Africa’s solar prospects shine bright for firms large, small

Nairobi. Demand for -- and increasingly affordable access to -- clean energy is increasing appetites for solar power across Africa. Players large and small are getting in on the act.

Over the past two months, Africa’s solar market has recorded a series of headline-grabbing activities, including the commissioning, award and confirmation of projects in some of the sunniest regions of the continent. Beyond the headlines, however, is a sector whose bright outlook is creating opportunities for home-grown companies of all sizes.

“Solar is becoming a competitive generation resource with respect to the utility grid, and reaching a grid parity level,” said Norman Chege, Group Solar manager for the East African regional water and energy equipment supplier, Davis & Shirtliff.

In an interview with bird, Chege ascribed the growing appetite for solar in African markets to its relatively cheaper cost advantage brought by technological advancement.

“Price history of Solar Cells has seen the average global price of solar modules fall sharply from $3 per watt in 2008 to less than $0.4 per watt in 2021,” he said.

Until fairly recently solar was seen as an outlier, an “alternative” source of energy. However, the drop in prices combined with the high costs of power outages has seen a shift in attitudes, even amongst heavy power users. A resulting increase in solar systems installation by power-hungry industrial companies seeking reliable and cheaper supply has rattled regional electricity distributors, says Chege. Those heavy power users account for over 50 percent of some regional utilities’ sales revenues and losing them would have a major impact on income.

The Africa Solar Industry Association says it has tracked close to 1.9 Gigawatts (almost 2,000 MW) of large scale projects across the continent that are advancing to different stages of development, since June.

The development phase of the projects identified varies from tender launch and licensing, all the way through to financial close and construction.

“Since June 1st 2021, projects totalling 1,879MW have made significant progress in their respective development stage,” said AFSIA.

Kenhardt, a small town in the Northern Cape province of South Africa, plays host to AFSIA’s most recent large-scale solar award, which combines 540MW of solar generation capacity and 1,140MWh of energy storage.

The Kenhardt project awarded to Norwegian developer Scatec in June is seen as a way forward for South Africa’s recurring load shedding and power outages.

Redstone, another large renewable energy investment in South Africa with a capacity to generate 100MW is at the financing stage.

Zambia has begun construction of three solar plants with a combined generation capacity of 200 MW, in the Serenje District.

Three other African projects, one in Tanzania (120MW) and two in DRC (100MW each) are under development.

Smaller projects that also include energy storage components and which are at a construction stage include one in Madagascar (20 MW and 5 MWh of storage), Mozambique (9 MW and 7 MWh) and Somalia (8 MW and 2 MWh).

My Joule Box, a French startup, announced it has raised 3 million euros last month to fund its solar expansion targeting 55,000 households in Benin, Burkina Faso, Senegal and Togo over the next two years.

“Solar has demonstrated long-term commitment to providing first-time access of grid-quality power to the last-mile, low-income, off-grid households, and businesses in Kenya,” said Chege, pointing to its growing popularity.

Davis & Shirtliff is amongst a number of medium-sized companies with their eyes set firmly on the fast-expanding continental market.

“D&S has the ambition to being in all African countries and offering the solar solutions in the whole of Africa,” said Chege.

The firm, with subsidiaries in eight countries in East and Central Africa, offers residential off-grid solutions to marginalized populations in Africa.

AFSIA says there are more than 1,000 significant projects already operational in Africa.

AFSIA’s inaugural Africa Solar Outlook, released earlier in 2021, indicated that increased solar development activities supported by governments and private sector players would push more African economies to join the world’s Gigawatt club-nations - those that have installed more than 1GW of solar energy.

Currently, only South Africa and Egypt represent Africa in the world Gigawatt club of 37 countries. Algeria and Morocco are the main front-runners in the race to join South Africa and Egypt, with Zambia, DRC, Angola Zimbabwe, Ethiopia, Botswana and Namibia coming up strongly.

The International Energy Agency, in its Africa Energy Outlook report 2019 had anticipated that increased investments in solar energy would boost the average annual solar deployment in the continent to 320 Gigawatts by 2040.

“Africa’s vast renewables resources and falling technology costs drive double-digit growth in deployment of utility-scale and distributed solar photovoltaics (PV), and other renewables, across the continent,” the IEA pointed out.

According to the IEA, solar will soon be the largest electricity source in Africa in terms of installed capacity, overtaking hydropower and natural gas.