Telecom Equipment Manufacturers' Association of India (TEMA) has said that the telecom towers in the country are costing exchequer a whopping Rs. 4,300 crore per year though subsidy on diesel.

In a letter to the Prime Minister Manmohan Singh TEMA said that almost 60% of the power requirement of telecom towers is met through use of Diesel Generator sets (DG Sets). The electricity available at the sites across major circles varies from 7-21 hours per day. There are hundreds of sites whose dependence on DG sets is almost 100%.

As per the TRAI recommendations issued in April 2011, approximately 8760 litres of diesel is consumed per year per site (assuming that on an average each site is operating for almost 8 hours on DG set), which works out to around 3.5 billion litres of diesel consumption by telecom towers alone. This alarming fact was even pointed out by the then Environment Minister Jairam Ramesh, in June 2011, who had justifiably questioned the subsidy benefit to the telecom operating companies and had advocated for its withdrawal.

The subsidy works out to more than Rs 85,000 per tower per annum. This simply translates to a mind boggling figure of a total loss of more than Rs 4300 crore per annum to the exchequer.

TEMA said the number of telecom towers essential for providing connectivity to all areas has also gone up exponentially. As per TRAI figures, the total number of telecom towers in the country at the end of 2010 was about 400,000. It is estimated that presently India has about 500,000 telecom towers with an average power consumption of around 3-4 kW per tower site.