Ushering in the Green Century
Dipal C. Barua shines a light on the importance of solar energy
We can be proud that Bangladesh has a world class Solar PV technology dissemination model that has effectively demonstrated that solar energy applications can be scaled up massively and rapidly to provide an affordable and climate friendly energy option for the rural people.
Over 400,000 Solar Home Systems (SHS) have been installed, benefiting over 4 million rural people, with more than 20,000 systems installed per month, and this number will double and triple within the next 2-3 years. We have the capacity to install 1 million more systems by 2012.
A Solar Home System can provide uninterrupted fuel-free supply for 25 years with negligible
maintenance cost (battery replacement cost after 5 years). Though the initial installation cost is high, the tradeoff is the large savings afforded to the economy's power grid since each household with a PV Solar Home System is actually the owner of an individual PV power plant.
At the current growth rate of SHSs, we expect that power generated by the photovoltaic cells will exceed 300 MW within the next few years and 700 MW by 2015. It is high time to seriously consider the potential of solar and other renewable energy technologies in Bangladesh.
Simply put, we are over-dependent on gas. We once thought we were floating on gas, but no additional sites have been identified. The result has been recurrent power failure and no dependable energy source to fuel power plants.
The daily electricity output totals around 3,800 MW against the demand of 6,000 MW, leaving a supply crunch of 2,200 MW. The demand for power could well rise to 20,000 MW by 2020. Bangladesh has to find alternatives as quickly as possible. But what are these alternatives?
According to energy experts, coal costs up to (US) 5 to 6 cents per kilowatt-hour. Nuclear power also costs the same, while solar power costs around 30 to 35 cents. Therefore, many policy makers in Bangladesh are advocating nuclear and coal power for Bangladesh on the basis of cost alone.
However, solar and other renewables can play a critical role in our energy mix. We are blessed with lots of sunshine and this increases the efficiency of Solar PV technology. Not only is the price of solar panels coming down in the world market, their efficiency is also increasing, meaning there will be grid parity within a few years. The same is true for Bangladesh. When we started our Solar PV Program in 1996, only a few could afford a system. Now, however, middle income and an increasing number of low-income groups can afford a system.
Bangladesh has the potential to become a middle-income country by 2025. Poverty has been reduced: new business opportunities, created both in Bangladesh and outside, and mechanisation and new technologies, have reached the rural heartland. Our resilience against the global financial meltdown has won international recognition.
However, our achievements and potential can be crippled if we cannot solve our energy crisis, which is making our lives unbearable. We also have to protect our people against threats related to climate change, such as cyclones, sea level rise, increased salinity, drought, drop in underground water, etc.
I am a passionate believer in solar energy for its potential to take Bangladesh forward, and make it one of the first "Solar Nations" in the world, with half of our people enjoying the benefit of renewable energy. Is this possible? Yes, I believe so. Let me talk about the potential of renewable energy and what we can do to realise its full potential.
A Bangladeshi Success Story
Bangladesh has one of the largest and fastest growing Solar PV technology program in the world with more than 15 rural based organisations working all over the country: GTZ, KFW, USAID, Asian Development Bank, Islamic Development and all major development partners are helping to promote solar and other renewables in Bangladesh.
It was not always like this. When I started promoting SHS in 1996, most people thought it was a utopian dream and an unachievable target. The challenges were huge. Despite the initial skepticism, I was committed to take renewable energy technology to the rural people.
I felt there would no meaningful rural development with more than 80 per cent of the rural people living in darkness accompanied by kerosene fumes. We had to design practical solutions that touched at least three components of sustainability: social, economic and environmental.
I started with SHS because Bangladesh has plenty of sunshine, and Solar PV technology is one of the best options for decentralised rural electrification, unlike grid electricity, which is expensive and unwieldy.
The first challenge was to develop a financial cum technical package suitable for the rural people. I used my experience with rural people to introduce installment-based payment, which reduced the upfront cost of a SHS and made it affordable at the same cost as kerosene. Rural homes and businesses could escape from kerosene fumes, reducing their monthly energy expenditure, while extending their business hours.
The second challenge was to create good will and gain the trust of the rural people. We focused on creating efficient and effective rural network of engineers and local technicians. We built our engineers as social engineers who went from door to demonstrate the effectiveness of renewable energy technologies. We trained local youth as technicians, thus creating local jobs, gaining community support, as well as ensuring efficient after sales service at reduced costs. Our engineers visited each client's home on a monthly basis and checked on the system for nearly 3-2 years. This created special incentive for timely payment of monthly installments.
