WORKSHOP REPORT

With the objective to increase business involvement in strategic areas of bilateral cooperation between the EU
and India and further catalyse socio-economic development in rural India, the Business Support to the EU-India
Policy Dialogues Project in collaboration with the EU-India Clean Energy and Climate Partnership Project and
the Delegation of the European Union to India organised the “EU-India Distributed Renewable
Energy Investment Workshop” on Tuesday, 15th June 2021 from 12:00 pm to 2:00 pm CET / 3:30 pm to 5:30
pm IST.

In order to lay the framework for DRE pilot projects in the State of Uttar Pradesh, the workshop was divided
into three sections:
• Firstly, the launch of the DRE Market Brief of the State of Uttar Pradesh in order to offer into areas for
technology support and investment action;
• Secondly, high-level discussion on financing DRE in India and some of the options available,
presentation of EU technologies with financiers and project developers in improving their project
designs, descriptions and plans to improve their bankability; and
• Thirdly, the facilitation of contacts between project developers and the financing community

The workshop was a follow up activity of the webinar entitled “Building EU-India Technology Partnerships to
promote Distributed Renewable Energy (DRE) as source of reliable energy access to power rural India” which
was held on Tuesday, 11th May 2021.

The interactive exchange workshop was attended by over 70 participants from both the EU and India that
exchanged ideas on policy and regulatory frameworks, holistic business models, the importance of smart
technological innovations & energy efficient appliances and the impact of Distributed Renewable Energy in
developing rural India. The workshop was followed by a half day B2B meeting session for interested EU
companies to meet with Indian stakeholders.

1.1. Inaugural and Keynote Sessions - Opening Remarks & Context Setting

Poul V. Jensen, Managing Director, European Business and Technology Centre and Team Leader of the
Business Support to the EU-India Policy Dialogues Project extended a warm welcome to all the participants of
the workshop. He noted that the EU-India Clean Energy and Climate Partnership Project identified DRE as an
area for significant collaboration between the EU and India and thanked those participants from the 1st
workshop for already sharing their project proposals. He hoped to gain insights from speakers through the value
chain of DRE projects to understand the current scenario including gaps, and potential solutions for the growth
of the sector. He stated that the outcomes of the workshop would flow into creating a framework of pilot
projects and into the Financing Investment in Clean Energy Platform (FICEP) to create a more conducive
environment for DRE projects, focusing on the Indian state of Uttar Pradesh (UP).

Edwin Koekkoek, Counsellor, Energy & Climate Action, EU Delegation to India emphasised that renewable
energy transition is at the helm of the EU Green Deal and the recovery package. At the recent G7 summit, EU
leaders and the Indian government agreed to strengthen their Clean Energy and Climate partnership. He
suggested that the partnership is key to EU-India cooperation, and that the activities under this partnership,
such as this workshop, would provide useful suggestions for FICEP to create support mechanisms for the
renewable energy sector.

Chintan Shah, Director Technical, IREDA began by describing the challenges in the DRE sector. He touched upon
metering regulations that differ by state and are often ambiguous. He emphasised that clear regulations often
lead to projects coming up in a big way, like in the state of Gujarat. Administration of debt is another major
challenge in rural areas. The absence of proper mechanisms to assess credit-worthiness of consumers for
projects in villages, and also the rating of projects themselves. Credit offtake is a concern in terms of lender
security in rural areas, and there is a need to look at social collateral. Mr. Shah underscored the need for a
standardised model, one that is replicable and scalable. As models become more standardised, they will be
easier to implement, and hence easier to scale. Standardization and aggregation are required to make projects
more bankable.

V K Tiwari, Senior Project Officer, UPNEDA appreciated the focus the workshop placed on developing the DRE
sector in UP. He specified that the customers in rural UP are willing to pay higher tariffs to mini-grid developers
for reliable and high-quality electricity. He recognised the benefits of mini-grids and other off-grid systems such
as solar cold storage and rooftop solar projects that can generate income and benefit rural communities, but
recognised that these projects need to be assessed to make them techno-commercially viable. Mr. Tiwari
reiterated his keenness to hear the speakers and their insights on policy changes that can be implemented by
the UP government to create an enabling environment for DRE projects.

