Operators are considering how to reduce the diesel consumption of electricity generators at mobile base station sites and cut their operational expenditure (opex). Fuel costs can represent 20% to 40% of a typical mobile operator’s radio network opex. Continuing rapid growth in mobile broadband traffic will cause a dramatic increase in operators’ power requirements and costs.
Diesel prices are highly volatile and are expected to continue to rise overall. Moreover, diesel must be provisioned, transported, stored and secured, and it produces large amounts of carbon dioxide when burnt. But when electricity grid access is not available or the quality of electricity supply is poor, diesel may be the only practical solution.
Operators must consider the need to safeguard profits against fuel price rises alongside other cost reduction initiatives such as the sharing of radio sites, re-organisation of operations and outsourcing. Technologies do exist to address this issue by upgrading base stations to hybrid power supplies, if operators can find the necessary capex (typically USD40 000 to USD50 000 per site to install batteries and solar panels, as shown in Figure 1 below). To understand where it is best to invest, they need access to the right information on traffic, revenue and fuel consumption.
![Figure 1: Return on investment in batteries and solar panels for mobile base stations [Source: Analysys Mason]](/PageFiles/16008/Comm_June-2010-David%20Eurin.jpg "Figure 1: Return on investment in batteries and solar panels for mobile base stations [Source: Analysys Mason]")
Figure 1: Return on investment in batteries and solar panels for mobile base stations [Source: Analysys Mason]
Hybrid base stations are built on three core principles: using more energy-efficient active equipment; producing electricity locally; and optimising the use of diesel generators if necessary.
Power consumption on the latest 3G equipment is at least 20% lower than on typical 2G kit. This reduction in power consumption, in conjunction with the use of batteries and a renewable energy source (wind turbines in Europe or solar panels in Africa and the Middle East), has the potential to reduce fuel consumption by up to 85%. A generator operates most efficiently when it is run at full speed, with excess energy then stored in batteries for use when the generator is switched off. The combination of a generator and batteries can reduce fuel consumption by 40%.
However, ‘green’ mobile base stations are still rare. Data from the GSMA suggests that fewer than 10 000 green base stations were in use by the end of 2009. A major reason for this limited take-up is that mobile operators are still struggling to build a sound business case within strict capex constraints.
Any decision to invest in green base stations must be based on detailed information on each of the base stations. Data on traffic patterns and volume, transmission requirements, revenue contribution and the cost of possible solutions must be collected and analysed so that operators can make the most effective use of their investments. It typically takes an operator around two or three years to make a return on its investment in a solar panel configuration (as shown in Figure 1).
For 25 years, Analysys Mason has been assisting players in the telecoms industry to make the right investment decisions at the right time, using our unique quantitative analysis capabilities and unrivalled understanding of the telecoms and IT sectors.