END TO END ENERGY SOLUTIONS WORKSHOP – TELECOM Tuesday , 25th Nov 2014 Ashok Juneja Founder AJ TELECONSULTING & Chief Advisor, Applied Solar Technologies

Applied Solar Technologies rolled out its first solar RE solution in February 2007 Since then AST has become India’s largest ESCO with over 3000 installations for the telecom sites, over 300 for ATM machines and over 80 petrol stations Past six years have been full of learning Diesel is the most expensive solution both economically and environmentally and it is the solution used exclusively when there is no other solution We all strive to reduce diesel consumption to as little as possible Power requirements for Telecom have a very high degree of uptime requirement (no more than 20 seconds of downtime in 24 hours) which makes the total cost of power very high Furthermore this uptime can only be achieved with multiple sources of power and delivery of power as a service Any solution to reduce diesel consumption is very capital intensive and so we must balance customer needs with the IRR needs of the investors and risk mitigation needs of the lenders – without this balance there is no business possible Long term contracts become a necessity for capital intensive businesses

Diverse customers base

Types of Services Offered Solar Hybrid end-to-end energy as a service: ATC/BIL/Indus/Idea Energy Efficiency on a Cluster Basis: MTS Pilot Project with Social Foundations: Rural Microgrid Solar without diesel end-to-end energy as a service: SBI/PNB/BOB All services offered under opex model backed by full SLA needed by our customers

Telecom Customer Needs .. Our Experience Customers demand 99.95% uptime even in most difficult rural areas where the cost of this uptime is very high – But it is hard to justify the cost of this expensive uptime requirement Customer demand heavy diesel reduction (the carbon footprint reduction) Customers want all the equipment O&M (SMPS/PIU/AC/battery/DG etc) so that there is one point of responsibility but lenders are apprehensive of such deliverables Customers want “cluster” model so that ESCO can take care of both RE and non-RE sites

ESCO Company on the other hand needs to satisfy its investors and lenders Investors and lenders participate only if Fund requirement is large (large orders year over year) of at least 1000 towers per customer Minimum 10 year take or pay contracts with no on-demand exit clauses Commercial terms which meet several cash flow criteria of lenders IRR at least as per industry norm ALL PARTIES (CUSTOMERS, ESCOS, and INVESTORS and LENDERS) will have a win-win only if All parties understand each other’s requirements and are willing to compromise Contract sanctity is maintained at all times

Support required at the Policy level Provide RESCO/ESCO industry Infrastructure status so that the cost of credit comes down Remove any entry tax on RE equipment and solutions Access to soft loans Permit blending of grid/DG/Solar/other Res power as an integrated source of energy as a service solution. Current regulations do not permit sale of grid power RE in distributed, high uptime, cannot be sold in terms of KWH but it has to be offered as a service – this recognition is important to understand the total cost of doing business

Thank You