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President Obama’s recently announced multibillion dollar African power initiative may present a unique opportunity for renewable power generally and solar specifically. When solar is configured as a roof top installation or on a village level it eliminates the need for transmission networks and some or all local distribution cost. This can be substantial in dollars, but more importantly, in time delays getting power to the people.

 

Solar power has now fallen in cost to where it is price competitive with oil-fired power in places like Hawaii and Puerto Rico. Once installed, Solar requires very little maintenance. Opportunities may exist for US companies well beyond the production of the solar cells themselves, including system design and integration, supporting structures to mount the cells onto the roofs or in local arrays, supplying inverters, and education and training of local installers. Also, simple and low wattage storage systems are another potential opportunity, particularly at the village level. The US embassy and the export bank may be helpful and cost-effective sources of potential partners. Since it’s distributed power generation it is not susceptible to problems with the distribution system, and peak solar generation occurs at the same time peak demand is occurring. Solar may provide a valuable and cost effective addition in areas with unreliable power supplies.

Financing the installation could be facilitated by the US export/import bank, carbon credit sales, and US and local bank financing. Partnerships with large US companies working in the area are another avenue worth pursuing, e.g. General Electric.  Working with the local utility may also be a possible form of distributed power. Moreover, in some places financing may be available from NGOs fighting desertification, as clearing brush to burn is a cause of particular interest in sub Sahara Africa and Madagascar.

 

While location-dependent and more involved than a simple roof top solar installation, wind power may also offer potential opportunities. As first and second generation wind turbines are replaced with newer and higher power systems, the old wind turbines may get a second life in the developing world. These may be acquired at greatly reduced cost, rebuilt, potentially locally, and put back to work. The operation of wind turbines is more complex as they do require maintenance but they produce power whenever the wind blows not just during daylight.

 

It will be interesting to see if this initiative lives up to its potential to improve all aspects of life in Africa and provide export for the US. Time will tell.

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