Market for Solar Home Systems (SHS) in East Africa
East Africa is an market of the future when it comes to renewable energies: In Ethiopia, Kenya, Rwanda, Tanzania and Uganda was a great economical growth the recent years. A consequence of population and economic growth is an increasing need for energy.
Networks and power plants are outdated and lacking in efficiency. In many rural areas, people have no access at all to electricity.
In view of the acute energy crisis, demand for alternative and innovative supply options is growing. Enormous natural potentials exist for photovoltaics, wind, water and bioenergy as well as for solar and geothermal energy.
Almost all countries in the region have launched promotion programmes for renewable energies, and competitive bidding offers interesting business opportunities within ongoing development programmes. The private sector is also showing increasing interest in renewable alternatives, especially after the oil price shock in 2008.
With regard to this developing market, the following part presents potentials of East Africa.
Target Market Analysis for Ethiopia
Even if Ethiopia has abundant solar energy resources (national annual average irradiance is estimated to be 5.2 kWh/m2/day), the Ethiopian solar market is still at an early development stage with an estimated installed capacity of 5 MWp. Growth during the 1990s was under 5 % but has reached 15-20 % during the last few years, primarily driven by the telecom market that constitutes 70 % of installed capacity. Five or six companies supply 90 % of the market and some lack a specialist focus on solar PV.
SHS has the greatest annual growth rate of 20 % with few suppliers and driven by the extension of low-cost housing and real estate developments.
Local Capacities
Availability of qualified solar technicians in Ethiopia is limited. Training is mainly given by companies to their technicians. Whenever there is a training session it is sporadic, non-modular and project specific. As a result a cadre of highly skilled technician with technical capacities to design, size and install larger and more complex PV systems is lacking. Including in-house technicians of local PV dealers, all of whom are based in Addis Ababa, a total of about 50 technicians are believed to exist nationwide.
Outlook: Market Potentials
The market potential is estimated at 52 MW, the majority within the solar home systems (SHS) market and continued expansion in telecom sector.
