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Project Development Programme East Africa
Rwanda’s Solar Energy Market
Target Market Analysis
www.renewables-made-in-germany.com
www.german-renewable-energy.com
Authors
Integrated Energy Solutions (IES):
Mark Hankins
Anjali Saini
Paul Kirai
December 2009
Editor
Deutsche Gesellschaft für Technische
Zusammenarbeit (GTZ) GmbH
On behalf of the
German Federal Ministry
of Economics and Technology (BMWi)
Contact
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This Target Market Analysis is part of the Project Development Programme (PDP) East Africa. PDP East Africa is implemented
by the Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) on behalf of the German Federal Ministry of Economics
and Technology (BMWi) in context of the Export Initiative Renewable Energies. More information about the PDP and about
renewable energy markets in East Africa: www.gtz.de/projektentwicklungsprogramm
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Target Market Analysis: Rwanda’s Solar Energy Market V
Content
1 STATUS QUO OF THE SOLAR ENERGY SECTOR ............................................................... 1
1.1 Brief Solar Sector Overview .................................................................................................................. 1
1.2 Major Market Segments ....................................................................................................................... 1
1.3 Local Capacities .................................................................................................................................... 4
2 MARKET POTENTIALS ............................................................................................................. 5
2.1 Overall Sector Outlook ......................................................................................................................... 5 2.1.1 Public Sector Market........................................................................................................................... 6 2.1.2 Private Sector PV ................................................................................................................................ 8
2.2 Undeveloped Market Opportunities ..................................................................................................... 9 2.2.1 Solar Water Heating (SWH) ................................................................................................................ 9 2.2.2 Grid-Connected Solar PV .................................................................................................................... 9
3 SOLAR-SPECIFIC REGULATION AND FRAMEWORK .................................................... 10
3.1 Policies and Regulations ..................................................................................................................... 10
3.2 Applicable Public Sector Support / Financing Mechanisms and Sources ............................................. 11
4 BUSINESS PARTNERS AND COMPETITORS .................................................................... 12
4.1 Overview of Key Solar Market Players ................................................................................................ 12
4.2 Overview of Major and/or Most Emblematic Projects ........................................................................ 14 4.2.1 Public Sector PV Investments ........................................................................................................... 14 4.2.2 Kigali Solair ........................................................................................................................................ 14
Target Market Analysis: Rwanda’s Solar Energy Market VI
List of Tables
Table 1: A Summary of Current Solar PV Market Activities in Rwanda ................................................................... 1
Table 2: MININFRA Solar Energy Related Budget 2009 ......................................................................................... 6
Table 3: Indicative ICT and PV System Procurements, 2008 Budget by MINEDU 2008 ........................................ 7
Table 4: The SHS Market in Rwanda ...................................................................................................................... 8
Table 5: Importing Companies of Rwanda's Solar Market .....................................................................................12
Table 6: Consultants; NGO's and Non-Government Projects ................................................................................13
Table 7: Government and Public Sector Projects ..................................................................................................13
Currency
1 USD = RWF 575 (May 2010)
1 € = RWF 708 (May 2010)
Measurement
W Watt Wp Watt peak Wh Watt hour
kW Kilowatt kWp Kilowatt peak kWh Kilowatt hour
MW Megawatt MWp Megawatt peak MWh Megawatt hour
GW Gigawatt GWp Gigawatt peak GWh Gigawatt hour
Target Market Analysis: Rwanda’s Solar Energy Market VII
List of Acronyms
ACDM Atelier Central de Maintenance
a-Si Amorphous Silicon
BBS Battery Based System
BTC Belgian Technical Cooperation
BTS Base Stations
BOS Balance of System (Components of PV Systems)
CDC Centre for Disease Control
CRS Catholic Relief Services
EGPAF Elisabeth Glaser Pediatric AIDS Foundation
ERC Electricity Regulatory Commission
FHI Family Health International
GEF Global Environment Facility
GLE Great Lakes Energy
HC Health Centre
ICAP International Centre for AIDS Care and Treatment Programmes
ICT Information and Communication Technology
JICA Japan International Cooperation Agency
LED Light Emitting Diode
MINIEDU Ministry of Education
MININFRA Ministry of Infrastructure
MTS Modern Technology Services
NGO Non-Governmental Organisation
PEPFAR President’s Emergency Plan for AIDS
PIH Partners in Health
PPA Power Purchase Agreement
PPP Purchasing Power Parity
PV Photovoltaic
PVMTI Photovoltaic Market Transformation Initiative
SELF Solar Electric Light Fund
SHS Solar Home System
SWH Solar Water System
UNDP United Nations Development Programme
USAID United States Agency for International Development
x-Si Chrystalline Silicon
Target Market Analysis: Rwanda’s Solar Energy Market VIII
Summary
Rwanda is a densely populated, small country with a relatively low average income. Its small solar
market was less than 60 kWp/annum in 2008 and total installed capacity is estimated to be below 1
MWp.
Solar power in Rwanda is mainly a procurement market for government and NGO institutional
systems though there is an increasing demand for solar home systems. In 2008, Kigali Solair (up to
now the largest solar PV project in Sub-Saharan Africa), injected 250 kW to the grid and plans are to
expand to 1 MW. But still there remains no renewable energy feed-in tariff.
