2. Serial Contents Page | 1
Page
number number
1 INTRODUCTION TO SOLAR ENERGY 02
2 PRESENT CONDITION OF ELECTRICITY IN 03
BANGLADESH
3 REGULAR DEMAND OF ELECTRCITY IN 04
BANGLADESH
4 CAUSES OF POWER CRISIS 05
5 SOURCES OF POWER ENERGY IN 9
BANGLADESH
6 INTRODUCTION TO SME 10
7 PRIMARY GREEN OPTION-SOLAR 11
8 SOLAR PV IN BANGLADESH 11
9 SOLAR PV COST STRUCTURE 12
10 SOLAR PV APPLICATION 13
11 ADVANTAGE OF SOLAR ENERGY 13
12 SCENARIO SOLAR ENERGY IN 14
BANGLAADESH
13 SCOPE OF SOLAR ENERGY BUSINESS IN 16
BANGLADESH
14 GOVERNMENT POLICIES IN REGARD TO 17
SOLAR ENERGY
15 RECOMMENDATION 19
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1. INTRODUCTION TO SOLAR ENERGY
The Sun, our nearest and the biggest star, is the biggest source of energy to us. Sun
energy or the solar energy has been in use since the time human existed on the earth.
Solar energy is our essential need and we need it naturally to make our life work
properly. Sun has a lot of stories and histories attached to it, for most of the humans of
the world, Sun is God, it is a Holy part of religion to many tribes like the American
Native Tribe, it is also worshipped by the Greek people, where as many other religions
like Hinduism, Buddhism, Zoroastrianism and Druids of England take Sun as the priority
of their religion. Today we know that solar energy is highly important for us and without
it we would not be able to live our lives. We need solar energy to get our work done from
inside home to outside there in the factories and industries. The old fossil fuel is also one
form that has a lot of sunlight energy trapped in it. In short the Sun and also other stars
are responsible in providing us energy. We can use solar energy in different methods to
get our work done in proper way.
According to market economy, the increasing worldwide demand for energy, forces a
continuous rise on the price of fossil combustibles. In fact, it is expected in the near
future, that the demand for energy will grow faster than the finding out of new available
fossil resources. This market behavior brings a positive challenge to the scientific
community as more funds are allocated for the research and development of new
alternatives to the usual main energetic sources (fossil combustibles). In this context in
the last decades, concentrated focuses have been assisted on renewable energy research.
Among these renewable energetic sources, the international scientific community has
devoted intense efforts to wind, solar photovoltaic and biomass. Some investigations and
hardware developments on wave energy have been led by Great Britain and Portugal .
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In this paper an intelligent sun-tracking system for efficiency maximization referring
solar energy production is developed. Nowadays solar energy has a low efficiency ratio
concerning the complete distribution chain from production to consumption (ca. 12%). In
optimized environments (materials, electric inverters, tracking systems, etc) an input of
1000W of solar incident energy production and it avoids systematic failures coming from
changes on the assumed values (position, initial infrastructure orientation, cleanness of
the photovoltaic cells, etc.).
2. PRESENT CONDITION OF ELECTRICITY IN
BANGLADESH
The urban Bangladesh now faces almost 10-12 hours load shedding every day while the situation
in the rural areas are even worst, where in most cases, the length of load-shedding range between
18-20 hours. Though the current government led by Bangladesh Awami League made specific
pledges to the nation of greatly resolving the power shortage maximum by 2012, in reality the
situation is getting worst from bad. Power crisis has already affected country‟s production sector,
while severe environmental pollution is continuing due to use of generators at domestic,
commercial and industrial establishments. Diesel-run generators not only create unbearable
noise, it also releases hazardous smokes or gas, which is extremely vulnerable to human health.
Power Development Board (PDB) said, the rental, quick rental and peaking plants were
undertaken on a fast-track basis to address the nagging power crisis. The QRPP projects were
supposed to add about 1,000 MW of electricity to the national grid. These QRPP projects are
Meghnaghat 100 MW, Khulna 115 MW, Meghnaghat 100 MW, Ghorasal 78.5 MW, Ashuganj
80 MW (gas-generated), Keraniganj 100 MW, Ashuganj 53 MW, Noapara 40 MW, Amnura 50
MW (Chapainawabganj district), Juldha 100 MW, Siddhirganj 100 MW and Katakhali 50 MW.
