Are Ghanaian Officials Stuck on Stupid? The Case For Solar Energy (4)

Five (5) Simple and Essential Lessons from Mahatma Gandhi's India


By: Prof Lungu


Dear reader, again, the 1964 speech by Dr. Kwame Nkrumah of blessed memory, fifty-one (51) years ago, when Dr. Nkrumah asked Ghanaians to begin prioritizing solar energy research, validates our on-going "Stuck-On-Stupid" campaign1.

Given the comparative cost advantage solar energy now enjoys, it was not amusing hearing Dr. Kwabena Donkor talk about "...solutions...to beef up the supply situation...(in the)...medium to long term...(with)... 1,000MW...(and)... 5,000MW generating capacity from natural gas, clean coal and renewable energy sources within the next five years..." (General News, Ghanaweb, Sunday, 16 August 2015).

Dr. Kwabena Donkor should tell Ghana who is it that invented "clean coal", when, from where, what the reliability factors are, and what cost in externalities are. Then, Dr. Donkor must tell us why the lackadaisical approach to Ghana's Dum-Sor Emergency?

Alternatively, Mr. Mahama could give a "communicative" speech on all those points for Ghana to hear!

And so, as we've said before, India is moving strongly on the solar energy front. India is swiftly creating new-economy-jobs for its citizens and beginning to arrest some of the effects of climate change through its aggressive renewable energy policy, thus showing other developing countries what prioritizing for industrial development means even today, 51 years from 1964.


INDIA ON THE PATH TO SOLAR POWER NIRVANA:
India is on the path to Solar Power Nirvana while dead-brained Ghanaian politicians and administrators sleep at the wheel!

And, as they say in the US, "You Snooze, You Lose"!

Last year, in 2014, US Conglomerate General Electric Co. (GE) announced its first major investment ($24 million) in the Indian solar energy sector by partnering with Welspun Energy in a $150 million solar power project in, India. The 151 MW solar PV (Photo-Voltaic) project is located in Madhya Pradesh. The project has a 30-year useful life, as they do these days.

As reported by Clean Technica:

"... Welspun Energy...secured the tender for the project through a reverse auction organized by the Madhya Pradesh government...(using)... debt financing worth about US$150 million for the project. The company offered to set up the project seeking a tariff of US$0.14 per kWh. At this rate, the project is expected to bring in annual revenue of about US$35 million every year...The company will use the equity infusion by General Electric to pay off a portion of this debt..."

The reader should note that the 151MW Welspun Energy solar project actually cost $150 million! In that sense, $1 million buys 1 MW at that scale. To boot, solar systems are scalable - you can add to current setup easily (as parts become cheaper, more reliable, and customer densities increase). Consequently, if the plan is for 600MW, cost should be less per MW, while the system still remains scalable.

Also, the $24 million GE investment will be used to finance cost of capital (i.e. $150 million cost for construction of the solar plant).


THE WELSPUN-GE NUMBERS ADD UP:
General Electric Co. invested $24 million in the project because GE has now recognized the “incredible potential” of solar energy.

The big deal with that GE-fund-induced $174 million5 solar project is, given projected annual revenues of $35 million, the project should pay for itself within nine (9) years, or sooner. Therefore, even if we reduced the estimated useful life of the facility to 25 years (to cover operating and maintenance costs), the project would be on target to net Welspun Energy more than $625 million in cash during the period, not counting/quantifying other benefits to India.

TO THE PONT, DURING THE ENTIRE TIME OF THE USEFUL LIFE OF THE PROJECT, NOT A SINGLE BARREL OF OIL, NOT A SINGLE CANISTER OF NATURAL GAS, NOT A SINGLE CABOOSE-LOAD OF COAL, WOULD HAVE BEEN USED TO POWER A SINGLE KILOWATT AT THAT SOLAR POWER PLANT IN INDIA.


GHANA-CENTERED/GHANA-PROUD PATH TO SOLAR POWER NIRVANA:
Given the hard data and anecdotal evidence we've reported on these pages, the 151MW Welspun Energy project provides Ghana a roadmap to solar power nirvana for Kwame Nkrumah's Ghana. So, for the wise and the prudent, these are our five (5) Laughing-Out-Loud (LOL), Stuck-On-Stupid points for Ghana's leaders:

1. Only Ghana's officials and the people can prioritize the solar energy agenda. (The World Bank, the US Government, the IMF, the British Government, GE, the Chinese Government, etc., will not do that for Ghana)

2. $1 million buys 1 MW at that Welspun-151MW

3. The Welspun project is feasible under a tariff of US$0.14 per kWh

4. The GE funds will used to pay the first of the Welspun Energy loan payments as they mature, allowing the project to sustain itself in the medium- to long-term. (In other words, the GE funds are not site preparation and/or cost for construction)

5. In 2015 and beyond, any Solar Power project in Ghana that proposes to require a tariff of US$0.16 per kWh or more, must be seriously reviewed and rejected, unless there are other non-economic reasons justifying the higher cost in the Ghana national interest.


So, where are our solar energy plan and dividends, Dr. Donkor?


Where are our solar energy plan and dividend, Mr. Mahama?


NOTE: In our next essay on this series, we will take a brief look at public policy with respect to "Renewable Energy" in Ghana.


So it goes, Ghana!


SOURCES:
1. In 1982, just sixteen (16) years after the coup d'état by the Nonentities, Liars, and Crooks (NLC), among them Ankrah, Kotoka, and Busia, and eighteen (18) years after Nkrumah's order to government to prioritize solar energy research, Ghana produced just 3,798 GWH of electricity. This was from a high 5,129GWH the previous year and represented 27% less from that year (1981). That was the beginning of reductions in available power to industry in Ghana, under Mr. Jerry "Accountability" Rawlings.

2. GRIDCO. Electricity Supply Plan, 2014.

3. Solar Cell Central. Com. Solar Electricity Costs, PV Solar Parity Has Begun.
http://solarcellcentral.com/cost_page.html.

4. Mridul Chadha. GE Invests $24 Million In India’s Largest Solar Power Plant, Clean Technica, May 4th, 2014 by, http://cleantechnica.com/2014/05/04/ge-invests-24-million-indias-largest-solar-power-plant/.

5. In an earlier essay we overstated the total investment in the Welspun solar project. It is hereby corrected as $174 million (not $194 million).

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©Prof Lungu is Ghana-centered/Ghana-Proud.
Prof Lungu is based in Washington DC, USA.
Are Ghanaian Officials Stuck on Stupid? The Case Solar Energy! (4)
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