Energy Efficiency Made Simple Vol IV

Engen

Solar PV is by far the most popular technology in development to date,

followed by wind, geothermal and CSP. Despite the small amount

of MW under construction, significant progress occurred since the

beginning of 2014 with some flagship projects being commissioned

such as the Olkaria I-III-IV geothermal projects in Kenya (306 MW),

the first grid-connected solar PV plant in Rwanda (8,5 MW), the

Adama II wind project in Ethiopia (153 MW) or large projects having

reached financial close such as the Lake Turkana wind project in Kenya

(310 MW). This is in addition to the 1 800 MW of grid-connected solar

and wind power projects having been commissioned in South Africa

under the REIPPPP.

There is still a shortage of expertise among government

decision-makers and the relevant public institutions in sub-Saharan

Africa. Corruption is still present in a lot of countries. Poor long-

term planning often obliges governments to implement expensive

short-term solutions. The lack of a clear and stable regulatory frame-

work promoting private investment is jeopardising the bankability of

these projects.

What the market needs is to find new creative funding schemes

which will improve the bankability of RE power projects. Examples

such as the IFC’s recent ‘Scaling Solar Programme’ and the ‘Scaling Up

RE in Low Income Countries Programme’ are going in this direction.

It is important that the power technology that will be adopted

makes economic sense for the country and helps it reach a sustainable,

diversified and affordable electricity generation mix. Factors such as

dispatchability, construction lead times, environmental impact and

benefits to local communities must be considered and compared with

alternative technologies.

Furthermore, it is essential that governments strike a balance

between grid-connected and off-grid power solutions, or centralised

and decentralised power systems. Each country must look at its

indigenous resources and what makes more sense economically,

taking into consideration externalities such as fossil fuel subsidies,

environmental impact, dependence on finite fossil resources, but also

electricity affordability, especially for disseminated rural populations.

Conclusion

There is much opti-

mism in the market for

the development of RE

power projects in sub-Sa-

haran Africa. Countries are in

various stages of liberalisation

of their electricity sector. Many

governments are trying to establish

new regulatory frameworks and

contractual structures to allow IPPs

in the power generation sector, which

will greatly facilitate the adoption of RE

power projects. However, some issues

continue to restrain the development of these

projects. Strong government support, including

a long-term vision, good energy planning, and a

real desire to involve the private sector is essential

for the successful implementation of RE power

projects in sub-Saharan Africa. If one can combine

these with innovative financing structures, which

allow circumventing the bankability and scaling

issues, then one can expect to be proud of what

this will bring for our future generations

References

[1] REN21: Renewables 2015 – Global Status

Report.

[2] Large-scale RE power development

opportunities in sub-Saharan Africa – A

story about bankability, affordability,

and grid capacity. 2015. Frost & Sul-

livan.

[3] IRENA: Estimating the Renewable

Energy Potential in Africa. 2014.

ENERGY EFFICIENCY MADE SIMPLE 2015