Making Light Work
Principal Investigator: Dr Alex Money, Smith School of Enterprise and the Environment, University of Oxford
Case Study: Making Light Work
What are we doing?
Making Light Work analyses a new programme, developed by the World Bank, that aims to rapidly increase the amount of energy that is generated through solar power in developing countries. The programme, called Scaling Solar, involves creating a “one stop shop” that pulls together the key elements necessary to develop and implement privately funded grid-connected solar projects, delivering electricity at competitive tariffs. The programme is at an early stage, with engagements in a few countries in Africa. Our objective is to identify the key factors that are necessary for the initiative to succeed at scale.
Why does it matter?
High levels of solar irradiation in many parts of sub-Saharan Africa suggest the region should be well placed to meet a significant proportion of its electricity needs through solar power. And yet, despite dramatic falls in the price of photovoltaic (PV) cells, penetration remains modest. In countries such as Zambia, one of our key study sites, around 95% of electricity generation is currently from hydro power. However, a drought in recent years drastically depleted Zambia’s storage reservoirs, resulting in chronic shortages of electricity supply.
Solar power could offer a significant and sustainable complement to the energy mix of countries like Zambia. Progress in building further upon programmes such as Scaling Solar would support many of the objectives of the Sustainable Development Goals, most obviously on energy, but also in terms of economic growth and infrastructure. Conversely, a lack of progress in expanding sustainable electricity generation might lead to greater energy insecurity, with the attendant risks this presents to rapidly growing and urbanising populations. The stakes could therefore not be higher.
How is it going?
Making Light Work is using the funding provided though the British Academy to empirically evaluate the progress being made through Scaling Solar on specific country programmes. Some of our findings are already causing us to think further about unintended consequences.
For example, the first auction conducted under the Scaling Solar programme took place in Zambia in 2016. Solar power developers competed fiercely to win contracts to supply electricity to the national utility, resulting in some of the lowest tariffs yet achieved for solar power generation in sub Saharan Africa. This was in marked contrast to the sense of crisis that had pervaded the energy sector just one year previously when the drought was at its most acute, and a natural cause for celebration.
However, these very low tariffs have sent out some complex signals to solar energy projects under development elsewhere in the continent, and beyond. For example, some power purchasers have attempted to renegotiate the tariffs they would pay on projects that are already in development, citing the low rates achieved in Zambia. This has sometimes created conditions of uncertainty, delaying some projects that were already underway, while keeping others on the drawing board for longer. Our preliminary analysis suggests that these may simply be frictional delays, and part of the necessary disruption. But it is also likely that the delays are indicative of institutional constraints that may curtail the pace of renewable energy adoption. Part of our work is to identify what these constraints are, and how they might be addressed.
In summary, this is an exciting time to be conducting research in a rapidly evolving sector. The British Academy’s Sustainable Development Programme has provided an opportunity for us to make a contribution towards the global effort to achieve the SDGs, and we look forward to updating you on our progress.