Jun 192013

By Sunil Acharya
[Published in May-June 2013 issue of Face to Face]

Mainstreaming renewable energy is most reasonable way to tackle the growing energy crisis in Nepal.

We have long boasted about Nepal’s high potential for energy resources, which are mostly renewable. Yet only 40% of the population has access to electricity. Those who have access to electricity at times have to endure 16-hours daily power cuts.

The energy crisis is the largest obstacle for country’s economic development. Despite a sluggish improvement in the efforts to alter the state of affairs, there is a long road ahead for energy-secure Nepal. Can anything be done to speed up the transition? Certainly. But a long term vision is required for the sustainable development of renewable energy in Nepal.

The Hydropower Dilemma
We take pride to the fact that Nepal has hydropower generation potential amounting to 83,000 megawatts, with technical and economic potential amounting to 42,000 megawatts. After a century of hydropower development, the hydropower generation is a mere 700 megawatts (data for Fiscal year 2010/11). The plans to generate 10,000 MW hydropower in the next 10 years and 25,000 MW hydropower in the next 20 years are gathering dust in the selves due to bad investment environment. The idea of selling electricity to India is a popular political sloganeering only. We are in fact buying about 17% of total electricity supply from India.

Although, hydropower is a cheap form of energy, this sector faces a number of problems, such as the geo-politics of upstream-downstream water sharing.

It is high time that we revise the 50-year-old 83,000 megawatts hydropower potential because of deforestation, soil erosion, environmental degradation and climate change that have changed both our topography and hydrology. The high dam reservoir based plants are not appropriate because of difficulty in relocating increasing populations and from the environmental perspective. We already know the problem with run-off the river system, i.e. wet season-dry season variation in energy production. As an impact of climate change, there is a change in the river flow, thus making hydropower generation more difficult.

Hydropower is without the principal source of energy in Nepal; however, hydropower centric energy policies alone cannot solve the energy crisis. The present requirement is for the diversification in the energy mix or the other forms of renewable energy.

Burden on Biomass
Fuel wood supplies about 77% of the total energy demand in the country (data for 2008/9). Other sources of biomasses are agricultural residues and animal dung which contribute about 4% and 6% respectively. Of the total residential sector energy consumption, fuel wood comprises about 86.5%. According to the more recent data, 64% of households use fuel wood for cooking.

Deforestation has long remained a major challenge for Nepal. We can predict the dire state of forest sector by looking at the current trend of fuel wood consumption. Considering the problems of indoor air pollution and black carbon, there has to be a rapid shift in this fueltype consumption.

An unfair affair with Fossil fuel
The escalating consumption of diesel and petrol in transport sector coupled with ever rising prices has jeopardized the national economy. The share of petroleum is 8.2% of the total energy consumption. This figure does not include the dangerous trend of installing diesel generators for electricity production by urban residents, industries and businesses in recent years. Despite the high cost to the tune of 35 to 42 rupees per unit, there are estimates of about 500 to 700 megawatts of electricity being produced from privately owned diesel generators (Whilst there has been no official study yet, Clean Energy Nepal, a non government organization with support from Clean Air Asia is taking stock of diesel generators that are in use and electricity production through them in Kathmandu valley).

Kerosene is still used by more than 50% of rural people for lighting their homes.

Nepal cannot afford an affair with fossil fuel both from the economic and environmental considerations, especially considering the fact that Nepal is a leader of LDCs in international climate negotiations where alternative to fossil fuel based economy are being searched.

Renewable in the Sidelines
According to Solar and Wind Energy Resource Assessment (SWERA) project, 3000 MW of electricity can be generated from wind energy if we only consider 10% of area with more than 300 W/m2 wind power density (WPD) in Nepal. Similarly, Nepal receives 3.6 to 6.2 kWh of solar radiation per square meter per day, with roughly 300 days of sun a year, making it ideal for solar energy.  If we use just 0.01% of the total area of Nepal, we can very generate solar electricity at 8GWh/day; that is 2920 GWh/year.

Despite the huge potential, only fraction of energy has been harnessed from renewable energy technologies such as micro-hydro, solar power, wind energy. At present, around 23 MW of electricity is generated from micro hydro schemes, 12 MW from solar PV system and less than 12 KW from wind energy.

The reason for such a slow progress in renewable energy is mainly due to high energy production cost from solar and wind energy technology. Due to the political reasons, the Nepal Electricity Authority (NEA) has not adjusted its electricity tariff for a long time. Nepal is spending billions of rupees every year to import hydro-electricity, invertors and batteries. The good news is that renewable energy generation through solar and wind technologies have become efficient and cheaper globally.

The table below summarizes the dismal picture:

The table summarizes the dismal picture

Time for mainstreaming the alternatives
In Nepal, the micro-hydro, solar, wind and other biomass based technologies are often attributed as alternative energy. These alternative sources can be mainstream sources if only the right policies are made and implemented. There are a couple of policies related to renewable energy, including recently updated subsidy policy, but the main focus to date is only on rural electrification. While it is important to prioritize rural electrification using RE sources, it is equally important to prescribe technology type that is favorable to a particular area through research rather than making flat assumptions.

The tunnel vision of the policy makers is exemplified by not including Solar Photovoltaic technology installed in Urban areas in the subsidy policy endorsed in March this year and the effort of AEPC to revise it to incorporate waste to energy technology within months of endorsement. A policy should be a guiding document that can be used for decades not that it is altered every now and then.

The government is in the process of finalizing 20 years renewable energy perspective plan. The experts following the drafting process criticize it for not focusing on promoting renewable energy mainstreaming in urban area particularly that of Solar through community grids or Feed-in tariff (FIT) system. FIT is a system which enables communities and local private enterprise to participate in renewable energy production and the utility company (NEA in our case) pays to the producer.

Any policy that aims to mainstream renewable energy in Nepal requires a dual approach: independent off-grid system in rural area devoid of grid connection and grid interactive systems or reverse metering system for urban areas. The benefits of such systems are twofold; provide sustainable energy to the communities and bring economic gain due to reduction in transmission loss and distribution costs.

This is the right time for renewable energy revolution. But are we ready?

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