The true value of a new technology may only surface if there is a proven record for success. Few are willing to invest in and be the ‘pioneers’ of a new technology, considering the huge risks that are involved.
The case with the deployment of solar photovoltaic (PV) in Africa is no different.
Since countries like Germany, USA and Japan became the ‘pioneers’ in solar PV deployment, many other regions have started tapping on the ‘deployment knowledge’ of those countries to enter the solar photovoltaic market. Countries like Taiwan and China, who are ‘followers’ have now become major players in the global solar photovoltaic industry, through benefitting from the deployment knowledge of the ‘pioneer’ countries.
Access to electricity in Africa is very low, especially in rural areas, when compared to other regions in the world. The continent has huge renewable energy potential as it receives much more bright sunlight than any other continent. While the solar energy potential is huge, Africa is a small player in the global solar photovoltaic (PV) market. The continent has traditionally been reliant on hydropower, which is vulnerable to droughts and other climatic conditions.
In total, at least 40 GW of photovoltaics (PV) systems were installed globally in 2014, up from 37 GW in 2013 setting a record for the solar PV sector. Solar Power Europe suggests that the 540 GW mark at a global level could be reached in five years’ time. With PVs accounting for more than 7 % of the electricity demand in 3 countries in Europe (Italy, Germany and Greece), the projection is that solar power could grow in Europe by 80 % by 2019.
The institutional and economic conditions for PV has improved considerably in many countries, resulting in the growth of new PV markets. China’s PV sector with an installed capacity of more than 10 GW and Japan’s PV market with more than 9.7 GW suggests that Asia is now a major hub for solar PVs. Other markets such as Australia, Korea, Thailand or Taiwan are now established solar PV markets. The global solar sector reached a cumulative capacity of 178 Gigawatt (GW) in 2014.
South Africa is the first African country to install close to 1 GW of PV in 2014. Morocco is currently undertaking an ambitious solar project with the launch of the world’s largest concentrated solar power plant, that is expected to provide almost half of the country’s energy by 2020. Rwanda’s 8.5MW solar power plant, has been operational since July 2014. But in comparison to Europe and Asia, Africa’s installed PV capacity is small.
With the low level of solar deployment in Africa, the boggling question is why is Africa not benefiting from the PV deployment knowledge from ‘pioneer countries’ as the Asian countries are doing? Despite its huge potential, why isn’t Africa at the centre of solar markets? Why are countries like Germany, with meagre sunlight when compared to African countries, installing more solar PVs than the entire sub-Saharan Africa? Why are ‘follower countries’, like Taiwan and China, harnessing PV deployment knowledge of the 'pioneer' countries and are able to leapfrog and become leaders in the global PV industry and African countries are yet to catch up? How and what can African countries learn from the ‘lead countries’ in solar PV deployment?
Despite the existence of a huge repository of knowledge on the successes of PV deployment in Europe and Asia, the answers to these questions may not be simple for African countries.
African countries are bedevilled by huge barriers to technology transfer in the solar PV industry. Firstly, there is little history financiers on the continent investing in renewable energy and there’s an apparent lack of financiers willing to invest in solar PV sector in Africa. Secondly, there is limited awareness of and experience with solar PV technology in many African countries. Thirdly, technical knowledge in installation, operation or maintenance is limited. Additionally, the initial cost of investment is prohibitively high for many parts of Africa. There is also lack of standards, or where there are standards, it may be inadequate for many countries. There is not much in terms of national policy that could drive the deployment of solar PV in many African countries.
Many ‘follower’ countries have successfully surmounted their own barriers to solar PV deployment by tapping on the deployment knowledge of the ‘pioneer’ countries.
But what exactly is solar PV deployment knowledge?
It is important to note that ‘deployment knowledge’ does not only refer to the solar PV installation or the physical aspects of a solar energy technology, but also installation and quality management standards, national policies that incentivises the adoption of solar PV technology, obtaining investment for renewable energy, integration of solar PV into the electricity grid, knowledge and information for property owners, skills for operation and maintenance, support scheme for market creation and tax laws, as well as technology standards related to PV hardware components.
Existing literature on how “follower countries” have built their solar PV “deployment knowledge”, and if and how they have learned from the experiences of the pioneer countries is scanty. One suggestion of how follower countries are building their deployment knowledge is through cross-country spill-overs, especially when there are strong connections between countries. This is because knowledge about innovations are not fully codified and remains tacit and informal.
Taiwan’s growth as a player in the global solar PV sector is an example of how a country can benefit from cross-country knowledge spill over.
