for off-grid renewable

The world’s largest off-grid renewable energy initiative in Ladakh consists of 28.3 MW of solar PV, small hydro and solar thermal in North India’s Jammu and Kashmir province. Duncan McKenzie finds out how this remote place came to be the focus of this initiative.

Leh, in Ladakh, India, is benefitting from a major government-backed renewable energy initiative Credit: D. McKenzie/LREDA

Ladakh, a remote district set in India’s northern-most state, is enjoying the benefits from the largest off-grid renewable energy project in the world.

The Ministry for New and Renewable Energy (MNRE) is spending a jaw-dropping INR473 billion (US$88.8 million) on decentralized solar and hydro technologies to bring energy security to this remote mountain region. The obvious question is: Why Ladakh?

‘Because we Ladakhis are closer to God,” smiles Jigmet Takpa, project director of the Ladakh Renewable Energy Development Agency (LREDA). “Our sunshine is high quality. We have an average of 320 sunny days every year and the mountain air is thin and cold, making the operation of photovoltaic systems highly efficient. Ladakh is a solar paradise.’

Ladakh, known as the Land of High Passes, is a high-altitude cold desert region in Jammu and Kashmir state, neighbouring China to the east and Pakistan to the north. It is a focus of the 3.5 year Ladakh Renewable Energy Initiative (LREI), a 28.3 MW energy revolution, now in its final year.

Ladakh is taking a flagship role in national renewable energy policy. Although only small, with a sparse population, its rugged geography means that many dispersed communities are beyond the viable reach of the regional grid system. Stand-alone renewables are the obvious solution. ‘The harsh environment makes it the perfect test case for the technology itself, and for future policy: to prove to the government and the public that renewables have a valid role to play,’ says Dr. Parvind Saxena, director of MNRE in Delhi.

Electrifying rural areas is a prime government concern, and Prime Minister Manoman Singh has given his personal commitment to electrifying every Indian household by 2017. The 2005 programme, Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY), has pursued grid electrification of villages, and the 2009 Remote Village Electrification Programme makes off-grid provision.

Conditions in the mountains make the operation of solar PV systems extremely efficient Credit: D. McKenzie/LREDA

Displacing diesel

However, 400 million Indians still lack access to modern forms of energy, and 20,000 villages are too remote, realistically, ever to be grid-connected. Beyond the social expectations, there is also a financial incentive to this initiative. ‘We noted that, bar a couple of small hydro projects, almost the entire region, including the Border Defence Force, was using diesel generation for electricity and kerosene for space heating, and due to Ladakh’s remote location, fuel is imported by road at a very high cost. Harsh winters close those roads for at least five months of the year, exacerbating energy vulnerability and deprivation, says Saxena.

Prior to the LREI, Ladakh generated a total of 25 MW electricity. Of some 240 villages, 187 received electrification by microgrid for a few hours each day, 75% by diesel and the remainder by small hydro. A few remote communities entirely lacked electricity.

‘The high cost of diesel generation in Ladakh – currently INR25–28/kWh – makes renewable energy very competitive,’ says Takpa.

‘Off-grid solar PV-generated electricity worked out over a 20 years’ system-life in Ladakh currently comes to INR16–18/kWh And the cost of solar keeps falling due to technological development and scalability.’

The November 2012 report by the International Renewable Energy Agency (IRENA) confirmed renewable energy as the default option for off-grid electricity provision, with solar PV now a cheaper option than diesel in many locations.

LREI’s use of dispersed hydro and solar PV have rapidly replaced diesel to a large extent and avoided unnecessary extension of long, expensive grid lines. According to LREDA figures, the total expected saving of diesel in Ladakh from hydro and PV generation is 35 million litres per year – or approximately INR1.6 billion annually – a substantial saving for the government.

Ankur Agarwal, the CEO of Advanced Renewable Energy Technologies, says: ‘The increasing cost of diesel will be a key demand driver for solar PV installations in India,’ a country that has an estimated 60 GW of diesel power capacity. Recent cuts in government subsidy for diesel will encourage this trend.

Initiative’s background

At LREDA’s offices in Leh, Takpa is consulting with senior project engineer, Reuben Gergan, a Cornell-educated Ladakhi. The dynamic team has strong links with India’s main tech providers, collaborating on R&D and international scientific exchanges. LREDA is a state nodal agency of MNRE, born in 2000 from the Ladakh Autonomous Hill Development Council. Takpa joined in 2001 and oversaw the Remote Villages Electrification Project, the first of its kind in India. It supplied solar home lighting systems to 200 hamlets in the region, and its success led to the setting up of a nationwide programme.

LREDA’s 2005 Ladakh Vision 2025 document highlighted the massive untapped solar, geothermal, hydro and wind energy potential of the region, from which Takpa successfully proposed the LREI as a catalyst for development.

Takpa’s engineering and conservation background, and his role as conservator of forests, make Ladakh’s fragile ecosystem his concern. Growing tourism and a cash economy have affected local ecology and living practice. He promotes rural livelihoods, ecotourism and ecosystem management, and the LREI complements these needs through renewable energy and conservation techniques for housing and agriculture.


Central government funding came from MNRE’s financing arm, the Indian Renewable Energy Development Agency (IREDA), a non-banking finance agency that funds mainly rural projects. Over half of IREDA’s sanctions are for the wind energy sector, with the rest for small hydro, biomass and solar projects.

As an Autonomous Border Region, Ladakh receives Special Area Status (strategic, remote, underdeveloped) and the highest funding – hydro and solar PV hardware are 100% funded.

Electricity is then charged from users. According to Gireesh Pradhan, secretary for MNRE: ‘Upfront costs of renewable energy access systems is the key barrier, and therefore complementing subsidies with funds is a practical way to solve the first-cost capital financing problem. Subsidies for energy access projects are generally justified as a response to inequality and social expectations in energy provision.’

Ladakh nonetheless suffers barriers to large investment. The lack of initial grid connectivity, the region’s remoteness and the small population’s limited growth potential discourage large-scale solar projects. The small capacity of projects has so far restricted developers from benefiting from Renewable Energy Certificates, although a revision for hydro is proposed.

LREDA has encouraged incentivisation, including removal of entry tax on solar products and provision of district-level simple clearances.

The LREI undoubtedly sets new standards for rural electrification, development and energy conservation. Its broad initiative takes holistic approach and amounts to a flagship for distributed renewables at a timely m,oment in India’s energy story. Further remote regions seem likely to follow, with the MNRE currently funding a second off-graid Special area Project in Arunachal Pradesh, a remote north-eastern state, well suited to small hydropower.

Duncan McKenzie is a freelance journalist, who writes on the energy sector.

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