China solar producers woo African business
Johannesburg - In a show of commercial muscle that highlights China's growing investment in Africa, Chinese solar power producers dominated exhibits on Thursday at an energy conference on a continent where nearly two-thirds of the population lives off the electric grid.
"Wow! It's like an invasion!" exclaimed a South African exhibitor at the African Energy Indaba, where 60 of 80 stands were Chinese vendors, according to event organisers.
Chinese producers are working hard to maximise their impact among African clients. Those could include governments that want to power health centres and schools in remote areas, rural farmers who want electricity for water pumps and cellphones.
They also could include villagers who walk long distances to find wood for cooking, and middle-class families fed up with soaring power prices and urban power cuts.
Only Chinese producers offered solar powered technology at the conference ending on Thursday in Johannesburg.
Germany, the leader in solar energy in the West, was represented only by the European nation's chamber of commerce. The US, in growing competition with China for African business and resources like oil and strategic minerals, sent two diplomats.
"The country that's likely to be on the leading edge of all this is not the United States but China," South African businessman Jayendra Naidoo told the meeting.
"China is really becoming a leader in various niches of low-carbon supply of equipment and technology, even if the original technology was developed elsewhere," he said afterward.
Exhibitor Sunny Wu, who sat at a stand displaying large posters of his Shanghai company's home supply systems, said the preponderance of Chinese exhibitors reflected his country's growing dominance in the solar panel industry.
Wu said the number of exhibitors had doubled since his company first came to the conference in 2010, but that buyers were fewer this year.
He offered everything from a small panel to power one light bulb to a system that would help power a three-bedroom home, for $11 430.
He emphasised that the Chinese companies had one main goal: "We're in this to make money," he said.
But, he lamented: "Even at our much cheaper prices, people here cannot afford solar power." The small panel he's selling costs about $215 - more than the monthly wage of an average South African farm labourer.
Wu said governments would have to intervene with subsidies and cheap loans to bring solar power to rural Africa.
Experts at the meeting echoed his comments, saying only governments and development banks have the means to enforce a greening of power on a continent that is largely run on oil and coal.
The paucity of Africa's power supply is evident in night time satellite images that show a a concentration of light in North African Arab states and in southern Africa, mainly SA. Vast expanses of black are broken by twinkles in West and East African capitals, often provided by expensive and dirty diesel-fuelled generators.
While Africa is magnificently endowed with the resources for clean power - abundant sunshine, wind and water - little is exploited, said Abubakar Sambo, the World Energy Council's vice president for Africa.
"Africa has the world's best solar resources" yet efforts to exploit that energy are restricted to "several pilot projects, not the large-scale national projects required to lift the level of energy", Sambo said.
SA, the continent's economic powerhouse, will confront a massive power shortage over coming years, despite hefty hikes in electricity rates this year, with more to come.
Lack of maintenance and increasing demand precipitated an unprecedented power crisis in 2008 that had South African mines idle for days and cost the economy an estimated R50bn.
South Africa's government is subsidising costs for home owners who install solar-powered water heaters - which can account for half and more of a household's electrical power consumption. A law expected to pass in April will require all homes to have 50% of water heating provided by solar power.
But Laurraine Lotter, executive director of South Africa's Chemical and Allied Industries' Association, said those water heaters will have to be foreign ones, as South Africa's immediate needs would not justify the expensive of a new plant. She said the government needs to implement policies to encourage the creation of such plants.
In Africa, a Chinese firm has helped Kenya take the lead in solar power. Project developers anticipate producing panels in Africa for one-third of the imported price.