Basic Technical & Commercial Aspects of Solar System

We have seen rapid evolution in technology, especially in the last 50 years and this has not yet stopped. We have now named it the fourth industrial revolution. Like we used to call computers, the internet, or smartphone our life-changer, we are now familiar with the terms big data, artificial intelligence, and blockchain to redefine the common man’s life. These developments are also helping R&D in solar technology.
This article tries to cover all basic commercial and technical matters of the Solar system especially related to the Pakistan market using friendly terms.
In the first phase of any technological invention, it is only available for limited users. However, in the second and third phases, it is widely and commonly available.
We could find the first solar Electricity plant as old as in 1968 in Italy. However, only in the post-2000 era, it has become available on a large commercial scale and the development has been so rapid after 2016 that we find new specs for solar plates every six months or year.
WHAT ARE THE TERMS YOU SHOULD KNOW ABOUT SOLAR PANELS?
Although we could have 15-20 technical terms associated with solar plates, we only shed light on the below most relevant terms:
Material: Silicon is the basic raw material in solar plates, the outer surface is made of glass. Solar plates work on the principle of photovoltaic effect, that means it converts light energy into Direct current (DC) Electricity. The three common types of material used are Polycrystalline, Monocrystalline, and thin film.
DC output (Watt): Initially, the DC KW output of the solar plate was 150W and it gradually increased from 250W, 330W, and 435W and now a 590W size plate is available in Pakistan.
Efficiency & Size: Efficiency defines solar plate capability to provide useful KW output in the minimum surface area. The efficiency rating measures the percentage of sunlight hitting the panel & getting turned to usable electricity. The efficiency depends on the spectrum and intensity of the incident sunlight and the temperature of the solar cell. The solar plates being available today have an efficiency of around 11-15%.
Size: The higher the efficiency, the lesser the surface area needed for solar panels, currently a solar plate with 590W output has a size of around 3.5 x 7.9 ft. Similar to mobile phones and memory cards, we expect solar plates to generate more power in less space, which means far more efficiency in the future.
WHAT ARE THE POSSIBLE APPLICATIONS OF SOLAR POWER?
Historically, we use solar energy mainly for heating purposes but with the development of solar plates, we are now using it for generating electricity which in turn being used in the following applications:
• AS AN ALTERNATIVE TO GRID POWER:
The first & biggest application is to convert Solar Panel DC output to AC output and then use it as a source of Power alternative to our normal power from Grid/utility. We can put this system in our home with few solar plates or we can make a large-scale power plant with thousands of solar plates connected.
• TO RUN DC APPLIANCES:
The other applications are direct use of solar DC output for an appliance. In this case, the appliance is designed to run on solar power, sometimes the manufacturer provides both special solar plates together with the appliance. Examples are solar pumps, solar lights, solar air conditioners, solar heaters, and so on.
• TO CHARGE STORAGE BATTERIES:
The third application is to use solar power output to charge storage batteries, these batteries then provide power after sunset.
WHAT IS THE BENEFIT & ROI OF EACH APPLICATION?
When we talk about using solar plates as a source of AC Power, we should know that the return on investment depends on:
• Self-consumption
• Net metering (selling power to utility)
• USING SOLAR FOR SELF-CONSUMPTION:
Being a consumer, you should get a fast return on investment if you can completely self-consumed solar power output as it will reduce your electricity bill. However, if you generate power more than your personal use even then you get compensation in your bill via Net metering but you must know buying power from Grid is at higher rates while selling power to Grid is at a lower rate. So, one should know its consumption pattern before deploying a Solar system for the best return on investment. Generally, the ROI for solar investment is 3-5 years.
• USING SOLAR FOR SELLING TO GRID:
When an investor puts a large-scale solar plant only to sell AC power to Grid then it deals with Govt for a long-term agreement on rates, which will define its investment feasibility. In Pakistan, AEDB (Alternative Energy Development Board) is the central Govt body that deals with all the approval and agreements for renewable projects.
Here, we share for the interest of readers that the largest solar plant in the world is Bhadla Solar Park – 2245 MW, located in Rajasthan Jodhpur District India with Pakistan’s largest solar panel is Quaid-e-Azam Solar Park 400MW, located in District Bahawalpur.
• USING SOLAR FOR APPLIANCES:
The second application of using solar output directly for appliances provides the highest return on investment. Although these systems (appliance + solar plates) are more expensive than conventional AC appliances if you calculate expense on account of Diesel Generators operation & maintenance in remote areas where grid power is not available then these would prove to be a better option.
WHAT IS NET METERING?
Power Distribution companies bill consumers (Home, factories, commercial complex, etc.) via conventional meter, this meter doesn’t differentiate whether power is consumed by customer or customer has supplied power to Grid and it always bills towards the customer, while NET Metering is a billing mechanism that offers credit to residential and business customers who are making excess electricity with their solar panel systems and exporting it to the grid. Below is the procedure to get Net metering done in Pakistan.
• You hire a contractor that is approved by AEDB (Alternate Energy Development Board)
• This contractor finishes the installation and submits a Net Metering application form to a primary utility company (KE in Karachi).
• Pay Order on behalf of NEPRA needs to be submitted along with the application form which is equal to 1000 Rs/KW.
• You will get the ticket and your Electricity provider whether K-Electric, IESCO, HESCO, etc. inspect your installation and approve safety assurance. The respective power distribution company replaces the meter after the challan is submitted.
• You will get the first bill after 03 months of installation of the Net Meter.
• Note that Meter should be three-phase (For Karachi Only) and it must be in the owner’s name and 5 times PV can be installed as compared to your sanctioned load.
