Title: Off-Grid Photovoltaic Technologies in the Solar Belt: Finance Mechanisms and Incentives
Publisher: Elsevier
Publication Year: 2016
JRC N°: JRC98071
ISBN: 978-0-12-409548-9
URI: http://www.sciencedirect.com/science/article/pii/B978012409548909713X
DOI: 10.1016/B978-0-12-409548-9.09713-X
Type: Articles in periodicals and books
Abstract: Access to modern energy is a social and economic priority to rural population and policy-makers because of its direct socio economic and environmental benefits, as well as the indirect benefits of energy as an important input factor to growth and the Sustainable Development Goals (SDGs). In this sense, renewable technologies offer the option to provide access to sustainable energy services and foster economic development. However, there are many barriers to the widespread diffusion of renewable energy technologies in the rural environment. One of the main barriers is financial, as many rural families have little expendable capital and lack access to credit on one hand and entrepreneurs face challenges due to the small size and risky nature of the projects arising from their remoteness, limited demand and poor consumer base on the other. Therefore, schemes for financing off-grid electrification are just as important as technological innovations. This chapter reviews existing support mechanisms and incentives for off-grid photovoltaic (PV) deployment in developing countries, particularly combining market, energy use, and socio-economic elements. Additionally, it analyses the progress and adaptation of the support mechanisms depending on the degree of failure in the past, and suggest new solutions for promoting sustainable energy options for remote rural areas in developing countries. We must note that the schemes reviewed can be used to finance also other forms of renewable energy, as all renewable energy suffer from similar barriers – high initial cost and low operational cost in an environment where long term credit is difficult to acquire. PV projects are the focus of this chapter because there is more data about off-grid PV projects in developing countries than any other type of renewable energy technology. To this end, we acknowledge the extensive work of the wider energy research community represented in this chapter; in particular the Alliance for Rural Electrification (ARE), the Renewable Energy Policy Network for the 21st Century (REN 21), Grameen Shakti, International Solar Energy Society (ISES), Energy Sector Management Assistance Program (ESMAP) of the World Bank, United Nations Development Program (UNDP), United Nations Environment Program (UNEP), United Nations-General’s Advisory Group on Energy and Climate Change (UN-AGEC), Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), Energy for Sustainable Development (ESD), International Energy Agency (IEA), ENERGIA, Fundacion Bariloche, Climate Action, TERI (The Energy and Resources Institute, New Delhi) and DB Climate Change advisors.
JRC Directorate:Energy, Transport and Climate

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