Rahimafrooz to set up solar panel assembling plant
Rahimafrooz Renewable Energy Ltd is set to assemble solar panels to grab the domestic market for solar home systems that are on an upward curve on the back of the government policy support to help off-grid people get electricity.
“We have taken initiatives to establish a solar panel assembling plant with an investment of Tk 34 crore by June 2010 as the market for solar systems is widening fast,” said Munawar Misbah Moin, managing director of the company, yesterday.
A concern of Tk 1,500-crore-Rahimafrooz Group, the company has been engaged in distributing solar systems for the last few years.
Since 2003 the use of solar home systems has been increasing fast in the off-grid areas of rural Bangladesh backed by over a dozen of NGOs that enjoy refinance facility from state-run Infrastructure Development Company Ltd (IDCOL), which promotes renewable energy development.
Now the number of solar home systems (SHSs) stands at around 325,000, up over 40 percent from 230,000 a year ago.
The SHS use increased because of the government aim to provide green energy solutions to majority of the country’s around 15 crore people who have a little or no access to electricity through national grid.
SHS installation is expected to grow faster as IDCOL plans to install 10 lakh units by 2012 to realise the government vision of meeting 5 percent of the total electricity demand by 2015 and 10 percent by 2020 through renewable energy resources, including biomass, biogas and wind.
Industry insiders said except for solar photovoltaic panels and tube lights, all the accessories for installing solar system with capacity of 20-120 watts come from the domestic manufacturers.
Solar panels and tube lights are usually imported from countries such as Singapore, India and China, with Japan-based Kyocera and TATA BP Solar controlling majority of the market.
Industry people said price of a complete SHS ranges between Tk 9,000 and Tk 60,000 and the solar panels account for nearly 70 percent of the total costs.
Rahimafrooz Renewable Energy expects that locally assembled solar panels will be more competitive than the imported ones.
“We make everything locally but still remain dependent on imports of solar panels. If we start assembling, we won’t need to depend much on the global market, and at the same time we will be able to provide 10-15 percent cost advantages to customers,” said Munawar.
The company, which claims a market share of about 40 percent in SHS, said the plant will assemble panels having a total yearly capacity of 5 megawatts.
Munawar said the total investment for the plant would be around $5 million (around Tk 34 crore) and the plant would be set up with technology support from a globally renowned company.
“We hope there is a prospect and that’s why we are taking the risk,” he said. “Our experience and knowledge in the field will help us attain the goal.”
Industry insiders also believe there is a prospect in renewable energy programmes as the government has attached priority to the sector, and is providing various financial and tax incentives to promote alternative energy development.
Recently the Bangladesh Bank has formed a Tk 200 crore revolving fund for banks and financial institutions to extend loans at low interest to areas such as renewable energy development.
In the proposed budget for fiscal 2009-10, the government also exempted VAT on solar panel and brought down custom duty on the prime accessory to zero from existing 3 percent.