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Power of Green

A commitment to clean energy innovation is empowering the lives of millions, allowing them to achieve their dreams without harming the planet.

Uttar Pradesh is India’s largest state – with 200 million people – and also one of its least developed. While the state neighbours the capital New Delhi’s rapidly modernising urban sprawl, villagers often lack a key basic need to achieve their aspirations for a better life: electricity.

India’s OMC Power is working to transform this picture in a sustainable manner, partnering with Mitsui & Co. to build a network of small-scale solar farms in Uttar Pradesh and across the subcontinent. OMC’s unique “ABC Model” propels Anchor customers, Businesses and Communities to a brighter future – powering telecom base stations and laying cables directly from power plants to homes, shops, schools, banks and hospitals.

The Indian mini-grid project is one of several green power initiatives Mitsui & Co. is developing with global innovators to allow people around the world to achieve their ambitions with minimal impact to the environment, including biogas and electric vehicle technologies.

Use OMC Plant OMC Power’s pioneering ABC model sends electricity from micropower plants to telecom towers, from which it is distributed to business and homes via smart grids – enabling community life across India

While such solutions are needed everywhere, huge developing nations like India in particular need vast amounts of energy on their journey to prosperity – and it’s imperative that the story does not end in climate tragedy. That’s why Mitsui & Co. has committed, as a pillar of its enterprise vision, to imaginative green energy solutions such as OMC’s microgrids to power sustainable growth.

“Until now, rural electrification in India was covered by fossil fuels such as diesel and kerosene,” says Koichi Yamada, CFO of OMC Power, seconded from Mitsui & Co. “But OMC Power is more stable and has less environmental impact by combining solar power generation and batteries at a lower price. That contributes not only to the development of the regional economy but also to reduction of carbon emissions.”

More than an energy supplier
In India, OMC views itself as more than a power company, essentially an empowerment platform for rural life. There’s critical need. Roughly 70 per cent of India’s 1.3 billion population live in rural areas. More than 300 million Indians have limited or no access to electricity.

Our mission is to contribute to the economic development of villages, to empowerment and safety of women, and to education, healthcare and inclusiveness

Rohit Chandra, CEO of OMC Power

By lighting up homes at night, OMC allows children to study longer for school. Stable power means village stores can extend opening hours. Supplying energy to hospitals transforms the quality of healthcare. Firing up telecom towers helps villagers use mobile phones around the clock – opening a wealth of opportunity by keeping people connected to information, digital finance, e-commerce and e-health services.

OMC has a “layered service” business model in which power infrastructure meets multiple needs, such as clean drinking water, cold storage for fruits and vegetables, electric vehicle charging and access to e-health services.

“Our mission is to contribute to the economic development of villages, to empowerment and safety of women, and to education, healthcare and inclusiveness,” says Rohit Chandra, CEO of OMC Power.

Interviewees From left, Alwin Thomas, OMC Power, seconded from Mitsui & Co.; Anil Raj, MD of OMC Power; Rohit Chandra, CEO of OMC Power; Koichi Yamada, CFO of OMC Power, seconded from Mitsui & Co.

Waste gas to clean energy
Some of the technologies Mitsui & Co. is championing may sound like science fiction – yet have huge real-life implications for sustainable development. LanzaTech, one of Mitsui & Co.’s “business innovation investments,” is using microbes to transform waste gas containing CO and CO2 into clean ethanol – turning the culprit in global warming into a clean energy hero.

The technology is not a dream but reality. In the Chinese province of Hebei, Beijing Shougang LanzaTech New Energy Technology fired up the world’s first commercial facility converting industrial waste gas from a Chinese steelmaker into next-generation ethanol in 2018 – using LanzaTech’s gas fermentation technology. The plant has capacity to produce 45,000 tonnes of ethanol per year.

The LanzaTech Freedom Pines Plant (USA) in June 2019 The LanzaTech Freedom Pines Plant (USA) in June 2019
Copyright LanzaTech

Meanwhile, LanzaTech’s clean energy solution is taking to the skies. Mitsui is developing a business specialising in Sustainable Aviation Fuel (SAF) production, using another LanzaTech proprietary technology called Alcohol to Jet (ATJ). Momentum for SAF is gaining globally due to its potential as a key resource for CO2 emission reductions in aviation beyond 2030.

Mitsui is conducting a feasibility study on deploying ATJ in SAF production, aiming to be the first Japanese player to produce SAF on a commercial scale.