Bangladesh‟s energy infrastructure is quite small, insufficient and poorly managed. The per
capita energy consumption in Bangladesh is one of the lowest (136 kWH) in the world. Non-
commercial energy sources, such as wood, animal wastes, and crop residues, are estimated to
account for over half of the country‟s energy consumption. Bangladesh has small reserves of oil
and coal, but very large natural gas resources. Commercial energy consumption is mostly natural
gas (around 66 percent), followed by oil, hydropower and coal.
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Electricity is the major source of power for country‟s most of the economic activities.
Bangladesh‟s installed electric generation capacity was 4.7 GW in 2009; only three-fourth of
which is considered to be „available‟. Only 40 percent of the population has access to electricity
with a per capita availability of 136 kWh per annum. Problems in the Bangladesh‟s electric
power sector include corruption in administration, high system losses, and delays in completion
of new plants, low plant efficiencies, erratic power supply, electricity theft, blackouts, and
shortages of funds for power plant maintenance. Overall, the country‟s generation plants have
been unable to meet system demand over the past decade.
3. REGULAR DEMAND OF ELECTRCITY
IN BANGLADESH
Peak demand is catered by:
Demand from:
Natural gas 85% DESA,DESCO
1800MW
Liquid fuel 6.76% REB
2200MW
Coal 5.41% PDB itself 1500MW
Hydropower 2.45%
1 TCF Coal (37MT) can produce 14000-94000 MW
1 TCF Gas can produce 3.5 barrels of oil = 17000 cubic feet gas
= 1780
pound coal (in terms of energy production)
4. CAUSES OF POWER CRISIS
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Bangladesh electricity supply industry is controlled by the centralized bureaucratic
system of the Ministry of
Power, Energy, and Mineral Resources (MPEMR) and its subordinate
organizations Power Division and BPDB. It is believed that the organizational
inefficiency along with other factors is responsible for the current electricity crisis.
(A)Organizational structure and Reform Policy
Kerr and Savelsberg (2001) argue that reformation is done by the state for welfare
of the people. The locus ofresponsibility for welfare is refocused in what we see as
part of a broader new social agenda which encompasseschanged roles,
expectations, rights and responsibilities for individuals, organizations, and
governments (Kerr andSavelsberg, 2001). Alamet al. (2004) argues that, the
Bangladesh government has kept the electricity business inits jurisdiction with a
view to serve the mass people either in the name of corporate body or of company
as thisindustry has an immense social, political and economic importance. As a
result Bangladesh electricity supplyindustry is highly centralized within the
bureaucratic system, although private participation is there (Alametal.,2004).
Tayeb (1994) discusses that, high degree of centralization means all the decisions
are taken at the topof the organizational hierarchy. It this situation the employees
cannot express their opinions and it does notreflect the consultations and
information exchange (Tayeb, 1994). In Bangladesh all the decisions are taken by
the cabinet and the ministry without consulting with the stakeholders (“PM
approves emergency powerplant……”, 2010).
(B) Privatization and Public-Private-partnership
Williamson (2002) discusses that, the main rationale for privatization is the belief
that private industry ismanaged more efficiently than state enterprises, because of
the more direct incentives faced by an organizationalmanager who either has a
direct personal stake in the profits of an enterprise or else is accountable to those
whodo. But, in Bangladesh public-private-partnership or privatization take place in
the case of urgency andemergency rather than increase efficiency of the electricity
supply industry (Gratwick and Eberhard, 2008).Independent Power Producers
(IPPs) take part in electricity generation under privatization and private-
publicpartnership policy of Bangladesh government at the moment when
government funds are not available and crisisin electricity supply becomes acute
(World Bank, 2003; TIB, 2007). Although Bangladesh adopted electricitysupply
industry reformation policy and the private sector power generation policy in 1996
to encourage privateinvestment in this industry (BOI, 2010; World Bank, 2003), it
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takes a long process for approval of these IPPsprojects due to political influence,
corruption and inefficiency (“Lengthy process sets back power projects…”,
2010).
