Solar PV Rooftop Net-metering in Nepal

By Purna N. Ranjitkar l

Taking very simply, net-metering is a utility billing mechanism available in many countries that offers a credit to residential and business customers who are producing electricity with their solar panel systems installed on roofs or at any part of premises and sending it to the grid in the daytime. So as, when an individual or institution have a rooftop solar electricity generating system, generate more or less to the consumed electricity taken from the utility system and send the excess to the utility system is Grid Tied Solar PV Rooftop System. The reconciliation of accounts of give and take is net-metering. 

With net-metering, the prosumer (who plays a dual role of a consumer and a producer as well) is only billed for the “net” energy used each month or an agreed period, that is, the difference between the energy sent to utility system energy consumed by the consumer (prosumer) over the monthly billing period or an agreed period. 

In Nepal, Nepal Government, Ministry of Energy, Water Resources and Irrigation (MoEWRI) and Nepal Electricity Authority (NEA) had formulated rules and regulations for any institution or individual who generate electricity from solar panels and connect to the national grid. The electricity generated should be 500 watt in minimum and 5 kW in maximum. There are separate rules and regulations for larger than that size.

However, only a few rooftop Solar PV Systems have been connected to the grid so far. The reasons behind why ordinary consumers are not attracted to is lack of information on this system can give benefits to consumers.

Net-metering can save thousands of rupees to individual households or institutions on their utility bills every month, so it’s a good reason to make the money-saving choice and go Solar sooner rather than later.

There’s another benefit from net-metering. Since a Solar PV System is generating electricity near the point where it will be used, this reduces strain on the grid’s distribution and transmission infrastructure and minimizes energy loss from sending voltage miles away from the nearest power plant. On the other hand, some claim that net-metering represents an unfair burden on non-Solar electricity customers, as per the studied carried out in the developed countries.

Moreover, electricity generation from Solar PV Systems in Nepal is considered to be complementing to hydropower. Electricity from Solar can contribute mainly in the dry seasons when volume of water flow in the rivers decreased to generate about 30% of the installed capacity of hydropower plants. That means most of the hydropower plants in Nepal are run-off the-river (ROR) typed which generate electricity as per water flow in the river. Principally, they generate electricity as per installed capacity in 40% of the days in a year which period is considered wet season. The water flow in the river go down gradually to reach at around 30% in the top dry days.

So that electricity produced cannot match the average demand. That means, electricity demand is fulfilled in the wet season even spilling hundreds of megawatt of electricity as excess. But in the dry season electricity generation by hydropower plants cannot meet the average demand.

Therefore, electricity generated by Solar PV or other technologies should be added in the system. That is also permitted by principles of Energy Security and Energy Mix.

The electricity generated by Solar PV Systems in the day time can fulfill the day time demand. Moreover, hydropower plants with Peaking Run-Off the River (PROR) may be stopped electricity generating in the day time substituting by Solar PV and back to generate electricity in the peak hours.

Thus, electricity generated by Solar PV Systems can complement. This has been realized by policymaker and planners since a long time.   

Experts say that there are around 600,000 residential houses in the Kathmandu Valley alone. Only 100,000 out of that number if install 1kW Solar PV Systems in minimum that in total will be able to generate 100 MW of electricity. That is 500 MWh in a day as solar insolation is taken as 5 hours in a day. More such systems may be added for more electricity to generate.

Moreover, the rules and regulations need to be simplified. The rules of give and take of energy to and from the utility should be prosumer friendly — easy to understand and account should be transparent. Likewise, power purchase agreement (PPA) to this effect should be simplified and valid for at least 10 years with rooms to extend for future. The technical intervention for Solar PV Rooftop Net-metering is not complicated or sophisticated. Those who have installed the system can lend their knowledge and experiences to prospective prosumers with pleasure, they say.

The important thing involved is extra investment in installing the system. The most required instrument such as grid-tie inverter and some others are expensive to the small prosumers. Therefore, credit to prosumers to purchase such items should be supported with low interest rate loans.

Similarly, benefits of this technology should be well communicated to ordinary consumers as this can lower their electricity bill, can contribute to participate in climate change actions as renewable energy promotion is recognized as a part of climate actions. This is also helpful in reducing import of electricity in the dry seasons mainly.

The government sector must be positive to allocate funds for investment in such technologies so as ordinary consumers will be attracted to participate in this movement.

This is worth to mention that Solar PV Rooftop Net-metering in developed countries is a common practice. This has contributed significantly in promotion of renewable energy technologies to avoid fossil fuel based electricity. Prosumers are equally getting benefit out utilizing this technology. Likewise, the government and utility institutes are also getting benefits.

Thus, the authorities in Nepal also may be suggested to pay due attention to promote Solar PV Rooftop Net-metering which can contribute to reduce electricity shortage in the day time to well back up 1400 MW demand of industrial sector.