East Africa: Utility Companies Urged to Give Incentives for Solar Use to Encourage Clean Energy

Posted on :Thursday , 2nd March 2017

East African Community's utility companies should consider paying individuals a fee for the solar power they consume to encourage more investments in clean energy.

While the grid parity -- the threshold between the hydroelectricity and solar tariff -- has narrowed with the dramatic fall in the prices of solar panels on the global market, the region has not fully seized this opportunity.

The operationalisation of net metering could help the region boost the off grid solar power capacity, estimated at between 25 MW and 40 MW. But experts fear net metering could be delayed for fear of additional operational costs and reduced grid electricity sales.

Richard Mugo, Rwanda country manager of Davis & Shirtliff, a regional company that deals in solar modules, believes the adoption of the renewal energy credit system will help deepen solar penetration in East Africa. However, he added that fiscal incentives have to be supported by regulatory changes to introduce renewable energy credit for owners of solar power generation units in the region.

In the 2016 Renewable Energy and Energy Efficiency Status Report for the East African Community, Paris-based lobby Renewable Energy Network 21 said the EAC power mix is currently dominated by hydroelectricity at 75 per cent, geothermal 20.9, biomass 3.8 per cent and wind 0.9 per cent.

But solar energy contributes a paltry 0.3 per cent of the energy mix prompting REN21 to suggest that EAC adopts an aggressive distribution and generation policies to change the energy landscape in favour of solar power.

Rwanda and Uganda where auction policies have been developed have already started reaping the benefits of the attractive auction policies.

The East African Community power demand is projected at 5.3 per cent annually to 2020 through development of cheaper energy sources.

Official data indicates that Uganda needs to increase its electricity generation by 75.3 per cent, Tanzania to 96.4 per cent, Kenya to 96.4 per cent and 115 per cent in Rwanda.

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