Publication - Stand Alone Solar (SAS) Market Update Sierra Leone

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Stand Alone Solar (SAS) Market Update Sierra Leone
African Clean Energy
Africa Clean Energy Technical Assistance Facility with contributions from Abu Bakar Massaquoi, Ami Dumbaya, Michael Yambasu, Karin Sosis and Esther Kahinga
Published in
February 2021
The COVID-19 pandemic has impacted the daily life of Sierra Leoneans in many ways. Businesses, airports, borders and schools were shut down as stay-at-home orders were issued in efforts to stop the spread of the virus. The population living in rural off-grid areas or served by unreliable grid networks were hardest hit by the effects of the pandemic as they lacked electricity, water and fuel for domestic use. At the same time, the pandemic has shown that it is much harder to sustain measures needed to fight such outbreaks without adequate electricity. Stand-alone solar (SAS) companies have taken steps to shore up their finances, including deferring loan payments and cash expenses, reducing sales promotions and new installations, drawing down available credit, conducting cash sales and tapping development partners and banks for emergency funding. Although there are several donor and development finance institutions (DFIs) that have funded the development of the country’s SAS market, particularly in the recent past, these funds have not provided direct financing into the SAS supply chain. Similarly, although the government recently provided grants to various businesses (including hotels) through the Bank of Sierra Leone (BSL), none of the grants targeted SAS companies. Large SAS suppliers like Easy Solar are therefore forced to mobilise their own resources, while smaller ones like Smiling Through Light are curtailing their activities. While recent data points to a slow recovery of the sector, job losses and shutdowns continue to cause delays in the distribution of SAS products. The introduction of new distribution channels by some companies (mainly retail sales outlets) and a payroll deduction scheme have increased financial inclusion as well as access to reliable and affordable energy services during the pandemic. The entry of a new market player, Felicity Solar Technology, in spite of current uncertainties, has been encouraging. Recent policy and institutional measures have also increased the prospects of a more coordinated sector post-COVID-19. The Ministry of Energy (MoE), for example, requested support from ACE TAF to develop an Off Grid Strategy and monitoring mechanism in response to the lack of a unified national strategy for deploying SAS systems. The Millennium Challenge Corporation Unit (MCCU) is also developing an Integrated Energy Resource Plan, building upon the National Electrification Plan 2017–2030 Roadmap, reflecting all energy solutions including SAS. MoE is also reviewing and updating the 2009 National Energy Policy. A corporate tax relief for businesses engaged in the provision or supply of renewable energy from solar mini-grids and an exemption from Goods and Services Tax (GST) for SAS equipment and services have been proposed by government in its 2021 budget. There are also ongoing efforts to mainstream gender issues in energy access initiatives implemented by the sector and to support the Sierra Leone Standards Bureau (SLSB) in establishing quality standards.