Rwanda is well-positioned to serve as an export market within the Great Lakes region. Since it is
based mostly on procurement, current demand is extremely unpredictable and irregular. The future
outlook however seems promising. High electricity prices, combined with some favourable policy
indicate future opportunities in the solar water heater industry and also in the grid-connected solar PV
market towards 2015. The government’s solar energy related budget 2009 allocated USD 1.72 million,
excluding project-related work, the majority will be spend for a strategic study of renewable energy.
Target Market Analysis: Rwanda’s Solar Energy Market 1
1 Status Quo of the Solar Energy Sector
1.1 Brief Solar Sector Overview
Rwanda receives an annual solar radiation of 5.2 Wh/m
2/day. This represents a good potential for
solar PV development. Like most countries in the region, solar radiation is considerably variable, and
months in the cloudy season have average irradiation levels of below 4.5 Wh/m2/day.
A combination of high electricity and fuel prices, and a growing economy, as well as export
opportunities into the Democratic Republic of the Congo (DRC), should increase the overall demand
for solar PV equipment in Rwanda. However, due to the small size of the country, the medium to long-
term off-grid opportunities will gradually decrease as the grid network is enlarged and coverage made
denser. Despite of the high cost for electricity in Rwanda (USD 0.21 kWh), the solar PV market is still
undeveloped. Current demand for PV is below 60 kWp/annum and total installed capacity is estimated
to be below 1 MWp.
The current installed capacity of Rwanda’s energy sector amounts more than 85 MW, however, the
country needs a total of at least 100 MW to meet present demand and sustain its economic growth. In
Rwanda has a net deficit of power with a national electrification rate of 8 % and a rural electrification
rate of 1 %. There is a government target to double the electrification rate, increasing connections to
16 % of the population (equal to 200,000 connections) up from the current 100,000 customers by
2012 at a cost of USD 400 million.
Government and NGO programmes, electrification targets for rural health, educational facilities, and
government administrative offices are the key drivers of the Rwandan solar energy market. While the
demand for solar home systems appears limited, there has been a recent growth in this sector due to
an increasing (but still small) middle-income community. The Rwandan Government is working with
partners such as the European Union, the World Bank and the Belgium Government to install solar PV
in public health centres, schools and government administration facilities in the rural areas. Their total
installation target is approximately 200 kWp in solar PV installations commencing in 2009.
Rwanda is also home to the “largest single solar installation” in Africa - the “Kigali Solair” solar power
plant - that generates 250 kW and feeds into the national electricity grid. The plant was funded by the
German municipal power company Stadtwerke Mainz and installed by the German company Juwi in
2008.
1.2 Major Market Segments
There are several active market segments in the solar PV market, elaborated below and in Table 1:
Table 1: A Summary of Current Solar PV Market Activities in Rwanda
Solar PV technology Size of
opportunity
Estimated kWp
installed/year (2008)
Notes
Government administrative
centres
>0.4 MWp ±15 kW Good government contacts
required
Government clinics and schools >1 MWp ±40 kW World Bank, EU, Belgium
NGO & NGO health sector >0.3 MWp <±5 kWp PEPFAR
Solar Home System >4 MWp N/A Low rural spending power
TOTAL >6 MWp >50kWp
Target Market Analysis: Rwanda’s Solar Energy Market 2
Government programmes
The Rwandan Government has an excellent relationship with donors and relies on donor support for
budget support and infrastructure development. It issues tenders for the installation of solar PV in
schools, health centres and clinics, as well as administrative centres (sector offices). Relationships
with key donors, including the European Union, the World Bank, the US Government (through the
United States Agency for International Development (USAID) and the President’s Emergency Plan for
AIDS (PEPFAR)) and the Belgian Government, will enable Rwanda to aggressively pursue – and in all
likelihood achieve – a high level of electrification of government institutions.
Administrative centres. There are 145 such sector offices currently un-electrified. Out of the
total 496 centres, 86 run on diesel generators and 116 on solar PV. The central government
issues three to four tenders per year1. District governments contract directly with the
contractor and public tenders are not always announced.
Health centres and schools. The World Bank, the European Union and Belgian Technical
Cooperation (BTC) will be funding solar electrification of government health centres and
schools over the next five years. The objective is to cover all non-electrified institutions. These
procurements may cumulatively be larger than 200 kWp.
Non-Government organisation procurements
In addition to the government programmes, various donor-led programmes to electrify Health Centres
in Rwanda are under way. PEPFAR/USAID, which spent over USD 120 million in Rwanda in 2008, is
supporting programmes to electrify the hundred plus health centres that proving anti-retroviral, HIV
testing and counselling services.
Implementing partners (who manage programme, and purchase energy systems) include the Catholic
Relief Services (CRS), Partners in Health, Intra Health, International Centre for AIDS Care and
Treatment Programmes (ICAP), and Family Health International (FHI), EGPAF and Columbia
University. Together they have installed a few tens of kW of PV over the last three years. In the future,
battery backups with inverter systems will also make up a large part of this growing demand.
