Rooftop solar PV in Bhutan: A systemic analysis of feed-in-tariff program

Abstract

Solar photovoltaic (PV) systems are critical to the global electrification efforts, especially in the rural and remote communities of the developing countries. This study analyses the prospects of a feed-in-tariff program for solar PV systems in Bhutan. It is based on the analysis of a pilot project covering 361 households in rural areas of Bhutan. A mix of qualitative and quantitative methods is applied, which captures the multi-disciplinary variables and generates primary data from the pilot project in Bhutan. The two critical variables argued are user acceptability and financial sustainability in the long-term in the context of access to clean energy and empowerment in rural areas. From the field data assessment, it was found that the low existing energy tariff has a cybernetic effect on user acceptability and the financial sustainability of the solar PV feed-in-tariff system in Bhutan. The current tariff rate for low voltage (LV) consumers is $ 0.038/kWh whereas the solar energy generation cost ranges between $ 0.04–0.045/kWh considering the PV project life of 25 years. The findings of the study suggest that users are willing to accept the feed-in-tariff as an enabler for rural livelihood provided the tariff rate is reasonable (at least in the range $ 0.05 to 0.07/kWh) to sustain the capital investment.