SUSTAINABILITY ASSESSMENT OF DECENTRALISED SOLAR PROJECTS: INTRODUCING A MULTI-CRITERIA APPROACH

Abstract: Lack of energy access in developing countries remains a major barrier in the economic development of rural communities. Worldwide, about 1.3 billion people lack access to modern energy services, and there is a need to pursue ways other than grid extension due to the remoteness of most of these communities from national grids. Following the Sustainable Energy For All (SE4ALL) initiative of the United Nations, the role of decentralised solar generation systems has been acknowledged to meet rural energy objectives. The initiative has also resulted in growing participation of private sectors in the rural energy field for boosting project execution and delivery.   To evaluate the success of private entrepreneurs operating rural energy projects, the research has proposed a decision support sustainability assessment framework for evaluating performance of operational decentralized rural solar energy projects. A rural electrification project is said to be performing sustainably when it reliably ensures access to its services for productive uses, while engaging and gaining acceptance of the community and which operates within socio-ethical norms maintaining its financial gains as well as maintaining the local environment. Based on this definition and the multi-criteria Analytical Hierarchy Process (AHP), 15 energy indicators have been proposed to evaluate sustainability performance of existing projects.  These indicators are spread over the standard three pillar approach – capturing economic, social, environmental dimensions, along with the contribution of a fourth ethical dimension of sustainability. Multiple stakeholder groups including 16 project planners, evaluators, advisors and investors have been consulted in applying the multi criteria Analytical Hierarchy Process (AHP). Organisations consulted include University of Oslo, Aalto University, Institute for Energy Technology (IFE), Multiconsult AS, Micro-energy International, African Solar Designs (ASD), SunErgy AS, RVE.SOL, Swedish International Development Cooperation Agency (SIDA), Foundation of Rural Energy Services (FRES), Alliance of Rural Electrification (ARE), and Fortum Corporation. The outcome from two rounds of consultation surveys have yielded highest priority to economic dimension (33,18%), followed by social (27,55%) and ethical (23,17%) dimensions, and lastly the environment (16,18) dimension. With these prioritisations, the framework has been used to evaluate the performance of  rural decentralised solar projects in Kenya and Malawi. Results of this framework yielded average performance of Kenya and Malawi in the economic dimension – in Kenya being driven by a competitive O&M cost and delivery of project services to businesses; and in Malawi through a low rate of payment defaults and ability to increase tariffs with inflation.  In assessing the Kenya case study, a higher score in the social dimension was attributed to the range of services on offer resulting in better involvement of the community in the project as compared to the Malawian case study. However, a limited number of services in Malawi have ensured a more transparent and accountable management structure resulting in a higher score in the ethical evaluation. For both projects, environmental performance has been average due to lack of solid policies for waste treatment, end-use recycling of batteries, and some recorded negative impacts on the local bio-diversity-  Outcomes of the framework suggest a applicability of the framework in addressing concerns of multiple stakeholder groups including project planners, evaluators, advisors and investors in understanding operational challenges of rural solar projects. Insights from the case studies point towards the strength of  solar electrification as a means rather than the ultimate goal of rural development, the necessity of economic and social sustainability synergies during project operation, and the importance of affordable energy pricing and payment methods.