Tata Power is looking for funding from long-term capital providers such as foundations and sovereign wealth funds to give a further fillip to its micro grid initiative.

In November 2019, Tata Power, along with Rockefeller Foundation, launched an initiative to set up 10,000 micro grids over five years to provide electricity across places where it is scarce or unavailable. In line with this, it formed a company TP Renewable Microgrid, which will be operated and managed by Tata Power.

“We are looking at long-term capital with relatively lesser return expectations,” Tata Power CEO Praveer Sinha told BusinessLine . Foundations such as Omidyar, United Nations Foundation and sovereign wealth funds such as CDPQ invest in sustainable ventures.

What is a micro grid?

A micro grid is a mini version of an electric grid that serves a smaller geographic area, such as a college campus, and can power appliances such as fans, refrigerators and TVs.

The initial micro grids are proposed to be set up in Bihar.

“There is a larger construct of the government wanting to provide 24/7 power. How that can be achieved at very affordable costs — This is where we come in,” said Sinha.

Where Tata Power is looking to differentiate is in trying to build an ecosystem ranging from power producers, to distribution companies, and smart meters and getting the nod from people in small towns and villages.

Challenges ahead

“The only challenge we see is in people accepting it. But over time they will,” said Sinha, pointing to Tata’s legacy of building communities. Another area where Sinha sees the effort is different has to do with micro entrepreneurship.

With access to continuous power, entrepreneurship opportunities in healthcare and digital learning open up.

“There is also a possible shift in socio economic conditions which could arrest urban migration, as people in rural places would get earning options,” according to Sinha.