The implementing partners carry out the above contracts. Each partner carries out tenders according
to their own process, and these processes differ considerably. For example, Columbia University
purchased all of its equipment in the US through a US NGO, while CRS and FHI both purchase
equipment on the local market. USAID and PEPFAR may complete a larger procurement project in
the near future.
Solar Home Systems (SHS)
Solar home systems will be an important sector for future growth in PV. Presently, most of the likely
customers include middle class customers with homes in off-grid rural areas including teachers,
business people, church leaders and NGOs. Only one company called Modern Technology Services
(MTS) (see section 4) is aggressively exploiting this market at present.
Great Lakes export opportunities
Because Kigali is strategically located to serve consumer needs of eastern Congo (Goma, Kivu),
Burundi and parts of Uganda, many business people sell products into these regions from Kigali. Solar
PV providers consistently mentioned that they serve these markets, and that they make up a
significant portion of their business.
1 Tenders are issues by district agencies. Quality of tender documents is mixed and there is a lack of quality
design work and specification in tender documents.
Target Market Analysis: Rwanda’s Solar Energy Market 3
Predominate operator models
The Rwandan solar PV market is an early-stage market of small players that is poorly integrated into
the global and regional solar energy industry. Six to eight companies compete in the market, but only
two of them sell over 15 kW per year (see section 4). In general, companies are involved in PV as a
side-business. The PV business was better developed before the genocide, but, as with other sectors,
demand collapsed during 1993/94 and did not pick up again until ten years after the war. Total
“normal” demand for PV is unlikely to be more than 60 kW per year, but an increasing number of large
projects have made this number grow quickly and it is likely that there is a substantial “invisible” /
under the counter market. As with other countries in early stages of PV development, much of the
business is channeled through the donor sector, and some local companies have poor access to
these projects. In 2008, over 30 % of the total demand was in a single procurement by a donor agent
that avoided taxes and duties.
PV and balance of system (BOS) prices are much higher than in other parts of the region. Module
costs well over USD 10 per watt are common. PV system components such as batteries are also very
highly priced. This means fully installed systems often cost over USD 20 per watt. Equipment is
sourced from Europe and Asia; solar companies tend to be linked with European partners.
The high price regime favors a contracted approach to sales rather than over the counter. Only two
companies were able to provide price lists. High prices are caused by high duties2, lack of competition
and lack of availability of components on the market, and the consequent need to source individual
purchases rather than buy in volume or stock. It is interesting to note that, despite increasing activity in
Rwanda’s PV demand since 2007, there is little interest in the market among the large (i.e. Kenyan)
regional players. This has to do with the fact that local Rwandan companies do not actively seek to
lower prices or become more competitive (i.e. by seeking out lower prices), as their customers
(donors) have previously been willing to pay high prices and there is little competition.
Only two companies displayed a strong linkage with PV companies outside of the country (see section
4). Many dealers were not conversant with recent developments in PV and inverters – technologies
that change almost monthly. As well, rather than taking an educative approach to customers, some
dealers “mystify” the technology, making it seem like something that the layman customer would not
be able to understand.
Companies maintain very little stock, instead relying on tenders and projects to gain business. In this
regard, solar PV is like a contracting business. Equipment is procured after the deal is made and little
is kept in stock. One or two companies (MTS, SECAM) are more customer-oriented than others (a
favorable trend). But in general all companies rely on clients that come back, such as NGOs,
churches, the military or projects and are willing to pay premium prices. Very few companies are
attempting to build volumes by supplying to agents.
Some companies complain that multilateral and government tenders are not conducted transparently
and that the donor-controlled aspects of the market make it difficult to participate. Some companies
interviewed do not participate in tenders any more because of the time consuming nature of bid
preparation and the lack of “fair” evaluation of tenders. Surveys carried out by this consultant have
found that many government-tendered systems are installed without proper design or specification
work. One of the problems is that “government” tenders are put together by District officials, Ministry of
Health officials, and the military or other government departments. There is no accepted methodology
for designing and procuring PV systems.
2 Duties amounted to over 60 % of the cost of systems until they were recently removed. However, dealers
complained that customs officials were unaware of the removal of duties and still charged them.
Target Market Analysis: Rwanda’s Solar Energy Market 4
1.3 Local Capacities
There are five to six players active in the Rwandan solar energy sector, and they are the primary
repositories of solar energy skills (as well as a number of independent contractors). These include
SECAM, Modern Technical Services (MTS), Davis & Shirtliff, Great Lakes Energy, EPS Renewable
and the Solar Electric Light Fund (SELF)3 (see section 4 for more information). In addition, the Kigali
Institute of Technology has conducted basic solar training courses with SELF. As well, the Atelier
Central de Maintenance (ACDM, the Maintenance workshop for the Ministry of Health) plays a role in
maintenance of health equipment, though it does not have well-developed solar energy expertise. It
does have qualified technicians at district level who can easily be trained to maintain PV systems.
There is also some regional expertise in solar energy in smaller towns. For example, Family Health
International (FHI) – who are one of the main players in electrification of PEPFAR health centres –
have a small network of solar PV technicians.
