Scaling Up Distributed Solar in Emerging Markets : The Case of the Arab Republic of Egypt
Like many emerging markets, the Arab Republic of Egypt is keen to promote distributed solar, defined here as systems below 500 kilowatts, but has struggled to create conditions for growth in the sector. The aim of this paper is to identify policy a...
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World Bank, Washington, DC
2017
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| Online Access: | http://documents.worldbank.org/curated/en/815911497878875622/Scaling-up-distributed-solar-in-emerging-markets-the-case-of-the-Arab-Republic-of-Egypt http://hdl.handle.net/10986/27301 |
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okr-10986-273012021-06-08T14:42:47Z Scaling Up Distributed Solar in Emerging Markets : The Case of the Arab Republic of Egypt Sakr, Dalia Huenteler, Joern Matsuo, Tyeler Khanna, Ashish SOLAR OFF-GRID PV DISTRIBUTED ENERGY METERING PHOTOVOLTAIC Like many emerging markets, the Arab Republic of Egypt is keen to promote distributed solar, defined here as systems below 500 kilowatts, but has struggled to create conditions for growth in the sector. The aim of this paper is to identify policy actions to unlock the distributed solar market for on-grid and off-grid applications, using Egypt as a case study. The paper calculates the rate of return on investment for different distributed solar applications, identifies nonfinancial barriers to scaling up distributed solar, and derives policy implications. For on-grid applications, the analysis finds that neither net metering nor the feed-in tariff makes distributed solar financially attractive, despite recent reductions in electricity subsidies and adjustments of feed-in tariff levels in October 2016. For off-grid applications, the profitability of distributed solar depends highly on the local price of diesel: distributed solar is viable only in areas where diesel is not available at the official (subsidized) price. In addition, several nonfinancial barriers limit the scalability of the distributed solar market. These findings indicate that the distributed solar market in Egypt will remain a niche market in the next few years without strengthened government support. First, for on-grid applications, the net metering scheme should be kept in place until a bankable feed-in tariff has been established. Second, for off-grid applications, the government should explore interventions to unlock opportunities in the agriculture and tourism sectors. Third, the government should strengthen private-sector activity in the sector, including by addressing nonfinancial barriers, such as transaction costs and gaps in the availability of data, and by building capacity among users, suppliers, and financial institutions. 2017-06-21T20:17:02Z 2017-06-21T20:17:02Z 2017-06 Working Paper http://documents.worldbank.org/curated/en/815911497878875622/Scaling-up-distributed-solar-in-emerging-markets-the-case-of-the-Arab-Republic-of-Egypt http://hdl.handle.net/10986/27301 English en_US Policy Research Working Paper;No. 8103 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Middle East and North Africa Egypt, Arab Republic of |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
SOLAR OFF-GRID PV DISTRIBUTED ENERGY METERING PHOTOVOLTAIC |
| spellingShingle |
SOLAR OFF-GRID PV DISTRIBUTED ENERGY METERING PHOTOVOLTAIC Sakr, Dalia Huenteler, Joern Matsuo, Tyeler Khanna, Ashish Scaling Up Distributed Solar in Emerging Markets : The Case of the Arab Republic of Egypt |
| geographic_facet |
Middle East and North Africa Egypt, Arab Republic of |
| relation |
Policy Research Working Paper;No. 8103 |
| description |
Like many emerging markets, the Arab
Republic of Egypt is keen to promote distributed solar,
defined here as systems below 500 kilowatts, but has
struggled to create conditions for growth in the sector. The
aim of this paper is to identify policy actions to unlock
the distributed solar market for on-grid and off-grid
applications, using Egypt as a case study. The paper
calculates the rate of return on investment for different
distributed solar applications, identifies nonfinancial
barriers to scaling up distributed solar, and derives policy
implications. For on-grid applications, the analysis finds
that neither net metering nor the feed-in tariff makes
distributed solar financially attractive, despite recent
reductions in electricity subsidies and adjustments of
feed-in tariff levels in October 2016. For off-grid
applications, the profitability of distributed solar depends
highly on the local price of diesel: distributed solar is
viable only in areas where diesel is not available at the
official (subsidized) price. In addition, several
nonfinancial barriers limit the scalability of the
distributed solar market. These findings indicate that the
distributed solar market in Egypt will remain a niche market
in the next few years without strengthened government
support. First, for on-grid applications, the net metering
scheme should be kept in place until a bankable feed-in
tariff has been established. Second, for off-grid
applications, the government should explore interventions to
unlock opportunities in the agriculture and tourism sectors.
Third, the government should strengthen private-sector
activity in the sector, including by addressing nonfinancial
barriers, such as transaction costs and gaps in the
availability of data, and by building capacity among users,
suppliers, and financial institutions. |
| format |
Working Paper |
| author |
Sakr, Dalia Huenteler, Joern Matsuo, Tyeler Khanna, Ashish |
| author_facet |
Sakr, Dalia Huenteler, Joern Matsuo, Tyeler Khanna, Ashish |
| author_sort |
Sakr, Dalia |
| title |
Scaling Up Distributed Solar in Emerging Markets : The Case of the Arab Republic of Egypt |
| title_short |
Scaling Up Distributed Solar in Emerging Markets : The Case of the Arab Republic of Egypt |
| title_full |
Scaling Up Distributed Solar in Emerging Markets : The Case of the Arab Republic of Egypt |
| title_fullStr |
Scaling Up Distributed Solar in Emerging Markets : The Case of the Arab Republic of Egypt |
| title_full_unstemmed |
Scaling Up Distributed Solar in Emerging Markets : The Case of the Arab Republic of Egypt |
| title_sort |
scaling up distributed solar in emerging markets : the case of the arab republic of egypt |
| publisher |
World Bank, Washington, DC |
| publishDate |
2017 |
| url |
http://documents.worldbank.org/curated/en/815911497878875622/Scaling-up-distributed-solar-in-emerging-markets-the-case-of-the-Arab-Republic-of-Egypt http://hdl.handle.net/10986/27301 |
| _version_ |
1764464148230438912 |