We were proactive in involving the local community. Local teachers and elected leaders helped us explain the benefits of renewable energy technologies, especially SHS to the rural people. We trained solar users especially women on taking care of their systems. We developed special programs including scholarships for rural school children.
Once the villagers became aware of the multiple benefits of a SHS, the system sold itself. Increased sales meant decreased overhead costs, which helped us to provide further credit options to the rural people. We also started assembling solar accessories such as charge controllers, invertors, mobile phone chargers etc, and this further reduced costs.
Our success attracted policy makers, and a program was taken up through Infrastructure Development Company Ltd (IDCOL) to initiate and scale up similar models in Bangladesh around 2002-3. This was a personal milestone, as well a milestone for the renewable energy sector in Bangladesh. SHS registered exponential growth after the advent of IDCOL with the number of service providers, suppliers, manufactures multiplying. Bangladesh gained the capacity to manufacture all solar accessories expect for the solar panel.
However, what makes me most happy is making rural women an integral part of our success story. We successfully created green jobs for rural women by training them at rural based technology centres. I designed and set up such 45 centres to train roughly 5,000 rural women technicians. These women are successfully assembling solar accessories such as charge controllers, invertors, and DC-DC mobile chargers in their villages.
We have created decent jobs for women right in their villages, protecting them from dowry, torture, illegal immigration etc. Our women technicians are earning Tk. 5,000 to Tk 8,000 to take care of themselves, as well as their families. We have succeeded in creating a mechanism to take renewable energy to the villages through our women. Our rural women have the potential to become solar ambassadors and ambassadors of women empowerment in their communities.
The Power of Green Energy
This is the era of green technology. Green Energy can do more for a country like Bangladesh. We have only tapped into the potential of individual SHS.
We have huge unmet needs -- education, health and enterprises are hampered because of lack of power. Our coastal people are suffering badly because they lack access to clean water, improved housing and early warning systems.
Green energy can help us in these areas -- it can be used to meet the greater needs of our people. Let us explore the possibilities :
Low cost solar solutions to replace kerosene: We are already installing SHS in the rural areas to light up homes and businesses. We are also promoting CFL, LED for energy efficiency and better options for our rural clients. Small SHS of 10 and 20 watts are becoming popular in rural shops and low-income households. We can also popularise solar lanterns and 5 watt SHS and this will help to promote solar among the low-income households. We can also promote small SHS in the urban areas. Scaling up of small solar energy solution could mean gradual replacement of kerosene, huge savings of our foreign currency, lesser health and fire risks and more productivity among both rural and urban low-income users.
Solar panels for irrigation: We can use solar panels for irrigation. There are some 200,000 pumps consuming around 750 MW of electricity. Every irrigation season, our rural farmers face problems as prices of diesel keeps on increasing. We can replace all the pumps with solar panels. Individual solar panels for irrigation, however, may not be cost effective. If we can install a mini-grid, then it can provide light to the village at night and pump water in the daytime. The solar mini-grid could also be connected to main power grid to reduce load-shedding and transmit the extra electricity to the grid.
Each urban building a powerhouse: We can install grid-connected solar systems on rooftop of urban buildings. Urban households can escape from load shading while transmitting the extra electricity to the grid. This would tremendously reduce the over load on our grid system. We can initiate feed in tariff to popularise Solar Pv technology in urban buildings. Large shopping centers and restaurants can also install Solar PV technology to meet their lighting needs. We can promote the use of CFL, LED to increase energy efficiency. Less use of grid electricity for urban consumption, will free electricity for use in the agricultural and industrial sector.
Education, health car, and telecommunication: Our government has promised a computer for each school. Solar PV technology can provide the power to bring computers to rural schools. Education can be facilitated in night schools, hostels etc. Solar PV technology can power refrigerators and other electronic equipment in rural clinics. If long-term credit facilities are available for rural clinics to install solar energy systems, we can scale up the program. Solar thermal can meet the demand for hot water at reduced cost at both rural and urban clinics. We can use Solar PV technology to power mobile phone base stations. Leading mobile phone companies in Bangladesh have already taken steps to power their base stations with solar power.
Against the threat of climate change:
Cyclone Sidr and Cyclone Aila have battered our people in the coastal areas recently. To
protect ourselves, we can set up cyclone shelters equipped with renewables, such as solar-powered early warning systems, water desalination systems, emergency lighting etc. We can promote organic fertilisers, tree plantations especially on embankments. We can use hybrid models such as solar or wind hybrids to protect our coastal people from the threats of climate change.