Rwandan solar energy companies are just beginning to build up capacities. Their products are rather
expensive (over USD 20/Wp), and there is limited capacity to design and deliver sophisticated PV
systems and battery backups. Furthermore, other groups that might provide technical service, such as
the Atelier Central de Maintenance (ACDM) in the Ministry of Health or the Ministry of Infrastructure
(MININFRA), are over-stretched and poorly equipped to provide services4. Nevertheless, as described
below, some groups have recently provided capacity building services in the country.
Training programmes have been conducted sporadically be a variety of players in the past ten years.
Unfortunately, there is no coordinated repository of trained PV technicians, and as yet there is no
accepted code of practice or curriculum for PV in the country in university or among technician
practitioners. Some of the classes carried out include:
PEPFAR-sponsored classes to develop local knowledge to maintain the solar PV and health
centre energy systems. The Atelier Central de Maintenance (ACDM) was involved in these
classes.
SELF/Kigali Institute of Science and Technology classes on basic solar PV. SELF also trained
a dozen technicians to install sophisticated hybrid PV-generator systems as part of its
Columbia University work.
The Centre for Disease Control (CDC) is collaborating with Toluene University of Columbia for
development of capacity for energy management and maintenance of the solar PV systems in
the health centres.
The Japan International Cooperation Agency (JICA) is supporting a college with the Ministry
of Education (MINIEDU) to train solar technicians.
Stadtwerke Mainz, the German company that installed the grid-connected system trained a
network of regional PV technicians.
The EU solar programme of the MININFRA plans to train technicians.
Bidders for various government solar PV contracts are required to include a component for
training of technicians.
3 SELF does not maintain a local office but has contracted with PEPFAR partners to install dozens of institutional
systems. It has conducted several training programmes to install large health centre systems. 4 Although ACDM is designated as the provider of maintenance service for health care centres, it has only two
vehicles and less than 25 staff who must provide all maintenance skills for the entire country’s health sector.
Target Market Analysis: Rwanda’s Solar Energy Market 5
Strengths and weaknesses of local capacities
All the local companies have limited capacity to install large scale projects. For example, MTS, Davis
& Shirtliff, and SECAM are dealers for other types of goods and services including diesel generators,
pumps and general hardware.
Several large tenders have been announced for sectors (i.e. the Global Fund tender for the health
sector). As mentioned previously, PV experts do usually not design such tenders and the system
designs are not adequate for international companies to bid on. There is a critical lack of capacity to
design, specify and prepare procurement documents for PV systems among government and project
staff. This means that is it often impossible for professional PV suppliers to prepare bids, as the
documents on which their bids are based do not enable proper sizing and elaboration of systems.
Therefore companies often win them without experience in PV technology.
In other cases, government tenders are often announced in small tranches on regional levels to be
handled by small local companies. Well-connected small contractors, not necessarily importers-
suppliers, often win such contracts. Many of them do not have fulltime technicians – let alone
engineers. They contract technicians on an as-needed basis.
Complaints of poor installation as a result of bad workmanship or components are common. There is a
task force in the MININFRA to establish some basic standards for solar PV equipment and installation.
An international NGO is set to start producing PV modules from second quality silicon wafers and to
sell them in the local market at discounted prices. This is expected to build local capacity in basic
production and assembly of PV modules, which could extend to better installation practice.
2 Market Potentials
2.1 Overall Sector Outlook
The overall outlook for solar in Rwanda is that the government and donor projects will continue to
dominate the market in the short and medium term. Demand by private sector for solar products
remains limited, but may become an important niche market.
There are over one million households in Rwanda, out of which only 8 % have access to grid
electricity, with most connections in the main cities (Kigali alone accounts for nearly 75 % of total
electricity consumption). Electrogaz is the country’s only power generation and distribution company.
It has an installed domestic capacity of about 27 MW that is barely sufficient to cover half of its peak
demand. The other half is imported from Rusizi - a consortium of the electric utilities of the Democratic
Republic of the Congo (DRC), Rwanda, and Burundi. Electricity sales have been growing at a rate of
about 7 % p.a. on average since 1997. Supply constraints kept sales artificially low.
In 2008, the Kigali Solair solar PV plant fed 250 kW into the grid. Another 4.5 MW has been connected
from the initial phase of the Lake Kivu methane gas project. Even then, the utility is faced with a
generation deficit and still has to rely on thermal generation to meet peak demand.
Target Market Analysis: Rwanda’s Solar Energy Market 6
2.1.1 Public Sector Market
The government plans to increase grid connection to 16 % by 2012 at a cost of USD 400 million. This
will require a combination of expanded grid extension and new power generation. By the year 2020,
the grid coverage is projected to reach 35 %.
In the past ten years, several hundred kWp of solar has been installed off-grid in Rwanda, mainly in
health care centres, schools and administration buildings. The planned government budget
expenditures for solar energy in 2009 (which do not include projects) are summarised in Table 2.
