Grid-connected solar system: New step in Nepal’s energy mix

Posted on: April 30, 2019


Nepal is rich in water, solar, wind and biomass resources, but the country is unable to utilise these resources in the absence of innovative technical knowledge and finance.

Given that solar is the second most abundant and preferred source of energy for Nepal after hydro, developing the solar PV industry is justifiable. As for the distributed solar home systems (SHSs) and solar micro-grids, Nepal has seen some development in those sub-sectors already, but their impact is limited. Distributed solar home systems took off in the last decade, but the model got limited to just powering a few bulbs in the rural households. Solar micro-grids turned out to be vastly expensive and unsustainable without at least 80 per cent of the total cost in grants. The only other model that can achieve large-scale solar PV development is utility-scale solar system, as in India today. However, as Nepal has significant transmission constraints, this solar system also becomes less feasible.

Proliferation of grid-connected solar PV solutions would mean that Nepal is able to attain a reliable, diversified energy system capable of providing power to even the remotest parts of the country. The government plans to achieve 99 per cent electrification rate by the year 2030, and it cannot achieve that by relying on hydro plants that take a minimum of five years to construct.

A grid-connected solar system mainly has two components: solar PV panels and an electronic device called an inverter. Apart from these components, there are other minor components, such as switches and fuses, which allow each of the two major components to be completely isolated when repairs are needed.

The system does not require any battery, making the cost of the system 60 per cent less compared to an ordinary solar-battery system. Electricity generated is directly utilised for load operation, and surplus energy is fed into the grid, which is eventually balanced through net metering and is paid back through the feed-in tariff (FIT) rate.

The technology holds tremendous potential at sites having day loads like hospitals, schools, colleges, hotels, industries/factories, offices, making them independent in energy use and thus lessening the burden on Nepal Electricity Authority (NEA).

There are many advantages to using a grid-connected solar system. This technology will give a boost to the total energy supply. Currently, we import almost half of the electricity from India, thereby implying major energy security risks. Large solar PV injection, therefore, has the power to minimise imports. Hydro, the major source of power for the country today, cannot be constructed immediately to offset imports. Supply diversification is another advantage. With climate change impacts getting more visible in the Himalayan region, relying on hydro alone is highly risky. Solar PV complements hydro generation, especially in the winter months when the rivers dry up.

Nepal suffers from a worsening trade balance due to high levels of power and fossil fuel imports. Nepal currently imports electricity of about Rs 20 billion, LPG gas of about Rs 30 billion and petroleum products of about Rs 100 billion annually. A stronger local energy generation, therefore, has the power to improve the trade balance significantly. In addition, the current national goal to make electricity the primary source of energy supports the need to develop solar PV industry in the country.

Nepal’s transmission network is outdated and is in no position to accommodate large power generation that the government plans to achieve in the next 10 years. On-site solar PV generation, therefore, has the capacity to not only reduce pressure on transmission and distribution but also reduce power losses that occur upon using the outdated infrastructure.

One major advantage is that there will be higher energy access for rural consumers. If big consumers consume less energy as a result of on-site solar PV, the rest of the country will have access to more power.

In Nepal, a grid-connected solar system is in its nascent phase. A few attempts have been made in this sector, such as a 1-MW system at Singha Durbar, 680 KW system at Sundharighat, 100 KW system at Kharipati, 65 KW at Nepal Telecom and a 1-KW test project at Pulchowk Engineering Campus. However, the technology is yet to gain momentum commercially. Hence, net metering and feed-in tariff (FIT) would be crucial policies. The government has already formulated these policies, but its unwillingness to implement them is causing delay in its commercialisation.

In India, in 2011, under the Jawaharlal Solar Mission policy (which is now renamed as National Solar Mission), the Indian government formulated policies to kick-start a grid-connected solar system. One important part was the feed-in tariff (FIT) rate. Narendra Modi, then chief minister of Gujarat, offered IRs 15 per unit (kWh) for solar electricity. This policy attracted so many private investors in the sector that the government’s target to develop 22,000 MW from solar electricity by 2022 was met within 2017. They reformulated the target to 100,000 MW by 2022.

Feed-in tariff rate in Nepal is Rs 7.30 per unit (kWh). Economists say at this price, it is challenging for any private investor to invest in this sector. The government should come up with a policy similar to that of India to kick-start this sector in Nepal.

