Energising economies with solar power

Experts at a recent discussion hosted by Swiss power giant ABB said recent advancements in technology and supportive government policies indicate that solar energy can address energy poverty and climate change.

For all the energy innovations in the 21st century, over 1.2 billion people worldwide still do not have electricity at home. And yet on any given day, only one hour’s worth of energy from the sun is enough to sustain the energy consumption of the entire world for a year.

Recognizing the huge potential for solar energy to address existing energy poverty, Swiss power and automation giant ABB recently hosted a session on solar energy on the sidelines of the World Economic Forum in Manila. The discussion, held on May 22, called “Sharing the sun: The future of solar energy in East Asia”, centred on advancements in solar, as well as the opportunities and challenges for this sector in the region in the context of achieving equitable progress – the theme of the WEF.

Experts on the panel highlighted Asia’s energy poverty woes, particularly in archipelago nations like the Philippines and Indonesia where millions still do not have electricity, hindering development. Policies promoting deployment of solar and innovative business models that capitalise on existing solar technologies are key factors that can drive sustainable and inclusive economies, they said.

Maxene Ghavi, head of ABB’s solar industry segment initiative and a panellist at the Manila discussion, noted that ABB supports both traditional power applications and applications for off- or microgrids, especially in Asia where energy security and access to energy is “very, very critical”.  

ABB is the world’s second-largest supplier of solar inverters. It also provides products that cater to the entire range of the solar photovoltaic (PV) value chain – from generation and transmission to distribution and maintenance. Some of its specific solutions include inverters for large-scale PV power plants and grid stabilization technology that integrates renewable energy into microgrids or off-grid locations for a reliable supply of power.

ABB believes solar energy decouples economic growth from energy consumption and improves lives, especially across various appliations, said Ghavi.

The firm recently announced a technology partnership with Solar Impulse SA, a Swiss solar aviation research and development (R&D) company that is attempting the first round-the-world flight powered by the sun in 2015. Ghavi said ABB’s decision to support Solar Impulse was due to an alignment of vision, which is essentially to power a better world.

The solar aviation firm’s Solar Impulse 2 – a single-seater solar plane with a 72-metre wingspan with 17,000 solar cells – recently completed its maiden flight on June 2 in Switzerland. Commending the project, founders Betrand Piccard and André Borschberg said Si2 incorporates a vast amount of new technology to render it more efficient, reliable and in particular, better adapted to long-haul flights.

Solar Impulse aims to prove that exploration and aviation, which currently accounts for two per cent of global manmade CO2 emissions, can be done without fuel or pollution. Their ambition, they added, is to “contribute to the cause of renewable energies [and] to demonstrate the importance of clean technologies for sustainable development…”

Solar’s potential

Posing a provocative question, Satinder Bindra, former CNN South Asia bureau chief and ADB principal director for external relations who moderated the discussion, asked: “If a solar plane can potentially travel the world, how come we are lagging behind in getting solar energy out there?”

He highlighted Asia’s continued dependence on fossil fuels, citing statistics from the Asian Development Bank (ADB) that the consumption of coal, oil and natural gas is set to increase by 2035 in the region. Demand for coal, which is the primary energy source in the energy mix, is projected to increase by 53 per cent by 2035 in Asia and the Pacific, according to a 2013 ADB publication.

In addition, electricity demand in the region is forecasted to more than double between 2010 and 2035, while CO2 emissions from the energy sector will increase to over 22 billion tonnes, a growth rate of two per cent per year.

Panelist Eric Berkowitz, chief investment officer of impact investing at private equity firm Bamboo Finance, noted that solar is the way to provide clean and affordable electricity to the over one billion people in the world who live off the grid, and to the other two million people who have limited or unreliable access to energy.

These people should use safe, affordable solar lanterns that can be upgraded to a solar home system or microgrid for their energy needs, in place of kerosene or candles, which not only provides poor lighting but also produces hazardous fumes and is a fire hazard, said Berkowitz.

“Solar can transform communities. It creates vibrancy and stimulates economic activity. People can open and operate their businesses after dark, kids can study at night and – a frequent feedback from the communities – it even prevents snake bites,” he added.

