GEN, SET, GO!
BY MITALEE KURDEKAR Gensets have always been a necessity in India, but with urbanisation and economic development, they are proving to be even more relevant today
Long before ‘Make in India’ became the talk of the town, India was an established manufacturer of generators. The country has witnessed tremendous development since then, but generators continue to sell like hot cakes. Even as the government is making efforts to build more power plants, our increasing population in metros and Tier II and III cities ensures that power supply will always be outweighed by demand. In addition, the government’s ‘Make in India’ campaign and the sudden spurt in infrastructure and construction projects will definitely aid the generators industry. In addition, many MSMEs are setting up operations in newer cities and this is bound to fuel the growing demand for generators. As a result, manufacturers of generators are looking to keep up with demand by offering better designs – both outside and inside – and continuously improving the standard of their products. Cooper Corporation, for instance, has been in the business of manufacturing diesel engines since 1922. They would get the engines designed by Ricardo (UK) and then develop and market them in India. The strategy has been so successful, that they follow it even today. But they have also remembered to move on with the times. Farrokh Cooper, CMD, Cooper Corporation, explains how they have graduated to modern technology for their engines.
“We have recently installed an emission analyser at the plant. This is one of the latest installations to meet the latest norms – BS IV,” says Cooper of the instrument that he imported from Japan. “Emissions are tested during the development validation. And every year we have to do COP (conformance of production). Then we send the engines to the Automotive Research Association of India (ARAI) for certification,” he adds. His company currently produces 2, 3, 4 and 6-cylinder engines, which are all developed with this environment friendly approach.
One key market for generators is retail and companies are cashing in on the volume of demand in that segment. Sterling and Wilson Powergen has always been focused on big-ticket projects and catering to different verticals. Sanjay Jadhav, president, Sterling and Wilson Powergen, points out, “We are now focused on venturing into the retail market, for which we have designed our products as per the demands of respective areas. The product has been completely stabilised and is also CPCB II compliant. We offer customers a wide range of DG sets right up from 10kva up to 3000kva. We do not place ourselves in a price driven market but believe in performing through a qualitative approach which is our basis for our expanding our export portfolio.”
In keeping with this approach, earlier this year, Sterling and Wilson Powergen announced that it plans to expand its dealer network across India in an effort to bring its products closer to its customer base. Their target obviously will be the Tier II and III cities. The company plans to double its dealer network in the country within this year itself.
Other companies too are capitalising on their ability to provide streamlined solutions to serve customer needs. One such solution is hybrid gensets, and these are beginning to gain wide-spread appeal. JCB is producing gensets clubbed with a battery bank as a cost effective solution for applications where the average running of load is much below the size of the installed genset. The use of these products results in a lesser overall running cost and less mass emission, both being a big advantage for customers. In Europe, this has been a successful product initiative for JCB and the company is exploring the possibility of bringing this range to India in line with increases in demand.
Diesel gensets that are clubbed with solar panels and dual fuel are another hybrid option that is gaining popularity. Al though the efficiency of gensets is affected under dual fuel usage, there is still a growing demand for gensets being coupled with solar plants, where diesel gensets can operate when solar panels are dormant.
“We see that in a DG-Solar-Battery hybrid system, battery would evolve from present lead acid batteries to cleaner technologies like lithium ion batteries. We have already built hybrid solar battery solutions in our portfolio and are working to incorporate lithium ion batteries soon,” says P Palaniappan, business head & senior vice president, Mahindra Powerol.
In the product differentiation battle, gas gensets also seem to be gaining traction over their diesel counterparts. They offer many benefits, but gas availability, better distribution, and Government regulations will determine their demand. The need for a gas grid is a major obstacle, and once established, the demand for gas gensets would probably increase
“The main area of difference between diesel gensets and gas powered gensets for users is the fact that a gas genset is less polluting in nature. It gives the benefits of more carbon credits and has lesser running costs. But these are still not very popular in the small and midrange, mainly because of their high initial cost and an elongated payback period. This arises out of the fact that they are used only in standby applications. Availability of the gas grid is also a limiting factor as currently the grid is available only in a few selected areas. A lot depends on its expansion and the rationalisation of the price as well. Addressing these factors together can certainly help augment demand for gas gensets,” believes Vipin Sondhi, MD & CEO, JCB India.
