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Power Woes : Growth Interrupted

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Voice&Data Bureau
New Update

In the past few years, the enormous growth in mobile services has been
restricted largely to urban India. But today, the scene has changed completely.
'Go rural' is the latest buzz in the telecom circle, making rural India a
popular destination for telcos, infrastructure providers, VAS players and
vendors. However, even with a foolproof action plan in place, the major
challenge for them lies in providing connectivity at affordable prices to those
in rural and remote areas.

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India might have gained the status of the country with the fastest growing
telecom industry, but there are major impediments that have to be overcome by
industry stake-holders. Basic issues like low literacy, shortage of spectrum,
energy and fuel crisis in rural India are not being addressed, and today, these
issues have become some of the biggest challenges for infrastructure service
providers.

Long power outages result in increased operating expenses of telecom
companies. There are around 80,000 villages in India without electricity, and in
villages that are already wired, power supply continues to be erratic. The
current per capita power consumption is about 612 kwh per year while the world
average is 2,596 kwh. So when it comes to setting up infrastructure in rural
areas, the operators and infrastructure companies are having a tough time.
Uniform electrification of rural India and setting up infrastructure towers is
an uphill task for both the government and private players and the recent global
fuel and energy crisis may stoke this power crisis.

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Hampering Growth

Rural areas present a large untapped market for mobile operators to build
coverage and connectivity. The rural market is characteristically different from
the urban and semi-urban market, which poses new sets of challenges for
operators and infrastructure providers setting up infrastructure in remote
locations. While in some areas geographical barriers are problem, the other
major problem but the lack of power-all this when capex in rural areas is
already high.

Tower sites in rural areas are distinctly different from the urban. Normally,
urban sites are constructed on rooftops in densely populated areas. These urban
rooftop sites require 9 to 18 meter high towers. However, in rural areas the
towers need to be constructed higher, which means a higher capex.

"Power and energy scarcity is a major challenge while setting up towers in
rural areas. Moreover, it's an obstruction during the construction phase, as
this leaves us dependant on alternative sources like gensets which adds to our
input cost," says Probal Ghosal, CEO, Quippo Telecom Infrastructure.

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Shortage in power and energy availability is hampering expansion plans and
has become a bottleneck to strong infrastructure. Due to the lack of regular
power supply in rural areas, cost of bridging electricity boards at the site is
high, diesel sourcing outlets are limited and operational cost of the site is
high, as most of the time the site is running on gensets.

Prakash Ranjalkar, coo, GTL Infrastructure says, "It is an undisputed fact
that better power and road infrastructure will help in rapid deployment of
telecommunications infrastructure in the hinterland."

"Longer waiting period and feasibility of grid power is difficult to
ascertain before site readiness; frequent and longer outages of grid power; and
accessibility in water-logged areas, especially during monsoons, are some common
problems while expanding in rural areas," he adds.

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A growing population and increasing demands for electricity by the rapidly
growing industry sector is widening the gap between demand and distribution of
power furthur. This has led to a severe power crisis in rural India. Power
companies and state electricity boards are unable to provide electricity for
more than a few hours in a day in rural areas. Therefore, the process and cost
of rolling out telecom sites becomes prohibitively long and high. Moreover, due
to regular outages, sites require running of DG sets for several hours.
Electrical energy from DG costs more than double the cost of electricity board
power.

Ajay Madan, CEO, Essar Telecom Infrastructure says, "Yes, power and fuel
crisis are major issues. The electricity board takes a long time to connect
sites to the grid. We have had to install two DG sets to provide power on a 24x7
basis. The energy bill for the operator also increases, as running on diesel is
costly. In addition, the O&M cost also increases, as diesel filling needs to be
more often and DGs need more frequent maintenance."

It is an undisputed fact that
better infrastructure of power will help rapid deployment of
telecommunication infrastructure in the hinterland


Prakash Ranjalkar, COO, GTL Infrastructure

There is a need for
sophisticated R&D producing bio-fuels from renewable energy resources like
agriculture residues

Deepinder Bedi,
deputy director, Tulip Telecom

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The Savior

Wireless last mile infrastructure can have a positive impact on the economic
and social development of the rural areas in the country. Seventy percent of
India's population lives in rural areas that are underdeveloped in terms of
infrastructure. Inadequacies in generation, transmission and distribution as
well as theft and inefficient use of electricity restricts availability of
power.

Deepinder Bedi, deputy director, Tulip Telecom points to a solution to the
power problem: "As we all are aware of fact that power outages in the rural
areas are very common and effect business operations, there is a need for
sophisticated R&D for producing bio-fuels from renewable energy sources like
agriculture residues. These bio-fuels can easily power the existing gensets."

