PayGo, a solar home systems technology backed by an innovative financing mechanism to help customers’ self-finance access to clear solar power has made significant inroads into East Africa and Nigeria can learn from what they are doing right.
Azuri Technologies-owned PayGo solar homes systems is a commercial provider of electricity to rural off-grid communities, without having end-users pay high upfront fees, but instead pay small, regular amounts via mobile phone technology.
This is why Azuri’s entry into the Nigerian market in 2017 with its PayGo Solar Home Systems was cheered.
With the widest reach of any provider in Sub Saharan Africa, Azuri is leveraging solar and mobile technology to allow users in 11 different countries to access power on a pay-as-you-go basis.
The Nigerian Government has an ambitious Renewable Energy Policy which aims to increase energy production from renewable energy sources from 13 percent of total electricity generation in 2015 to 23 percent in 2025 and 36 percent in 2030. Part of this plan is the goal to increase the percentage contribution of solar energy to the total energy mix.
“Nigeria needs to quicken adoption of off-grip solutions. To achieve the we need to allow an effective distribution of solar equipment and solar home systems, SHS, like in East Africa, which facilitated complete adoption of the PayGo systems while in Nigeria adoption is still low” Ubah Benson, chief energising officer, CEO at Solarify said during a Tweet Chat under the aegis of #GridlessAfrica, an advocacy group.
One of the challenges the industry faces in Nigeria is the question of warranty claims for SHS when the system goes bad from poor installation and improper usage, “the end-user usually denies voiding the warranty terms and condition” Benson added.
Despite success stories in East Africa, renewable energy has yet to be widely adopted in Nigeria as an alternative power solution. Off-grid communities in Nigeria have relied on kerosene lanterns or candles for their energy needs, with many unable to purchase solar power systems outright owing to the high costs. Solar Home Systems offer an affordable and environmentally friendly option.
According to the United Nations’ Climate Change (UNCC) agency, tens of thousands of units have been distributed in 11 countries across Sub-Saharan Africa; in Tanzania, Kenya, Ethiopia, Uganda, Sierra Leone, Malawi, Zimbabwe, South Africa, Rwanda, Togo, and Ghana
Hundreds of thousands of people have benefitted from the clean energy that Azuri solar home systems provide. Azuri calculates that 28.5 million hours of clean light and 9.5 million hours of mobile phone charging have been provided, resulting in 3,504 tonnes of carbon dioxide, CO2 emissions avoided to date.
Azuri’s PayGo Solar Home systems have the capacity to power four LED bulbs providing up to 8 hours of lighting, a radio and a USB port with charging cables for mobile phones.
Customers pay the monthly top-up rate via mobile money for 36 months after which time the unit can be unlocked and the customer owns the unit. In a move to upsell its services, Azuri then provides these customers with options to upgrade to a larger system.
Solar projects in Africa are picking up momentum. Social impact investors, many of which are backed by United States-based or European funds, have focused on this area especially in trying to get electricity to remote rural areas which are unlikely to be connected to a traditional electricity grid anytime soon.
San Francisco-based Off-Grid Electric, which serves about 150,000 people in Tanzania, Rwanda, Côte d’Ivoire, and recently expanded to Ghana, has secured $55 million funding which will be focused on research and development and further expansion of its services on the continent. The Series D funding was led by Helios Investment Partners, with support from GE Ventures.
European solar trade body, SolarPower Europe expects the global solar industry will add nearly 800 gigawatts of new solar over the next five years, bringing the planet’s total solar capacity to 1.3 terrawatts in 2023.
SolarPower Europe published its Global Market Outlook 2019-2023 at Intersolar Europe Tuesday, revealing its near-term and long-term predictions for solar capacity additions.
After 102.4GW was added in 2018, according to the group, in 2019 about 128GW of new solar PV capacity will be added according to its Medium Scenario – translating to growth of around 25%. This, in turn, will increase the globe’s cumulative solar PV capacity to 645 GW.
Looking further afield, SolarPower Europe expects the terawatt mark to be passed in 2022, and its 5-year Global Market Outlook expects nearly 800 GW of new solar capacity to be brought online by the end of 2023, raising total capacity to 1.3 TW.
“2018 was a unique year for the entire global solar industry, as we exceeded the magic installation mark of 100 GW per year for the first time, which led the solar power sector to grow to over 500 GW or 0.5 TW,” said Christian Westermeier, President of SolarPower Europe.
“Last year, we again saw strong cost improvements with solar becoming the lowest-cost power generation source in more and more regions. At the same time, new applications have quickly progressed, such as floating solar, while corporate renewable Power Purchase Agreements have reached a double-digit GW-level, and a market for merchant solar has emerged in several countries.”
SolarPower Europe’s figures for 2018 clash with those of market analysts, though no two figures for 2018 have been found to be the same.
The International Renewable Energy Agency claimed that only 94 GW was installed in 2018, while Wood Mackenzie believes installations for 2018 only reached 97.3.
On the other hand, Bloomberg New Energy Finance reported 107 GW of capacity installed in 2018.
A total of 102.4 GW, however, seems to not only fit the evidence, but is as satisfactory middle-ground as we are likely to expect for 2018.
The main reason for 2018’s slowdown, however, is not up for debate, and is laid entirely at the feet of policy movements made in China to effectively halt installations halfway through the year.
By the end of the year, China still installed 44.4 GW – down 16% on 2017’s figure but well up on some of the doomsaying projects from halfway through the year. Contributing to the lacklustre growth in 2018, according to SolarPower Europe, was stagnant growth in the United States and shrinking markets in India and Japan.
However, in 2018 11 countries installed over 1 GW of solar – bringing the total number of GW-scale countries up from the previous year’s 9, and on its way to 16 in 2019, according to SolarPower Europe.
“Global solar demand continued to grow last year, as new emerging markets have embraced solar’s attractive business case – a clean, versatile and low-cost power generation source,” said Walburga Hemetsberger, CEO of SolarPower Europe. “This market diversification means interest in solar is rising at a rapid pace.”
“In Europe, we have entered a new era of solar growth and with the recently concluded Clean Energy Package, we have a new framework for solar that will see our technology thrive even more in the coming years. We now look to EU member states to put ambitious solar targets in place and ensure robust implementation guidelines in their 2030 National Energy and Climate Plans (NECPs).”
