Bangladesh is endowed with reasonably good solar energy potential thanks to its geographical location. Of all renewable energy sources, solar is the most dispersed form of energy offering a wide range of applications using commercially available technologies. Important applications of solar energy in Bangladesh include solar home system, solar park, solar irrigation, solar mini grid and rooftop solar. Taking all the applications together, installed capacity of solar power in the country stands at around 466 megawatt (MW) only. Given the availability and rapidly declining costs, substantial amount of solar power could not be generated because of competing demand of land for agricultural or other uses.
In view of scarcity of land, rooftop solar is one of the promising options to scale up solar power generation. Net Energy Metering (NEM) is a policy mechanism for the expansion of rooftop solar as it allows electricity consumers to connect their rooftop solar system to the distribution grid. Thus, any surplus electricity, after self-consumption, generated from rooftop solar is supplied to the grid and in exchange, the consumer may either import equal amount of electricity from the grid or receive price of net amount of exported electricity at the end of financial year. NEM typically uses a bidirectional meter that can measure and record electricity flow in two directions - from utility to the customer (import) and from customer to the utility (export). The customer is billed on the basis of net meter reading, that is, imported unit minus exported unit. The following figure-1 illustrates the architecture of a typical net metering arrangement using solar PV as an example of distributed renewable energy system.
Realizing the importance of NEM, the Directorate General of Food installed a grid-tied solar PV system with an installed capacity of 360 kWp on the rooftop of its multi-storied warehouse at Santahar (Bogra) Grain Silo with net-metered connection, which is the first of its kind in the country. Upon signing an agreement with the Bangladesh Power Development Board (BPDB), the Directorate General of Food's Santahar Grain Silo started operation in February 2017. Following successful implementation of 360 kWp net-metered rooftop solar, the government of Bangladesh launched Net Metering Guidelines on 28 July 2018, which was revised later in November 2019. As of October 2020, a total of 1,074 net-metered rooftop solar systems have been installed throughout the country, making a cumulative capacity of 16.52 MW.
According to the NEM guidelines, as it exists today, any electricity consumer with a three-phase connection is eligible to install a net-metered system, where the installed system’s inverter capacity (AC) should not exceed 70% of the approved load. There is also a maximum ceiling of 10MW for net-metered system. Usually, the consumer who installs a net-metered system is called a ‘Prosumer’; as he produces and consumes electricity simultaneously. The reading of the net meter is the primary basis for billing. If the reading shows the prosumer as net importer, he has to pay the utility for the net amount he imported. On the other hand, if the reading shows the prosumers as net exporter, he has to pay nothing but regular service charge. The net balance is carried forward to the next month in favor of the prosumer. Thus, at the end of the settlement period, every year in July, the energy balance is calculated and if there is any net exported unit, it can be sold to the utility at bulk tariff defined by the Bangladesh Energy Regulatory Commission for that utility.
The Net Metering Guidelines provides for two models for the implementation of net-metered system: CAPEX Model & OPEX Model. In CAPEX Model, an electricity consumer installs and operates the solar system in his/her premises by own financing or by taking loan from bank/financial institution. An agreement needs to be signed between the utility and consumer to operationalize the system. Whereas in OPEX Model, a third party/ company installs and operates the solar system in the premises of the electricity consumer by own financing or by taking loan from bank/financial institution. In this case, a tripartite agreement takes place among the system owner, consumer and concerned distribution utility. If any consumer fails to pay two consecutive monthly electricity bills, the system installer may lodge compliant to the utility and the utility may consider disconnecting electric connection under Electricity Act 2018.
To install a net-metered system, an interested consumer should apply to the concerned distribution utility in a prescribed form given in the guideline. The utility provides permission on examination of the application and other conditions of their system. With permission from utility, the consumer is allowed to start the installation work. After installation of the system, the consumer asks utility to examine the system and go for final agreement. Once the agreement takes place, billing on the basis of net metering system starts.
At present various banks/ financial institutions provide soft loan for installation of the net-metered system. For example, Infrastructure Development Company Limited (IDCOL) provides loan at 6% interest to the consumers who are willing to install the net-metered system. The efficiency of solar panel is increasing while the price is decreasing day by day. Inverter and other apparatus are also getting improved. On the other hand, price of grid electricity is getting higher every year. Thus, the installation of net-metered solar system is getting popular.
The installation cost of a net-metered rooftop solar system includes the cost of solar panel, inverter, energy meter, mounting structure, lightning arrestor, combiner box, cables, connectors and other accessories. Basically 90-92% of the project cost is the installation cost, whereas operation and maintenance require a negligible amount (8-10%) of total project cost. From recent market analysis, it is found that for the installation of a 60 KWp net-metered solar system, the total project cost is around Tk 30 lakh. It means that installed cost per kilowatt is now around Tk 50,000, which leads to a Levelized Cost of Electricity (LCOE) less than Tk 3.0/kWh considering the solar system’s life time of 20 years.
Net Metering Guideline has generated keen interest among private sector to install rooftop solar systems. Roofs of textile mills, readymade garments industries, cold storages, poultry, pharmaceuticals, paper, packaging and other industries offer a huge area for installation of rooftop solar system with net-metered connection. IDCOL has estimated that about 5,000 MW of electricity can be sourced from rooftop solar. With decreasing cost of rooftop solar, net-metering is expected to be a game changer for renewable energy in Bangladesh provided proper facilitation is in place. Addition of 16.52 MW rooftop solar capacity through 1,074 net-metered rooftop solar systems within a short span of time is a ray of hope.
Md. Pavel Mahmud, Assistant Director, SREDA