Bio-gas in cylinders and from urban waste: We can use bio-gas technology not only to generate cooking gas, but also to generate pure methane gas which can used for running vehicles, power pumps and other electronic equipment. This will facilitate rural development. We can purify biogas and place it in cylinders. We can use all types of wastes ranging from animal dung to crop residues for this purpose. This is successful technology that has been implemented in India, Sweden and many other countries. Our government, which is promoting independent power generation, should also facilitate this type of technology. We can use bio-gas technology in urban areas to convert waste into electricity, gas and organic fertilisers. One such initiative has already been set up in Narayanganj to convert market wastes into organic fertilisers. Cities in Germany have laws to sort out their waste so that they can be recycled and turned into energy.
Protecting us from indoor air pollution:
Improved cooking stoves can be one of the most cost effective devices to stop indoor air pollution, reduce deforestation and over dependence on biomass. We have already constructed over 100,000 improved cooking stoves through local service providers and technicians. These stoves are an upgraded version of traditional stoves with chimneys and need 50 per cent less fuel, emitting no smoke. However we have tapped only slightly into huge potential market of nearly 12 million stoves. We can accelerate the growth rate through better models such as portable stoves that can be mass-produced at a lesser cost, along with product diversification, especially targeting rural commercial needs.
Micro-grids and hybrids for more power and flexibility: We have been very successful in popularising individual SHS. We have also met with some success in popularising the micro-utility model where a few neighbours share a single system. Based on this model, we can install micro-grids connecting rural households or businesses. We can also develop hybrid models depending on the situation. For example, in rural market places, we can successfully install solar bio-gas hybrids, where biogas plants are powered with human and market waste. Flexibility can be added to the model through providing plug in options for extra facilities, to individual households and businesses.
Promoting eco-villages/zones in coastal areas: We can create eco-villages or zones where each home and business is run using solar and other renewable energy technologies.
These special zones would have solar mini grids, improved cooking stoves, rain water harvesting, organic fertilizers, nurseries and tree plantations etc . The houses would be built sturdily on especially elevated bases. We could promote this type of villages especially in coastal areas suffering from cyclones, tidal surges.
DEDARUL M CHISTY
Solar farms in CHT: We can set up solar panels in Chittagong Hill Tracts around Mirasarai and Fatickchari to produce and feed electricity to grid lines .
Local manufacturing units and green jobs: We are already creating green jobs and businesses through renewable energy technologies, especially in the rural areas. We have provided employment to bright engineers and given them training both home and abroad. Most importantly, we have taken the assembly of solar accessories to the rural areas through our women. We can further this by creating green enterprise zones especially in the rural areas to assemble world class solar products for both local and international consumption. China can be our model in this regard. We can also train human resource for exporting outside.
Greening our vehicles: We can also easily green our transport. We can use solar and battery-powered hybrids to run small vehicles. We already see battery-powered three-wheelers in Dhaka, and University of Dhaka has also piloted a solar battery hybrid model. Instead of charging themselves at gas stations, solar hybrid vehicles can charge themselves at the solar battery stations. These vehicles can also store extra power and transmit it to the grid.
Ushering in the Green Century
Our government has set a target to distribute electricity to every corner of the country by 2020. My dream is to ensure that at least half our people, i.e. 75 million out of 150 million people can have access to affordable clean, environment friendly renewable energy by that time, if not earlier. I want green energy to complement other government efforts to take electricity to all by 2020.
How do we go ahead to explore the full potential of renewable energy technologies? How do we accelerate growth and build on what we have achieved?
This decade has brought tremendous changes especially in the lifestyle of the rural people. Nearly 59 per cent of the rural people have access to televisions, and mobile phone subscription is growing at a tremendous rate.
Mechanisation is becoming a way of life. Farm animals have been replaced by power tillers, and rice threshing takes place at mechanised mills. This means a huge rural potential market for renewable energy technologies if we take into account increased disposable income, growing consumption, and couple this with the great strides renewable technologies have made in terms of efficiency and cost reduction.
As for the urban people, lack of power has been devastating. The urbanites are desperately looking for alternatives and renewable energy can be that alternative.
Despite the above, existing companies are reaching only a tiny portion of the expanding market. This is due to high field level transaction cost, lack of innovative product development and especially ineffective utilisation of entrepreneurial forces.
