Abstract
Rice husk-based electricity generation and supply has been popularized in South Asia by the Husk Power Systems (HPS) and the Decentralised Energy Systems India (DESI), two enterprises that have successfully provided electricity access using this resource. The purpose of this paper is to analyze the conditions under which a small-scale rural power supply business becomes viable and to explore whether larger plants can be used to electrify a cluster of villages. Based on the financial analysis of alternative supply options considering residential and productive demands for electricity under different scenarios, the paper shows that serving low electricity consuming customers alone leads to part capacity utilization of the electricity generation plant and results in a high cost of supply. Higher electricity use improves the financial viability but such consumption behaviour benefits high consuming customers greatly. The integration of rice mill demand, particularly during the off-peak period, with a predominant residential peak demand system improves the viability and brings the levelised cost of supply down. Finally, larger plants bring down the cost significantly to offer a competitive supply. But the higher investment need and the risks related to monopoly supply of husk from the rice mill, organizational challenges of managing a larger distribution area and the risk of plant failure can adversely affect the investor interest. Moreover, the regulatory uncertainties and the potential for grid extension can hinder business activities in this area.
Highlights
Out of 737 million tonnes of paddy produced in the world in 2012, 90% came from Asia and South Asia contributed about 30% of this production [1]
A part of the waste is used as fodder and in brick kilns, while a Abbreviations: Build and Maintain (BM), build and maintain; BOM, build, own and maintain; BOOM, build, own, operate and maintain; CDM, clean development mechanism; CNG, compressed natural gas; DESI Power, Decentralised Energy Systems India Private Limited; HH, households; Husk Power Systems (HPS), husk power systems; PoA, Programme of Activities; PV, photovoltaic
Rice husk gasification is commonly used in small-scale plants for electricity access and two commercial ventures, namely the HPS and DESI Power have been quite successful in this respect
Summary
Out of 737 million tonnes of paddy produced in the world in 2012, 90% came from Asia and South Asia contributed about 30% of this production [1]. Few attempts have been made in South Asia, in India, to utilize rice husk for electricity generation. The Ministry of New and Renewable Energy in India has been promoting biomass gasification projects under various schemes and it is reported that there are 60 mini rice husk powered electricity plants operating in various parts of the country. The purpose of this paper is to analyze the business model and techno-economic feasibility of rice husk based electricity generation to understand the basic conditions required for developing a viable husk power business. The paper is organized as follows: Section 2 presents a review of the HPS business model and DESI Power model; Section 3 considers rice-husk based electricity generation for rural applications with and without rice mill demand and checks for the viability of such a system. Some concluding remarks are presented in the last section
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