1.2. Launch of the DRE Market Brief Report – Uttar Pradesh

Samit Mitra, Senior Director, Smart Power India

Mr. Mitra asserted that the state of UP has been at the helm of innovation in the DRE sector in India. He
attributed this to the encouragement of the state government and its entities, and their support towards DRE
projects and pilots. UP was the first state to develop a comprehensive policy and regulations for mini-grids. The
enabling environment created by the UP government has led to many DRE project developers such as OMC
Power, Husk Power, Tata Power and Tara Urja choosing the state to begin their operations. Smart Power India
(SPI) began their journey six years ago, and facilitate more than 500 mini-grids with 13 Energy Service Company
(ESCO) partners in UP. The learnings garnered by SPI’s implementation experience has equipped them with a
good perspective on the state of the DRE sector in UP and its potential.

Rahul Kumar Kandoi, Associate Director, Smart Power India

Mr. Kandoi presented the DRE Market Brief for the state of Uttar Pradesh. There is a huge electricity supply-
demand deficit in UP, and at the same time, the state has great potential for successful DRE projects. The market
brief describes mini-grid systems as well as successful business models that have been implemented in the
state. The regulatory environment and financing options were also explained. The report stated the lack of clear
regulations, financing instruments, and suitable technologies as key challenges to the sector. Mr. Kandoi
provided some suggestions to overcome these barriers, and emphasised DRE projects as a key to catalysing
socio-economic growth in rural UP by layering electricity with various services such as health and education. He
stressed that the DRE sector rests on a cooperative 4P approach (Public-Private-People-Partnership) that is
supported by dynamic policy and supportive finance.

1.3. Financing DRE in India – What are the current mechanisms available, challenges and asks from
developers?

Marcus Wiemann, Director Energy, EU Tech Chamber, highlighted the shared ambition of the EU and India to
build a better world by advancing infrastructure and building partnerships. While emphasising the positive
business environment in UP he stressed on the fact that for this webinar, we have selected a great group of
professional speakers from the EU and India representing all relevant parts of the value chain for mini-grids. He
hoped that the workshop would help financiers, companies, and other stakeholders to improve project design,
technologies, and modelling so that projects are able to provide clean energy to rural areas and catalyse socio-
economic development.

Rohit Chandra, Co-founder & CEO, OMC Power

Mr. Chandra began by appreciating the UP government and UPNEDA for their work in legitimization of the DRE
sector through regulations. He did add that regulations must be constantly revised to accelerate growth of the
sector. He mentioned that UP state has allowed for a market-based mechanism to prevail in the sector. A key
challenge is that though debt is available, the DRE sector is not entitled to adequate debt instruments as
projects are considered to be risky and financiers approach projects with a conventional mindset. A yardstick
to evaluate DRE projects from a non-collateral financing standpoint needs to developed. Another issue in the
sector is co-existence with Distribution Companies (DISCOMs) – mini-grid players must either co-exist with the
grid or develop a model where they provide generation support, storage, and customer service at the last-mile
for DISCOMs. Energy storage is also a technological bottleneck. Innovations need to drive down the cost of
storage so that projects become bankable and Levelized Cost of Energy (LCOE) from mini-grids can compete
with that of the central grid. He believes that technology and bulk procurement need to drive down LCOE and
hence make DRE projects suitable for debt financing.

Saugata Datta, India Country Director, Husk Power Systems

Mr. Datta pointed out that equity finance for DRE projects comes at a premium. It is important to note that
mini-grid projects have a long period before there is a return on investment. There should be mechanisms to
subsidise rates for DRE projects so that they breakeven sooner, and the return on investment is higher.
Additionally, financiers are reluctant to fund companies who have a negative EBITDA. Pooling funds so that
guarantees come from the social investment sector may encourage investors to fund projects. Another
challenge is the long lead time for due diligence as projects in the sector are not standardised. Financiers are
usually sceptical about lending to developers as using standard parameters for due diligence are not helpful in
the case of these projects. A body could be instituted which would regulate time-frames for processing approval
of funds to shorten turnover times. Mr. Datta emphasised that availability of debt is not a problem, but the real
challenges are the associated cost, long processing times and required securities.

