Seeta village captures hope and frustration of solar power

By Gaaki Kigambo & Kayvan Farzaneh

When Father Lazarus Luyinda went to Italy in August 2005, he was surprised to see how interested his Italian acquaintances were in the stories he told of Misindye, his village of birth near Seeta, Mukono district. But as friendly conversations go, he was soon telling his friends his stories of growing up, trekking the many kilometres to school and reading under a kerosene lantern, locally known as tadooba.

It was a story that, while familiar to Fr. Luyinda, was totally alien to his friends. They were moved to do something that would improve the lives of people in Fr. Luyinda’s community, especially for the school-going children who were perhaps still experiencing what the Father did many years ago.

It happened that a number of these acquaintances worked in the Italian solar industry and it was in talking with them, that the idea of installing solar panels to light homes in Misindye was born.

Less than a year later, after Fr. Luyinda and friends had raised the money needed, the first team of Italian volunteers came to Uganda to install the solar stations. Unfortunately, they returned to Italy without doing any work, after custom officials at Entebbe Airport impounded the solar panels demanding that they pay hefty taxes. A second team of volunteer workers would have to return and spend three weeks installing five small solar stations throughout the community and educating the villagers on how to properly maintain them. In total, the stations provided light for 35 households and powered two communal refrigerators. As expected, it transformed the lives of the villagers.

But this project, successful as it was, was short-lived. Soon, thieves, allegedly in the employ of a better-off neighbourly resident, stole all but two stations, denying many village homes clean light and sending them back to the ordeal of the terrible fumes and poor light of the tadooba.

Theft, however, is the least of challenges in the way of providing solar power in Uganda. Still, one cannot help wonder why the Ugandan government is not doing something similar to Fr. Luyinda’s project. Surely, one could say, installing solar panels for 10 percent of Ugandaís rural households over the next five years is an achievable goal. After all, the Electricity Regulation Authority (ERA) say existing solar data clearly shows that Uganda’s solar energy resources are high throughout the year. Besides, wouldn’t the effects be felt in the national economy?

According to officials from the Rural Electrification Agency (REA), the leading challenge to solar power is its high cost. For instance, studies have shown the mean solar radiation is about 5.1kWh/m2 per day (a total of five hours) on a horizontal surface, which averages to about 1000 watts per hour. But a solar panel of one metre square, at its best, can only convert 170 watts of this radiation into electricity, which is a total of 850 watts per day. But then, if you want to power a kettle (whose voltage is between 1500-2000 watts) for an hour, you would need two panels of that size, which cost no less than Shs 3.5m. And that is only for a kettle. In the end, electricity generated through solar systems comes out to be three to five times more expensive than other technology such as hydropower.

The next immediate challenge is the cost of silicon, the key ingredient of solar panels. Silicon is expensive and not only do panels require a lot of it, but demand for the element is driven by the global semiconductor industry which in turn sets its market price. This means that it is very difficult for panel manufacturers to cut costs to the competitive level of other energy sources. Unfortunately, industry watchers do not see the situation improving in the short term, as the semiconductor industry continues to grow, and demand for silicon continues to grow.

Even so, if Uganda were to produce the amount of electricity it has the capacity to generate through solar (according to ERA Uganda has a potential of 11.98 × 107 MWh gross energy resource), with an estimated conversion efficiency of 15 percent, it would require a highly efficient storage system to work– one that the current electrical grid cannot provide. Countries like Germany that have been successful in harnessing solar power, have put mechanisms in place to feed solar power into the national grid. But because of Ugandaís decentralised population, such an option is just not viable.

The challenges notwithstanding, solar power is the best option for isolated areas. Most of these areas are characterised by stand-alone homes, which makes extending the grid either not feasible or extremely expensive. Unlike other energy sources, the amount of solar needed in these areas does not need any sort of grid and is highly reliable since power needs for most people in rural areas do not go beyond lighting. It is in these cases that solar fits into the complex puzzle of rural electrification.