(C) Electricity crisis due to organizational weaknesses
Electric supply industry of Bangladesh subsidizes its residential customers as well
as its commercial andindustrial customers, although the industry is not able to meet
their operational costs (Khan, 2003). Khan (2003)suggests that, the Government of
Bangladesh (GoB) funds to Rural Electrification Board (REB) to meet therevenue
deficit and the operational losses. REB and DESA in Bangladesh also receive
power from BPDB atsubsidized rates. Temple (2002) estimates that, in the year
2002, the average cost of electricity supply was taka3.08 per kWh whereas, the
average selling price of BPDB was below its cost of supply, providing a total
subsidyof 12170 million taka to its customers in the year 2002. The losses of
BPDB have been attributed to mainly threefactors: Low Average tariff, high
system losses of (including pilferage, non-billing, non-payment of bills, etc)and
low rate of bill recovery (ADB, 1997; Rahmatullah, 2001).
(D) Inefficient organizational management
In view of the fact that BPDB has been in losses, unable to recover its operation
cost through sales revenue, thesubsidy to REB come from public funds rather than
cross-subsidization from BPDB‟s other customers (Alametal., 2004). Alamet al.
(2004) argues that, these losses implied that allocation to BPDB by the government
couldnot be fully utilized for capital investment in expanding electricity
infrastructure. Also it is likely that thisaffected the available resources with the
government for allocation to the rural electrification program (TIB,2007).
(E)Corruption
Klitgaard (1988) defines corruption as “the abuse of office for personal gain”. In
Bangladesh electricity supplyindustry corruption takes many forms, ranging from
grand corruption – the capture of high office of governmentby elites and the uses
of these offices for private gain – to “petty” corruption – the use of bribes or other
“facilitating payments” to provide services, bend or break laws (TIB, 2007; Azfar,
2002; Johnston, 1996) . TIB(2007), World Bank(2003), Newbery(2006) &
Smith(2004) think Bangladesh electricity supply industry suffersfrom all sort of
malpractices and inefficiencies, particularly „corruption„. Ahmad (2007) argues
that, corruptiontakes place because of inadequacies in existing public management
systems as well as in social and cultural roleof communal bonds and kinship ties
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within social framework„. On the other hand Mauro (1993), opines that,„speed
money„or „bribe‟ helps to conquer the „bureaucratic red tape„ works as motivation
for the industriousgovernment employees. Due to the alleged corruption in the
electricity supply industry the present Prime Minsterand ex-Prime Minister along
with their political and bureaucratic colleagues were arrested and they are still
facing the court (Bangladesh Awami League, 2010).
(F) Weak governance: Theft and lack of accountability
Accountability covers the issues such as, making the elected representatives to
answer for their policies to thevoters, making the public servants answerable for
their mistakes and seeking redress from government agenciesand officials by the
member of public (Mulgan, 2000). Mulgan (2000) suggests that there should be a
relationbetween accountability and efficiency and accountability leads to
responsibility for political and managerialaspects. Laking (2001) and Khan (2003)
argue that, the main form of corruption in Bangladesh PowerDevelopment Board
(BPDB) and Dhaka Electric Supply Authority (DESA) is system loss and the
employees ofthese organizations are responsible for that loss. System loss occurs
mostly due to the theft of electricity byunauthorized connections and unpaid bills
and the employees of these organizations assist these activities (Smith,2004; Khan,
2003; Laking, 2001). Engineers of the electricity supply industry oppose the
reformation process astheir professional body named, „Institution of Engineers in
Bangladesh (IEB)‟ that is controlled by the politicalleaders, is partly against the
reformation process in this sector (Bhattacharyya, 2003; IEB, 2000). Hill and Lynn
(2004) demonstrate that, political actors who pursue their interests through the
hierarchical structures of nationalpolitical institutions control over the officers and
organizations having the administrative authority and thus thestaffs are not
formally accountable to anyone.
(G) Other weaknesses
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Apart from the organizational inefficiencies there are some other factors those are
considered as equal responsiblefor the current electricity crisis
1.1 Wrong policy
Governance framework has the power to make policy and its implementation quite
different from reformers‟intentions (Boyne et al. 2003). Forbes et al. (2004)
suggests that different levels of governance influence oneanother, that is, that the
organization of governance impacts what, how, and for whom public services are
provided. Public managers control formal structures and authority below the level
of national policy making,other discretionary choices by public managers, and the
characteristics of service provision (Forbes et al., 2004).TIB (2007) finds that due
to the indecision of the Power Division of Bangladesh in policy formulation
processsome proposed power plants both in the public and private sectors could
not start its operations on time and thusthe crisis has been deepen in these days. On
the other hand wrong site selection and wrong policies to build new
power plants are also responsible for the delay (TIB, 2007).