India’s power demand hit a record high on Friday night

Posted on: April 27, 2019

  • India’s electricity demand touched an all time record high of 176.724 gigawatts on Friday night
  • The all-time high for electricity in the spot market was 18.2 per unit for 4 October delivery last year

Topics : electricity demand

New Delhi: India’s electricity demand touched an all time record high of 176.724 gigawatts (GW) on Friday night at a time when the general elections to elect the 17th Lok Sabha are on.

This comes in the backdrop of mercury soaring in Central India on Wednesday, with the temperature reportedly touching 45 degrees Celsius in parts of Madhya Pradesh and Maharashtra. Delhi yesterday also recorded the hottest day of the season with temperature touching 43 degrees Celsius in the national capital.

Mint reported on 19 March about India’s demand for electricityand auto fuel expected to go up as India approaches general elections.

“All India demand touched 176,724 MW (all time highest) at 23.06 hrs on 26 April, surpassing earlier peak of 175,590 MW on 18 Sept, 2018,” power secretary Ajay Bhalla said in a tweet on Saturday.

In the build up to the general and the state assembly elections last year, additional power requisitioning by distribution companies had led to a short-term hike in electricity prices.

According to data collated by Icra and the Indian Energy Exchange (IEX), the demand for electricity, petrol and diesel picked up in March of 2009 and 2014, just before general elections. While the 2009 elections were held in five phases from 16 April to 13 May, the 2014 elections were held over nine phases from 7 April to 12 May. Polling this year is being held in seven phases from 11 April to 19 May.

Of India’s installed capacity of 350.162 GW, peak electricity demand has been low due to issues such as precarious finances of some state-owned electricity distribution companies, which prevents them from power procurement of the required quantum.

The all-time high for electricity in the spot market was ₹18.2 per unit for 4 October delivery last year. Of the estimated 1,200 billion units (BU) of electricity generated in India, the short-term market comprises 130-150BU.

The government claims that in the nine months of FY19, peak demand grew at 7.9% as compared to 2.8% in the corresponding period in FY18. It attributed this increased power demand to the spread of household electrification, increased supply to agricultural consumers, low hydropower generation and extended summers.

As rollout of solar-pump scheme is delayed, Bihar offers higher diesel subsidy to farmers

Posted on: April 24, 2019

Tenders for KUSUM have not been finalised as Model Code is in force: official

The delay in the launch of the solar irrigation pump scheme which the Centre announced in the previous Budget has left States like Bihar with no option but increase diesel subsidy offered to their farmers.

The Nitish Kumar-government in Bihar received nearly 23 lakh applications for diesel subsidy from farmers in the current rabi season, which is more than those received in the previous seasons. This is because Bihar is currently reeling under a major drought in which 280 of the 534 blocks in the State are affected.

In October last year, in view of the drought, the Bihar government decided to enhance the diesel subsidy for five rounds of irrigation as compared to three rounds earlier. The increase in subsidy comes in light of KUSUM (Kisan Urja Suraksha evam Utthaan Mahaabhiyan), the Centre’s solar pump distribution scheme, taking longer to kick off.

This scheme was first announced in the Union Budget 2018-2019. A Cabinet approval for this scheme came almost a year later in February 2019.

“Our aim is to de-dieselise the farm sector. The budgetary framework and implementation are also in place. We could not finalise the tenders for the solar pumps because the Model Code of Conduct (MCC) is in force. Once the MCC is lifted, the tenders will be finalised and the scheme will kick in,” an MNRE official told BusinessLine.

Farmers in Bihar are paid a subsidy of ₹50 a litre and a farmer with one acre of land gets subsidy for 10 litres of diesel for each round of irrigation.

According to official data, as many as 22.93 lakh farmers applied for diesel subsidy during the 2019 rabi season, while the number of applications received during the last kharif season was 19.38 lakh. Out of these, around 15.64 lakh farmers got a diesel subsidy worth a total of ₹195 crore in the kharif season alone.

The roll out of KUSUM has been long overdue. According to Cabinet approval for the scheme, the Centre will provide ₹10,000 crore for four years.

The Indian Renewable Energy Development Agency (IREDA) will borrow ₹6,000 crore for the first phase (lasting for a year) to fund the Centre’s contribution. IREDA will next borrow ₹15,000 crore for the second phase that will last for a year.

Under the original scheme, on a per pump basis, the Centre will subsidise 30 per cent of the cost, the State will do the same, and 30 per cent of the amount will be offered as a loan. The farmer has to give an upfront cost of 10 per cent and then pay the instalments to the bank.

KUSUM was envisaged to replace nearly 2 crore electric and 75 lakh diesel pumps over 10 years.