Avoid Fuel Crisis

The fuel crisis has opened a plethora of concerns all over the world. And,
India being the second largest populated country in the world, the situation is
even grimmer. To safeguard their interest, telecom infrastructure companies are
working to adopt various measures to safeguard their interests. For instance,
GTL Infrastructure is putting in a lot of effort to ensure uptime even in the
most challenging conditions. At present, the company is testing energy
management solutions to improve the overall efficiency, which includes:
identification of energy efficient air-conditioning system with high EFR (energy
efficient ratio); free cooling/emergency free cooling concept of
air-conditioning systems to utilize cool ambient temperature for reducing
compressor running; wide input voltage range SMPS for better efficiency even at
lower input voltages; fuel optimizer method of operating DG interleaved with
battery back-up; and usage of energy star-rated products.

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To monitor site parameters, GTL has created dedicated national network
operation centers, which will bring in operational efficiencies. The company has
also deployed dedicated O&M teams in each circle.

Telecom operators and infrastructure providers are exploring non-conventional
and renewable alternative energy sources like wind power, solar energy, and
bio-fuel for running infrastructure sites.

Quippo Telecom Infrastructure has employed several measures such as: higher
capacity battery banks for increased back up hours; optimized use of electricity
boards and diesel gensets through automation at sites; use of solar and wind
hybrid as alternate source of energy; implementation of diesel saving technology
like fuel savers; and installation of wide-band static voltage stabilizers to
maximize use of electricity board at the tower site.

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Essar Telecom is working out a hybrid of solar and wind energy solutions. For
reducing the need for frequent diesel filling, large storage tanks are being
installed with special pilfer-proof caps.

Tulip will be rolling out solar installation soon, as the company is on a "Go
Green" mission. They aim to reduce the use of diesel generators substantially in
the near future. Tulip also provides connectivity using multiple wireless
technologies for access in the rural areas. Its solutions are IP-based using
wireless technology to deliver high quality of voice, data and video. The
company has also tried to address power challenges using high-grade, spike-proof
power interfaces and ruggedized radio equipments. A majority of their wireless
PoPs in the rural areas have uptimes in excess of 99%.

Major Demands

Ghosal of Quippo Telecom Infrastructure says, "With an aim to provide strong
infrastructure for telecom operators, we place certain demands on high
importance. Some of our distinguished demands are use of low power consumption
base transceiver station, and government guidelines directing the state
electricity board for prioritizing availability of electricity board to telecom
sites, and at subsidized rates."

The government should subsidize
the rural tower sites, and also active infrastructure sharing should be
allowed

Ajay Madan, CEO, Essar
Telecom Infrastructure

The rural potential is certainly
an area of prospects with its untapped market and increasing traffic


Probal Ghosal, CEO, Quippo Telecom Infrastructure

On the measures that need to be taken Ranjalkar of GTL Infrastructure says,
"Proactive support of electricity companies to provide power connections for
tower sites, simplified processes of approval from municipalities/gram
panchayats and uniform guidelines in all states for levies/fees are some
measures that will have a positive impact on growth of rural communications."

"The rural tower sites should be subsidized by the government and also active
infrastructure sharing should be allowed," says Ajay Madan of Essar Telecom
Infrastructure.

For any project to be successful, it is very important that the government
works closely with the corporate sector and with the agencies working at the
grassroot level. While the corporate sector can provide the necessary
technological and managerial support, the organizations working at the ground
level can create the necessary trust in such utilities among people.

Bedi of Tulip Telecom adds, "Although we have been able to address power
concerns using innovative techniques, stable power availability will allow us to
further increase the pace and reach of our endeavor."

Future Plans

Inspite of the huge energy crisis, Infrastructure and power companies are very
aggressive about rural expansion. At present, GTL infrastructure is operational
in 18 telecom circles with a total of 7,000 towers. Approximately 75% of these
are in rural areas and 5% of them are in most rural (USO) locations. The company
has a vision of creating 23,000 towers by 2011 and 60-65% of these will be rural
sites covering 50,000 villages.

Quippo Telecom has 1,854 rural sites, and it foresees demand and expansion in
various areas like rollout of sites for IP business also.

The company expects substantial rise in the number of site rollouts by
partnering with existing and newly licensed operators, as the present rural
teledensity of 9% is a huge opportunity. Quippo is also expecting incentivized
schemes by the government to compensate tenancy if it is less than three. This
can be a deviation to USOF subsidies.

Considering the robust plans for the future, it seems that telcos, and
infrastructure and power companies are committed and are working vigorously to
explore and expand their network reach to far-flung areas. But the power and
fuel crisis is coming in the way of a successful rollout.

Trai encouraging infrastructure sharing, could help greatly reduce the
pressure on power and infrastructure companies, helping them to deal with the
power and fuel crisis.

Arpita Prem

arpitap@cybermedia.co.in

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