Easy availability and cost-effectiveness has led to solar energy making inroads into most service sectors in India. The banking industry is no exception with most harnessing solar energy to cater to their power requirements
New age banking in India has meant not just digitisation and greater use of technology, but longer working hours as well. In such a scenario, where continuous power has become a pressing need, solar energy has proven to be extremely effective.
It is not surprising therefore that most banks in India are now adopting solar energy to ensure their work goes on unhindered. “Many banks, including State bank of Hyderabad, ICICI Bank, Andhra Bank, Axis Bank, Ratnakar Bank and State Bank of India have installed solar power across their branches. Most of these systems have been under the capex model where they purchase the system outright and are installed at multiple locations, especially rural locations,” says Vikram Dileepan, co-founder and CEO of SolarTown Energy Solutions Pvt. Ltd.
SolarTown, currently working with banks in urban and rural areas across India, was the first to offer a lease/PPA (power purchase agreement) financing option for solar rooftop installations under 100 kW. Recently, it installed solar rooftop systems at multiple branches of Ratnakar Bank Limited (RBL). Each system was installed under SolarTown’s zero-down business model where RBL enters into a 10-year fixed monthly lease agreement with no upfront costs. The solar assets are transferred to RBL after the 10-year lease period.
The bank is adopting energy efficient systems and processes to have assured power, make efficient use of resources, better management expenses and promote clean energy, said Manoj Rawat, head of agri business, government schemes, renewable energy and priority sector, RBL Bank. It has implemented solar rooftops in 10 branches to get predictable energy with better uptime of 98%. The conversion to solar, he added, “makes significant commercial sense as the monthly diesel generator running expenses are completely eliminated.”
RBL, which provides credit to clean and renewable energy projects such as solar based agriculture pumping system so that farmers can replace diesel pump-sets, has also been promoting efficient micro-irrigation in states such as Maharashtra, Karnataka, Madhya Pradesh, Uttar Pradesh, Tamil Nadu and Gujarat.
Now, by opting for solar PV (photovoltaic) rooftop systems at 10 of its own sites, it is likely to save Rs.146,000 (approx. $2,200) a year. Each branch will feature a minimum 3 kW system which will offset a major part of the business’ energy consumption and more than 70 tonnes of carbon dioxide emissions over the lifetime of the solar installation.
Currently, the bank is in the process of converting its other branches to solar too. This includes charging of UPS and converting day energy load to solar energy. Furthermore, it is adopting energy efficient practices in its offices through smart office systems.
Bank of Baroda has also opted for solar power at its 79 branches across India. In an official note, Tata Power Solar, which implemented rooftop solar systems for the bank, stated, “Bank of Baroda wanted to lead the way in embracing green energy by implementing solar systems to power their branches in the rural and remote locations across India. Continuous electricity at the bank will give thousands of households’ access to next level banking experience.”
Accordingly, a solar power-battery based system of 3.85 kW with an inverter capacity of 3 kW, battery bank of 48V that provided 700 hours of electricity was installed at selected locations. All the solar power systems supplied were covered with a five-year maintenance contract. The solar power systems have helped the banks– which were otherwise dependent on grid supply that was erratic at best – in meeting their daily requirement of electricity.
Dileepan feels that banks, like many mission-critical businesses, have a zero downtime requirement. The Reserve Bank of India (RBI) has mandated banks to be present in numerous rural and semi-rural locations where the grid is very unstable. This has led to increasing demand for solar coupled with energy storage. Like other commercial customers, banks also are looking to offset some of the rising costs of diesel to power generators as a primary or secondary energy source. This factor coupled with consumers’ interest in becoming more environmentally conscious is making solar a preferred choice.
According to Dileepan, solar power comes with two very distinct benefits for commercial establishments like banks – first, the cost of generating power through solar rooftop systems have now gotten to the point that it is much lower than commercial electricity tariff even without a subsidy; secondly, solar plus energy storage hybrid systems have the potential to reduce diesel bills when synced with diesel generators during power cuts, eventually reducing total energy costs. This makes solar the preferred choice for many establishments.
Moreover, the fact that companies like SolarTown help businesses like RBL adopt solar power at a fixed cost, lower than current distribution company rates, and enables them to take control of their energy bills and better manage their bottom line has only increased the popularity of this source of clean energy.
Citibank has also adopted solar in its Chennai and Bangalore branches. Amit Paliwal, manager procurement (CITI bank account south), ISS Facility Services India Pvt. Ltd, said, “CITI has adopted a solar project with the aim of contributing towards sustainability projects, clean energy initiative and reduction of carbon footfall etc. Also, the bank has large data centres and other assets like heating, ventilation and air-conditioning (HVAC) equipment, electrical and electronic Items which need huge amount of energy. By adopting solar energy, CITI has reduced its energy demand.”
The move has helped in reducing the total per kW/kWH energy requirement and as a result, the annual maintenance cost is low. Owing to the encouraging response, ISS, he added, will contribute to future solar projects for other banks as well.
Inroad into semi-urban areas
Semi-urban areas have seen an increase in the number of banks. Since these areas have rampant power cuts, at times for long hours, using solar power has helped in providing clean and consistent power.
According to C.B. Arkatkar of the State Level Bankers Committee(SLBC), Maharashtra, “Power problems continue to plague semi-urban and rural areas. Therefore, solar is very convenient and useful. It ensures regular power supply and banking work flows smoothly.”
In the last few years, a lot has changed for the better in the solar sector. In Dileepan’s view, the accelerated depreciation of solar assets has been the single most important factor driving rooftop solar installations. For-profit institutions and banks are much more willing to augment their existing battery systems with solar rooftop systems, especially since it increases their tax savings and supports their ”zero down time” policy for rural branches.
Arkatkar, too, feels that owing to an encouraging policy and the price of solar power coming down, things have improved. “Thereby, prospects of increased usage in bank branches have also brightened.”
India has committed to producing 100 GW of solar power by 2020. That will make it the world’s largest solar power. But for that to happen, virtually every second rooftop in the country will have to produce energy from the sun. Some banks are showing the way by turning their terraces into generators. Others need to follow, while all banks need to reduce the cost of borrowing to install solar power generation systems, whether at factories, offices or homes.