Vijay Bhaskar, Managing Director, Hamara Grid

Mr. Bhaskar highlighted that DRE projects such as mini-grids are nuanced and need to be looked at differently
by financiers. Mini-grid projects take a few years to reach 100% utilization, and hence debt should be structured
so that the repayment system has a moratorium period till the time the grid is able to sell a certain number of
units. Additionally, financiers should take into account social impact and softer aspects such as demand
management and capacity building while creating finance structures. Mr. Bhaskar noted that in the short term,
there should be blended finance structures that are a mix of grants, debt and equity. In the medium term, it is
important to bring down LCOE substantially. This can be done through the scale of projects, and by reducing
operational expenditures by employing innovative technologies.

Diane Jegam, Regional Director South Asia, PROPARCO

Ms. Jegam emphasised the role of the private sector in reaching global green energy objectives and reiterated
PROPARCO’s mandate to support projects that are aligned with the Paris Accord. She then outlined some
challenges in the sector, beginning with macroeconomic risks such as the covid-19 pandemic. The decrease in
energy demand clearly impacted DISCOMs and hence Independent Power Producers (IPPs) experienced delays
in payments from them. This is one of the main causes of the slowdown of renewable energy projects in India.
A few other challenges mentioned were the delays in signing Power Purchase Agreements (PPAs), access to
financing, tight project schedules, and regulatory frameworks being modified without notice. Ms. Jegam
suggested the creation of an electricity contract enforcement authority to enforce PPAs to positively impact
private sector engagement into the sector.

1.4. Presentations – EU & Indian Technologies in DRE to pilot in UP

Ayush Misra, Co-founder & CEO, Amperehour Energy

Mr. Misra introduced Amperehour’s innovations – a containerised plug-and-play energy storage system and an
associated energy management system software. He suggested that when projects are implemented at scale,
the LCOE can go down considerably. To implement mini-grids at scale successfully, it is useful to have plug-and-
play solutions that can be implemented in a day’s time and do not require skilled manpower. Amperehour’s
containerised solution specifically designed for mini-grids and provides a single point of support for developers.
Amperehour’s software solution that provides remote data monitoring and is designed to use machine learning
to optimise their algorithm as more data is generated. The data management system is able to showcase the
optimised dispatch of power from mini-grid plants.

Abhimanyu Sahu, Director APAC, Access to Energy, Schneider

Mr. Sahu presented Schneider’s energy management system that allows for real time remote monitoring and
control to ensure demand and revenue management. Smart meters provide data at a household level and there
are many controls on equipment at the source. This helps monitor demand and generation to provide insightful
analytics and optimise the system accordingly. The systems allow for flexibility as it is able to prioritise certain
loads and set limits on them. Mr. Sahu also introduced Schneider’s standardised solution designed for Mini-
grids that contains a complete power conversion system and inverter, and simply needs to plugged into a
battery rack. Finally, he touched upon mini-grids with irrigation pumps as their primary anchor and agro-
processing loads as their secondary anchors. These models are successful as they are commercially viable
despite seasonality, and because loads are run during the day.

Ulrich Zimmermann, COO, Zimpertec GmbH

Mr. Zimmermann introduced Zimpertec as a Solar Home System (SHS) technology provider that has pay-as-you-
go enabled systems for home electrification as well as for productive use applications like on farms and health
centers. He maintained that the key to reducing the LCOE is to have long lasting systems in place. This reduces
installation and maintenance costs considerably. Battery management and technology is crucial to this and
hence Zimpertec uses long lasting Lithium Phosphate batteries. Mr. Zimmermann also touched upon pay-as-
you-go productive use solutions that can be bought or rented, and emphasised the importance of full battery
autonomy for resilient systems.