Partnering for planet’s future – in mobility and beyond
Clean transport innovation, another focus of Mitsui & Co.’s environment strategy, is bringing about a paradigm shift in the way we think about mobility. The sogo shosha is committed to being at the forefront of this eco-friendly transport revolution by investing in electric vehicle (EV) development, EV core components and battery packs, fuel cell technologies, and innovative services such as energy management and the sharing economy.

Portugal’s CaetanoBus provides EV buses in London Portugal’s CaetanoBus provides EV buses in London.

One key Mitsui & Co. partner is Portugal’s CaetanoBus, a developer of EV and fuel cell buses. It recently won a contract to supply London’s iconic red buses. The company’s edge is not just superior batteries. CaetanoBus thinks of total green transport solutions, including safe aluminium bodies – which enable reduction in weight, greater energy efficiency and fewer carbon emissions.

With valued partners from India, the United States, Portugal and beyond, Mitsui & Co. is helping to drive the clean energy revolution in sectors that are critical for humanity’s future – empowering lives in nations both developed and emerging.

The Challenges The Potential The Solutions The Successes

Challenges

India has a population of 1.3bn. Its most populous province, Uttar Pradesh, is home to about 200m people. According to the Energy Sector Management Assistance Program (Esmap) of the World Bank: “Over 100 million people [in Uttar Pradesh], at least half of the rural population, lack a formal connection to a distribution grid.”

Despite a government pledge to supply power to every Indian citizen by 2019, bringing electricity to remote villages remains a challenge. Rural electrification lags behind goals in part due to the inability of traditional power-distribution companies to fund grid expansion.

Esmap estimates that the basic energy needs of an Indian household without an electricity connection can absorb up to a third of all monthly expenditure. Kerosene lighting is not only expensive but also damaging to individual health and the environment.

Potential

Small-scale solar farms feeding mini-grids each with capacity of 10kW to 500kW are increasingly expected to play a key role in clean electricity generation in Uttar Pradesh and across rural India, powering homes, small businesses, schools, banks and even hospitals.

The World Bank notes that women are key mini-grid customers in low-income countries, with loans increasingly available to female entrepreneurs wishing to access mini-grids. In India, the World Bank stated in 2019: “Initiatives like these result in better-managed mini-grids with higher load factors, leading to increased profitability.”

The success of mini-grids in Asian countries is expected to encourage their use globally, notably in Africa. Esmap estimates the annual global profit potential for private-sector developers for 2019–2030 at $3.3bn. Net-profit potential across all mini-grid component and service suppliers in 2030 alone would then be $4.7bn.

Solutions

In 2017, Mitsui & Co entered into partnership with OMC Power, one of the world’s largest mini-grid operators. In the medium term, OMC aims to operate 1,000 mini-grid-based power plants with a total generation capacity of 50 MW, delivering electricity to more than 1m people.

Asia now has more than 16,000 installed mini-grids, representing 85% of the global total. The three countries with the most mini-grids are Afghanistan, Myanmar and India.

Mini-grid capital costs are declining and are expected to continue a downward trend through 2030. Costs of key mini-grid components, such as solar panels, inverters, batteries and smart meters, have decreased by 62–85% in a decade.

Successes

Over 80 per cent of mini-grid users in India are satisfied with their connections, according to a consumer report by Smart Power India. Data was collected from over 10,000 rural households and 2,000 rural enterprises across four states – Uttar Pradesh, Bihar, Odisha and Rajasthan.

High satisfaction was due in part to the fact that mini-grid users receive uninterrupted electricity during evening hours of 5pm to 11pm, when grid-users face three hours of power cuts on average.

In 2017, news agency Thomson Reuters spoke to Anita, one of OMC’s first customers in the Uttar Pradesh. Having had no electricity, Anita now had three lights, one each in her room, her son’s room and her kitchen. “Earlier, the children would have to go search for a light to study by,” said the widowed mother of two. “But now they study at home and I can do housework even at night.”

About Mitsui & Co.
Mitsui & Co. is one of the largest global trading and investment companies. Founded in Japan in 1947, we maintain a unique, unobstructed view of international markets through its worldwide network spanning across 66 countries and regions, with a diversified business portfolio stretching across six key sectors; Metals, Machinery & Infrastructure, Chemicals, Energy, Lifestyle, Innovation & Corporate Development.

MITSUI & CO