The current government’s promise to deliver ‘24X7 Power for all’ would reap benefits for the power back up industry. The flourishing industry of inverter-battery is expecting a cumulative growth of close to 10 per cent in the coming years as more households — both urban and rural get electricity connections.
The industry estimates the size of market to be 50 lakh inverters and 120 lakh inverter batteries annually. “The market grew between 5-10 per cent every year,” said a sector executive.
Industry executives said as grid electricity reaches tier-2 and 3 cities and rural households, it spurs demand for back up. “We largely expect it to continue to be in line with last 5 years in inverters and batteries and expect growth of over 25 per cent in solar,” Vipul Sabharwal, Managing Director - Luminous Power Technologies Ltd.
He said that tier-3 and 4 towns and upcountry markets would grow faster than the large cities and top tier towns. Luminous has grown by over 15 per cent over the same period.
In the past five years, the inverter-battery segment has shown multi-fold growth with cost also coming down to affordable rates.
Sector is expecting that with government schemes for both urban and rural electrification kicking in, it'd help spur the growth of power backup systems as well.
“When a household starts getting at least 6 hours supply from nil earlier, the aspiration to get more hours of electricity increases. So, the government’s drive to ensure power for all is a blessing for the industry. We would make sure there is reliable power supply,” said an executive with one of the leading battery makers in the country.
At the same, it has phased out the diesel gensets — which was a major competition and held a lion’s share in back up industry, till five years back. Industry experts pointed out that apart from commercial units such as telecom towers, small factory units, MSME units; inverter-battery has wiped out the diesel genset market from domestic segment.
One major addition in the backup segment is solar based solutions. Sabharwal said in the past 3 years, the growth of solar backup systems has increased by 30 per cent. "For Luminous, the growth of solar backup systems has been 50 per cent," he said.
With increasing brand consciousness, the unregulated market of local batteries has fallen significantly. The share of unregulated segment is close to 40 per cent of the market, mostly in the tier-3 towns and rural areas. Demonetisation has hit the unregulated market and could lead to reducing their market further.