Table 2: MININFRA Solar Energy Related Budget 2009
Project Amount (RWF) USD
Rural electrification with solar energy 250,000,000 450,500
Access to energy in rural areas 130,000,000 234,000
Strategic study/renewable energies 575,000,000 1,036,000
Total 955,000,000 1,720,000
Current tenders and projects:
European Commission (EC) programmes at MININFRA. The project will spend 7 million Euros
over the next five years on solar electrification of at least 350 institutions – ranging from
schools, health care centres and administration offices with 1.5 – 2.5 KW each. The
programme will be implemented by the private sector through tenders by the Ministry.
Belgian Technical Cooperation (BTC). This programme aims to electrify 60 health care
centers with a budget of 1.5 million Euros in its first phase from 2009-2010. It is targeting
about 1 kWp per health care centre.
The World Bank is currently supporting a major rural electrification initiative in Rwanda. It is
expected to provide the government rural electrification programmes with considerable
resources, a significant portion of which will be renewable and PV.
Government administration: The energy supply of the 496 government offices is as follows:
146 centrally supplied by Electrogaz
205 supplied by:
Solar PV (116)
Diesel generators (86)
Micro hydro (3)
145 un-electrified
From the above, more than 230 government sector offices (including diesel operated ones) will
potentially be supplied, through government procurements, by solar PV with a requirement of as much
as 300 kWp.
Health care sector
Out of the 528 health care centres in rural areas, 50 % have been electrified (with grid connections,
generators or solar). Around 300 private health care centres currently lack electricity. A programme
administered by the government in collaboration with partners and NGOs aims to electrify all rural
health care centres in the country. In 2009, the UN Global Fund for AIDS issued a tender for 34 health
facilities, while the Belgian Technical Cooperation (BTC) programme covers another 60.
Target Market Analysis: Rwanda’s Solar Energy Market 7
Projects will be done mainly through tenders where the government invites eligible firms to bid for the
contracts5. As mentioned previously, a major area of concern has been the tender specifications,
supervision and quality of installation.
Education sector
A decision by the government to include English as an official language will most likely lead to an
increase in electronic broadcasting and information communication technology (ICT) applications
which could stimulate the demand for solar PV – especially in rural areas. Rwanda is rated highly
among African countries with regards to ICT adoption, and this could also spur the growth of PV
market as many NGOs and homes acquire computers and telecommunication/entertainment devices.
There are plans by the government – through the Ministry of Education (MINEDU) to have ICT in all
schools in the country. This is another major driver for PV development in Rwanda. The total Ministry
of Education budget for solar PV to promote ICT in 2008 was RWF 1,350,000,000 (Table 3).
Table 3: Indicative ICT and PV System Procurements, 2008 Budget by MINEDU 2008
Type of school Amount RWF USD
Primary school 500,000,000 901,000
Junior secondary school 400,000,000 721,000
Upper secondary education 400,000,000 721,000
Teacher training and colleges of education 50,000,000 90,100
TOTAL 1,350,000,000 2,433,100
Recommendations to German enterprises
Work closely with existing traders. Seek those that maintain good government contacts and
that have a track record of completing contracts for the government (see section 4 for
company lists).
Develop networks of local agents and installers (it may be helpful to seek graduates of
previous programmes). Provide in-service training.
Understand the procurement procedures of the government.
Ensure that the local agent understands your equipment and is equipped with a suitable
amount of spares.
When funds originate from a donor, make an effort to communicate your company’s desire to
participate in any tender with both the government and the donor.
5 Companies interested in these programmes should contact the Ministry of Infrastructure, the Ministry of Health
or the relevant donors supporting the projects.
Target Market Analysis: Rwanda’s Solar Energy Market 8
2.1.2 Private Sector PV
Solar Home Systems (SHS)
The limiting factor for the deployment of SHS sector is the extremely low purchasing power of rural
populations. With a purchasing power parity (PPP), adjusted per-capita income of USD 1,206 (161 out
of 177 total countries), not many rural consumers can afford solar systems in Rwanda. However, the
economy has been growing moderately and is expected to spur demand for solar home systems.
Extension of mobile phone coverage will increase the need for phone charging possibilities around the
country. As well, expansion of television coverage will lead to an increase in the number of private
television sets and also spur the solar home market.
Growth in the SHS sector is slow but encouraging with at least three companies actively marketing
their products. Given the low-income level of the country, this report estimates that less than 10 % of
the total off-grid rural population (1.7 million un-electrified) would have an interest in a 10-50 Wp PV
system and another 30-40 % would be interested in a micro system. Table 4 provides a basic model
for this market:
Table 4: The SHS Market in Rwanda
Type of solar home systems Size of system
(Wp)
Estimated % of
households buying
Total number Size of market
(kWp)
No System 0 55.0% 944,690 -
Micro Systems 2 35.0% 601,166 1,202
One Light & Radio 10 7.3% 124,527 1,245
Two light and radio system 20 2.0% 34,352 687
Four light system or higher 50 0.5% 8,588 429
Larger systems (inverter or
hybrid)
150 0.3% 4,294 644
TOTAL 100.0% 1,717,618 4,208 kWp
Telecommunication
The telecommunications sector has not been – and will not be – a major client though the
government/donors have subsidised the use of solar energy in a couple of base stations (BTS) in
remote areas to enable mobile coverage. There would be the opportunity to extend the coverage of
mobile phones if the mobile phone companies made use of more solar PV.