1.2 Insufficient Government funding
USAID-SARI/Energy (2007) finds that Bangladesh Government had insufficient
fund for electricity supplyindustry since its emergence as electricity generation,
transmission and distribution require large financialinvestment. Bangladesh„s
electricity generation plants have been constantly incapable to meet system
demandsince 1990s (Newbery, 2005). Newbery (2005) argues that, shortages of
government funds for electricitygeneration plant maintenance and for installation
of new plants have created this acute problem in Bangladesh.
1.3 Inadequate public-private investment
Bangladesh started „privatization‟ and „public-private-partnership„in 1994,
consulting with the World Bank andAsia Development Bank (ADB, 2001).
MacEwan (2002) argues that, as the private company earns enormousprofits for its
owners, „privatization‟ is not always suitable and it is particularly tricky when it
swaps aninefficient government monopoly. (Newbery, 2006) thinks that,
Bangladesh have been more successful thanIndia in continuing to attract foreign
private investment, although it was the most corrupt country in the world till
2005.On the other hand Bhuyan (2009) argues that, although Bangladesh adopted
„private sector generationpolicy' in 1996 and declared its vision in 2000, it has not
10. Page |9
received significant amount of investments in thissector ever after a decade.
Experts, businesspersons, donors think there are still scope to invest in Bangladesh
electricity supply industry (“Enough scope to invest in power sector……”, 2010).
1.4 Long term absence of government oversight
Womukonya (2003) , TIB (2007) and (Bhattacharyya, 2007) identify many causes
of the crisis those are notproperly over-sighted by the government over the years,
although those are creating current electricity crisis: 1)
5. SOURCES OF POWER ENERGY IN
BANGLADESH
Natural Gas
Diesel
Petroleum
Coal
Solar Energy
Wind Energy
Water Energy
6. INTRODUCTION TO SME
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SMEs all over the world have played a fundamental role in promoting economic
and industrial production. In particular, SMEs especially the „micro-enterprises‟
provide the necessary foundations for sustained growth and rising incomes in the
less developed and transitional economies. However, in the current state of
changing times, SMEs need to adapt themselves to new realities and challenges
and to stay competitive. Not only they must add new features to their products,
improve performance and reduce prices to remain competitive, but must also
innovate to create new products and markets. Clean and renewable energy
technology or CRETs need to be effectively tapped by SMEs to enhance their
competitiveness. The deployment of CRETs need to be seen as a process which
compliments and is customized to the local requirements of the users such as micro
and SMEs, with a view to enhance their competitiveness aspect especially those
related to quality, convenience, flexibility, delivery and cost of the product being
manufactured. The technology innovation in the context of SMEs has to be
deployed in a way that enables its business activity to operate efficiently and
profitably, while providing equitable opportunities for jobs, and due consideration
to gender issues such as inclusive role of women. The technology transfer of
CRETs to SMEs in modernizing their production system and making them more
efficient in utilizing locally available fuel can significantly reduce the energy
inputs required for their operations, making them more profitable and
economically competitive. Technology transfer takes place in various different
modes. Most commonly it occurs through the consumption of products or services
that incorporate the technology, through licensing the production, or by a joint
venture arrangement or foreign direct investment. Technology transfer also may
result from technical assistance programmes from either multilateral or bilateral
donors. These might include training and capacity building in technical skills,
policy formulation, project management, development and monitoring, and
application and commercialization. Whichever mode is used, the transfer of
hardware, knowledge and expertise to operate that hardware must be
complemented by the development of local knowledge and expertise to modify and
adapt that hardware as necessary.