Of course, falling gas prices are certainly helping to make gas gensets a viable option, especially for captive power generation, even as DG Sets remain an emergency backup, aided in part by their lower operating costs. Diesel generators have a cost analysis in the range of Rs 15-16 /unit in the sub 100kVA range, and the figure improves marginally as you move upwards in the rating, with larger sets generating energy at approximately Rs 13-15 per kWhr.
“Diesel gensets are classified into three categories: LHP, MHP & HHP. Based on the application and power requirement, the applicable rating is chosen. The operating cost depends on the number of running hours, maintenance cycle and fuel consumption per hour. Our generators are highly fuel optimised with longer maintenance cycles, which ensure the lowest operating costs,” says Jadhav.
No matter what the type, generators will now witness sustained demand given the increasing urbanisation across the country. Despite the steady improvements in our power situation, increased economic activity, pressure on power grids for more rural-focused projects and constant transmission and distribution losses are a clear indication that a demand and supply gap is bound to crop up in near and distant future. Going forward, a surge in economic activity will ensure that there is a requirement for reliable power generation at sites, factories, residential and commercial establishments, in turn presenting ample opportunities for diesel gensets.
JCB is focussing on tapping this segment with a world-class product differentiator. “We see this as a good opportunity as this will fuel greater construction opportunities, and with a focus on manufacturing, we feel there will be more demand for a reliable power back up. Large scale infrastructure projects will come in with the success of this campaign and we look forward to the opportunities that will be created by this programme,” confesses Sondhi.
Palaniappan also expects the DG set demand to increase on account of new investments and increasing urbanisation, resulting from the ‘Make in India’ campaign. “We would be ready to tap this opportunity,” he asserts. In order to meet these needs and garner a bigger market share, Mahindra Powerol is looking at developing sustainable technology solutions. They are already working on making biogas plant solutions and their pilot plant is ready and operating. “Our unique proposition is that we can offer this solution along with the equipment to run on the biogas generated,” states Palaniappan.
All things considered, there could not be a better time for genset manufacturers in the country. With demand on the upswing, most players are sprucing up their project portfolio. “Depending on the market demand, we plan to extend our mid-range upwards, in the near future, and to a higher range thereafter. We aim to replicate our best practices from our operations in various parts of the world, where JCB gensets are operating successfully,” states Sondhi.
Mahindra Powerol too plan to expand their engine range from the current 200 kVA and are working on augmenting this range through in house development or strategic partnerships.
Sterling Wilson is currently operating in the entire available range of gensets i.e. from 10kva to 3000kva. Going forward, they plan to push for containerised sets in the Indian market, similar to the ones that are currently seen in their exports segment.
Speaking of exports, Indian genset manufacturers have big plans to go beyond domestic sales. JCB India has been a frontrunner, with their gensets being exported long before they catered to the domestic market. Since the product was well accepted overseas, the company has extended its range to 200 kVA and footprint to over 39 countries now. Meanwhile, Mahindra Powerol is currently focussed on South Asia, South East Asia, Middle East and Africa for exports, while Sterling Wilson services the Middle East, Africa, Asia, and Australia. In fact, diesel generator exports to these countries contribute to around 30% of Sterling Wilson’s overall revenues in India.
With India fast becoming a hub for diesel generator exports, with respect to improved quality, cost and delivery, many manufacturers have been quick to adopt global standards in terms of technology and manufacturing processes. This is only raising the country profile as an established manufacturer of generators, which will only open more avenues for Indian generator manufacturing companies in the days to come.