At least one major dealer of PV in Kigali has recognized this opportunity and is developing a solution
for mobile phone companies. As in other East African countries, a small market for PV-powered phone
charging devices is likely to develop.
Recommendations to German enterprises
Work closely with existing traders. Select traders that have experience selling goods into the
consumer and private market (see section 4).
Develop networks of local agents and installers (it may be helpful to seek graduates of
previous programmes). Provide service training.
Develop a marketing strategy for rural households, NGOs and other groups.
Ensure that the local agent understands your equipment and is equipped with a suitable
amount of spares.
Connect your Rwandan agent with other players in the East African market with which you are
associated.
Target Market Analysis: Rwanda’s Solar Energy Market 9
2.2 Undeveloped Market Opportunities
2.2.1 Solar Water Heating (SWH)
Many households, hotels and institutions in Kigali use electricity to heat water. Given current tariff
rates this amounts to costs close to USD 100 per month and boiler. The use of electricity for water
heating is extremely expensive, and is often the most expensive part of a business’ or household’s
electricity bill.
At present, there are only a few providers of solar water heaters (SWH) in the country, and the market
is only in its early stages. Prices for SWH are extremely high and few players trade aggressively in
this market. The two primary markets are private households and tourism. Assuming 15 % of the
existing electrical connections have a boiler, the base potential market is about 15,000 households
and commercial establishments. Government legislation will require new buildings to include SWHs in
their design. This will provide impetus to the development of the SWH market.
Recommendations to German enterprises
Approach large hotels, developers, urban-based customers, NGOs, health sector supporters
and finance agencies.
Monitor government solar water heating programmes and legislation closely. This is best done
through use of partner companies.
Meet with government and donors to discuss how SWH programmes can be rolled out. Note
that energy legislation is primarily made in MININFRA.
Advertise in the media stressing how investments in solar pay back quickly. Any advertising
campaign would best be planned with a local partner.
Develop partnerships with companies that are familiar with the tourism and housing industry
(not necessarily solar PV companies). These include contractors, architects, service
providers, etc.
2.2.2 Grid-Connected Solar PV
Grid connected PV is not considered in existing government policy. As mentioned below, high level
interest in grid connected solar is not explicitly mentioned. Hydro, diesel generation, regional
interconnection and methane-fired generation are the current major focus for national power supply.
Three things make the prospect of grid connected PV perhaps more interesting in Rwanda than in
other parts of Africa:
Rwanda already has experience with Africa’s currently largest grid connected PV system.
Electricity prices are among the highest in Africa and Rwanda has a major shortfall of
electricity. At USD 0.21, grid parity is not far away.
Unlike other countries in the region, the power sector in Rwanda is managed in a transparent
manner and with government incentives it would be fairly easy for a project to be developed.
Interest in grid-connected systems would likely be higher from consumers (who could combine
systems with power backups and off-set power prices) than from the power company. Note that peak
power demand occurs in the evening, not during the day, so Electrogaz would be unlikely to pay a
premium for PV power.6 Government dispensations in favor of grid connection would be required. In
6 The initial 250 kWp solar array outside Kigali was installed chiefly as a demonstration, and proper long-term
price agreements were not reached.
Target Market Analysis: Rwanda’s Solar Energy Market 10
order for this to happen, there would have to be development of financial, technical and legal
protocols that are independently supported. However, currently there is no signal to believe that the
government would be broadly supportive of any initiative.
3 Solar-Specific Regulation and Framework
3.1 Policies and Regulations
Rwanda is well-known for being a leader in governance in the region since the genocide, and as such,
it has attracted significant amounts of donor support during the last 15 years. Much of this support is
targeted at the energy sector. As well, the government is aggressively pursuing rural electrification
strategies which include Renewable Energy components. What is missing is a strong internal capacity
to develop and build appropriate energy policy regimes. Given the urgency of the energy problems
faced, the lack of skilled manpower and the lack of finances, it is not surprising that there is not a well-
developed solar energy policy. For better or for worse, much of the policy development in Renewable
Energy occurs on an “ad hoc” basis, often as a result of donor advice.
The government is focused on rural development, poverty alleviation and creation of business
opportunities. As such, its energy policy is designed to support these overarching goals.7
The national energy policy objectives are to ensure availability of reliable and affordable energy
supplies and their use in a rational and sustainable manner in order to support national development
goals. The national energy policy, therefore, aims to establish an efficient energy production,
procurement, transportation, distribution and end-use systems in an environmentally sound and
sustainable manner.
In the 2004 Energy Policy, solar energy is only mentioned broadly as a “potential” source of energy,
and as a part of its strategy to electrify off-grid areas. Rwanda does not have the budget to invest
heavily in Renewable Energy outside of its immediate development targets (and donors who provide a
large portion of government support limit expenditures to immediate priorities).
