RURAL ELECTRIFICATION: PRESENT SCENARIO, ISSUES AND SOLUTIONS Renewable Energy World Asia

Transcription

1 RURAL ELECTRIFICATION: PRESENT SCENARIO, ISSUES AND SOLUTIONS Renewable Energy World Asia 1-3 September 2015, Bangkok, Thailand Arul Joe Mathias B.E., M.Engg., MBA Managing Director

2 Rural Electrification Trend in Asia Dramatic increase in electrification rate due to grid expansion Allotment of more funds by government More and more funding by development banks, bilateral and multilateral organizations Reliability in technology development Technology cost is coming down Major challenges is electrification of remote areas, where grid expansion is not viable

3 Technology Options for rural/remote electrification Solar Home Systems Community solar systems Small Wind Turbine Pico and Micro hydropower plants Hybrid systems Community biogas plants Biomass gasification (Dual fuel: Diesel + producer gas) Biomass gasification (100% producer gas)

4 Technology Selection Criteria Reasonable investment cost Easy to operate Easy and practical to maintain Should work for the designed lifetime Suitable for locality, people/community Reasonable life cycle cost

5 Major Challenges in Rural Electrification How to ensure the implemented system works for its designed life time? Technology Approximate life Solar Home System 20 Solar Community plant 20 Biogas Plant 15 Biomass gasifier 15 Small wind turbine 8 Micro/Pico hydro power plant 7

6 Major Challenges in Rural Electrification Selection of expensive option from life cycle cost point of view (e.g., 15 kw gasification instead of 15 kw SPV) Lack of technical knowledge on project development Mismanagement of funds leading to very high development cost, life cycle cost Delayed or ignored repairs, leads to permanent failure Free systems leads to lack of commitment from end users (end user should invest some minimum amount) Maintenance issues for the life time of system Poor business plan and lack of stakeholder commitment

7 A good business plan to ensure success A good business plan for a successful rural electrification project o Life cycle cost analysis o Stakeholder commitment and support o Operation management throughout lifetime o Plant safety o Minor maintenance o Major maintenance o Timely repairs and other maintenance o Proper metering o Accounting losses o Payment from end user for electricity and proper collection method

8 Solar Home Systems (SHS) Presently most popular in Asia and Africa Size of the systems ranges from 10 Wp to 250 Wp. Various subsidies and micro finance available in many countries No infrastructure needed Low construction period Cost ranges from XX to YY/W

9 Community/village solar power generation system One of the popular technology for mini grid development Size of the systems ranges from 10 kwp to 250 kwp. Low maintenance and easy construction Development of proper business plan for successful project operation

10 Community/Village Solar Power Generation System

11 Small Wind Turbine (SWT) Technology is proven Output ranges from 10 kw to 250 kw Different design options available Suitable for community/village Proper maintenance is required Major limitation is wind velocity

12 Small Wind Turbine (SWT) Schematic Diagram

13 Pico Hydro system

14 Pico hydro plants

15 Micro Hydro system

16 Micro hydro plants

17 Community biogas plants Suitable for community operation Technology is well proven Engine maintenance is required Limitations: Waste availability for anaerobic digestion

18 Community biogas plants Schematic Diagram

19 Biomass gasification Dual Fuel (producer gas and diesel) Diesel usage up to 20% and remaining is balanced by producer gas No standard technology Diesel consumption is higher than planned Over a period of time, risk of operating engine with 100% diesel Technical issues in gasifier operation Technically skilled professional needed for maintenance

20 Biomass Gasification 100% Producer gas 100% producer gas and no diesel usage Tar formation is a major operational problem Engine needs frequent maintenance Technically skilled professional needed for maintenance Great future, but still not 100% proven

21 Biomass Gasifier Engine

22 Hybrid Renewable Energy System Photovoltaic/diesel hybrid system Photovoltaic/wind/diesel hybrid system Photovoltaic/hydro hybrid system Photovoltaic/biomass hybrid system Wind/hydro hybrid system

