Generating your own power
Sri Lanka’s year-round sunshine is essentially a gigantic power plant producing free energy. by utilizing this energy through rooftop solar panels connected to net metering, Sri Lankans could substantially cut their electricity bills.
Obtaining a net metering system requires only a hand- ful of steps involving the Cey- lon Electricity Board (CEB), the Sustainable Energy Authority (SEA) and a solar panel provider, and comes at a surprisingly low cost. The biggest beneficiaries are high domestic consumers who pay as much as Rs45 per unit, perhaps the region’s highest tariff. High domestic users are heavily penalized in an electricity tariff system that charges commercial estab- lishments, places of worship and even low domestic users much lower rates.
The key factor in net metering is the connection between the home generation facility and the main electric- ity grid. They are connected through the customer’s main service panel and meter. Since renewable energy can- not be switched on and off, and renewable energy storing batteries are prohibitively expensive, much of the power generated by standalone home systems would be wast- ed, leading to low returns. Furthermore, given limited resources and space in fam- ily homes, as well as ease of operation and maintenance, these home generation facili- ties in Sri Lanka are currently limited to solar; without stor- age batteries, solar systems are useful only during the day. The connection to the main electricity grid provides an energy banking system, which solves these problems.
When the home system generates more electricity than the consumer needs, the net meter allows the genera- tor to feed this excess to the main grid. When the consumer requires more electricity than his home system generates, the system draws power from the main grid. The meter turns in one direction when the home draws power from the grid, while it turns in the opposite direction when it provides power to the system. With the meter turning in both directions, it mea- sures the consumer’s purchased power versus his supplied power, and bills for the net value.
Net metering was launched in 2010 by the Ministry of Power & Energy, the CEB, the Lanka Electricity Company (LECO) and the SEA. Sri Lanka’s electricity consumers are currently permitted to build generation facilities of maximum 1MW capacity. The SEA says that net metering is viable for those who consume over 160kWh per month, or those with bills above Rs4,500. At the end of 2014, there were 1,732 net metering users, with over 13MW in capacity. This number is small, but growth was at 200%, which is likely to continue.
Consumers have to submit applications to obtain an energy permit from the SEA, as well as an estimate from the CEB, which uses the consumer’s current consumption to determine their required system capacity. Consumers then purchase their systems from vendors who install them and finally sign an agreement with the utility. NDB, Sampath Bank and Pan Asia Bank provide loans for the purchasing of these systems.
Net metering users don’t receive cash payments for the electricity they provide to the main grid, nor can they “gift” this credit to anyone else. Instead, they earn credit that can be reconciled against purchases in the following months; this credit expires after 10 years.
It is in the customers’ best interest to install a generation system that provides only as much electricity as they consume. Otherwise, the extra investment made to install greater capac- ity will see no return. This also thwarts entrepreneurial ambitions of anyone who aspires to make money by self gener- ating electricity. This is a system designed to save money, not make money.
Net metering users can not only get a high return on their investment in the long term, but also help lower the environmental degradation caused by power generation. Coal or oil powered thermal energy accounted for over 60% of Sri Lanka’s electricity needs in 2014, with a devastating environmental impact.
Net metering has one major drawback that, however, does not affect the consumer.The CEB and LECO incur their highest costs during peak demand in the evenings due to running costly oil-fired generators to meet high demand. During these peak hours, net metering consumers draw power from the main grid, but pay for it through the credit they’ve acquired by providing solar-generated power to the grid during daylight when electricity consumption is at medium levels. This means that the utilities bear the burden of providing high-cost electricity units in return for low- cost units.