Putting Two and Two Together: Abolishing Austerity Politics and Upgrading the Grid

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An article in IANS today raised the issue of the Indian electricity grid and the need to upgrade it to cope with new sources of electricity.

The subject is the capital investment needed for a transition to a smart grid. To add a projected 275 GW of photovoltaic electricity by 2027 in India, to supplement the existing 221 GW of coal gas and diesel fired capacity and the 57 GW of renewables and 45 GW of large hydro, we need a grid that will automatically switch supply between generating stations based on hydro, wind, solar, biomass and the existing conventional sources, depending on load and natural factors like strength of wind, sunshine, rain etc.

In Bihar, our sunshine is notoriously undependable. We can go for months with overcast skies, which dramatically reduces the generation of photovoltaic electricity generating stations. So, in Bihar we need to bring power from generating stations in sunshine states, or from stations based on either biomass, coal, or wind within the state or other states, which can supply electricity when there is no sunshine. Biomass for example can be used in a hybrid generating station with photovoltaic power, as we potentially have lots of agro-residues, provided the agriculture in villages is done for own consumption and the biomass is renewably produced, rather than depleting soils and catering for export-led model of development.

If each family of four people needs one kW of reliable twenty-four hour installed capacity of uninterrupted power supply (UPS), provided by a 1 kW UPS based on photovoltaic electricity to back up the grid supply, - provided by a combination of the centralised smart grid and decentralised tail-end micro grid, - then Bihar needs a smart grid investment of Rs 6 lakh crores. This would cover a cost of 2 lakhs for every four-member family. The system would combine the matching of supply and demand in the grid with the local storage capacities of a decentralised UPS for each household at household or ward level.

Solar power generation is a near zero marginal cost source of supply. This means once you have installed your equipment you can generate an extra unit at practically no extra cost – apart from the time and labour cost of cleaning the panels to ensure that they are dust-free and able to convert sunlight into electricity at the highest possible efficiency. Thus, all in all, this entire thing is technically highly doable and highly attractive.

But this year’s state energy budget is just 10 crores, down from 15 crores last year, a cut of 30%, and an investment of just Rs 840 per person in the state.

It is evident that the central government provisions for state electricity supply are captive to a fiscal austerity regime that limits government spending at the centre and the state to 3% of GDP, and that these are totally are incompatible with what is being projected as the policy aim by 2027.

If Bihar and other underserved states are to get a smart electricity supply that meets the needs of the present and future generation without sending the climate system into a spin that will be fatal for all of humanity, we need to abolish austerity and bring back socialist economics now. This may not at all have to be License Raj or centralised planning. It can be a decentralised vision of financing for third tier level of government, with execution done by Gram Panchayats, and the stuff owned and operated by Gram Sabha members for their own benefit with the jobs that go with it, and with central and state support for national integration based on a vision of full employment for all.

It is time to tell the BJP and the INC, political parties that have both driven India into an austerity dead-end in recent years, to pack up, and give the realists the control of the economy. 


 Anandi Sharan was born in Switzerland, lives in Bangalore, and worked in Araria District in 2016. She mainly writes about India and how we need a better money policy to help agricultural labourers and women especially to adapt to man-made climate change.

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