Blogs, Grid Scale, Solar, Storage

The Potential of Nigeria’s Residential Solar Rooftop Systems

For many years, the clamour for more stable and reliable electricity supply in Nigeria has been never-ending, particularly for households. The inability of families to consistently enjoy one of the most essential necessities of life in the 21st century has plagued many parts of Africa’s largest economy for too long. This has had palpable negative impacts on the nation’s economy and the standard of living of its people for eons.

Disappointingly, in February 2015, the national grid recorded a total power generation of just less than 2,900 MW which is about 1.8 percent of the estimated capacity required nationwide according to the Minister of Power, Prof. Chinedu Nebo. In January, he confirmed that Nigeria needed 160,000 MW in order to reach globally accepted standards and satisfy the demand for stable supply for the 170 million Nigerians. To put this into further perspective, according to Bloomberg, Nigeria generates a tenth of the amount of electricity produced by South Africa despite the fact that its population is three times more.

This is enough to justify why many Nigerians are fraught with the search for new alternatives to their National Grid. In 2009, Dr. Frank Jacobs, regional chairman of the Manufacturers Association of Nigeria (MAN), disclosed that 60 million Nigerians own fuel powered generators for use during power cuts. Since then, this number has significantly increased as a result of decreased electricity generation and longer spells of black outs.

A month ago, I met with an Investment Portfolio Manager, Princewill Udo, who lives in Lagos with his wife and 2 children. Just like many, he owns a 4-kW petrol powered generator to provide back-up electricity when there is no power; apparently this happens nearly every day. On average, he spends N480,000 ($2,420) on fuel annually and approximately N40,000 ($202) per month. In 20 years, at this rate, he will spend about N9.6 million ($48,480) on fuel alone excluding maintenance and replacement costs. According to him, this is a typical scenario for many. I saw this as an opportunity to enlighten him on new energy trends that could help reduce costs and offer more energy security.

In the world we live in today, there are a number of alternative sources of electricity. The good news is that we are no longer constrained to the “business as usual” approach of the electricity chain where a huge power plant thousands of miles away is the sole source of electricity.

New and renewable energy technologies such as solar have a transformational role for many homes in Nigeria. The case for residential solar photovoltaic (PV) systems in Nigeria is principally based on two major factors- the ability of the technology to provide cost savings and power reliability for customers.

Over the past decade, the cost of going solar has significantly reduced by more than 40 percent due to falling manufacturing costs and market competition. The average cost of solar panels has gone from $3.00/watt in 2005 to $0.48/watt in 2015. Currently, the average cost of installing a 4-kW solar PV system for an average three-bedroom household in Nigeria is N1.8 million ($9,090) including the costs for a battery bank for energy storage. In addition, the solar panels have 20 to 25 years warranty from manufacturers.

Advancements in solar technology have made it possible for sustainable and more reliable electricity through the sun’s free energy. Globally, solar electricity systems, typically on rooftops, are the most common solar installations by far. They comprise of electricity generating solar panels mounted on rooftops of residential or commercial buildings. With these, there are no fuel or maintenance costs for any mechanical moving parts. It’s a no brainer (really) in tropical climates and regions with more sunny days than cloudy and rainy ones.

Although, it is arguable that the initial cost of installation is relatively pricey, there is no doubt that solar technologies offer a much sought after cocktail – financial savings mixed with power reliability, when compared to the use of the most widely used alternative power technologies in Nigeria, —petrol and diesel powered generators. Invariably, as solar customers continue to experience price crashes, so will its popularity and patronage increase. Eventually, solar will dominate the “energysphere” because it is a technology, not a fuel.