23 Case Study: One of the world s most successful rural electrification project in Bangladesh

24 Bangladesh rural electrification project Technology : Solar home system Installation so far : Around 3.7 million SHS (by May 2015) Implementing Agency : Infrastructure Development Company Limited (IDCOL) *The World Bank is providing soft loan for IDCOL

25 Major Funding Agencies Involved

26 Bangladesh rural electrification project Beneficiaries Power Generation Job Creation IDCOL Investment : 13 million (9% of population) : About 135 MW : Around 70,000 people (direct +indirect) : Around USD 560 million *The World Bank is providing soft loan for IDCOL

27 Year wise Growth in Installations

28 SHS Program Model Suppliers Provides approval Seeks approval Technical Standards Committee Supply Equipment Pay for Equipment PO Selection Committee Applies Select POs PO * Provide grant & loan Seeks grant & loan IDCOL Sells SHS & provide service Pay downpayment & installment Grant & soft term credit Repayment Operations Committee Household Donors * PO - Participating organisations

29 Fund Flow & Role of Partners Development Partners GoB IDCOL POs Households Provides grant and soft loans Provides technical assistance needed Provides grant and soft loan to IDCOL Provides policy support Provides grants to reduce SHS cost and for capacity building Provides soft loans Provides training, promo support Monitors implementation Identify potential customers Installs SHS Extends micro-credit Provides after sales services Maintain system Repay loan in monthly installments Debt Service Debt Service Debt Service Debt Service

30 SHS System Configuration Capacity Appliances Operation 10 p Lamp: hours 20Wp 50Wp 85Wp 135 Wp Lamp: 2 Mobile Charger: 1 Lamp: 4 TV: 1 Mobile Charger: 1 Lamp: 9 ; Fan: 1 TV: 1 Mobile Charger: 1 Lamp: 9 ; Fan: 2 TV: 1 Mobile Charger: hours 4-5 hours 4-5 hours 4-5 hours

31 SHS System Cost Capacity Cost ( BDT) Cost (USD) 10 p 6, Wp 10, Wp 19, Wp 28, Wp 40,

32 Program Success Factors A. Ensuring commercial viability Innovative financing model through public-private partnership Declining grant Price determination by the market competition Ensuring loan repayments by participating organizations (around 46)

33 Program Success Factors.contd B. Stakeholders commitment Stakeholder Contribution Risk factor 4 million Consumer Minimum 10% of system price as down payment If remaining monthly instalments not paid, then, the system will be seized. 46 Participating Organizations Approximately 18% of system price as their direct investment If repayments are not collected properly, then, their investment will be lost IDCOL Provides 72 % of system price as loan to Participating Organizations If POs are not properly selected and monitored, then, the Participating Organizations may default.

34 Program Success Factors.contd C. Independent selection of POs and suppliers Technical standards committee comprising experts approve the equipment and their suppliers Every PO is chosen carefully through peer review and competitive evaluation by PO selection committee Ensures quality products available in market and also maintains competitive pricing of products

35 Program Success Factors.contd D. Indirect subsidy for the customers Subsidy is fixed for all sized SHS at around 10% of SHS cost on weighted average. Subsidy is given to POs who deduct it from their system price due to market price competition Fixed subsidy for each system irrespective of system size Poorer customers buying smaller systems are more benefited from the grant support

36 Program Success Factors.contd E. Rigorous quality control mechanism SHS installations are regularly inspected by IDCOL On sample basis, a team of 200 plus inspectors check around 4,000 systems every month For each discrepancy identified, deductions are made on the loan amount to the Participating Organizations

37 Role model for other countries Program has become the fastest growing rural electrification program through renewable energy Proven business model for technology dissemination through micro-credit Ethiopia, Ghana, India, Nigeria, Kenya, Uganda and Tanzania have approached IDCOL for replication of SHS program in their countries. NUS has published a book chapter on this programme

38 Thank you