There is a good bit of news to those who are into solar, like me. In South Africa, a recent study showed that solar power is now cheaper than power from South Africa’s bumbling power utility Eskom. This does not bode well for Eskom and should serve as a warning to our own power monopoly ZESA.
What the research says
NuPower a South African solar and renewable energy company crunched some numbers and this is what they found:
- An average South African household uses about 30 to 40 units of power where one is equivalent to one kWh per day
- For this household to go off-the-grid without it getting any power from Eskom it would need to spend about R220 000 (about US$15 000) as an initial investment
- This will be enough to buy a top of the range system which has:
- A 5 KVA Victron Hybrid Inverter,
- Two 48V Lithium Phosphate batteries with 100Ah
- About sixteen 330 Watt panels or 15 Kw in panels
- A solar water heating panel fitted to a geyser to reduce the geyser’s power consumption
- Such a system would be able to produce between 27 to 37 units of power per day
- The system would provide a return on investment of about 9-12% during its first year
- It would have a lifetime of about 20 years
Now here is the maths part. If we divide the cost of such a system by the estimated power it will generate over its lifetime we get the estimated cost of each unit that it will produce. According to the numbers above we get:
R0.0814 per unit or about US 5.5 cents
Now that is less than half of what Eskom is charging per unit! If we ran the same numbers for Zimbabwe we would get pretty similar results. Thanks to years of government greed, incompetence, inefficient power production in these monopolies are now charging more than you would pay using solar.
If you are such a heavy user on ZESA you would be required to pay about $10.33 ZWL per unit which is the highest tariff. That translates to about 0.8 US cents even if we assume a generous rate of 115 ZWL per 1 USD. I repeat solar power is cheaper than ZESA in the long run.
In Zimbabwe there is a catch
I have to be honest, ZESA is a complete and utter disappointment. Not just to me, everyone I know says the same. We can all harken back to the dark and torrid existence that was 2019 when we had to endure 18 hours without power.
Even though the dams are full, the problems are not over, we have to contend with a different kind of dilemma: a creaky hydrophobic grid that cannot countenance the whiff of a rainy cloud.
Now that we are going through the wettest summer in recent years most of us have had to spend days waiting for the ZETDC to fix the many faults cropping up and looking at how this county’s infrastructure is crumbling it’s only going to get worse. Underground cables and transformers have been constant points of failure. People have had to spend days in darkness.
So why aren’t people flocking to the solar power bandwagon? Well, there is a pretty big catch. That initial investment is a pretty big barrier to entry for most people. Not a lot of people have US$15 000 lying around somewhere and would therefore require some sort of financing. This is not a problem if you live in a country like South Africa where banks regularly give out loans.
For now, that is ZESA’s saving grace. People have no choice but to stick with it or have no electricity because they simply cannot afford to go solar. However, that is unlikely to stay like that forever. Already in the corporate space, we are seeing more and more companies investing in solar and with net-metering in effect, these companies will be paying much less to ZESA.
In the domestic consumer space, we have seen ingenious startups come up with ways to reduce the initial costs. Senegalese startup Oolu Solar recently got $8.5 million dollars in funding. Like most startups, they provide pay as you go service. Typically these companies provide a solar system for the customer who then pays in instalments for the system. I can see such companies decimating ZESA’s market share.
Solar is coming for you ZESA!
I have been saying it for a while now I am starting to sound like a broken record. There will be a time if ZESA is not careful when ZESA will become about as powerful as TelOne is in the communications sector. Sure the reformed TelOne is great and awesome but the majority of people live their happy lives without needing the company’s service.
It wasn’t always so. There was a time when TelOne was known as the PTC, an omnipotent government communications monopoly. That was before the time of cellphone providers like Econet and Telecel. Nowadays it’s just another Telco fighting for a piece of the pie.