Urban Infrastructure and Utilities

Poor urban infrastructure has been a drag in India’s growth story. Rapid increase in urban population (primarily attributed to migration of people) and city-based economic activities have put urban infrastructure under huge stress. Not to mention the unprecedented level of air pollution in Indian cities. As per the latest data released by WHO, 14 of the 20 most polluted cities (in terms of PM2.5 concentration) are reportedly in India. Not surprising the issue of urban infrastructure has come to the fore of policy-related discourse and cities have become the focus of many of the recent flagship interventions of the Government of India that include 100 Smart Cities Mission, Atal Mission for Rejuvenation and Urban Transformation (AMRUT), and the National Electric Mobility Mission (NEMM) 2020. Moreover, there is growing interest among policymakers to encourage EV-based mobility in cities and phase out fossil fuel consuming Internal Combustion Engine (ICE) driven vehicles. This can potentially transform the transportation landscape in the country. Interestingly, demand side energy efficiency is a critical element in all these interventions.

Globally electricity sector is at a crossroads. It has witnessed some rapid changes in recent times — cost of electricity generation from renewable sources and prices of energy efficient appliances such as LED lamps have come down significantly, while demand for fossil fuels has been largely muted. Notwithstanding, a new wave of disruption is building up, driven by a fall in cost of electricity storage. This may potentially pave the way for faster adoption of distributed energy resources (DER) such as rooftop solar and plug-in electric vehicles. According to some estimates, electric vehicles are expected to constitute about 20% of new vehicle sales globally by 2030 and this may rise to 35% by 2040 (Bloomberg New Energy Finance, 2016). It is envisaged that among other factors, time-of-day of charging and concentration of charging stations will hugely impact the electricity distribution network and load profile of utilities. Application of smart grid and grid interactive end-use appliances would be increasingly important in this regard – to realize power distribution which is more efficient, resilient and nimble.

Urban landscape is going to be the testbed for these transformations. India, one of the fastest growing major economies in the world and third largest energy consumer, is naturally in the spotlight of these developments. Taking cognizance of the need to modernize the power distribution network, in 2015 the Government of India has launched the National Smart Grid Mission to accelerate smart grid deployment in the country.

In the VUCA (Volatile, Uncertain, Complex and Ambiguous) world of today, the role of electricity regulators is extremely challenging. While they have to be mindful of the current financial distress of the utilities, they need to create a regulatory environment which enables the sector to cater to the energy requirements of the 21st Century.

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