HOW BANKS ARE HELPING WITH SOLAR INSTALLATIONS?
Banks provide loans with a 6% mark up with easy installments from 3 – 5 years whereas customers need to pay a 25% minimum down payment. Note that Bank provides loans only for Net Metering installations and it will require you to engage the only bank-approved solar installers in the project and property and the meter should be in the name of the applicant.
SOME KNOWLEDGE ON SOLAR INVERTER?
As we mentioned in the previous para that the two applications where we use solar plates as a source of the alternate power, the power is converted to usable AC power via Inverters.
According to the application of the inverter, we could classify it into three types:
• ON-GRID INVERTER:
This kind of inverter converts Direct Current (DC) electricity into Alternating Current (AC) Electricity however to generate output it needs availability of a primary Grid source. It synchronizes its output voltage and frequency to the mains power supply. This is ideal where the user only needs solar power during the daytime and a Grid supply is always available.
• OFF-GRID INVERTER:
Simply opposite to ON Grid inverter as it does not need the availability of Main Grid to produce output from Solar plates. However, it is preferred a set of the battery connected to it. During normal operation Inverter output fed the load and also charge batteries, after sunset or during cloudy weather when inverter output is decreased, charge batteries provide backup power to load. It is ideal for remote places where no Grid supply is available.
• HYBRID INVERTER:
ON Grid inverter connect with AC Grid & load while OFF Grid connects with batteries & load, however, HYBRID inverter has provision to connect with AC Grid, Batteries and load. A hybrid inverter (sometimes referred to as a multi-mode inverter), We can prioritize the output of the inverter to be used to charge storage batteries or to serve the load connected to it. It can also serve load through solar power and charge batteries via Main Grid power depending on selection. It is an expensive inverter compare to ON Grid and it is ideal for places where we have planned or unplanned outages of utility Grid.
WHAT ABOUT MAINTENANCE & LIFE CYCLE?
Solar panels need regular maintenance especially in dusty areas, the performance & efficiency of solar plates decreases with time and it has a useful life of up to 25 years but it could work beyond that as well.
All large-scale solar plants have ground-mounted solar plates where maintenance is easy. However, in the case of a rooftop, we can have both ground-mounted or elevated structures. Elevated structures help in putting more solar plates in the same covered area however it is difficult for maintenance.
There are special vehicles, Drones and wipers, and other tools available for efficient cleaning of solar panels.
HOW GOVT IS HELPING IN PROMOTING SOLAR INSTALLATIONS?
We know that there is a 17% sales tax applicable on the trading of all products in Pakistan whereas there is 0% sales tax on Solar plates & solar inverters. To ensure only A-Grade material solar plates are imported in the country, AEDB has a guideline document “Process flow for Import of solar PV equipment in Pakistan”, according to this document, importers need to produce quality certification from independent Lab before clearance of the shipment.
Because no adequate and large-scale testing lab is available in-country, many importers get the required certification done at the origin country. However, still, people complain about a lot of low-grade material circulation in the market and therefore one should be careful in purchasing solar panels from any unknown company.
HOW SOLAR SYSTEMS ARE BEING TRADED IN THE MARKET?
All world-leading solar panels manufactures have their representative available in Pakistan, they create an agreement with different large-scale importers /stock keepers, these importers order many containers in advance and sell into the market. The middle contractor companies purchase solar panels from these importers and provide complete solutions with installation & commissioning to users.
While large scale contractors purchase solar panels directly from manufacturers and provide complete turnkey solutions to Govt or big customers.
AEDB also recognizes different categories of solar installers based on their capabilities to handle the size of the project i.e., ARE-V3 up to 50kW, ARE-V2 up to 250kW, ARE-V1 up to 1000kW
HOW PRICING IS DONE?
Internationally solar panels are sold with per watt pricing and similarly, contactors sell complete systems with per watt pricing, for example, in Pakistan, the price of the latest 590-watt solar plates is PKR 40 ~ 44 per watt, similarly, complete installation of the solar system is PKR 100 ~ 120 / watt. This is the base figure and the actual price may vary according to special site requirements.
WHAT ARE KNOWN AND SOLAR BRANDS & INVERTERS AVAILABLE IN PAKISTAN?
International banks approve loans against certain solar brands to be used in large scale projects, these we called bankable solar panels, some of the famous solar brands available in Pakistan are
LONGI, Trina, JINKO, Canadian Solar, JA Solar, Hanwha Q Cells, Risen Energy, etc.
Similarly, the following are the famous solar inverter brands available in Pakistan
SMA, Huawei, Fronius, Sun grow, Solis, GoodWe are available in the ratings of 5kw, 10kw, 15kW, up to 200kW
WHAT ABOUT LOCAL PRODUCTION?
Few companies are working to develop solar plates locally in collaboration with Chinese companies but we are far away from reaching the global quality standards and it required mass scale production to achieve competitive pricing. Govt, academia, and industry need to put joint efforts in achieving this milestone which may turn around Energy transformation in Pakistan.
WHAT IS THE FUTURE POTENTIAL OF THE SOLAR SYSTEM?
In Pakistan, at least 50 million population and around 25% land area does not have utility Grid coverage and the transmission Network would be too costly for arranging power in those dispersed areas & population, locally installed Solar plants would be an ideal solution, in addition, there is huge potential in urban areas for both domestic and industrial use.
Pakistan renewable energy has been slow to develop and it has only a 4% share out of the total energy mix, however, in April 2019, Govt announced an ambitious target of 30% share of the renewable Energy mix that is from solar, wind & biomass, this is to achieve by 2030.
With favorable govt policies and every improving pricing of solar plates because of development in technology, we hope to achieve the goals set by govt.