In order to make solar truly affordable for rural markets, it is necessary to couple small panels with energy-lean technology such as LED lights or five-watt bulbs. In an encouraging trend, the past year has seen a 40% drop in solar panel prices. If prices continue to weaken and cutting-edge technology such as nanosolar achieves large-scale manufacturability, solar technology could become far more affordable in the next decade. The least expensive light-only setups, such as solar lanterns, are now as inexpensive as Shs 50,000. But even such low costs are a heavy burden for the grassroots, especially if the product ends up breaking down after a year.

To tackle these challenges, in Phase I of the Energy for Rural Transformation (ERT) programme, which began in 2004, REA conceived that the extension of electricity to rural areas would be led by the private sector. The government would merely provide support to the private sector. First, the government made available marketing and business development support, a form of cost sharing where the government would cover 50 percent of the private company’s cost of starting up and developing of rural electrification related businesses, up to $50,000. It would also give subsidy support to companies that install solar systems. Companies would be paid $2.5 per watt generated for the first 30 watts and $1.5 for the next 50 watts.

But when the programme was launched it attracted less response than had been expected. The government, through REA, decided to change its tack and to instead take up the burden of establishing the required infrastructure. Only after this would it contract the private sector to run and maintain it.

Among the reasons cited for the first phase’s failure was the small size of solar companies and their inability to aggressively market solar energy. In villages like Misindye, the potential market is constrained by upfront costs. This potential market is largely in rural isolated areas where solar has a higher appeal because of the absence of hydropower. Unfortunately, the small solar companies prefer to focus their attention on winning tenders to supply projects where business and profit are guaranteed, such as health centres in urban areas. Thus, tenders, good as they are, have turned out to be a disincentive for private companies to aggressively sell their products into rural areas.

Phase II of ERT has been granted $75m of funding from the World Bank and is now being tabled before Parliament. As part of this new phase, the REA is adopting what it has termed the Photovoltaic Targeted Market Approach (PVTMA). This approach is intended to address three primary challenges that it identified during first phase: affordability (initial cost of installing solar power), accessibility (where to buy/get solar services) and information gaps. REA noted that most people do not know much about solar energy beyond the fact that the sun powers it. This lack of adequate information affects the decisions people make about solar.

To deal with the problem of affordability, REA is now working with established financial institutions (currently Post Bank and Finca) to provide arranged credit for people who would like to have solar in their homes. Alongside arranged credit is a direct government subsidy. The catch, however, is that only those who sign up for credit would be entitled to it. REA figures that this is the only way to monitor, control and also check a black market, which would try to take advantage of the subsidies.

To address accessibility, REA plans to pre-qualify companies who would attract subsidies for people within a 100-kilometre radius from where they set up shop. But there is another targeted advantage in this: provision of cheap and quick maintenance services, as opposed to solar users travelling to a centre in case they need repairs to their systems.

In order to overcome information gaps, the REA is also targeting specific geographical markets revolving around institutions. For instance, if there’s a farmers’ group in any given area, it is ideal to work with them because they provide a network to disseminate information. REA anticipates this approach has a higher chance of success because it has been tailored from the shortfalls and lessons learnt from the preceding strategy.Â

In Misindye, Fr. Luyinda has not let the thieves weaken his spirit, and vision. In the coming years, what started out as a project to provide just light is going a notch higher. The plan is to build a single centralised solar station that would be easier to protect from theft. With a larger station, Father Luyinda says, he could move from supplying provisional light to supplying permanent power. Such a setup could convert the electricity on-site from 12 volts to 220 volts, which would allow the villagers to use income-generating machinery such as sewing machines.

An official from REA says the agency welcomes such individual efforts and they stand to benefit from the initiatives it has set within the new approach to bolster solar energy supply to rural areas.

Father Luyinda hopes that his community can take advantage of the power to create a local economy, generate real income and eventually be able to pay for the electricity it uses. The villagers would then be participatory consumers and caretakers of a localised electric grid. A consortium of local leaders would be able to set prices for the community as well as regulate the electricity needs of each household. This, he hopes, could lead to development and great strides in the Misindye villagers’ quality of life.