Kushal GurungWindPower Nepal Pvt
Ltd- CEO
Financing clean energy projects in
Nepal
Nepal’s Energy Consumption:2015
16 GJ /per person 128 kwh/per person 65% access to grid
electricity
Clean Energy sources in Nepal
Hydro: 83,000MW Solar: 2100MW (2% of land) Wind: 3000MW Bioenergy: Biogas, Improved cooking stoves Waste to Energy: Municipal Solid Waste
Rivers: >6000
Hydropower potential: 83,000 MW
1st Hydro project: 500kW in 1911 AD
Installed capacity: 787 MW (≈ 1%)
Under construction:~2000MW
Hydro
Solar
Solar irradiance: 4.7 kwh/m2/day
Sunshine days: 300
Total potential: 2100MW (2% of land)
Installed On-grid: ~680kW
Installed Off-grid: ~40MW
Solar Applications: Solar cooker/ dryer Solar water heaterSolar street light
Wind
1980s: NEA led10kw*2 units Kagbeni project, failed
>2010: AEPC led Off-grid wind-solar hybrid community projects (4-5 sites)
Nepal wind resource mapping (2015-2018)
Next: On-grid wind? Potential: 3000MW
Bioenergy and Micro hydro
Domestic biogas ~350,000 installed 1,100,000 potential
Improved cooking stoves ~1,000,000 installed 2,500,000 potential
Microhydro ~54.5MW installed 100MW potential
Improved watermill ~10,000 installed 30,000 potential
Policies
Endorsed Global initiatives by Nepal: SE4ALL; SDGs (No 7) NEA (Ministry of Energy): State Utility
On-grid hydro: 35 year PPA; Tax breaks On-grid solar and wind: in-pipeline (no clear policy yet)
AEPC (Ministry of Population and Environment): Subsidy driven Biomass- Improved cooking system solar home system- Urban/Solar/Institutional Rural off-grid community electrification system
Micro-hydro Wind-solar hybrid system
Biogas- Residential/Community/Large scale/Commercial biogas Waste to Energy
Investment Board of Nepal Single window approach for FDI on big energy projects (>500MW)
Financing in Clean Energy- Government
Approach: Subsidy, Grant and Technical Assistance
National Rural & Renewable Energy Programme (AEPC) Single programme modality, from 2012-2017 Budget: $170.1 million, including $40 million of TA Included energy sources: solar, biogas, biomass
Renewable Energy for Rural Livelihood (AEPC) 2014-2019, supported by UNDP & GEF, Budget:
$5 million To develop 10 MW from mini and micro
hydropower plants, 2.5 MW of solar PV systems and establishment of mini grids connecting Micro-Hydro Plants of 300 kW capacity
Financing in Clean Energy- Government
Scaling Up Renewable Energy Program (AEPC) Extended Biogas Project, 2014-2019 World Bank funded, Budget: $ 7.1 million Target: support large scale off-grid biogas
projects for thermal application and electricity generation
Grid Solar and Energy Efficiency Project (NEA) World Bank funded, 2014-2020, $138 million Grid-connected Solar PV Farms Development;
and Distribution System Planning and Loss Reduction
NEA working on 25MW on-gird solar EPC tender
Financing in Clean Energy- Government
South Asia Sub-regional Economic Cooperation project: Power System Expansion (NEA/AEPC) Funded by ADB; 2014-2022 ~$440 million as Loan, Grant and Technical
Assistance On-grid: executed by NEA; Off-grid: executed
by AEPC Off-grid plan: 4.3MW of mini hydro and up to
500 KW of mini-grid based solar or solar/wind hybrid systems; $5 million loan, $10 million grant
On-grid solar project- $20 million grant, PPA competitive tender, NEA executed, date: TBC
Financing in Clean Energy- Government
Ministry of Federal Affairs and Local Development Public Participation Based Solar Street Light
Programme, i.e. ministry, local bodies and users’ committees bear 60, 25 and 15 % respectively
45,308 solar street lights within 2073/74 ; ~$10 million
Financing in Clean Energy- Non-govt
NGOs: Grant driven Rural applications- solar water pump,
biogas, improved cooking stoves WWF Hariyo Ban Program, Winrock, CRT/N,
etc Private Sector
Business model: most of them are Vendors and EPCs
Emerging model: Energy Service Company (ESCOs)
Opportunities >30% population have no access to grid,
i.e. 90 lakhs*100watt = 900MW off-grid opportunity
On-grid: Peak demand is up to 1400MW, while installed capacity is less than 900MW =500MW
Growing demand for electricity: 10% annual growth
Nepal wants to become Developing Country by 2022 (Bangladesh’s per capita electricity consumption is 258kwh), i.e. more electricity needed
Modernised Agriculture: solar water pump, machineries
Improved Access to Finance: Central Renewable Energy Fund (US$113.1 million); Urban solar subsidy
Bottle necks
On-grid Unclear policy for renewables, other than hydro
Off-grid Mostly subsidy driven- EPC model Size limit up to 100kW system (2073) Unclear policy for ESCO business Rural population have low electricity consumption
Access to finance Unclear law for innovative financing instruments-
crowdfunding Project financing at promoters’ risks Bureaucratic hurdles in channelling FDI
Way Forward More pilot projects esp for on-grid Conducive renewable energy policies
Net metering, Feed-in-Tarrif Attractive financial schemes and tax
breaks Accelerated Depreciation Tax Production Tax Credits
Push for local manufacturing Conducive policies for FDI
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