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Renewable Energy as a Viable Option in the Bangladesh Electricity Portfolio

Institution of Engineers Bangladesh 23 March 2011 Dhaka, Bangladesh

Prof. Saifur Rahman Virginia Tech, Washington, DC

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DHAKA, Mar 13: Bangladesh has set a target to produce 500 MW of electricity to reduce greenhouse emissions and ensure sustainable development in energy sector. It also plans to install solar irrigation system to cut diesel cost.

Newspaper  Report  

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Where does this target fit in the overall power generation sector in Bangladesh?

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Power  Genera/on  mix  in  Bangladesh  

 n  Natural  Gas  n  Oil  n  Coal  n  Hydro  n  Renewables  –  solar  and  wind?    

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Solar  Photovoltaics    

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World  and  EU  PV  markets  in  2009  (MW)  

Source: Global Market Outlook for Photovoltaics Until 2014. May, 2010

http://www.epia.org/fileadmin/EPIA_docs/public/Global_Market_Outlook_for_Photovoltaics_until_2014.pdf

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Source: Global Market Outlook for Photovoltaics Until 2014. May, 2010

http://www.epia.org/fileadmin/EPIA_docs/public/Global_Market_Outlook_for_Photovoltaics_until_2014.pdf

Regional  PV  distribu/on  in  the  World  (Policy-­‐Driven  scenario)  

Annual Additions

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Solar  PV  Applica/ons  

n  Grid connected applications n  Remote area applications n  Building Integrated PV (BIPV)

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100  kW  Grid-­‐connected  Project  in  China  

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Remote  Area  PV  Project  in  Bangladesh  

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Roof-­‐top  solar  photovoltaic  panels,  Japan  

Source: Energybiz Magazine

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BIPV  in  Thailand  

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Source: Solartron, Thailand

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Source:  Interna-onal  Energy  Agency    (IEA  Sta-s-cs  2007  data,  available  as  of  September  2010)  

Solar Electricity in Bangladesh

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Solar  Home  Ligh/ng  Ac/vi/es    

Source: Grameen Shakti

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Community  Center  in  Dhamrai,  Dhaka    

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Garment  Factories  in  Ashulia  

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Solar  Panels  for  Garment  Factory  Ligh/ng  

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Source:  Interna-onal  Energy  Agency    (IEA  Sta-s-cs  2007  data,  available  as  of  September  2010)  

Why some countries are more successful than others ?

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Programs  to  encourage  renewables  penetra/on  

Source:  Interna-onal  Energy  Agency    (IEA  Sta-s-cs  2007  data,  available  as  of  September  2010)  

Renewable Portfolio Standards (RPS)

Feed-in Tariff (FIT)

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Renewable Portfolio Standards (RPS)

Source:  Interna-onal  Energy  Agency    (IEA  Sta-s-cs  2007  data,  available  as  of  September  2010)  

State regulators mandate certain percentage of renewables mix in generation For Example, California 2020: 20% non-hydro renewables mix by 2020 EU: 20-20-20 (RE-EE-CO2)

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RPS in Bangladesh

Source:  Interna-onal  Energy  Agency    (IEA  Sta-s-cs  2007  data,  available  as  of  September  2010)  

Solar electricity support REB requirements: 10% for industrial customers

7% for commercial customers 3% for residential customers

DESA/DPDC/DESCO requirements:

3% for residential

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Feed-­‐in  Tariff  (FIT)  

Source:  Interna-onal  Energy  Agency    (IEA  Sta-s-cs  2007  data,  available  as  of  September  2010)  

FIT is a renewable energy policy that offers guaranteed payments to renewable energy developers for the electricity they produce FITs are responsible for approximately 75% of global PV and 45% of global wind deployment

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United States Incentives/Policies for Renewable Energy

Federal and few state programs

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US  Federal  Incen/ves  for  RE    

Source:  Interna-onal  Energy  Agency    (IEA  Sta-s-cs  2007  data,  available  as  of  September  2010)  

Renewable Electricity Production Tax Credit (PTC):

•  Commercial and industrial sectors •  Amount: 2.2¢/kWh for wind; 1.1¢/kWh for other eligible

technologies. Generally applies to first 10 years of operation. •  Carryover Provisions: Unused credits may be carried forward

for up to 20 years following the year they were generated U.S. Department of Treasury - Renewable Energy Grants:

•  Amount: 30% of capital subsidy for solar and small wind •  Ends 12/31/2010

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European Union Incentives/Policies for Renewable Energy

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Germany:  Feed-­‐In  Tariffs  

