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ECONOMICS OF SOLAR HOMES

Solar Home Systems are the least cost method of household lighting and electricity. Rural households that currently use kerosene lamps for lighting and disposable or automotive batteries for operating televisions, radios, and other small appliances comprise the principal market for Solar Home Systems. Families are spending up to thirty dollars per month on home energy services, depending primarily on income levels and fuel prices. The monthly cost of a SHS is on a general world-wide level at $10 per month SELF approximates.

A family using 6 kWh per month to power 9 watt compact fluorescent lights (CFLs) would need over 30 kWh to receive the same amount of light from 60 watt incandescent bulbs. The average 50 Wp SHS provides approximately 200 watt hours a day, or six kilowatt-hours (6 kWh) per month. Based on the price of SHS components, and cost of relative fuels in its country markets, SELF estimates that using 8 watt fluorescent lights generating 400 lumens, a $500 SHS can provide high quality lighting at an average cost of $7.15 per million lumen-hours. For a diesel generator lighting 60W incandescent bulbs, this figure is $28.77 per million lumen-hours. A kerosene lamp can provide lighting at $400 per million lumen-hours.

To judge accurately the affordability of Solar Home Systems in rural areas, one must look not only at comparative lighting costs and how much families are already paying for energy services, but how much more they would be willing to pay for electricity from a Solar Home System. While a simple price comparison is useful in showing that PV is comparable to existing household expenditures for lighting, and the least-cost means of delivering household lighting, it does not convey the higher value placed on electricity over kerosene lighting, or the environmental benefits of solar-based electrification.

For example, in the Solomon Islands (Guadalcanal), the families of Sukiki are paying for their solar home systems (SHS) themselves. First, they made a $50 downpayment, after which they will make $15 installment payments each month for 4 years [$790 total cost]. The funds are being collected by the Guadalcanal Rural Electrification Agency (GREA), which SELF helped organize with the aim of "solarizing" all of the islands. The revolving solar credit fund will be used to provide additional loans to more families, and as a growing "solar bank" that will be financed by international donors who have already committed additional funds.

"This was SELF's most challenging solar project to date," said Robert Freling, Director of International Programs. "We had to import all the solar modules and other hardware from the U.S, to the Solomon Islands, then transport it by ship and canoe to Sukiki, where we trained the families to use solar photovoltaics for home lighting."

Written by: Solar Electric Light Fund,


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