Rural microgrids in the improvement of supply security : case Bangladesh
Ishtiaq, Farzana (2025)
Diplomityö
2025
School of Energy Systems, Sähkötekniikka
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi-fe20251205114838
https://urn.fi/URN:NBN:fi-fe20251205114838
Tiivistelmä
Reliability challenges in electricity systems are a growing global concern as many countries confront rising demand, constrained fossil fuel supply chains, and the increasing frequency of climate-induced disruptions. Worldwide, energy not supplied imposes substantial economic and social costs, especially in developing regions where infrastructure limitations intersect with dependence on imported fuels.
This thesis investigates how rural solar microgrids can enhance power supply security and reduce load shedding in Bangladesh, a representative case of developing economies that face persistent reliability deficits despite substantial installed generation capacity. The study quantifies annual energy not supplied and characterizes the paradox of high installed capacity and reserve margins coexisting with recurring load shedding, using operational records from the Power Grid Company of Bangladesh (PGCB) for 2023–2025, with 2025 data available up to August and applies three valuation approaches to estimate the economic cost of energy not supplied: grid-tariff-based costing, a macroeconomic proxy for the value of lost load, and a replacement-cost benchmark using the levelized cost of electricity for rural solar microgrids.
The results show that Bangladesh experiences sizeable economic loss from unserved energy, when valued using the value of lost load, are several times higher than the cost of supplying the same energy via solar microgrids, implying strongly favourable cost-benefit ratios for distributed solar as a reliability resource. The analysis further demonstrates that, once capacity payments and import dependencies are considered, rural solar microgrids can achieve levelized costs that are competitive with conventional fossil-based generation while improving resilience and lowering emissions. The thesis develops a replicable analytical framework that is applicable to other developing countries power systems with rapid demand growth, import dependence, and distribution-level reliability challenges.
This thesis investigates how rural solar microgrids can enhance power supply security and reduce load shedding in Bangladesh, a representative case of developing economies that face persistent reliability deficits despite substantial installed generation capacity. The study quantifies annual energy not supplied and characterizes the paradox of high installed capacity and reserve margins coexisting with recurring load shedding, using operational records from the Power Grid Company of Bangladesh (PGCB) for 2023–2025, with 2025 data available up to August and applies three valuation approaches to estimate the economic cost of energy not supplied: grid-tariff-based costing, a macroeconomic proxy for the value of lost load, and a replacement-cost benchmark using the levelized cost of electricity for rural solar microgrids.
The results show that Bangladesh experiences sizeable economic loss from unserved energy, when valued using the value of lost load, are several times higher than the cost of supplying the same energy via solar microgrids, implying strongly favourable cost-benefit ratios for distributed solar as a reliability resource. The analysis further demonstrates that, once capacity payments and import dependencies are considered, rural solar microgrids can achieve levelized costs that are competitive with conventional fossil-based generation while improving resilience and lowering emissions. The thesis develops a replicable analytical framework that is applicable to other developing countries power systems with rapid demand growth, import dependence, and distribution-level reliability challenges.