Veronica Garcia, CEO, Bitlumens

Ms. Garcia discussed Bitlumens’ role in facilitating green technologies in rural India using smart meters and
blockchain technology. In rural areas, there is not only a lack of electricity access and financial services, but also
of reliable data and remote monitoring capabilities. Bitlumens uses a combination of IoT and different smart
technologies such as LoraWan to provide a software solution for the Indian market that uses big data to offer a
financial track record to the end customer. This can be used to provide a credit score to customers and hence
drive investment into rural communities. Ms. Garcia added that they also allow developers to provide carbon
credits by calculating greenhouse gas mitigations at mini-grid sites, having them certified, tokenizing them, and
hence add a potential revenue stream for developers.

1.5. Consolidation of thoughts

V K Tiwari, Senior Project Officer, UPNEDA thanked the speakers for their presentations and acknowledged
the regulatory and financing issues present in the sector. He hoped to receive support from the EU on key
bottlenecks such as slow project lead times, access to finance and the need to incorporate innovative
technologies, especially for battery storage, remote monitoring systems, and smart meters, to make projects
more viable. He welcomed suggestions to make mini-grid more comprehensive, especially in the event of grid
arrival. Mr. Tiwari hoped to see a big scale-up of mini-grids in Uttar Pradesh.

1.6. Vote of thanks

Matthieu Craye, International Relations Officer, European Commission thanked the organisers, speakers and
participants. He appreciated the insightful prospects that were shared about the DRE market in UP and various
high-quality technologies that would help players from the EU enter the Indian DRE market and participate in
the implementation of successful DRE projects. One additional outcome of the webinar has been the costs for
mini-grids can be considerably reduced by up to 50%, in case the full marker potential of 20,000 mini-grids can
be realised with this initiative. Such a cost reduction would lead to further positive impact for the socio-
economic development of related sectors. He stressed the importance of standardising projects and hence
shortening lead times, and hoped to see FICEP produce manuals that would provide innovative mechanisms to
standardise and evaluate DRE projects.

AGENDA
EU-India Distributed Renewable Energy Investment Workshop
Tuesday, 15th June 2021
12:00 pm to 2:00 pm CET / 3:30 pm to 5:30 pm IST

TIME (CET) TIME (IST)

Opening Remarks & Context Setting
Poul V. Jensen, Managing Director, European Business and
12:00 – 12:03 15:30 – 15:33
Technology Centre
Edwin Koekkoek, Counsellor – Energy & Climate Action, EU
12:03 – 12:06 15:33 – 15:36
Delegation to India
12:06 – 12:11 15:36 – 15:41 Chintan Shah, Director Technical, IREDA
12:11 – 12:15 15:41 – 15:45 V K Tiwari, Senior Project Officer – 1, UPNEDA
Launch of the DRE Market Brief Report – Uttar Pradesh
Samit Mitra, Senior Director, Smart Power India
12:15 – 12:25 15:45 – 15:55
Rahul Kumar Kandoi, Associate Director, Smart Power India
Financing DRE in India – What are the current mechanisms available, challenges and asks from the
developers?
Rohit Chandra, CEO, OMC Power
Saugata Datta, India Country Director, Husk Power Systems
Vijay Bhaskar, Managing Director, Hamara Grid
12:25 – 12:50 15:50 – 16:20
Diane Jegam, Regional Director South Asia, PROPARCO

Moderated by: Marcus Wiemann, Director Energy, EU Tech Chamber

Presentations – EU & Indian Technologies in Distributed Renewable Energy to pilot in UP
Ayush Misra, Co-Founder & CEO, Amperehour Energy
Abhimanyu Sahu, Director APAC, Access to Energy, Schneider
Ulrich Zimmermann, COO, Zimpertec GmbH
12:50 – 13:30 16:20 – 17:00
Veronica Garcia, CEO, Bitlumens

Moderated by: Marcus Wiemann, Director Energy, EU Tech Chamber

 Consolidation of thoughts from UPNEDA
13:30 – 13:45 17:00 – 17:15
V K Tiwari, Senior Project Officer – 1, UPNEDA
Vote of thanks: Matthieu Craye, International Relations Officer at
12:45 – 14:00 17:15 – 17:30
the European Commission, Directorate General for Energy
B2B Meetings - Wednesday, 16th June 2021 from 9:00 am to 2:00 pm CET /12:30 pm to 5:30 pm IST