Productive Use of Solar PV in Rural Malawi: Feasibility Studies

Aran Eales, Hannah Buckland, Damien Frame, Berias Unyolo, Chawezi Gondwe, Morton Kaunda

Research output: Book/ReportCommissioned report

Abstract

Productive Uses of Energy are agricultural, commercial and industrial activities involving energy services as a direct input to the production of goods or provision of services. Productive uses include home businesses, non-monetary income, excludes social infrastructure and cuts across different sectors, energy sources, and types of enterprises. This study focusses on the economic feasibility of a range of businesses in Malawi powered by solar PV. The overall objective is to identify a set of businesses that have the potential to be progressed to pilot projects. Surveys were carried out on existing electricity using businesses in Dedza, Malawi to determine CAPEX, OPEX and monthly income figures for agricultural, sales and services, and repair and manufacture businesses. Solar PV systems were designed to supply the business loads and then priced using component costs obtained from suppliers. 10 year cash flow forecasts were conducted for 3 business scenarios (strong, stable and weak). Using the modelled profit and loss, the viability of the different businesses powered by solar PV was evaluated. As shown in the table below, the study has found that irrigation and small sales and services (specifically barber shop and phone charging) businesses powered by standalone PV systems look likely to succeed, with most paying back initial investment under 3 years over all scenarios. Maize milling and tailoring businesses give paybacks of 5 and 8 years for strong and stable scenarios respectively, indicating grant funding would be required to contribute to CAPEX to be affordable for most entrepreneurs in Malawi. A metal workshop business doesn’t recover initial investment within 10 years for any of the scenarios modelled. The results indicate solar PV has potential to reduce poverty through income generation in Malawi. Recommendations have been given for implementing pilot projects based on the feasibility studies, along with suggestions for future research to inform wider scale dissemination of Solar PV productive use initiatives.
LanguageEnglish
Place of PublicationGlasgow
PublisherUniversity of Strathclyde
Commissioning bodyScottish Goverment
Number of pages57
Publication statusPublished - 1 Apr 2017

Fingerprint

Industry
Sales
Solar system
Irrigation
Profitability
Repair
Electricity
Economics
Metals
Costs

Keywords

  • energy engineering
  • Malawi
  • solar photovoltaic systems
  • solar PV
  • poverty alleviation

Cite this

Eales, A., Buckland, H., Frame, D., Unyolo, B., Gondwe, C., & Kaunda, M. (2017). Productive Use of Solar PV in Rural Malawi: Feasibility Studies. Glasgow: University of Strathclyde.
Eales, Aran ; Buckland, Hannah ; Frame, Damien ; Unyolo, Berias ; Gondwe, Chawezi ; Kaunda, Morton. / Productive Use of Solar PV in Rural Malawi : Feasibility Studies. Glasgow : University of Strathclyde, 2017. 57 p.
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Eales, A, Buckland, H, Frame, D, Unyolo, B, Gondwe, C & Kaunda, M 2017, Productive Use of Solar PV in Rural Malawi: Feasibility Studies. University of Strathclyde, Glasgow.

Productive Use of Solar PV in Rural Malawi : Feasibility Studies. / Eales, Aran; Buckland, Hannah; Frame, Damien; Unyolo, Berias; Gondwe, Chawezi; Kaunda, Morton.

Glasgow : University of Strathclyde, 2017. 57 p.

Research output: Book/ReportCommissioned report

TY - BOOK

T1 - Productive Use of Solar PV in Rural Malawi

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AU - Eales, Aran

AU - Buckland, Hannah

AU - Frame, Damien

AU - Unyolo, Berias

AU - Gondwe, Chawezi

AU - Kaunda, Morton

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N2 - Productive Uses of Energy are agricultural, commercial and industrial activities involving energy services as a direct input to the production of goods or provision of services. Productive uses include home businesses, non-monetary income, excludes social infrastructure and cuts across different sectors, energy sources, and types of enterprises. This study focusses on the economic feasibility of a range of businesses in Malawi powered by solar PV. The overall objective is to identify a set of businesses that have the potential to be progressed to pilot projects. Surveys were carried out on existing electricity using businesses in Dedza, Malawi to determine CAPEX, OPEX and monthly income figures for agricultural, sales and services, and repair and manufacture businesses. Solar PV systems were designed to supply the business loads and then priced using component costs obtained from suppliers. 10 year cash flow forecasts were conducted for 3 business scenarios (strong, stable and weak). Using the modelled profit and loss, the viability of the different businesses powered by solar PV was evaluated. As shown in the table below, the study has found that irrigation and small sales and services (specifically barber shop and phone charging) businesses powered by standalone PV systems look likely to succeed, with most paying back initial investment under 3 years over all scenarios. Maize milling and tailoring businesses give paybacks of 5 and 8 years for strong and stable scenarios respectively, indicating grant funding would be required to contribute to CAPEX to be affordable for most entrepreneurs in Malawi. A metal workshop business doesn’t recover initial investment within 10 years for any of the scenarios modelled. The results indicate solar PV has potential to reduce poverty through income generation in Malawi. Recommendations have been given for implementing pilot projects based on the feasibility studies, along with suggestions for future research to inform wider scale dissemination of Solar PV productive use initiatives.

AB - Productive Uses of Energy are agricultural, commercial and industrial activities involving energy services as a direct input to the production of goods or provision of services. Productive uses include home businesses, non-monetary income, excludes social infrastructure and cuts across different sectors, energy sources, and types of enterprises. This study focusses on the economic feasibility of a range of businesses in Malawi powered by solar PV. The overall objective is to identify a set of businesses that have the potential to be progressed to pilot projects. Surveys were carried out on existing electricity using businesses in Dedza, Malawi to determine CAPEX, OPEX and monthly income figures for agricultural, sales and services, and repair and manufacture businesses. Solar PV systems were designed to supply the business loads and then priced using component costs obtained from suppliers. 10 year cash flow forecasts were conducted for 3 business scenarios (strong, stable and weak). Using the modelled profit and loss, the viability of the different businesses powered by solar PV was evaluated. As shown in the table below, the study has found that irrigation and small sales and services (specifically barber shop and phone charging) businesses powered by standalone PV systems look likely to succeed, with most paying back initial investment under 3 years over all scenarios. Maize milling and tailoring businesses give paybacks of 5 and 8 years for strong and stable scenarios respectively, indicating grant funding would be required to contribute to CAPEX to be affordable for most entrepreneurs in Malawi. A metal workshop business doesn’t recover initial investment within 10 years for any of the scenarios modelled. The results indicate solar PV has potential to reduce poverty through income generation in Malawi. Recommendations have been given for implementing pilot projects based on the feasibility studies, along with suggestions for future research to inform wider scale dissemination of Solar PV productive use initiatives.

KW - energy engineering

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KW - solar photovoltaic systems

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KW - poverty alleviation

M3 - Commissioned report

BT - Productive Use of Solar PV in Rural Malawi

PB - University of Strathclyde

CY - Glasgow

ER -

Eales A, Buckland H, Frame D, Unyolo B, Gondwe C, Kaunda M. Productive Use of Solar PV in Rural Malawi: Feasibility Studies. Glasgow: University of Strathclyde, 2017. 57 p.