New light for North African solar projects?

By mahlokoane percy ngwato

Follow @AfricaBizReview and @BusinessRME on Twitter. Like our Facebook Page.

Our sister publication Business Review Middle East originally covered this story

A study by the Middle East Solar Industry Association (MESIA), MENA Solar Outlook 2015, has indicated that 1,800MW worth of solar projects are set to be initiated within the next twelve months.

The projected figure of $2.7 billion represents a six-fold increase on 2014, when under 300MW of solar projects were awarded. While the report focuses on the Middle East, there is still much potential for North Africa in the near future.

The report highlights two key factors which are fuelling the sharp rise in solar projects in the Middle East and North Africa (MENA) region. First, the price of solar systems has dropped dramatically in recent years, from roughly $7.00/watt in 2008 to less than $1.50/watt in 2014, amounting to a 75 percent reduction in costs.

MORE ON SOLAR:

Enel Green Power grows South Africa's solar sector
South Africa’s Public Investment Corporation ploughs capital into solar projects
Gigawatt Global Opens East Africa's First Solar Energy Field in Rwanda

Simply put, this means that, for the same budget as a 10 MW solar PV power plant in 2008, a plant five times larger can be built today without having to spend a penny more.

Secondly, the cost of generating electricity from natural gas has increased. Regional governments have historically been able to produce or import natural gas for less than $2.00/MMBtu. Today, however, much of the new domestic natural gas production could cost up to $8.00/MMBtu.

By comparison, the cost of solar today is equivalent to burning natural gas at approximately $4.00/MMBtu.

With the cost of solar power generation steadily falling, it is becoming increasingly economically viable for governments and business to make the switch, and the MENA region could very well prove to be the exemplary case.

Read the May Issue of African Business Review. 

Share

Featured Articles

Top 10 largest revenue generating family businesses in MENAT

From the UAE to Turkey, these family firms are the largest by revenue in MENAT and cover everything from energy to entertainment

Top 10 metaverse projects in the UAE, including world firsts

As Accenture predicts the metaverse will fuel a US$1 trilion commerce opportunity by 2025, we round up 10 pioneering metaverse projects in the UAE

PwC’s survey shows Middle East CEOs remain upbeat on growth

CEOs in the Middle East are far more optimistic about regional growth than those in North America and Europe, according to PwC’s annual survey

Opinion: “Why we must tackle the digital skills crisis"

Leadership & Strategy

5 Mins With: Kathryn Kaminsky Vice Chair Trust Solutions PwC

Leadership & Strategy

Survey: The Future of Cloud Security in the Middle East

Technology