7. PRIMARY GREEN OPTION-SOLAR
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• Abundant solar radiation
– Annually ≥330 days are solar proactive
• Easy to use
– Relatively low tech
• Environmentally friendly
– No carbon emission
• Relatively inexpensive
– BDT 16 per kWh vs. PDB cost BDT 14 per kWh
8. SOLAR PV IN BANGLADESH
Installation Base
• Current PV installation
–15 MW in 2010
• Projected installation
– Ten-fold increase in 5
years
• Aggressive projection
by a Bangladeshi
publication
– 300 MW in few years
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9. SOLAR PV COST STRUCTURE
Module vs. electricity
• PV module lowest available cost
– Mono-crystalline silicon
• $2.07 /Wp
– Poly-crystalline silicon
• $1.74 /Wp
– Thin film
• $1.50 /Wp
• Solar firm installation cost
– $4.23 /Wp (US)
– $4.11 /Wp (EU)
• PV electricity cost
– 19.27 cents /kWh (US
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10. SOLAR PV APPLICATION
• Solar power systems
• Solar irrigation
• Solar heating
• Solar cooling
• Solar street lighting
• Commercial
• Industrial
• Househol
11. ADVANTAGE OF SOLAR ENERGY
One of the most important problems facing the world today is the energy problem. This
problem is resulted from the increase of demand for electrical energy and high cost of
fuel. The solution was in finding another renewable energy sources such as solar energy,
wind energy, potential energy...etc. Nowadays, solar energy has been widely used in our
life, and it's expected to grow up in the next years.
Solar energy has many advantages:
Need no fuel
Has no moving parts to wear out
Non-polluting & quick responding
Adaptable for on-site installation
Easy maintenance
Can be integrated with other renewable energy sources
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Simple & efficient
12. SCENARIO SOLAR ENERGY IN
BANGLAADESH
Energy issue has become a global concern. Like other countries, Bangladesh also may
not find immediate and easy solution to the energy problem. Moreover, with the passage
of time the demand for energy in Bangladesh will increase further. From the past
experience it appears that there is prevalence of huge gap between demand and supply.
Striving to remove this demand and supply gap, Bangladesh has made significant
progress in the renewable energy sector by introducing solar energy systems.
Infrastructure Development Company Limited (IDCOL), Grameen Bank, BRAC and few
other NGOs have taken remarkable steps forward in this regard. Grameen Shakti that has
installed about 125,000 Solar Home Systems at rural level has opened our eyes. This
energy technology might change the life style of the poor people.
Solar Home Systems have mainly targeted the rural areas of Bangladesh so the range of
products is limited. These can however be expanded to include the solar lantern, solar
torch light, solar thermal heater, and solar mobile charger. Small shop owners at rural
growth centers, mini poultry farm owners, country boat operators, and police and ansar-
VDP forces, Union ParishadChowkidars could be potential users of solar systems. In
urban areas slum people may use these solar products to improve their living condition.
Rickshaw puller may have the opportunity to use products like solar lantern in their
rickshaws and other products for their households.
In Bangladesh, building and houses located in all metropolitan areas could at least use
some of the solar products in lightning their garden, boundary wall, gates and furnish
security lights and water heating systems. RAJUK, CDA, KDA, RUK, city corporations,
16. P a g e | 15
which have a role in approving architectural and structural plans may have a good
opportunity to recommend solar energy systems.
There are about 3000 growth centers in the country. If growth centers are lighted with
solar applications by LGED it will have a tremendous effect in our agriculture, trade and
commerce and thus economic growth. The government can also bring thousands of flood
shelters cum schools, 465 Upazilla Chairman's houses, 490 Upazilla Teachers' Resource
Centres, 5000 Union Parishad Buildings, 54 Primary Training Institutes (PTI) 3150
colleges, 18700 high schools and 9300 madrashahs under the solar power system.
Moreover, 80,000 primary schools, 2.00 lakh mosques and few thousands rural health
centres may have the opportunity to use this energy. Maintenance of solar system could
be another opportunity of employment. Customised Technical education courses will
build local capacity and help generate rural employment.
There are many islands in coastal areas and remote char areas in Bangladesh. At present,
a few islands are using Solar Home Systems in households. The life of the people of Char
areas may change dramatically change through solar power. Coastal areas will have
similar opportunity.
Solar energy however will not be very competitive, in the economic sense, in a market
dominated by fossil fuels. Despite market factors, solar industry needs government
patronage and help to create the right momentum in solar market, and government grants
are needed for research in solar technology. Many countries in the world have provided
incentives to encourage people to use solar power.
