Solar power for all?

Flipping the switch to turn the light on - children living and learning in the SOS Kinderdorf in Mombasa, Kenya, cannot take that for granted. Electricity from the local supplier was unreliable - and expensive, too. But for some years now, the SOS Kinderdorf's housing and school complex has been running on solar energy.

"If you have as many children as we have here, you have to find ways of cutting your costs," said Ruth Okowa, director of the SOS Kinderdorf. Okowa installed a photovoltaic system, which generates enough electricity to satisfy the demand of the SOS Kinderdorf, and feeds surplus electricity into the grid.

Experts agree that in rural areas where sunshine is abundant but electricity supply is unreliable, the future could belong to solar energy.

"In rural areas, solar energy is becoming the most cost-efficient source of energy to power lamps, radio and television sets," says Peter Adelmann, a founder of the Institute for Decentral Electrification in Ulm, Germany.

'Pico' systems gaining foothold

Mainly two types of solar power system are becoming accepted in rural areas: small photovoltaic systems powering private households, and so-called "mini-grid" systems that power hospitals, hotels, companies or even small villages.

Especially in some African countries, small solar systems are becoming increasingly popular. They usually consist of a solar module, an electricity storage component, an LED module, a radio and a charging component for mobile phones.

"Such small systems cost only around $100, including the radio," said Adelmann. "Bigger systems, to which an energy-efficient television can be attached, cost around $200 - not including the television," he added.

These so-called "pico solar systems" can generate electricity for a house or a hut, with the solar modules generating 10 to 100 watts. Electricity stored in the battery will last for up to one-and-a-half days.

Payment via mobile phone

Retailers do sell the systems, but customers who can't afford this kind of investment may instead opt to pay a monthly fee, and make the payment via their mobile phones.

"This so-called 'pay-as-you-go' system has the customer paying $5 per month for the smaller units, and $10 for the bigger units," explained Adelmann, adding that the supplier would automatically switch off the electricity if the customer stopped paying.

Adelmann said that the small solar systems are increasingly used in the eastern African states of Kenya and Tanzania. "There are approximately 500,000 pico solar systems there, generating electricity for 2 to 2.5 million people."

He estimated that up to 2.5 million of these solar systems have been sold worldwide. If the market continues to grow at present rates, this could go up to "at least 5 million systems" by 2016.

Installments for affordability

Retailers for small solar home systems are primarily based in Australia, the United States and Germany. The Berlin-based company Mobisol is one that has moved into the market of micro-financed installment payments via mobile phones.

Customers own the system after three years, allowing them to generate electricity without incurring any further costs.

Mobisol says it has installed over 15,000 solar home systems over the past two years in countries such as Tanzania, Kenya and Rwanda.

Solar power instead of diesel?

In many regions and especially in the developing world, diesel generators continue to provide hospitals, factories, hotels and households with electricity.

But the electricity produced through diesel generators tends to be relatively expensive. According to a study conducted by the German Corporation for International Cooperation, or GIZ, diesel-generated energy costs almost $0.50 cents per kilowatt-hour in Tanzania.

"Solar energy in combination with battery storage is in many cases more cost-effective than diesel," said Stefanie Werler, Project Manager at the GIZ's Renewable Energy Project Development Program.

Lack of knowledge impedes spread of solar

Even though switching to photovoltaic is often an economically attractive alternative to diesel, such systems are only slowly being adopted. Werler said work still needs to be done to communicate the affordability of such systems.

Werler added that many consider solar energy unattractive because the initial investment was relatively high, and it would take five to 10 years to pay off the system. Tanzania, she pointed out, is one country where the benefits of solar systems are simply not yet widely known.

She and her GIZ colleagues aim to change this perception. "We provide training and identify new models to finance renewable energy systems, such as leasing," she explained.

"Solar energy has huge potential in Africa, where major parts of the population have no access to electricity," Werler said.

"Solar power could give a considerable boost to economic development in these countries."