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An economic appraisal of solar versus combined cycle electricity generation for African countries that are capital constrained

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  • Saule Baurzhan
  • Glenn P Jenkins

Abstract

Many public electric utilities in Africa are capital constrained. In this paper, an economic analysis is carried out to investigate the efficiency of investing in solar photovoltaic power plants, as an option for on-grid power generation. A comparison is made in terms of the economic net present value as well as greenhouse gases savings if the same amount were invested in a combined cycle thermal power generation. The results show that economic net present value is negative for solar photovoltaic plant, whereas it is a large positive value for the combined cycle plant. In addition, the combined cycle plant would be two times as effective in reducing greenhouse gases as the same value of investment in solar photovoltaic plant. Even with solar investment costs falling, it will take 9–18 years of continuous decline before solar generation technology will become cost-effective for most of Africa.

Suggested Citation

  • Saule Baurzhan & Glenn P Jenkins, 2016. "An economic appraisal of solar versus combined cycle electricity generation for African countries that are capital constrained," Energy & Environment, , vol. 27(2), pages 241-256, March.
    • Handle: RePEc:sae:engenv:v:27:y:2016:i:2:p:241-256
    DOI: 10.1177/0958305X15627546
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    References listed on IDEAS

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    1. Eberhard, Anton & Shkaratan, Maria, 2012. "Powering Africa: Meeting the financing and reform challenges," Energy Policy, Elsevier, vol. 42(C), pages 9-18.
    2. Gagnon, Luc & Belanger, Camille & Uchiyama, Yohji, 2002. "Life-cycle assessment of electricity generation options: The status of research in year 2001," Energy Policy, Elsevier, vol. 30(14), pages 1267-1278, November.
    3. Karekezi, Stephen & Kimani, John, 2002. "Status of power sector reform in Africa: impact on the poor," Energy Policy, Elsevier, vol. 30(11-12), pages 923-945, September.
    4. Joseph Cullen, 2013. "Measuring the Environmental Benefits of Wind-Generated Electricity," American Economic Journal: Economic Policy, American Economic Association, vol. 5(4), pages 107-133, November.
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    1. Brunet, Carole & Savadogo, Oumarou & Baptiste, Pierre & Bouchard, Michel A., 2018. "Shedding some light on photovoltaic solar energy in Africa – A literature review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 96(C), pages 325-342.

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