Unlike other countries in the region, Rwanda has neither a stand alone electricity regulator or rural
electrification agency. Other government departments (within MININFRA) play this role. The key
government institutions involved in renewable energy policy making and procurement include:
The Ministry of Infrastructure (MININFRA): The Ministry is responsible for the build up of
national energy infrastructure. Rural energy is part of this mandate, however, staffing and
funding requirements restrict what MININFRA is able to effectively do. The MININFRA views
its role in the off-grid energy sector to include training, strategy development, development of
technical specifications for energy equipment, recommendation of strategies for the
development of the private sector and follow up work on the above.
Ministry of Health: This Ministry is actively involved in procurement of solar equipment for
remote health care centres.
Government policy to promote rural electricity access is primarily based on the extension of the
Electrogaz network as the most cost effective means. However it recognises that where customers
are not clustered close enough for grid service, solar PV, generators or hydro power may be offered
through private suppliers.
7 Rwanda Government Energy Policy 2004.
Target Market Analysis: Rwanda’s Solar Energy Market 11
For long term costs and environmental reasons, the government is developing large scale PV
procurements for rural administration, health and education facilities. Priority action number four of the
energy policy is the only place where solar energy is specifically mentioned as part of implementable -
government programmes. The government, in theory, also supports commercial sales of solar PV to
off-grid private sector customers and households. Theoretically, the government has removed duties
and taxes on solar equipment. However, in a 2008 study, companies complained that customs agents
still charged duties on solar equipment.
So far Rwanda has not developed Renewable Energy feed-in tariffs, despite the implementation of a
250 kWp grid-connected project (which was given a spill contract by Electrogaz). As mentioned
above, grid connected solar power is not a priority, as the government is focused on building up base
load supply at low costs in order to be able to meet peak demand.
The government recognises that demand side management can play a role in reducing peak
electricity demand, as well as in lowering energy costs for consumers. To this end, they are promoting
compact fluorescent lamps and solar water heaters (to replace electric boilers). The building code8
was recently revised so that it requires new buildings to install solar water heaters and is likely to
activate development of the solar water heating market.
3.2 Applicable Public Sector Support /
Financing Mechanisms and Sources
Except for the procurements mentioned in section 2, no direct public sector support or financing
mechanisms are available through government programmes for solar. Government involvement is
mainly in the form of government tenders and contracts.
Nevertheless, the government has removed all taxes on solar equipment, which should have an
impact on pricing.
8 Discussions with Naceur Hammami, Ministry of Infrastructure Energy Expert
Target Market Analysis: Rwanda’s Solar Energy Market 12
4 Business Partners and Competitors
4.1 Overview of Key Solar Market Players
Table 5: Importing Companies of Rwanda's Solar Market
Importing
company
Description and
distributors
Company strategy Major products PV business sector Equipment sources Contact details
Secam National Company
based in Kigali
Member of family-owned
large group of companies in
Rwanda. Solar PV is one of
many products and services
offered.
Office equipment, tenders. PV is
less than 5 % of business.
Oldest player in the
Rwanda PV business
(started in 1980). Donor-
led and church
institutional market.
Control 40-50 % of the
local market and win at
least 25 % of government
contracts.
Relationship with Total
Solar. BOS from
companies such as
Steca and Labcraft.
Has not invested in
“modern” PV
technology or battery
backup line.
Olivier Costa
Managing Director
RC A0129/Rig BP 892
Kigali, Rwanda
Tel: (+250) (0) 573528
Mob: (+250) (0) 8303361
Email: [email protected]
Modern
Technology
Services
Solar equipment
supplier based in
Kigali; operates out
of shop
Aggressive, market-oriented
solar company. Places less
value on the system planning
and more value on volume
and low prices
Sells a wide variety of equipment
including German charge controllers
and inverters.
Over the counter solar
products for SHS tenders
Opportunistic Joseph Kayibanda
P.O. Box 7371
Kigali, Rwanda
Tel: (+ 250) (0) 5124687
Mob: (+ 250) (0) 8306805
Email: [email protected],
Internet: www.mts-world.net
Davis & Shirtliff Rwanda branch of a
Kenya-based water
pump company.
Large Kigali shop
Pumping equipment supply.
Offers PV and solar water
heaters. The company has 4
staff (only one technician)
Core business: supply of pumping
systems for high-end markets (such
as swimming pools) and rural water
supply systems in Rwanda, Congo
and Burundi. Minor player in
Rwanda PV market
Clientele includes NGOs
and independent
contractors. Focuses on
quality equipment and
service, and a long history
of serving donor clients
Same as D&S Nairobi.
Suntec modules,
Sundaya, Triplite
inverters. Turkish solar
water heaters.
Richard Mugo
Tel: (+250)(0) 504033
Mob: (+250) (0) 830 3343
Email: [email protected]
Great Lakes
Solar
Small project based
operator
Solar company managed by
expat American committed to
solar energy business. Great
Lakes has 5 full time staff.
Operates out of small office.
Very little stock is kept in the
premises.
Project-based equipment and
consulting. Opportunistically
operating in the niche between solar
equipment supplier, consultant and
activist NGO. Interested in other
renewables including biogas and
micro hydro.