Ghavi similarly stressed the existence of solar options in the market, highlighting the availability of solar technologies and its competitive pricing compared to conventional energy sources.  

She said the reason that the world is lagging behind in the use of solar energy, particularly in rural communities, is not for a lack of technology but the lack of policies and government support. – it’s about what policies are in place and what governments are able to support. “We need to have policymakers that enable the technology for deployment,” she added.

Infographic based on the 2013 publication “Energy Outlook for Asia and the Pacific”. Image: ADB

Small solutions, big impact

In a recent op-ed in Eco-Business, ABB region president for South Asia, Haider Rashid, argued that smallsolar farms, for example, can bring electricity to far-flung rural communities, which usually rely on generators running on expensive diesel fuel. Routing electricity to remote towns and villages from power plants can be very costly and communities typically have to wait years for the power to start flowing, he pointed out.

Unlike this traditional method and its requisite infrastructure, solar can easily provide electricity just as mobile phones have given those in distant provinces a means of communication despite the lack of telephone lines, explained Jim Ayala, a panellist and founder and chief executive of Philippine social enterprise Hybrid Social Solutions.

“Without electricity, they can’t develop. But with solar, we don’t have to wait for the grid,” said Ayala, one of 24 awardees in the 2013 Social Entrepreneurs of the Year by the Schwab Foundation.

For example, once a household in the Philippines has a simple solar lamp where they can also charge their cellphones, their household income goes up by 25 per cent, Ayala noted. That’s about US$40, of which $10 is savings usually spent on kerosene, batteries, and charging their cellphones in the village; while, the $30 is earnings from becoming more productive, since they have more time and they can use light in aid of their business, he explained.

Fishermen likewise benefit from affordable solar products. Rather than spend US$7 per night on kerosene, they can use light from a lamp with stored solar energy to attract fish, said Ayala. “So instead of spending $200 a month, you spend $200 on a system, and from then on it’s pure savings for the next five to ten years or until the system lasts,” he added.

Solar can transform communities. It creates vibrancy and stimulates economic activity. People can open and operate their businesses after dark, kids can study at night and – a frequent feedback from the communities – it even prevents snake bites

Eric Berkowitz, Bamboo Finance, chief investment officer for impact investing

Berkowitz further noted that companies or start-ups with innovative business models that are commercially viable and tap a distribution network are those that can increase and scale up best practices in clean technologies, as opposed to those with simply novel products or services.

Orb Energy in India is one example, he cited. The company helps underprivileged communities attain basic services like electricity and water through solar photovoltaic and solar water heating systems through their vast retail network of 150 stores that also works with local banks. This leads to rural electrification, he noted.

Solar is an ideal solution to provide light and other essential services in the developing world, especially to the millions of people in India who are still reliant on kerosene for basic lighting, said Orb Energy.

National policies

India’s new Prime Minister Narendra Modi is likewise keen to tap on solar energy as a means to stir sustainable development.

Prior to his win, he announced a solar revolution for the sub-continent as a way to eliminate power outages and achieve economic growth. In a post-election pledge, he said his government’s goal is to bring solar power to every home by lighting at least one light bulb by 2019.

In the Philippines, although there is a Renewable Energy Bill that promotes the development of renewable energy resources, there is still a need to make solar energy attractive, said Professor Alvin Culaba, head of the Solar Energy Center in De La Salle University who also spoke at the ABB solar session.   

He explained that since energy is still dependent on technology, large-scale solar infrastructure or production of electricity from renewable energy will still involve higher upfront costs compared to traditional energy sources – unless the government removes market distortions to conventional fuels and also adds in environmental and social costs. 

While the off-grid set-up is the clear advantage of solar, grid connection is also crucial for the economy, particularly to power industries, Ghavi pointed out. “So you need to have a grid and to invest in that infrastructure. That’s as critical, and that’s very dependent on what the government wants to enable and what policies they have in place,” she said.

Both clear policies from the government and economically viable solutions from the private sector are needed, she emphasised. Ambiguous policies are not effective since this only inhibits financing from investors, she added.

Still, despite any hiccups amidst the growing solar uptake, Culaba said, “With the sun always there, the future is always bright.”

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