As temperatures rise in many parts of India, the cost of air conditioning for telecom towers is expected to rise. These facilities are important to ensure uninterrupted operation of base stations for mobile connectivity around the clock.
According to a report in Economic Times, industry executives and analysts said that telecom operators such as Jio, Airtel and Vodafone Idea will find it difficult to install towers if the heat wave continues and that power and fuel demand could increase. Typically, transmission tower operators pass on fluctuations in energy costs to the network operators.
How heat waves affect mobile connectivity
Industry experts also warn that the current scenario could delay the expansion of the drilling rig network in the short term. It is also important to mention that Indian tower construction companies are already used to working in hot weather.
Mohit Rana, a telecom expert who works closely with mobile operators and is currently a partner at Red Seer Strategy Consultants, told ET in a statement: “Due to temperature changes, operators are forced to reduce energy consumption to air-condition active infrastructure.” (e.g. mobile base stations) are located in communication towers, especially to ensure that costs and fuel costs can increase by about 3-5%. ”
The rise in diesel prices can make things difficult for transport companies
The cost of electricity and fuel required to operate communications towers accounts for 45-55% of the annual operating costs of the operator’s network. Diesel accounts for almost a third of these costs at the pan-India level. Network operating costs account for approximately 20-24% of a telecommunications company’s revenue.
In addition to diesel, the telecommunications company’s energy costs include electricity costs (to support the network) and battery costs.
According to this report, analysts claim that telecom companies face a double challenge if oil majors hike diesel prices after the general elections. This could impact these companies’ profits unless the current heatwave subsides.