Donor-led institutional
market. Works with donor
clients to develop
proposals for installation
of systems. Once the
work is secured and
prices agreed, equipment
is ordered
Allied to G24 PV
company. Does not
stock.
Sam Dargan
Bonne Address Building, Top Floor,
Kigali, Rwanda
Tel: (+250) (0) 500537,
Mob: (+250) (0) 8656025
Email: [email protected]
Target Market Analysis: Rwanda’s Solar Energy Market 13
SOS Energie Kigali based solar
energy contractor
and solar water
heater assembler
5-year-old business operated
as a side-business out of a
separate auto-repair
business, Garage Sebalex
SAPL
Supplies by order, and maintains no
supply or storefront. Contracts with
Rwandan military and donors
Experienced solar system
designer and sub-
contracts a team of six
electricians, three
engineers and two
plumbers. He was trained
by the ex-head of
SECAM.
Supplies equipment
from French
companies such as
Total Energie
Sebastien Houben
Managing Director
PO Box 417, Av. de la Justice
Kigali, Rwanda
Tel: (+250) (0) 576060,
Mob: (+250) (0) 8301780
Email: [email protected],
Table 6: Consultants; NGO's and Non-Government Projects
Full name Role in sector Activities Procurements (types of
equipment/services)
Volume kWp or USD Plans in immediate
future
Contact details
PEPFAR/
Centers for
Disease Control
Health sector
project
Involved in control of HIV/
AIDS. Strengthening of
health sector institutions
Occasional purchase of energy
equipment
USD100's of K per year Not known Mary Hadley
Mob: (+250) (0) 830 2140
Email: [email protected]
Table 7: Government and Public Sector Projects
Full name Role in sector Activities Procurements (types of
equipment/services)
Volume kWp or USD Plans in immediate
future
Contact details
Ministry of
Infrastructure
Energy sector
policy and
leadership
Development of energy
projects
Health, education and military
sector purchase of solar equipment
Large procurements
planned
Not known Naceur Hammami, Alexis Karani
BP 24
Kigali, Rwanda
Email: [email protected],
BTC-CTB
Belgian
Technical
Cooperation
Energy
infrastructure
support
Launching project to install
PV systems in 30 clinics
around the country
PV equipment supply for clinics Estimated 3 million Euros Project being
developed
Erik Van Malderen
Rue Député Kayuku, 41, B.P. 6089
KigaIi, Rwanda
Tel: (+ 250) (0) 500267,
Mob: (+250) (0) 8305107
Email: [email protected]
World Bank Energy Unit,
Africa Region
Supporting Rwandan
Government in design of
rural energy projects
Procurement through Government
of Rwanda
Not known Project being
developed
Erik Fernstrom
Tel: (+250) (0) 591318, 5396318
Email: [email protected]
Target Market Analysis: Rwanda’s Solar Energy Market 14
4.2 Overview of Major and/or Most Emblematic Projects
4.2.1 Public Sector PV Investments
PV installations in the public rural institutions are the most significant projects in Rwanda. These are
government led initiatives and are expected to dominate the market for a while until the solar home
market develops and the private institutions take up solar. Projects are at various stages of
development. Interested players should contact the Ministry of Infrastructure (see section 4.1).
Projects include the following:
Ministry of Infrastructure / BTC installation of solar powered clinics. BTC has made
available three million Euros for the installation of about 30 solar powered clinics in the
country. The project is in a late stage of development (see BTC contact for more information).
Ministry of Infrastructure school and clinic power projects. With support from the World
Bank and the European Commission, the Rwandan Government plans to provide electric
power to all schools and clinics in the country in the next ten years. Those regions that cannot
be met by grid power will have energy systems provided by PV and/or generators. The project
is currently being developed. Contact the Ministry of Infrastructure for more information.
4.2.2 Kigali Solair
“Kigali Solair” is a PV plant built by Stadtwerke Mainz (a German municipal power company) at the
outskirts of Kigali in 2008. It feeds 250 kW into the national grid. The project builders hope to expand
this to 1 MW – but no timeframe has been given. The feed-in tariff offered by Electrogaz is said to be
too low to cover capital and operation costs of the plant.
Target Market Analysis: Rwanda’s Solar Energy Market 15
References
Common Development Fund (CDF): Annual Report (2008).
http://www.cdf.gov.rw/reports.html#rpt/ (July 2010).
EAC Strategy to ScaleUp Access to Modern Energy Services: Rwanda Country Report (2008)
http://www.eac.int/energy/index.php?option=com_docman&task=doc_download&gid=65&Itemid=
70 (July 2010).
GTZ (2009): Business Guide Ruanda, Eschborn.
Kigali Solair:
http://mininfra.gov.rw/index.php?option=com_content&task=view&id=204&Itemid=343,
http://www.energie-fuer-afrika.de/projekte/details/projekt/3-kigali-solaire.html (July 2010).
Ministry of Infrastructure: http://mininfra.gov.rw/ (July 2010).
Rwanda’s Energy Sector Strategy:
http://mininfra.gov.rw/index.php?option=com_content&task=view&id=110&Itemid=138 (July
2010).
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