Factors that Influence the Adoption of Solar Home Systems in Rural Areas in Uganda: A Case Study of Karamoja Region
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Evidence to date suggest that electrification is linked to a wide range of improvements, including more income generating activities (Khandker et al. (2012,2013)), generator of female employment generation (Dinkelman (2011); Grogan and Sandanand (2013)), better productivity (Kirundi et al. (2009)), firm creation and industrial development (Peters et al. (2011); Rud (2012)), higher literacy rate (Kanagawa and Nakata (2008)), and increased study time and educational performance (Gustavsson (2007); khandker et al. (2012); Furukawa (2014)). Globally, annual production capacity has increased from 1 to 40 GWp over the last 2 decades, and the sector has experienced annual growth-rates of 40-60 % (REN21 2013; Jäger- Waldau 2013) in the past five years. This is mainly due to a combination of economies of scale and market development in selected countries in Europe (Germany, Italy and Spain), China and the US created by favourable framework conditions, such as feed-in tariffs. In the period from 2008 to 2013 this led to a decrease of 60% in residential system prices in the most competitive markets and a decrease in module prices of 80% (Jäger-Waldau 2013). Although, an estimated 1.6 billion people in the developing world have no access to electricity [Saghir, 2005] with Sub Saharan Africa accounting for 37%. According to the International Energy Agency (IEA). The vast majority of these people live in rural areas of developing countries, where scarce of government investment and difficult geography keep the national electric grid from extending to their villages. Investment in transmission lines is expensive, especially when a village is far away from a large city or in the mountains (Steve Dahlke, 2011). In 2009, 91% of rural population in sub-Saharan Africa had no access to electricity; families could spend up to 25% of their household revenue on costly yet unsafe lighting sources like kerosene, candles and battery lights (IEA, 2011). The reliance has locked families in a vicious cycle of poverty; draining not only their income but also having a detrimental effect on their health. They also cause fatal burns, fires and emit carbon which has tremendously contributed to climate change. Uganda, despite efforts by governments and international donor agencies toward sustainable energy for all (United Nations (2010)), Universal access to electricity has been challenging. The government, in conjunction with multilateral agencies, does invest in increased energy 2 production and grid expansion within the country. The ultimate goal of Uganda’s National Development Plan and Uganda’s Vision 2040 is to meet the energy needs of the Ugandan population for social and economic development in an environmentally sustainable manner. However, with population growth rates among the highest in Africa (estimated at 3.5% for 2012) and minimal available infrastructure, the level of investment is not substantial enough to meet need (David Nicholson and Kim Beever, 2012). This has resulted in the use of solar energy (Kivaisi 2000), wind energy (Henderson, et al. 2009), 450 Tong et al. Perspectives on Global Development and Technology 14 (2015) 448-491 small hydro-power (Shrestha and Bhattarai 1993; Egre and Milewski 2002), and biomass (Sirte, et al. 2008) in the provision of clean alternative energy sources that could increase the access of the rural/urban poor to electric power (Abdullah, et al. 2010). Uganda is situated near the equator, with high levels of solar radiation; the average solar radiation is 4.8 kWh/m2/day (Bbumba 1999). Governments can encourage alternative state and non-state entities to venture into power generation through a “feed-in tariffs” mechanism for every registered renewable energy power plant (Dusko and Marinela 2010). Uganda is already exploring this approach, which has been successfully applied elsewhere. This transition has been facilitated to varying degrees by conducive enabling frameworks comprising innovative financing schemes, exemptions from VAT and import taxes, standardized power-purchasing agreements and feed-in tariffs. Masa (2010), assessing two models of solar home systems (SHS) on a selection of variables, argues that the success of a particular technology hinges on the projects’ conformity with the institutional development in the country.