Assessing the Market for Solar Photovoltaic (PV) Microgrids in Malawi

Abstract

Access to energy is widely acknowledged as an enabler for development, and a lack of energy is a barrier to economic empowerment. Currently just 12% of the Malawian population have access to the national electricity grid, with rural electrification at only 5.3%. Solar photovoltaic (PV) microgrids offer increased access levels over pico-solar systems and solarhome systems, and are a successful rural electrification method in many areas of Africa. This paper addresses the research question of: "what is the market potential for solar microgrids in Malawi?" through a multidisciplinary methodology and outlines necessary steps to overcome the key risks and barriers for implementation nationally. Case studies of existing initiatives in Kenya and Rwanda have been used to inform a system and business design appropriate to Malawi. The market potential of PV microgrids in Malawi has been identified and quantified through a novel approach combining microgrid optimisation software HOMERPro with Geographic Information Systems tools. The methodology also includes an energy ecosystem mapping exercise to identify and frame influencing parameters affecting microgrid implementation nationally. The findings show that solar microgrids are cost competitive with diesel microgrids in all locations in Malawi, although the addition of dispatchable diesel generation may provide economic benefits in larger, more urban systems. To implement solar microgrids would cost approximately $210 per person and average operational expenses of $17 per person per year. It was determined that 42% of Malawians may be most cost effectively served by existing infrastructure, 37% would be best served by microgrids and 21% would be best served by solar-home systems.

Broadening energy access for poor households in rural malawi: How pico solar, mobile money, and cloud-based services are being combined to address energy exclusion

“…This makes accessing electricity extremely difficult as only 4% of the rural areas are connected to the national grid (SEA4ALL, 2021). Given the high levels of poverty in Malawi and despite research showing the market potential for larger community micro-grids and the inefficiency of pico solar (Eales et al, 2020), it is likely that the latter will remain an essential energy source for many in rural areas for some time. As such, we ask the first question by interrogating affordability in comparison to traditional forms of lighting by analyzing LCOL.…”

“…2.1 The rise of solar lighting solutions Despite a policy focus by African governments on gridbased energy supply and access, many households remain offgrid and there is an obvious need for alternative energy solutions that are affordable, clean, and decentralised (Eales et al, 2020). Energy consumers are presented with multiple options, depending on the size of the demand, the lowest-cost energy resource and, in broad terms, the social and cultural contexts.…”

“…Such conditions certainly do not exist in Malawi and the prospects for rural Malawians attaining Tier 5 levels of energy access, based on grid-tied electricity, are grim (Eales et al, 2020). Annual household budgets for lighting are $30-$60 (Adkins, Eapen, Kaluwile, Nair and Modi, 2010;National Statistic Office, 2020) and the country lacks the financial capital to support the construction of a wider distribution or generation infrastructure.…”

“…Annual household budgets for lighting are $30-$60 (Adkins, Eapen, Kaluwile, Nair and Modi, 2010;National Statistic Office, 2020) and the country lacks the financial capital to support the construction of a wider distribution or generation infrastructure. Even Tier 1 energy access has been challenging, and much of the rural population remains in energy poverty (Eales and Unyolo, 2018;Smith et al, 2019;Eales et al, 2020).…”

Use of ICTS for socio-economic development of marginalised communities in rural areas: Proposals for establishment of sectoral Rural Entrepreneurial Networks

“…Providing rural areas in developing countries with centralized grid-connected electricity is difficult due to the high service cost that most of rural communities cannot afford (Sievert and Steinbuks, 2020). However, African countries such as Malawi are overcoming these cost-related challenges and are connecting rural areas to grid electricity (Eales et al, 2020). Decentralized standalone systems or mini-grids are the most cost-effective electrification methods that are relatively affordable to rural households (Sievert and Steinbuks, 2020).…”