HORIZON INTERNATIONAL SOLUTIONS SITE

Problem Overview:

Environmentally friendly energy sources

Background:

The Government of Zimbabwe views electricity as a critical factor in increasing literacy, slow rural-urban migration, and improving the overall quality of life for the country’s rural population of nearly 8 million people who are without access to grid-supplied electricity. Should Zimbabwe resort to its vast reserves of coal for electrical power generation (estimated at 30 billion tons, of which 2 billion tons are exploitable), serious global environmental problems would result. However, small-scale solar electric generation technology is now reliable, inexpensive, and available form a variety of manufacturers worldwide. This technology holds great promise as an alternative to power generation systems that burn fossil fuels and produce greenhouse gases linked to climate change.

GEF and the Government of Zimbabwe engaged in this pilot project to help overcome the numerous barriers to widespread adoption of small-scale photovoltaic technology throughout rural areas of the country. A project initiative targeted each barrier. Because many of these barriers are present in other developing countries, the experience gained can be replicated worldwide for similar circumstances. The project’s primary effort was to install 9,000 solar lighting systems in rural homes, schools, and clinics during 1993-97. The project also targeted weak indigenous solar manufacturing and delivery infrastructure to strengthen it through technical assistance, training and alleviation of constraints on manufacturing.

To establish a sustainable model of solar electricity dissemination in Zimbabwe’s rural areas and address the issue of global warming and greenhouse gas (GHG) emissions. The project will enable the country to:

- reduce the need for conventional electrical grid extension while immediately displacing carbon emissions from kerosene and candles

- enhance solar power manufacturing and delivery and expand its market

- establish credit mechanisms allowing low-income groups to purchase photovoltaic systems

Partners:

Global Environment Facility (GEF), Ministry of Transport, Department of Energy

Activities:

As of April 1997, a total of 6,000 solar systems had been installed. The remaining 3,000 systems were expected by the end of the year. Project assistance enabled 5 local companies to begin manufacturing components including photovoltaic panels, batteries, charge controllers, and lights. Some 50 solar companies became qualified to sell systems in a market-driven environment. The number of installation companies soared from a handful to more than 20, five of which are owned by women.

This collaboration between GEF and the Government of Zimbabwe also permitted the rapid removal of import duties on solar panels. Photovoltaic system standards were developed in collaboration with the Standards Association in Zimbabwe, and all installed systems are required to meet GEF standards that ensure low life-cycle costs. Project staff inspect and approve system designs and quotations before purchase to ensure quality and completion of the work. Both government and industry have indicated that the market for the technology is now much larger as a result of these measures.

The project established a self-sustaining, revolving finance facility that allows end users to pay a 15 percent deposit on installation. The balance is payable over 3 years at a 15 percent annual interest rate. Low-income rural farmers are benefiting from a special initiative to install systems through the national utility and non-governmental organizations. Loan repayment periods on these systems are long and cover a range of hardware, including low-cost, one or two light systems, solar kits, and mobile lanterns. A public awareness campaign via mass media, exhibitions, and fairs broadened the interest and expanded the market for solar systems.

Constraining Factors:

In Zimbabwe, high import duties affect the affordability of alternative energy sources such as solar equipment. The Photovoltaics project dealt with this problem by importing the equipment it financed duty free, but this had adverse effects on local manufacturers and avoided addressing the general impact of the duties. Zimbabwe’s solar industry has been hesitant to commit greater resources of its own in the absence of a clear direction from government.

Results and Replicability:

The project has advanced adoption of solar technology in Zimbabwe by:

- establishing the financing facility

- lowering costs through trade liberalization and local manufacturing

- improving quality systems

- sizing installations according to users’ needs

- coordinating public and private distribution modes

- developing ethical norms and standards for the industry

For households that installed systems, the project raised living standards by providing a pollution-free resource that displaces the use of firewood and paraffin lamps. The new solar home-lighting systems have resulted in more congenial living conditions, upgrading educational and health standards, increasing job opportunities, and reducing rural-to-urban migration in Zimbabwe.

A number of crucial lessons have also been learned regarding the design and implementation of measures to overcome the barriers to adoption of solar electric systems. These lessons are in the process of being widely disseminated to other developing countries facing similar dilemmas of providing electricity to poor rural areas for basic development needs. According to experience gained in the Zimbabwe project a list of aspects should given due consideration in similar projects:

1. Establishment of promotional activities that involve NGOs

2. Intensification of public awareness for consumers, community leaders, and industry

3. Promotion of the establishment of a unified solar industry under the umbrella organization

4. Development of a functional database on experiences with installed systems

5. Enforcement of installation quality standards and inspection

6. Devising of a sustainable and functional after-sale service scheme

7. Close coordination of major players (installers, end-users, industry, etc.)

8. Development of an efficient and comprehensive finance scheme that covers end-users, installers and manufacturers

9. Encouraging working urban-based relatives to help finance solar systems for their rural-based elderly

10. Hedge against high inflation rates that have a tendency to erode funds

11. Development of a strategy to target the poor

12. Establishment of enabling government policies, market-driven strategies, and market/fiscal incentives.

Submitted by:

Contact:
Thomas Johansson
Energy and Environment Programme
SEED
UNDP/NY
Tel: (212) 906 6085
email: thomas.johansson@undp.org