Taiwan acquired solar PV deployment knowledge from ‘pioneer countries’ through the cultivation of strong relationships with the PV sectors of pioneer countries as exampled in the way German firms such as Schmid, Jonas & Redmann, Centhrotherm, Manz & Abakus all have substantial operations in the PV solar sector in Taiwan.
As a ‘follower country’ in solar PV deployment, Taiwan has perfected the fast follower dynamics, not only in the technological aspects of the solar PV, but also learning from the policies, standards and incentives that had made solar PV deployment successful in the pioneer countries. The fast follower characteristics as demonstrated by Taiwan include its mastery of imitation followed by rapid domestic innovation. Fast followership dynamics, as perfected by countries like Taiwan and China have provided the platform for them to leapfrog some pioneer countries not only in solar PV deployment, but also in other industries like the semiconductor, electronics and flat panel display (FPD).
A study of the flow of knowledge in the photovoltaic industry with a concentration on patenting indicates that Taiwan obtains the bulk of its knowledge on photovoltaic from the USA, Japan and Germany with the USA and Japan accounting for more than 70% of the total international knowledge spill over to Taiwan before the year 2000 and a current total of 65%. It should also be noted that Taiwan, has been able to switch from external knowledge flows in many cases to internal knowledge generation.
Taiwan did not only followed and learned from the experiences of the ‘pioneer’ countries. The country also enacted laws and drafted enabling policies that provided incentives for investment in the solar PV industry. By 2006, the Executive Yuan (Legislature) of Taiwan had sanctioned the ‘Photovoltaic Action Plan’ which was in line with the government’s ‘Industry Flagship Development Plan’ for green and sustainable industry. In furtherance of instigating a green source of energy, the Executive Yuan had established the ‘Emerging Industrial Technology Strategy Review Board’ which determined that Taiwan should rely on the knowledge of its semiconductor and flat panel display (FPD) technology to develop its solar PV industry. Taiwan, which had already developed industrial competitiveness through its creation of high-tech industrial clusters, relied on the industrial clusters to serve as the conduit for knowledge transfer across industries for the development of the solar PV industry. The ‘Green Energy Industry Sunrise Program’ was launched in 2009 by the Executive Yuan with the aim of creating a complete photovoltaic industry cluster that can engender a sustainable solar photovoltaic Taiwan. In addition to the formulation of policies and creation for the ambience for a solar PV market, the government of Taiwan made a conscious effort in the development of various facets of the solar PV supply chain through different means including hosting conferences as well as facilitating cooperation between domestic and international solar Photovoltaic actors for the purpose of technology transfer. In terms of deployment, the Energy Bureau of the Ministry of Economic Affairs made a deliberate push for the promotion of the installation of solar photovoltaic through diverse programs. The 2009 Renewable Energy Development Act aim was to increase the total renewable energy capacity from 6.5 GW to 10 GW over the next 20 years, out of which 1.2 GW is expected to be solar PV capacity.
The example of Taiwan is an indication that most of the previously mentioned barriers to solar PV deployment in African countries could be addressed through learning from the experiences of countries that have successes in solar PV deployment as well as creating the conducive environment for investment in the solar sector and developing policies that would make solar PV attractive. Policies should be directed towards ‘soft’ deployment knowledge’ such as technical codes and standards; greater awareness amongst the population of the potential for solar energy; local regulations and permit procedures; knowledge and training of installation and maintenance firms; learning among utilities and municipalities; incentives for installation amongst households; incentives to encourage investment in renewable energy; knowledge related to business models; amongst others.
It must be noted that policies that may have been successful in one country may not necessarily be successful in another. Therefore, the development of PV deployment knowledge must take into consideration local context. Policy makers in many African countries have not had the time to support or create the policies, regulations and incentives necessary to start the transformation of energy sectors to new sources, as in the case of Taiwan.
Often, they are simply unaware of the real transformative potential of solar energy, especially for off-grid rural areas. In Africa, the whole concept of off-grid solar energy is entrenched in an idea that, it is appropriate mainly to rural areas. But the catch is that many commercial operators in urban areas in African countries do not even have secured access to energy and rely on generating their own energy. Small off-grid solar power generation could be a major boost to their operations in urban areas.
Policies targeting financing of renewable energy should also take a local context. Countries like Germany or Taiwan may have a large middle class to invest in solar PV that Africa may not have. While financiers in Europe are much more aware of investing in renewables, the same cannot be said of Africa.
In conclusion, building a local solar PV deployment knowledge is key to tapping on the solar potential for Africa, and one way to do so is to learn from the experiences of the pioneer markets in PV technology, installation and policies. South Africa, Rwanda and Morocco are the leaders in solar PV deployment on the continent. They could also serve as hubs of transferring solar technology knowledge to other African nations.