Unlike others, there are, of course, limitations in expanding these solar programmes in
Bangladesh. Research & development is not very significant. Initial investment in solar
systems is quite high. Moreover there is no complete manufacturing plant yet of solar
systems in Bangladesh. These are expensive and susceptible to frequent change of
17. P a g e | 16
technology. The private sector in Bangladesh may not be attracted enough to establish
solar manufacturing plants. Public Private Partnership might provide a solution. We may
also think about accessing funds from carbon trading etc. Despite the limitations, the
objective conditions are favorable and ready for expansion of solar energy in Bangladesh.
All we need are appropriate policy, planning and initiatives, together with Public Private
Leadership.
13. SCOPE OF SOLAR ENERGY BUSINESS IN
BANGLADESH
Cost details of acquiring solar panel:
To procure a solar panel one has to pay 15% down payment, the rest is covered by
installments, total costs stand at Taka 68000.
Direct purchase costs 2 thousand 720 less.
The maintenance cost for the panel is very low.
The companies also give 20-25 years of warranty.
Investment in this sector:
The amount of investment in this energy sector in rural area per year is more than
2500 crore.
60% of this invested in solar panel, total of which requires to be imported from
outside. 25% is invested in battery and the rest 15% in small mechanical parts.
Batteries and accessories are all produced in the country. In near future, the solar
panel will also be produced locally.
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14. GOVERNMENT POLICIES IN REGARD TO
SOLAR ENERGY
The cabinet of Bangladesh government and the ministry have taken some
immediate strategies as well as long termstrategies to overcome the electricity
crisis.
Immediate strategies
The Bangladesh government and the Prime Minister have taken some instant
measures to reduce social unrest and dissatisfaction: Prime Minster and her cabinet
rapidly approved some huge projects that are also haveallegation of corruption,
without following the rules and laws (“PM approves emergency power plant……”,
2010). Power Division, BPDB carried out decisions of shutting down some
fertilizer factories and diverting gasfor power generation, rationing the use of air
conditioners in private homes/offices, 1 hr electricity outage everyalternate hour
(“PM Orders 1 hr Outage ………”, 2010). All these were contingency approach of
the Ministry,Power division and BPDB though no measures have been taken to
enhance organizational efficiency and to stoppolitical interference.
6.2 Long-term strategies
The Cabinet of Bangladesh government and the power division of the ministry
have taken some immediate butlong term strategies to mitigate current electricity
crisis. Some of the mentionable strategies are: project to buildten "peaking power
plants" and project to modify and renovate the old generation units which will
produceelectricity in 2011 (“Cabinet body approves 3 rentals ………”, 2010).
Bangladesh is going to install a nuclearpower station with the help of Russia and
going to import electricity from India, Nepal, Bhutan and Myanmar(“Dhaka and
Moscow sign nuclear….”, 2010).
The objectives of solar energy policy are to:
Harness the potential of solar energy resources and dissemination of solar
energy technologies in rural, peri-urban and urban areas
Enable, encourage and facilitate both public and private sector investment
in solar energy projects.
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Develop sustainable energy supplies to substitute indigenous non-solar
energy supplies.
Scale up contributions of solar energy to electricity production.
Scale up contributions of solar energy both to electricity and to heat energy.
Promote appropriate, efficient and environment friendly use of solar energy.
INVESTMENT & FISCAL INCENTIVES BY GOVERNMENT
A renewable energy financing facility shall be established ; Private sector
participation including joint venture initiatives in renewable energy
development will be encouraged and promoted.
Renewable energy project investors both in public and private sectors shall
be exempted from corporate income tax for a period of 15 years.
Accelerated depreciation up to 80% may be allowed in the first year.
An incentive tariff may be considered for electricity generated from
renewable energy sources which may be 1.25 times the highest purchase
price of electricity by the utility from private generators.
To promote solar water heaters, rates of both electricity and gas may be
refixed to discourage electricity and gas use for water heating.
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15. RECOMMENDATION
Solar PV is primary choice of green technology for
sustainable industrial development in SME sector
Solar power systems be installed for SMEs as a backup if not primary power
supply
GOB and UNIDO incentivize solar installations for SMEs
Offer low interest loans/grants for global joint ventures.