Thinking globally acting locally

In the last World Economic Forum - India Economic Summit, Prof C.K Prahalad, was talking about how Indian companies have introduced business models to cater to the domestic customers. This did not require any path breaking innovations or creativity. Neither did Air Deccan innovate alltogether a new model of aircraft to ferry passengers at a cost as low as a glass of beer in any of the five star hotel across India nor did Hindustan Lever changed the composition of the shampoo. But both the companies were able to deliver their products and services to the "aam admi". Whether it is Bharti Airtel outsourcing the whole netowrk to IBM or Dr Aravind Eye Care clinic adopting the model of McDonald. All the leaders of the companies mentioned above had one thing in common. They thought globally but acted locally.

Can something similar happen to the energy sector ? Can power be delivered at a cost that would make providing power subsidy to farmers irrelevant ?  I know the questions that will prop in the mind of readers are about the gigantic challenges. The rate of addition to the existing capacities are abysmally low. There are lot of worries about how to achieve the traget set out in each of the five years plans. But those questions have remained for a long period of time and I do not see them being adressed in the near future.

So leaving the worries behind, we need to think globally and act locally. I belive the answer lies probably in decentralisation of power production and transmission. It is about changing the way power is produced and delivered. Producing energy using renewable sources will help in bringing decentralisation very rapidly and without much hassle.

With most of the countries embracing clean technology for power production the cost of equipments will also reduce. Here we have to take into account the benefits of globalisation. A recent article in New York Times mentioned about how the subsidies offered by Chinese government to the manufacturers of solar collectors help in reducing the cost. Even the most innovative companies of Sillicon Valley are not able to compete with the Chines manufacturers. This reduction in cost of solar collectors will be an incentive for local communities in India to set up their own power producing unit on a co-operative basis. As the plants will be run by the very people who will be the end consumer, I think many of the unasnwered question of yesteryears will not remain. Now suppose a village community has set up a local power producing unit based on solar power can also set up a small hydro unit that will be fully operational during rainy season. This will help in addressing the seasonal effects that hinder power production from any one particular renewable energy source. Usage of smart gird technologies can help the local people in adopting the most efficient means of using the transmission facilites. Smart grid techonolgies also enable in better forecasting of power consumption. So the whole operation of power production and transmission will be within the hand of local authority.

This model of power production and consumption can be done on a pilot basis to check out the feasibility. Successfull implementation will also help government to design their policies that may encounrage similar projects to be take up by other local communities.