Solar microgrids offer electricity at a village level: wired connections to houses and businesses supplied by solar power offer higher levels of access than pico-solar products or solar home systems, but are cheaper and faster to employ than larger minigrid initiatives currently under development in Malawi. The reduction in cost of Solar PV, battery and control technology has caused an increase in implementation of microgrids powered by solar PV globally, and presents an opportunity to increase energy access for Malawi’s rural population.
Following our recent work on conducting a feasibility study for a solar microgrid, and building on recent project findings including SOGERV, we set out to find out what the potential is for this innovative technology across Malawi, by conducting a national market assessment.
We learnt from case studies of existing initiatives in Kenya and Rwanda to inform a system and business design appropriate to Malawi. A novel methodology utilising techno-economic modelling and geographic information system software was used to quantify the market potential for solar microgrids, and we’ve mapped the microgrid ecosystem to frame the influencing parameters for implementing the technology nationally. For the modelling we have explored the impact of including diesel generators in the generation mix to investigate potential cost savings.
The summary report below outlines initial findings from the study, and we’ve included a link to an interactive map to guide practitioners and energy planners. Some of the key finding are summarised below:
- Solar microgrids (defined here as an islanded network of demand points supplied by a central PV generation of <10kW) are emerging as a cost competitive, low carbon and reliable method for offering energy access in developing countries. Global solar microgrid growth has benefitted from technological advances in remote monitoring with data acquisition on load profiles and smart metering with mobile payment systems.
- Solar or solar/diesel hybrid microgrids are the most cost effective electrification strategy for 37% of Malawi’s population, or 6.5 million people. The capital investment required to provide microgrid electricity to the quantified market is estimated as $824m, with an annual operation cost of $70.5m per year, or a total CAPEX of approximately $130 per person with OPEX of $11 per person per year.
- The lowest costs of energy are typically found in areas of higher population, where maintenance and diesel costs are lower and solar/diesel hybrid grids are recommended. When planning projects, it is important to choose sites with existing market centres and high energy use.
- Small amounts of diesel generation in off-grid systems can lead to a reduction in the necessary system sizing. However, incorporating diesel brings environmental problems, increased maintenance consideration, price volatility and security of supply issues which should be taken into account when planning projects.
- The cost of energy is anticipated to be highest in the most remote regions of Malawi and these populations are also likely to have a lower ability to pay, compounding an imbalance between cost reflective tariffs and ability to pay. Individuals living in these less accessible areas are also the least likely to benefit from grid-based electrification. In order to provide financially viable services, the more remote populations will require some form of gap financing or subsidy scheme.
- The expansion of the national grid is a threat to microgrid developers and a concrete rural electrification plan is necessary to reduce risk and increase investor confidence.
- Challenges to microgrid implementation in Malawi include an unfavourable regulatory environment, lack of access to finance, lack of local capacity for design and implementation of the technology, lack of mobile money integration, and limited supply chain for consumer appliances as well as renewable energy equipment.
The modelled Cost of Energy, optimal system type by location and national grid of Malawi are shown here in an interactive map. Both the cost of energy and optimal system type results come from the methodology described in the report below. The national grid map shown was adapted from Government of Malawi sources as part of Wind Empowerment’s “Market Assessment for Locally Manufactured PV-Wind Hybrid Systems in Malawi”.
The legends corresponding to the visualisation in each map are included, and it is possible to zoom into the map and explore areas of Malawi in greater detail. It can be seen that systems in proximity to urban centres are more likely to include diesel generation, and are more likely to have a lower cost of energy.
A key disclaimer for use of this data is that no off-grid implementation project should be based on these maps alone – as with all projects it is necessary to do a detailed feasibility study to ensure any project is financially sustainable. These maps are only intended to offer broad insights into the geographical distribution of systems and energy costs.
Link to the interactive map here
We hope the results of this study will be beneficial for stakeholders and policymakers in Malawi, indicating both where microgrids might be most viable but also indicating the estimated market size for each energy access type. The produced maps are intended to allow for intuitive understanding of the information processed in the project, and to provide stakeholders with actionable information regarding the market distribution and the effects of different factors within the energy access ecosystem, along with how to mitigate any barriers.
University of Strathclyde (UoS) will be working to address the outlined challenges through further research and implementation through the Rural Energy Access through Social Enterprise and Decentralisation (EASE) project, a £1.3m project funded by the Scottish Government for the EASE project running 2018 – 2023.
You can access the working paper here:
Strathclyde Energy for Development 