Cost plus profit model (Fixed FIT Policy):

- Average grid-supplied domestic electricity price: $0.29/kWh

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Asia Incentives/Policies for Renewable Energy

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India:  Feed-­‐In  Tariffs  (Launched  -­‐  2009)  

Cost plus profit model: Examples: West Bengal: Solar PV @ $0.25/kWh; PPA for 15 years Haryana: Solar PV @ $0.34/kWh; PPA for 5 years Rajasthan: Solar PV @ $0.35/kWh; CSP @ $0.31/kWh Tamil Nadu: CSP @ $0.27/kWh; Wind @ $0.08/kWh Average grid-supplied domestic electricity price: $0.08/kWh

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Thailand:  Feed-­‐In  Tariffs  (Launched  2006)  

Avoided cost + Premium (called an “adder”):

-  Total FIT = 0.12 +0.34 = $0.46/kwh -  Average grid-supplied domestic electricity price: $0.12/kWh

Energy  Source

AdderAdditional  for  

diesel  offsetting  areas

Additional  for  3  

southern  provinces

 Duration(Years)

 Wind   [USD/kWh] [USD/kWh] [USD/kWh]  <=  50  kW   0.13 0.05 0.05 10  >  50  kW   0.10 0.05 0.05 10  Solar   0.24 0.05 0.05 10

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China:  Feed-­‐In  Tariffs  

- Wind tariffs based on resource intensity $0.08–0.09/kWh - Average grid-supplied domestic electricity price: $0.05/kWh

Roof-­‐top $  2.26/WattBIPV $3.01/Watt

Grid-­‐connected 50%  of  total  project  costOff-­‐grid 70%  of  total  project  cost

FIT  for  Solar  PV  -­‐  2010 Auction-­‐based  price  discovery  

BIPV  capital  subsidy  (>  50  kW):  2009-­‐2011  -­‐  PHASING  OUT

Golden  Sun  capital  subsidy  (>  300  kW):  2009-­‐2011  -­‐  PHASING  OUT

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Key  Market  Strategies  

n  Price Support/Policies • Tax Subsidies • Min Fixed Payment Prices • Mandates (Renewable Portfolio Standards)

n  Cost Reductions/Balance of Systems

n  New Technologies

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Opportunities in Bangladesh

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Solar  opportuni/es  in  Bangladesh  

n  Health  clinics,  schools,  community  centers    n  Mul/-­‐family  solar  home  based  AC  electricity  supply  

n  Street  lights  n  Solar  water  pumping  –  DC  motor  n  Microgrid  –  mul/-­‐kW  free-­‐standing  grids  n  Photovoltaic  power  genera/on  for  na/onal  grid  

 

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Lessons Learned from other Countries

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Genera/ng  Capacity  Thailand,  2009  

Hydro, 11%

Import; 2.2%

Oil, 13%

Lignite/Coal, 12%

Gas; 56%

Diesel, 0.3%

Renewable; 2.4%

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Already

Commission-ed

PPA signed waiting for

COD

Approved waiting for PPA sign

Under consideration

process

TOTAL (MW)

Solar Energy 7.7 MW 1,331.9 MW 398.4 MW 637.6 MW 2,375.6 MW

(51) (291) (94) (135)

Biogas 43.0 MW 69.2 MW 44.8 MW 61.6 MW 218.6 MW

(41) (32) (31) (21)

Biomass 287.8 MW 1,495.9 MW 213.4 MW 413.7 MW 2,410.8 MW

(53) (201) (36) (65)

Municipal Waste 10.8 MW 96.4 MW 59.5 MW 120.6 MW 287.3 MW

(8) (14) (13) (20)

Small, Mini and Micro Hydro

0.5 MW 1.3 MW 5.0 MW 0.0 MW 6.8 MW

(3) (5) (1) (1)

Wind Energy 0.4 MW 25.0 MW 17.8 MW 85.3 MW 128.5 MW

(3) (5) (7) (13)

GRAND TOTAL 350.2 MW 3,019.6 MW 738.8 MW 1,318.8 MW 5,427.6 MW

Thai  EGAT’s  Power  Development  Plan  2010    

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Power  Genera/on  Mix  in  Ten  Years  

n  Natural  Gas  n  Coal  n  Renewables  n  Nuclear  ??    Success  of  renewables  will  need  policy  support  including  buy-­‐down  programs  Most  important:  Customer  must  believe  in  renewables  

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Thank  you

Saifur Rahman

Email: srahman@vt.edu

www.saifurrahman.org