Adopting Green Energy

A landmark day in Japan was celebrated in May'2012  as they shut down the last of their nuclear plant. Germany has also committed to phase out nuclear power whereas the US has started investing in alternative and green energy like wind and solar.

Where does that leave India? The recent the protests over the Kundakulam nuclear plant brought to the fore the simmering issue once again. A country that has abundant sunlight twelve months a year is far far away when it comes to tapping in to this source of energy. Whenever I have tried to broach the topic of  Solar energy , people have dismissed it calling it an expensive source of power. This at a time when prices of  Solar panels have crashed over the years thanks to the growing demand for Solar energy in the rest of the world.

The problem with our policy makers is that they think big when it is not required. They talk of acute shortage of power and invest in mega nuclear plants . These plants cost millions of dollars when a localized solution costing a fraction of this costs can provide a more sustainable green energy. The developed nations are dumping technology that is being shunned in their part of the world and our policy makers are lapping it up throwing up acute shortage of power as a reason for the same.

Another factor, which discourages localized and green solutions, is the kickbacks that the babus get in mega deals. How much money exchange hands when such kinds of deals are signed is of common knowledge. I am appalled why a country which is facing huge fiscal deficit and ever-growing oil bill is not pushing the use of alternative green energy. The recent budget did provide some concessions to  Solar Thermal project but it left out  Solar Photovoltaic industry, which makes up bulk of  energy market today.

The good thing about Solar power is that you can have localized solutions for eg, a School /Hospitals / Residences can have their own source constructed within the vicinity. Recently I read an article where a house owner in Chennai is able to beat the incessant power cuts by installing Solar power source in his residence. He is the envied one in his locality which plunges in to darkness very often due to rampant power cuts. Of course it is expensive but with support from the government these solutions can be made affordable to a wider base.

NDTV greenathon programme has been successfully lighting remote villages  using  Solar lamps where conventional electricity would take ages to reach. It is amazing that just by providing light after dusk one can alter the quality of life and improve productivity of the rural populations. These villages have no source of power and a simple Solar lamp is playing the role of catalyst in the overall development. Some times exceptions rather than rule hold the key to development. The general mindset is to go by the rule but it pays to step back and think if an exception to rule can help.

If the industry gets the right push the prices will come down driven by growing demand. Scarce financial resources can re-directed to projects that badly need funding.  All this requires political will and also tremendous amount of foresight.

Fighting Cancer and Protecting Intellectual Property Rights (IPR):

Recently the government allowed a local pharma company to sell the generic version of the anti cancer drug Nexavar at 97%  lower than what is charged by the patent holder MNC drug company. This brings the cost of treatment down from the current INR 280000/- to just INR 8880 pm.  A welcome move for ordinary Indians  already crushed under mounting inflation.

Needless to say this would not have gone well with MNC drug companies.  The government made this concession under the compulsory licensing provisions of Patents act. To those who would like jog their memory, India moved from Process patents to Product patents in 2005 and it did not have much choice but to move post the Uruguay round of trade negotiations. The drug is under patent until 2021.

Drug pricing has been a sensitive issue every where. In the US where bulk of the medical innovations takes place and where IPR are well-protected, medical care has become beyond the reach of ordinary Americans. What is the use of innovations if those who need it cannot afford it. The nexus between insurance companies and drug companies has made medical care expensive prompting government intervention in a pure capitalist country like US. Another factor, which has added to the spiraling cost of medicines, is the merger of pharma companies. In the last 2 decades competition among global players had shrunk due to mergers as it has reduced the number of players in the market. It has been a double blow for the patients, reduced competition and stricter patent laws.

While innovation is key to new drug discovery, we cannot ignore the human side of it. Profit is a reward for enterprise but then it cannot be at the cost of life. Agreed MNC companies spend a lot of money on R&D and IPR is their way of recovering the cost of research spend, it is the margins they are looking for which is inhuman. Healthcare should not be treated like luxury industry that operates on high margin and low volumes.

When I was in my early teens, USSR was going through Glasnost and Perestroika. My uncle who is a communist at heart was pained at the developments there. I was a big proponent of privatization and he told me then the perils of giving private enterprise a free run. Today after two decades I understand what my uncle said. Though I still advocate privatization, it has to be bound by humanist boundaries. Invoking of the compulsory provisioning under the patent act is a welcome move. This will send a strong signal to MNC drug companies who are out to make a kill to mend their ways. When a choice has to be made between profit and human lives, the latter should be preferred and no compromise on that.