New Publication on investment in large-scale, grid-connected solar power in Africa released

June 25, 2014

Solar power in Africa is on its way to becoming a market-based commodity. Significant reductions in the cost of photovoltaic (PV) panels and a 400 percent increase in oil prices since the 1990s have changed the competiveness of solar PV in all markets, ranging from individual households to mini-grids and grid-connected installations.

As a result, the market for large-scale, grid-connected PV plants is rapidly emerging throughout Africa, as production costs are currently competitive with large-scale diesel.

At the same time, a market for another large scale solar power technology, concentrating solar power

(CSP) has been developed especially in Spain, but also lately in South Africa and Morocco, with the effect that the cost of CSP is also being reduced, and currently competitive with PV under certain conditions.

Although large-scale and market-driven investments in renewable energy and local industry development in a high-tech sector is not something one typically associates with Africa, the emergence of solar power is what is currently being observed. While this situation is exciting from a policy and investment perspective, a coherent overview of the market for grid-connected solar power plants in Africa is currently not available.

The new paper ‘Prospects for investment in large-scale, grid-connected solar power in Africa’ provides a systematic overview of the prospects for and recent investments in large-scale, grid-connected solar power in Africa, based on reports from governments, international finance institutions and research centres, and supplemented by the latest media reports from the internet.

Structured into five sections the paper provides a background description of the power infrastructure in Africa in Section 2. Section 3 explains developments in the markets and prices for PV modules, followed in Section 4 by examples of recent policies and government plans for supporting large-scale solar power in a number of African countries. Section 5 describes the investment models applied in projects that are currently underway. The paper concludes that a number of African countries are encouraged to include large-scale, grid-connected solar power plants in their recent energy policies and development plans.

The updated overview of recently planned and commissioned large-scale, grid-connected solar power projects in Africa documents the blossoming of the solar industry in the continent in the past three to four years, with strong involvement from international investors and technology contractors.

The publication can be accessed here.