Telecom industry’s “diesel exploitation” exposed

Greenpeace report estimates loss to state exchequer at Rs 2600 crore annually

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Press release - May 18, 2011
New Delhi, 18th May 2011 -- Greenpeace released a report “Dirty Talking – A case for telecom to shift from diesel to renewable” today exposing how the subsidy on diesel has been aggressively exploited by the telecom sector, resulting in an annual loss of around Rs 2600 crore to the state exchequer (1).

The report builds on the previous industry and government research which show that at current growth rates, the sector would require 26 billion KWh of electricity and 3 billion litres of diesel by 2012, contributing to a much larger carbon footprint than previously estimated (2).

However, the report also shows how the sector can become a transformative force by adopting renewable energy for their business operations and advocating economy wide climate and energy solutions.

"With growth, the sector’s appetite for energy will increase, making it a significant source of Greenhouse gas (GHG) emissions unless the industry adopts and advocates renewable energy use and backs laws to cut global warming," said Mrinmoy Chattaraj, Climate and Energy campaigner, Greenpeace India and co-author of the report.

Despite the clear and visible benefits of shifting to renewable sources of energy the sector has been reluctant to make this positive transition in a substantive way.

"The telecom sector is well positioned to transit to a low-carbon growth trajectory. They must use their influence to promote policies that will allow them to grow responsibly without helping to fuel climate change” Chattaraj added.

Key findings of the report can be summarised as:

  • The telecom sector in India emitted over 5.6m tonnes of CO2 in 2008 on as a result of diesel use (3).Emissions have since risen, and are likely to increase significantly with the sector’s predicted exponential growth over the next few years.
  • A shift in power sourcing to renewable technologies, such as solar photovoltaic, will result in a close to 300 per cent reduction in total costs (CAPEX + OPEX) for telecom operators, in comparison to a diesel generator (DG) based tower over ten years.
  • Failure of the industry in disclosing its carbon emissions and committing to reduction of emissions in a public and transparent manner on a consistent basis. Major telecom companies within the sector are particularly guilty of this (4).
  • Similarly, telecom operators have yet to shift the sourcing of their power requirements to renewable sources at scales of significance. The investment required to power the entire network towers in the country by renewable is approximately Rs 151000 crore, which is more economically feasible than diesel based network towers in the longer run (5).

Abhishek Pratap, Senior Campaigner, Climate and Energy, Greenpeace India said, “For telecom operators, the business case for a significant switch to renewable energy is a robust one. Quite clearly the question for the Indian telecom industry to respond to is; are they willing to shift, in the interest of environment and indeed their long-term business prospects?”

Greenpeace is calling on telecom operators to publicly disclose their annual carbon emissions and shift toward clean source of energy by powering 50 % of their mobile towers through renewable energy by 2015.

The full report and other information is available at http://www.greenpeace.org/india/Global/india/docs/cool-it/reports/telecom-report-may-2011-web-optimized.pdf

Notes

1.     A subsidy of INR 7 to 11 per litre on diesel to artificially reduces the cost of the fuel by around twenty-one per cent, allowing it to be sold at a lower price primarily for the transportation of essential goods, public transport and agriculture. Due to absence of duel or differential pricing of diesel fuel for industry, telecom sector aggressively exploited as sector consumption of diesel grown to 3 billion by end of FY-2010-11.

2.     In IDFC 2009 industry discussion, KPMG in its analysis projected setting of 797,000 Base Transceiver Station (BTS) by end of 2012. Since each BTS consumes 32,734 units of electricity annually, a cumulative figure from mobile towers comes over 26 billions of units by 2012.

In 2008, according to Ministry of New and Renewable Energy (MNRE), telecom sector consumes 2 billion litres of diesel annually for running mobile towers which grown to 3 billion in year 2011 with 30 % growth rate.

3.      The overall emission of Telecom Network Towers (Diesel Consumption and Grid connected electricity in combination) was around 13.6 m Tons.

4.     TRAI’s recent approach paper on Green telecommunication which clearly stress on need to take proactive steps in disclosure of carbon emission and setting of target for clean energy purchase for mobile towers particularly in rural off-grid area where most of telecommunication expansion happening. http://www.trai.gov.in/Green_Telecom-12.04.2011.pdf

5.     Telecom sector spend INR 126 billion annually on diesel fuel. If subsidy of 21 % on diesel fuel removed for telecom sector, the cost of diesel fuel for telecom sector would go to INR 150 billion annually. On the other side, the cost to solarise entire network towers with initial expenditure and no or marginal operational expenditure is equivalent to annual diesel cost for next 10 years.

For more information visit www.greenpeace.org/india

Contact:

Abhishek Pratap, Sr Campaigner, Greenpeace India, +91 98456 10749,

Shashwat Raj, Media Officer, Greenpeace India, +91 968686 1974,

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