Africa: Set for Solar Revolution 0

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The future of renewable energy in Africa is looking brighter all the time.

The African Renewable Energy Fund (AREF) has raised $100 million for the development of grid-connected renewable energy projects in sub-Saharan Africa.

Though many countries in sub-Saharan Africa remain drastically underdeveloped, which has caused the region to have the world’s lowest electricity access rate at 24 percent, a handful of countries are taking the first steps toward a renewables revolution.

The Upside to Solar Energy Development

There are many specific challenges for renewable energy growth in sub-Saharan Africa, but the region also has a huge upside when it comes to solar power. According to the National Solar Power Research Institute (NSPRI), most African countries receive 325 days of sunlight a year and daily solar radiation between 4 kWh and 6 kWh per square meter. This high amount of insolation correlates to a high generating capacity potential.

With solar costs falling nearly 80 percent between 2008 and 2012, the price of PV is nearing grid parity for traditional electricity sources. Given that energy prices in sub-Saharan Africa are some of the highest in the world and only figure to get higher, demand for renewable energy should increase rapidly. This is one of the primary reasons many are predicting a solar energy boom in coming years.

The decentralized nature of solar power and other renewable energy technologies makes them particularly suitable for small grids or off-grid communities. Nearly 66 percent of the population in sub-Saharan Africa lives in areas where connection to the grid is too expensive or too difficult for other reasons. Solar can be specifically advantageous in these situations to electrify many of sub-Saharan Africa’s rural communities.
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Image Credit: IRENA

Finally, solar energy is a domestic resource that offers alternatives to the expensive imports of fossil fuels and will allow sub-Saharan countries to free themselves from foreign and volatile supply chains. The International Renewable Energy Agency (IRENA) reported that coal, oil, and gas together counted for 81 percent of Africa’s total electricity generation in 2009. Nuclear power accounted for 2 percent, hydropower 16, and all other renewable sources just 1 percent.

The volatility of price levels for fossil fuels have increased in the last decade, so a shift to more renewable energy sources such as solar power should be attractive for sub-Saharan African countries that want to reduce their dependency on more expensive and unreliable energy sources.

Going Solar Brings Unique Challenges to sub-Saharan Africa

Sub-Saharan Africa not only faces financial challenges but also political and logistical hurdles it must clear to help the region realize its vast renewable energy potential.

Given many sub-Saharan African countries’ reliance on fossil fuels, it’s not surprising that centralized power companies promoting large coal and petroleum plants do not have much room or will to fit smaller, decentralized PV projects into their programs. Politicians are hesitant to spend precious money on off-grid PV projects when their main focus is on expanding the electricity grid to the whole country.

In addition, because policy-makers are often caught up in managing day-to-day energy crises, they often remain unaware of the transformative power of solar energy for their countries. Without the time or support to create policies, regulations, and incentives necessary to help renewable energy gain a foothold in their countries, policy-makers struggle to create new power structures that incorporate renewable energy.
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Image Credit: CNN

One of the most well-cited challenges for renewable energy growth in sub-Saharan Africa is the lack of access to funds to help jumpstart renewable energy production. Solar’s high upfront capital costs and longer payback periods coupled with a lack of experience dealing with these new energy sources in the banking sector has led to many financing problems.

Sub-Saharan Africa is much different than some of the leading solar countries such as Germany, the U.S., and China because there is a comparative lack of a middle class to invest in solar PV systems. Developers chase large-scale power projects, which leaves many solar PV projects hanging out to dry with no financing in sight.

South Africa a Bright Spot for sub-Saharan Solar

In late-January, South Africa was ranked the world’s most attractive emerging market for solar PV, surpassing other contenders such as Turkey and Thailand, according to market analyst firm IHS.

A combination of the country’s target of 8.4 GW of installed solar PV capacity by 2030 and its large-scale tendering process in attracting investment to reach that target gave South Africa a final score of 66 out of 100 for the fourth quarter of 2013. It bested the next country on the list by 17 points.

Investment in South Africa for renewable energy also increased rapidly in 2012 up from a few hundred million dollars to $5.7 billion. This impressive surge even saw an investment from Google, which traditionally doesn’t look beyond the U.S. and Europe for investments in solar.

The search engine giant invested $12 million in the Jasper Power Project, a 96 MW solar PV plant in the Northern Cape province of South Africa. When the plant is completed, it will be one of the largest on the continent, generating enough electricity to power 30,000 South African homes. The project will also create approximately 300 construction jobs and 50 permanent jobs and will provide rural development and education programs.
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Image Credit: IHS Technology

Sub-Saharan Africa faces some serious political and financial challenges in establishing renewable energy programs across the continent, but many countries are already seeing the benefits of renewable energy for both urban and rural communities.

The region has arguably the most room to grow of any in the world, and declining PV prices along with increasing familiarity of solar PV and other clean energy sources among policy-makers and locals will boost renewable energy development in the coming years.

Though many projects are still in their infancy, they show great promise to transform Africa’s energy industry into one of the world’s most attractive markets for investment in renewable energy and solar PV.

Aven Satre-Meloy graduated from Santa Clara University with a B.S. in political science and environmental studies. He joined Mosaic last summer as a Communications Fellow and has been part of the blog team ever since, writing about clean energy and designing many of the infographics on Mosaic’s blog. Aven is currently teaching English in Turkey, which has a rapidly growing renewable energy program. A Montana native, Aven is especially interested in how renewable energy can create sustainable growth in the developing world.

Original Article on Mosaic

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