The Net Metering Guideline-2018 has recently been adopted, aiming to help the renewable energy sector flourish.
The guideline is yet to become popular among consumers and power distribution companies.
On the other hand, many measures planned to increase the use of renewable energy for the last two decades did not succeed significantly.
Shahriar Ahmed Chowdhury, the founding director of Centre for Energy Research at United International University, a Dhaka-based private university, has directly been engaged in researches and projects in the renewable energy sector for around 10 years now.
The renewable energy expert shared his views on the sector’s current scenario when he sat with energynewsbd.com’s Editor Aminur Rahman in an exclusive of late.
energynewsbd.com: The guideline is playing an important role to push up the use of solar power. What is your role in adopting the guideline?
Shahriar Ahmed Chowdhury: The concept of net metering something in which a consumer will use power generated from solar energy. If there is excessive electricity, that will go to the national grid. During weekends, or holidays when factories remain shut, net metering plays an effective role in the power sector.
The tariff of net metering is equal to what a consumer pays for using electricity from the national grid. The consumer can also export the unused or excessive electricity to the grid, which is later adjusted to the electricity imported from the national grid. This is the reason that net metering is much more attractive and effective than feed-in-tariff, to the power distribution companies. Accordingly, it is attractive for the consumers as well.
Feed-in-tariff is a tariff structure which guarantees the renewable energy producer a long-term contract with electricity tariff rate higher than the existing retail market rate. Feed-in tariffs also offer cost-based compensation to renewable energy producers, providing price certainty and long-term contracts that help finance renewable energy investments.
Small solar panels on rooftops of houses or industries are run in a way that those produce much power when there is a great deal of sunlight. If you cannot use the electricity, it will be wasted. But if there is net metering in place, the unused electricity will not be wasted.
For example, if an industry generates 1MW of power from solar energy against its demand of 2MW electricity, he or she has to receive the rest amount from the national grid. A net meter will take the reading of the 1MW as being import. In case of the factory having just a 1MW demand, it will not need electricity from the national grid. When the demand is 1MW and the generation is its double, the user can export 1MW of electricity to the grid.
During weekend or holidays, when the very factory needs half its demand or 500kW of electricity, it can supply 500kW power to the national network through net metering, which will be registered as an export of 500kW by a net meter. In this case, a consumer getting electricity from the national grid is called “import”, and the reverse act--supplying power to the grid--is termed “export”. The consumer doing such export and import is described as a prosumer, who is a producer and at the same time, a consumer as well. The consumer will pay the bill on the basis of export and import of electricity, at the end of the month.
The production cost of each unit of power generated from rooftop solar power panel is a little less than Tk7, where as the amount after VAT being added to it, jumps to around Tk9 when the electricity is supplied to industries from the national grid, clearly depicting that the net metering is benefitting its users by Tk2. This is a lucrative business. One in a few years can get return on the capital one invests for installing a solar panel.
Furthermore, you will get appraisal for helping reduce carbon emission. While drafting the net metering guideline, the policy of 40 other countries each was followed, making it suitable for Bangladesh. This is why the guideline is a modern and effective one.
energynewsbd.com: What is needed to be done to popularise the guideline among consumers, in your opinion?
Shahriar Ahmed Chowdhury: First of all, I would like to say that raising awareness in this regard is vital. The prices of solar technology are declining gradually. Conventional electricity will get pricier in future across the world, and for this reason, the price of grid power will go up as well. The payback period for SHS installment is now up to six years. Payback depends on the size of rooftop and the variety of technology.
If entrepreneurs are informed of the message, they out of their own interest will be eager to install net metering system. The Power, Energy and Mineral Resources Ministry or Sustainable and Renewable Energy Development Authority (SREDA) can take measures to build mass awareness through ads in TV, radio or newspaper. Basically, the net metering guideline has been adopted targeting industries. Even the power distribution companies need to acquire experience to this end. Officials of several of the companies are still in confusion over the guideline, and do not know how to work on it.
The digital meters have the option of net metering which actually remains disabled or the programme needed to operate it is not functional or it needs re-programming. Net metering will show the export and import of electricity and it is easy to calculate these at the end of the month.
The biggest facility of the method is that nobody needs to handle the current electricity infrastructure physically. To date, under the net metering, Far East Spinning Industries Ltd in Habiganj has installed a 1.1MW and Gazipur-based Paragon Poultry Limited has erected a 723kW rooftop solar system. Each watt costs them Tk78 each (project cost), which will drop to Tk65 by next March or April. There is a possibility to generate around 2,000MW of solar power on the roofs of different institutions along with those of large industries. It can be said undoubtedly that rooftop solar system under net metering will bring revolutionary changes in the power sector in the next two or three years.
energynewsbd.com: Despite solar home system (SHS) being popular in the country, why is its market is facing debacle now?
