rates are unattractive, farmers with solarised pumps might just overuse groundwater or grow crops that require more water.

Thumbar wants the government to give him a capital subsidy or low-interest loans to put up larger solar panels so he can put his land, which does not have enough well irrigation for intensive cultivation to profitable use. He also says the rates for such power should be higher – about ₹4-5 a unit. Shah says the rationale behind giving a one-time capital subsidy for solarised electric pumps is to cut down the recurring and large subsidy on farm power. If the rates are made attractive for those not connected to the grid, farmers might rent out even fertile agricultural land to earn a steady income. 

(The writer is a journalist and blogs on www.smartindianagriculture.com)