How 'green' is India's telecom growth?

BANGALORE, INDIA: It is a fact that the use of cellphone and Internet has revolutionized the way we communicate.

With its exponential growth the Indian telecommunications industry, which is projected to become the second largest telecom market globally by 2011-2012, is expected to make a revenue to the tune of Rs 1,58000 crore and record a growth rate of 45 per cent CAGR.

But at what cost?

This growth, however, has and continues to be at the cost of the climate, powered by an unsustainable and inefficient model of energy generation and usage, feels Greenpeace. Simultaneously, this growth has also come at significant and growing loss to the state exchequer, raising fundamental questions on the future business and operation model of the telecom sector.

To address this green concern, telecoms in India should publicly disclose their carbon emissions and set a progressive emission reduction target, said the organization, which suggested a few points to solve the ecological as well as economical concerns along with the energy problems brought forth by this development.

Currently, the sector requires 14 billion units of electricity annually to power its growing network infrastructure in order to provide uninterrupted service to its consumers. Out of the existing 3 lakh mobile towers, 1,25,000 exist in rural and semi-urban areas where either the grid-connected electricity is not available or the electricity supply is irregular, the organization said in a briefing paper.

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As a result, mobile towers in these areas, and increasingly in grid connected areas heavily rely on diesel gen-sets to power their network operations.

The consumption of diesel by the telecom sector currently is more than 2 billion litres annually, second only to the railways in India by 2007, points out Greenpeace. This translates to an operational energy expense for the telecommunication sector, of Rs 6500 crore, apart from other infrastructural costs, to operate their network towers, especially in off-grid locations.

In turn, this constitutes around 30 per cent of the sector’s revenue from off-grid services.

In addition to the high operational expenses for the sector, this also results in a loss of around Rs. 1400 crore to the exchequer, considering the indirect subsidies the sector benefits from, in relation to diesel.

The telecom sector in India (public, private, Indian and foreign), through its operations powered by diesel, is responsible for 5.2 million tons of CO2 emissions (13 million tons overall), annually, and responsible for over 2 per cent of the country’s total GHG’s emissions.

Into the future, these trends present a significant challenge to the economic sustainability and growth of the sector’s business model, in addition to its ongoing significant contribution to climate change.

The sector’s significant reliance on diesel to power its operations enhances its economic vulnerability, with increased expenses on the operational costs, as a result of the volatility of prices of fossil fuels in general, diesel in particular, besides the risk of access to depreciating fossil fuel resources.

Moreover, increased consumption of government subsidized diesel by the sector also translates to increased losses to the exchequer, it pointed out.

Continued reliance on diesel will also substantially increase the energy costs of telecommunication companies, besides the added environmental costs in the form of carbon emissions, warns the organization.

Go green, says Greenpeace

In this backdrop, Greenpeace also feels that the telecommunication sector is well placed to decouple its continued growth from continued reliance on fossil fuels, diesel in particular, to a business model which relies on energy efficiency measures in combination with harnessing clean energy sources for its operations.

Advocating the telecom firms to publicly disclose their carbon emissions and set a progressive emission reduction target, Greenpeace said telecom firms should commit to shifting the sourcing of their energy requirements significantly towards renewable sources and make clear investment plans for co-development of renewable energy source along with development of new telecom infrastructure.

It said they should enable a low-carbon economy by playing a significant role in advocating strong climate and energy policy changes in favour of renewable energy sources and technologies at the national and international level.