Shahriar Ahmed Chowdhury: Till date, as many as 5.5 million SHS’s have been installed across the country. Previously, parts of the country were not connected with the national grid, but almost every single house now has access to electricity. The development in power sector has been remarkable. This is the reason the trend of installing SHS’s is downward.
Installation of SHS’s by the state-owned Infrastructure Development Company Limited (IDCOL) is almost nearing zero. On the other hand, mini solar grids are being installed in some of the off-grid areas. An SHS consumer gets electricity for up to five hours, while a mini-grid supplies power for almost round the clock, which is a bit pricier due to battery back-up, though. Some 17 mini-grids have been installed as yet, benefitting thousands of families.
energynewsbd.com: What is delaying the construction of large grid-connected solar power plants or solar parks?
Shahriar Ahmed Chowdhury: Large solar power plants or solar parks require a huge space. And the scarcity of land in Bangladesh is so high. Managing a piece of land is very tough here. As many as 350 acres of land will be required for a 100-MW capacity solar power plant.
The government has so far approved 16 projects under private sector. Expect for a few of those, most of the projects will start functioning in the next few years. A 3MW and a 20MW grid-connected power plants in Sharishabari upazila of Jamalpur and Teknaf upazila of Cox’s Bazar, respectively, has started operation. The prospectus of renewable energy is very good in Bangladesh. The state-owned Bangladesh Power Development Board (BPDB) has already planned installing a floating power plant of 25MW capacity in Kaptai Lake of Rangamati.
The lake has a huge area and 470 square kilometres of it is waterbody. An area covering 1.5 square kilometres is enough for generating 100MW of electricity. Considering that, if only 10% of the lake’s waterbody is used, it will be possible to generate 3,000MW power from solar energy. The Haor (swampland) regions of Sylhet, too, have numerous waterbodies suitable for installing floating solar power plants.
The Rural Power Company Limited (RPCL) is going to construct a 125MW solar power plant over a fishing enclosure in Mollarhat of Bagerhat. An economic solution to the impact of fish production after installing such plants above the enclosures will greatly help decide on moving forward towards installing solar power plants in the enclosures in the southern part of the country.
energynewsbd.com: What is the prospect of the other sources of renewable energy in the country?
Shahriar Ahmed Chowdhury: The maintenance costs of solar power are much reasonable. There is no such expense except for what needed for washing panels. But the “waste to energy” or “biomass to energy” needs a lot of money for maintenance works. There is no success story of such initiatives outside developed countries.
Many countries, however, are undertaking such measures on the pilot basis, but that did not come out to be much sustainable. Given the level of technology, I do not think right now that it will be feasible to a large extent. But Bangladesh has a good prospect in wind. The US Department of Energy`s National Renewable Energy Laboratory (NRL) conducted study in several areas of Bangladesh, detecting a massive possibility of wind power in its coastal belts.
Hydropower is among other major renewable sources of energy. In the conventional 230-MW hydro-power plant in Kaptai, a maximum of 100-MW electricity can be generated. To be honest, there is no such area prospectus for hydropower production in Bangladesh.
energynewsbd.com: What is essential to attract more investment in the renewable energy sector?
Shahriar Ahmed Chowdhury: The bank interest rate against loan is so high in the country. In the meantime, the government has given some facilities. In order to encourage the use of renewable energy, it is providing loan at up to 7% interest rate through the state-run IDCOL. Installing the large solar power plants could have been much easier had the interest rate been even lower.
Scarcity of land is also a major issue for the growth of solar power since nobody wants to their land to be used for this purpose. Hence, the projects have to be undertaken in the way that the arable land can be of multipurpose use. There are so many crops that need less sunlight.
It would be also possible to plant crops underneath the solar power panels or plants. There is also the option to farm fishes. In India, its government allots land and installs transmission lines. This is something absent in Bangladesh, for which the private sector has been facing a lot of challenges. Bangladesh government willingly has to ensure all the necessary facilities to help the sector succeed.
energynewsbd.com: What are the main obstacles for the growth of renewable energy?
Shahriar Ahmed Chowdhury: The sector has to be declared as a special one and all taxes and import duties on the equipment needed for renewable energy need to be withdrawn.
energynewsbd.com: What kind of the role can renewable energy play to ensure energy security?
Shahriar Ahmed Chowdhury: Other than the installment costs for setting up a solar power plant, there is no such expenses for running it. Renewable energy will do ensure energy security because sunlight, wind or water are the main source of renewable energy, which will become the main driving force if the prices of oil, gas and LNG keep on rising or they become scarce due to socio-economic changes. Moreover, renewable energy does not emit greenhouse gas.
As many as 70% worldwide power plants installed in 2017 are based on renewable energy, while the rest ones, set up over the same period, are run by oil, gas and nuclear energy.
The number of fossil fuel-based power plants will plummet in future, and will be replaced by the renewable or nuclear energy-fired ones. In addition, the solar power technology is getting reasonable, meaning that it will become rather popular in the days to come. Renewable energy will be the key fuel in the future energy scenario.