Lecture 6

The sixth lecture was held on 14th February by M. M. Rahman and Jukka Paatero. Firstly, some topics related to the previous lecture were discussed. After that two computer programs for simulations and calculations of electricity generation were introduced. The programs were HOMER and RETScreen. HOMER is developed by National Renewable Energy Laboratory from Colorado, USA and RETScreen is developed by National Resources Canada.

In the beginning of lecture M. M. Rahman presented some interesting examples related to financing of electricity grids in rural areas in Bangladesh. There is a priority criteria in use in Bangladesh, who is getting the grid and who is not. According to the criteria, there has to be minimum anticipated annual revenue of 450 € per each kilometer of grid so that the grid can be built to the area in question. The anticipated revenue is calculated based on a table. For example for residential consumption the anticipated revenue is at least 10 € per year and if the load is above 1 kW, then the anticipated load is 10 € per kW per year. For commercial electricity consumption the numbers are double. Also the anticipated revenues to some industrial site types are given in the table

In my opinion this priority criteria system is quite clever because at the moment the grid can not be built to everywhere because of lack of capital. With this criteria system, it is simple to calculate for which area the electricity grid is the most valuable and then build the grid first there.

Some other financing issues related to electrification in rural areas in Bangladesh were also discussed on the lecture, for example funding of the grids. Government provides very competitive loans for building of electricity grids. There may be eight years of grace period in the loan, when no interests are needed to pay. Also the interest rate for loans is very low, 2 %. First thing to come to my mind is a question related to the funding of Government of Bangladesh. Can the Government really get funding or sell bonds at this low interest rate? If not, then it means that Government is also speeding up the building of the grids by providing subsidies.

The second topic on the lecture was energy modeling program called HOMER. I have never used this program so it was new for me. HOMER is designed for analyzing of power systems which contain several different electricity generation forms, like wind, PVs and conventional generation. Also load points and batteries can be included to the power system to be analyzed. Mr Rahman demonstrated on the lecture how to use the program and it seemed that the program may be useful for me also at some point.

The third topic on the lecture was planning tool called RETScreen. I have used this program quite a lot before so I am familiar with it. The program itself is capable to make investment calculations for different electricity generation technologies and for energy efficiency investments. Also cash flows or price of CO2 savings for the investments can be calculated with RETScreen.