High battery prices and inability to source quality raw materials or accessories, cost effectively are also two the major challenges most service providers face. Training and retaining efficient human resources at the field level is also very difficult.
We need a competitive business culture to innovate, cut costs, attract investment and take steps for penetrating new markets. Let me elaborate:
-We need to create business companies -- small and big, linked with village-based entrepreneurs to spread solar and other renewables to every nook and corner of the country. This would cut transaction cost, create ownership, innovations, and competition.
-We can create local women entrepreneurs to promote solar lanterns, small SHS as well as improved cooking stoves. The women entrepreneurs can set up micro-enterprises and be linked to SME financing to carry out their businesses. .
-We can link government-funded youth programs with renewable energy to provide training and soft loans to local youth who will install, as well as provide, after sales service for renewable energy technologies.
-We can focus on innovative business models to popularise solar pumps, mini-grids, etc. This could be through village-based entrepreneurs who would invest in the technology and earn a return by renting the technology to others. The entrepreneurs can source loans from rural banks for micro-enterprise scheme.
-We can set up special windows for green energy in all banks, especially in the rural areas for providing credit to consumers and entrepreneurs.
-We also need to create win-win linkages between renewable companies, suppliers and banks. This would lead to new source of funds, expansion, and diversification and eventually put the companies on the stock market.
-We need to set up more battery and other solar accessory-manufacturing units to create a competitive environment, reduce costs, and increase efficiency. We should also set up solar panel manufacturing units. Our government should try to attract foreign investment and R&D in this sector.
-We should concentrate on manufacturing export quality products to achieve economies of scale and tap into the world market. We can consider setting up green enterprise zones especially for solar accessories such as charge controllers, invertors, mobile chargers etc in the rural areas, to create green jobs with a focus on women.
-We need to develop a sustainable framework for developing human resources through country wide vocational centers, training institutes, etc. The trained human resource can be exported worldwide to earn us valuable foreign currency.
-We need to focus on R&D and have innovation departments in all universities linked with AIT, MIT and other world class institutes. This would help us to adapt, pilot test new technologies and especially develop engineers who are excellent in product design and implementation.
We will soon be passing the budget for 2010. I urgently request our policy makers to focus on the following:
Removal of VAT/tax for all solar products: Bangladesh has one of the highest VAT/taxes on solar accessories and raw materials. This should be removed to reduce manufacturing cost and subsequently prices of the accessories especially batteries. If all VAT/ taxes are removed , then we can reduce the cost of a Solar Home System from by 40 per cent. One of the main challenges in popularising Solar Energy Systems in the urban areas is the high price of batteries and invertors. If we can reduce these costs, then solar can become competitive with diesel generators and IPS. Our government and people will both benefit from reduced cost for importing diesel or kerosene, less load shedding and more productivity.
Easy access to credit for green business: It is heartening to see that Bangladesh Bank has set up a special credit scheme to popularise green energy. However, most end-users are not aware of this scheme and the banks do not have a distribution channel to reach potential customers. The scheme would be more productive if it targeted service providers directly, instead of customers. Currently service providers can access the fund at 10 per cent interest rate, which is too high, and the payment is only made after the product has been installed. This does not allow an organisation any fund for purchasing the system or retaining its distributional channel. We can amend this scheme to provide very low interest loans to entrepreneurs for carrying out green businesses including setting up battery/solar factories, etc.
Feed in tariff policy for urban dwellers: Feed in tariff policy had been very effective in promoting solar in most western countries. India also has a feed in tariff policy. Under this policy, a solar-system installer can sell electricity to the national grid at a slightly higher price. This will encourage urban dwellers to install solar-systems and feed the extra electricity to grid line. We can transform every urban building into a powerhouse through the effective implementation of feed in tariff policy.
I imagine a day when world-class solar panels and other accessories would be assembled on the soil of Bangladesh to be exported to other countries, after meeting domestic demand. Renewable energy can reduce oil dependency, save valuable foreign currency, protect us against environmental hazard, and especially help to create green businesses and green jobs that we can export outside to earn foreign currency.
Bangladesh could be in the forefront of ushering a true Green Energy Revolution to the whole world, if we all join our hands together and make it a reality.
Dipal C. Barua is the first Zayed Future Energy Prize Winner, Founder & Chairman Bright Green Energy Foundation and Founding Managing Director, Grameen Shakti.