Innovative ways to pay for solar power systems could make clean energy affordable for many of Zimbabwe's 1.5 million households that lack electricity, campaigners say.
Zimbabwe produces only around 60 percent of the electricity it needs when demand is highest, and relies on costly imports to make up some of the shortage, particularly when drought hits hydropower facilities, as happened this year.
That means solar panels and other clean energy sources not connected to the southern African nation's power grid are likely the cheapest and fastest way to bring electricity to those without it, say sustainable energy experts.
“Only focusing on grid extension and increasing generation capacity will not allow us to attain energy access for all by 2030,” said Chiedza Maizaiwana, manager of the Power for All Zimbabwe Campaign.
To meet the internationally agreed goal, so-called “decentralised” renewable energy is “a critically needed solution”, she told the Thomson Reuters Foundation.
“It is imperative that we create the opportunity for families and businesses to access (these) services rapidly and affordably,” she said.
Getting connected to the grid in a rural area can cost thousands of dollars, a huge obstacle when many people earn between $20 and $100 a month, said Ngaatendwe Murimba, a program officer for Ruzivo Trust, a non-governmental organization (NGO) working to improve rural energy access.
But families without electricity do pay for energy, buying firewood or charcoal – which drive deforestation – batteries, or polluting fuels such as paraffin.
A 2012 study by SNV, a Dutch anti-poverty NGO, found that a rural household in Zimbabwe spends on average $26 a month on lighting, communication and entertainment, including $8 to $15 on kerosene and candles alone.
A home solar system that can produce enough power to run lights, a radio and a television costs about $500, said Honour Mutambara, a renewable energy manager with SNV in Zimbabwe.
That’s one reason only a fifth of households in Zimbabwe use solar energy, he said.
SELF-FINANCING SCHEME
Simba Mangwende, a renewable energy director with the Ministry of Energy and Power Development, told a workshop in June the market for decentralised renewable energy is “abundant but it is being curtailed by deprivation of cheap sources of finance”.
Zimbabwe lacks clear-cut policies and targets for renewable energy, and is still developing a feed-in tariff, deemed key to attracting investor participation in the sector.
If families are to afford clean energy in the short term, innovative business models are needed, such as pay-as-you-go or rent-to-buy solar systems, experts say.
Jonathan Njerere, head of programs in Zimbabwe for charity Oxfam, said that in Gutu district, 230 km east of Harare, his organization and others had helped set up a community-owned, self-financing solar energy scheme.
It has enabled more than 270 farmers to irrigate about 16 hectares (39.5 acres) of crops.
Oxfam gave the community solar equipment for irrigation and an initial batch of solar lanterns, which were sold to members. The proceeds were pooled in a savings and lending scheme, allowing others to join and buy solar products for home and business use.
Community funds are used to purchase solar equipment for sale to the public through energy kiosks, and the revenue is kept for repairs and relief in natural disasters.
Njerere said the program, assisted by 2 million euros ($2.22 million) from the European Union, had helped chicken farms, fisheries, tailors and shopkeepers acquire hire-purchase solar panels, so they can work in the evening as well as during the day.
Other entrepreneurs use the solar panels to sell mobile phone charging services for $0.20 a time.
BOOST TO INCOMES
Jeffreti Chara operates his sewing business with a $700 home solar system bought on credit from the community scheme, which powers a sewing machine and lights his three-bedroom house.
He paid $50 upfront, and is now paying $20 each month, covering $290 of the loan so far.
“Production has improved dramatically since I started using a solar-powered machine, boosting my income from around $50 to $90 a month,” said Chara, who mostly sews uniforms.
“Solar energy has improved my family’s quality of life such that there is not much difference between us and people in the urban areas,” he added.
Servious Murikitiko, an energy kiosk chairperson, said the solar scheme had brought clean, affordable energy to the community, allowing children to read at night and schools to introduce computer lessons, while providing entertainment and extra income to homes and businesses.
Households purchase what they can afford, he added, with some paying just $4 a month to acquire solar lanterns.
More than 32,000 people have benefited from solar power across the district.
QUALITY CONCERNS
SNV’s Mutambara estimates Zimbabwe's potential market for solar lanterns at $33.7 million and that for solar home systems at $235 million.
But few lenders and solar companies have tried their luck in rural areas due to a perception of limited customers, as well as high transaction costs and risk, he said.
Providing subsidized solar equipment would hugely improve uptake, Ruzivo Trust’s Murimba said.
Communities are asking for free installation of solar systems, zero taxes on solar equipment, and government-accredited dealers who can provide them with quality solar equipment and technical support, he added.
One local company had to discontinue a popular package including a mobile phone and a $45 solar lamp. It sold some 400,000 lights to around a third of the country’s households, but they were poor quality, and many developed problems with no mechanism for repair or return.
In Harare, vegetable vendor Regina Meki, 40, uses a solar lamp she bought on credit to hawk her wares well into the night.
Under a payment plan offered by a local solar company, she pays $1 a day for the $50 rented lamp, which has helped boost her monthly earnings from $70 to $120.
“Solar energy has brought nothing but happiness to me, increasing my income. Besides payment for the equipment was easy on the pocket,” she said.
http://www.reuters.com/article/us-zimbabwe-energy-solar-financing-idUSKCN10J0L3
And here is another visual from energy boutique brokerage firm Tudor Pickering & Holt on where they think frac sand use is going next year in the Permian basin of SW Texas:
They have a near identical chart for the western Delaware basin of the Permian.
Here’s what Devon Energy (DVN-NYSE) said in their Q2 call last week:
