India’s massive power outage left a full 50% of India’s population without electricity. Globally, that equates to 10%% of the world’s population, a staggering number. Indians are virtually cut off from the world, as computers and cellphones, often their lifelines to business, sit unpowered.
It’s summer in India and for the second time in a week, India’s antiquated power grid has crashed. Pictures of traffic gridlock worse than normal splatter the news. Much of India relies on hydropower generation, and minimal rainfall in some areas has decreased the power being generated from hydro sources, over-burdening India’s coal-fired plants as they attempt to pick up the slack.
So who profits when the lights go out? This wake-up call will undoubtedly spur infrastructure revitalization and growth which will take decades to implement. If the designers of a new infrastructure plan are forward-looking, they will include renewable energy power generation an important part of the new system. And as the as the country plans for future power needs generators and distributed generation technology installations should increase.
As an investor or business seeking to do business in India’s power sector, look for companies that are providing consulting services that will help plan the infrastructure revamp, equipment manufacturers and installers, and local India entrepreneurs who understand the on-the-ground needs and challenges, and who have developed solutions to those problems.
The task ahead is immense. A full 25% of India’s population does not have access to electricity. Piracy of power by jimmy-rigging transformers is rampant. It is estimated that a whopping 30% of power generated is hijacked.
There are more than a few challenges to improving or revamping India’s infrastructure. The most daunting might be India’s reluctance to allow foreign innovators contribute to the solution. Another challenge is that due to the sheer size of the problems and lack of clear long-term plan, and questionable return potential, companies are wary of committing to a longterm position.
The power industry in India right now can be likened to the Wild West in America. Laws and enforcement are minimal, and the equivalent of stagecoach holdups are rampant (power theft). Blackouts will likely continue on a regular basis until India’s powers-that-be either internally develop a longterm investment plan – and plan to garner the money needed to implement it, or allow the rest of the world to be a part of the solution.