12 March 2010
World Bank research paper debunks conventional views that renewable energy is too costly for large-scale expansion.
A recent research paper released by the World Bank, entitled The Economics of Renewable Energy Expansion in Rural Sub-Saharan Africa, presents compelling evidence in support of civil society arguments that great potential exists for cost effective decentralized renewable power in large regions of rural Sub-Saharan Africa, contrary to conventional beliefs that renewable energy remains too costly for large-scale application. These findings underscore the need for energy planners to pay closer attention to opportunities for renewable energy expansion now and not decades into the future.
Using Ethiopia, Ghana and Kenya as case studies, the authors conducted an assessment of the comparative costs of power grid electricity provision and off-grid renewable power options across each country and found off grid renewable energy technologies to be the lowest cost option for many households in rural and remote areas.
The authors illustrate that while production costs of renewable energy sources may be higher than fossil power, they can be a more cost effective alternative in many areas once local costs of production are compared with those from extension of centralized grids. Wind and solar power, for example, can be exploited in decentralized units or mini grids and broadly distributed across rural areas, presenting potential cost competition to current power grids whose incremental costs of electric service increases as the grid is extended to locations outside the densely populated areas where they are clustered and are able to amortize fixed costs over a greater number of consumers.
The study highlights the important role decentralized renewable energy can play in expanding rural energy access, demonstrating that economic development can be reconciled with the need to reduce carbon emissions.
read the paper
The economics of renewable energy expansion in rural sub-Saharan Africa, by Uwe Deichmann, Craig Meisner, Siobhan Murray, and David Wheeler, the World Bank Development Research Group, January 2010 (Acrobat PDF, 2.13 MB)
see Also
BIC's Energy Strategy Review page