Solar, FiT and Nepal's 20-Year: Renewable Energy Perspective Plan
KASHISH DAS SHRESTHA
On June 1, as the country was coming to terms with the political vacuum it had entered at the end of May, Nepal’s Alternative Energy Promotion Center was looking ahead.
At a meeting in the capital’s Annapurna Hotel, it hosted a “Stakeholders’ Consultation Workshop (on) the Draft (of the) 20-Year Nepal’s Renewable Energy Perspective Plan.”
The consultation company, Feedback Ventures Nepal, a subsidiary of an Indian company, had prepared the 20-year document, and presented it to a mixed audience of government officials, donor agency representatives, and representatives of organizations working in Nepal’s renewable energy (RE) sector in various capacities.
It is this writer’s understanding that the document is still being finalized after a ‘feedback period.’ It appears that most feedbacks that were given did not touch on issues of solar power or Feed-in Tariff (FiT). And nowhere in the document is the word ‘community’ used to define a group that could potentially produce and distribute energy. When it is used, it appears to be preceded by the word ‘donor’ or talk about existing projects conducted by donor agencies.
On the other hand, the document does declare early on in its section titled ‘Rationale’ that “the plan shall serve as the guiding document for concerned agencies to promote renewable energy and will bolster the confidence of private investors, donor community, and financing institution in presence of a long term plan reflecting the commitment of the government to promote renewable energy in the country.”
That expression sets the stage for how solar energy would be developed in Nepal and what role the document might see fit for a Feed-in Tariff (FiT) model.
Like India’s National Solar Mission, the 20-year strategy document in Nepal too seems to treat solar as something that should be developed as a grid-connected large-scale energy source owned by private sector, while finding some space for Feed-in Tariff in the plan.
That may work in India, or any other country with the luxury of space and scale. In Nepal, it feels out of context.
The document imagines solar projects of multiple megawatts developed on single sites, scaled up over time to 10MW and more.
At the presentation, a representative of Feedback Ventures assured a wary audience that Nepal could in fact harness its solar potential within a few years, because India has shown that it can. He went on to say that because there is so much sunshine in the Terai, using that region for developing solar power generation would be ideal.
No, it wouldn’t.
Dr. Govinda Raj Pokharel, Executive Director of APEC (R), with Secretary of Ministry of Environment Krishna Gyawali at the June 1st meeting on APEC´s 20-Year Renewable Energy Strategy.
Sustainability versus feasibility
It appears that the driving force for the document is not necessarily the idea of sustainability, but rather the business of renewable energy and its feasibility.
While feasibility is critical, it has to be kept in mind that the primary interest should be to develop Nepal’s RE sector as to make energy accessible to as many Nepalis as possible, and to help take Nepal on a path of sustainable development.
The notion of building large solar farms in the Terai is unsettling simply because the region is Nepal’s primary farmlands. Ironically, there should be concerns of a successful solar farm in the Terai because that success could demand replication and scaling up of such projects in the region.
It is also unclear how large solar farms in the Terai would fit with the Ministry of Agriculture and Cooperatives and the Ministry of Finance’s vision of helping the country’s agro-sector grow more rapidly.
Simply put, food security and the agro-sector cannot be jeopardized for the sake of RE, namely, solar, not when the country suffers from massive food insecurity issues.
So, if the 20-year strategy cannot include large solar farms in the Terai, how can it harvest our solar potential?
A drawback solar energy has faced in Nepal at policy level is the continued treatment of solar as a source of energy best used by people who cannot connect to the grid.
While that is important, it is critical to understand and develop solar energy harvesting in Nepal’s urban centers. And in that, Kathmandu must lead the way as an example.
Here, solar could be the most reliable supplementary and consistent form of electricity for homes and offices while FiT could make owning them more feasible.
The document notes mandating solar PVs (photovoltaic systems) on government buildings. However, it does not mention mandating FiT at all. FiT cannot be considered as an “option.” It is a model and technology that has proven that renewable energy can indeed become a real and prominent source of a country or a community’s energy source.
When Germany set a world record by producing 22,000MW of solar power at the end of May, it did so with its FiT policies set in place in 2000.
Many other countries that have demonstrated success in making RE a key part of the national energy and national security strategy are those that have emphasized and pursued FiT-based model of energy production in which local communities and households are given a role in energy production, along with large private sector investors.
Beyond the business of selling energy
Another reason the document lacks in giving renewable energy a treatment it deserves is perhaps because it sees it as nothing more than another way to produce and sell electricity.
What role might solar PVs based on FiT model have in the future of private vehicle ownership in Nepal? How can it change the way we perceive energy production and consumption?
What does it mean for an urban center to have a maximum number of homes with some form of independent source of energy, especially at a time of natural disaster?
What will it mean for the national grid if it can reduce even some demand from thousands of homes and offices in Kathmandu? How will the grid benefit if in weekends a significant number of offices and government complexes are able to feed the grid, and on weekday afternoons residences are able to do the same?
If Nepal is seriously planning a 20-year strategy for developing RE, concepts such as FiT cannot be put on the sideline; it should be the basis on which much of the strategy is developed with ample role of homes, offices, community groups and local governments.
It is also a relatively ideal way to deal with the issue of subsidy. And it should under no circumstances be sidelined because large-scale solar projects may not need it.
RE isn’t just about powering the grid; it has to fit into a larger vision of sustainable Nepal, and it has to be about powering the society and empowering its members.
If our energy planners fail to address RE as something more than just a commodity, especially when designing a 20-year strategy, it will do a disservice to the country.
The author is currently a Policy Fellow at Niti Foundation, researching Feed-in Tariff in Nepal. You can follow him on Twitter @kashishds and email him at firstname.lastname@example.org