Publication:
Promoting Solar Energy through Auctions: The Case of Uganda

Loading...
Thumbnail Image
Files in English
English PDF revd (3.06 MB)
1,702 downloads
Published
2015
ISSN
Date
2015-11-24
Editor(s)
Abstract
Uganda has just completed the first donor-subsidized competitive bidding program for grid connected solar photovoltaic (PV) generation in Sub-Saharan Africa. Uganda’s GET FiT Solar Facility will provide a performance-based subsidy of USc 5.37/kWh to lower the cost to Ugandan consumers of the electricity produced from four 5 MW solar plants bid by two developers at an average price of USc 16.37/kWh. This note analyzes the bidding process and the lessons learned, for possible replication in other developing countries in Sub-Saharan Africa and elsewhere.
Link to Data Set
Citation
Meyer, René; Tenenbaum, Bernard; Hosier, Richard. 2015. Promoting Solar Energy through Auctions: The Case of Uganda. Live Wire, 2015/49. © World Bank. http://hdl.handle.net/10986/23138 License: CC BY 3.0 IGO.
Associated URLs
Associated content
Report Series
Report Series
Live Wire
Other publications in this report series
  • Publication
    Exploiting the Potential of Energy Efficiency in Residential Buildings
    (Washington, DC: World Bank, 2025-10-31) Singh, Jas; Mori, Takeshi
    The residential sector makes up about 70 percent of building energy demand. This demand is expected to grow rapidly over the next decade. Although the sector offers huge potential for energy efficiency gains, a range of barriers impedes the realization of these benefits. Fortunately, a wealth of global experience shows how these challenges can be overcome through a combination of sound planning, strong policy and regulatory frameworks, well designed financing and incentives, robust institutional and market development, and accessible information to scale up residential energy efficiency.
  • Publication
    Shared Infrastructure for Clean Hydrogen
    (Washington, DC: World Bank, 2025-08-31) World Bank
    Studies of the development of clean hydrogen have often focused on the production side. Infrastructure built and used for storage and transportation warrants more attention. Among the topics that should be assessed are system design, operation, integration, and ownership; market design and governance; and planning. This Live Wire examines case studies and literature on the infrastructure for hydrogen hubs, with an emphasis on the benefits of shared infrastructure. Given the breadth of hydrogen production and infrastructure, the focus is on renewable hydrogen production for domestic use and for export after conversion to ammonia.
  • Publication
    Decarbonizing Ammonia and Nitrogen Fertilizers with Clean Hydrogen
    (Washington, DC: World Bank, 2025-03-12) World Bank
    Synthetic fertilizers are essential to sustaining the world’s population, but their production is responsible for 1.8–2.4 percent of global greenhouse gas emissions. Clean hydrogen holds growing potential (amid falling costs) to decarbonize fertilizer production. Hydrogen produces synthetic ammonia, a building block of most fertilizers. With the fertilizer market as a reliable off-taker, this shift could support the overall expansion of clean hydrogen, even as it boosts global food security. However, this transition may require adjustments, including changes in fertilizer types and modifications to existing subsidy schemes.
  • Publication
    A Responsible Data Sharing Framework for the Distributed Renewable Energy Sector
    (Washington, DC: World Bank, 2025-09-25) Shrestha, Ashish; Pedersen, Anders; Janardhanan, Neelima; Hanley, Mollie
    In collaboration with Nigeria’s Rural Electrification Agency, the World Bank is piloting a Responsible Data Sharing Framework (RDSF) for the distributed renewable energy sector. The framework was developed over the course of 12 months in 2024, through collaboration with some 25 stakeholders from government and the private sector. It embodies a shared ambition to turn data into better outcomes for the communities served. At its core, an RDSF for the sector sets out how appropriate data about projects can be shared in ways that are efficient and effective. In 2023, the World Bank approved the Nigeria Distributed Access through Renewable Energy Scale-up (DARES) project. DARES aims to bring new or improved access to clean energy to 17.5 million people and replace more than 280,000 petrol and diesel generators in the process. The RDSF pilot is part of DARES.
  • Publication
    Measuring the Climate Resilience of the Power Sector: Harmonization, Not Homogenization
    (Washington, DC: World Bank, 2025-08-31) World Bank
    Although by its very nature climate resilience can never be fully “standardized”, the development and mainstreaming of climate resilience metrics can benefit from greater consensus around key topics. Areas such as metric categories, methodologies, and reporting frameworks can be aligned through coordinated efforts among regulators, utilities, and other stakeholders, enabling more consistent, effective, and scalable resilience planning across the sector. The key is harmonization and not homogenization.
Journal
Journal Volume
Journal Issue
Collections

Related items

Showing items related by metadata.

  • Publication
    Promoting Renewable Energy through Auctions : The Case of India
    (World Bank, Washington, DC, 2014-06-13) Khana, Ashish; Barroso, Luiz
    This knowledge note singles out auctions as an important mechanism that has been implemented in a growing number of countries in recent decades. It features a case study of auctions designed to promote the generation of electricity from renewable sources in India. The country's national- and state-level experience with auctions of solar energy products both large and small attests to the flexibility and adaptability of auction mechanisms. Under the National Solar Mission, auctions have been implemented with good results in a variety of settings. Lessons include the importance of clear ideas about key goals and objectives, and about areas where sacrifices can be made. Experience in several states has also underlined the importance of regulatory stability. This case study is interesting, because India's National Solar Mission led to concurrent implementations of renewable auction schemes. Both national- and state-level auctions have led to successful projects. The Indian central government's experience with auction implementations can be split into three main segments. Phase 1 auctions concern centralized auctions for procuring utility-scale solar plants. Rooftop auctions concern central government conducted auctions for rooftop solar generation in specific cities. No centralized auctions for large-scale solar generation were conducted in 2012 or 2013, so phase 2 auction were created under a new bidding process. Successive delays that were observed in the implementation of phase 2 auctions had negative results. Investors need to feel secure before they will establish a strong manufacturing or developer base.
  • Publication
    Promoting Renewable Energy through Auctions
    (World Bank, Washington, DC, 2014-06-13) Elizondo Azuela, Gabriela; Barroso, Luiz
    This knowledge note singles out auctions as an important mechanism that has been implemented in a growing number of countries in recent decades. It features case studies of auctions designed to promote the generation of electricity from renewable sources in Brazil, China, and India. Auctions in various forms are being used to promote the generation of electricity from renewable sources. Properly structured auctions can avoid the disadvantages of feed-in tariffs and renewable purchase obligations. Moreover, they offer the best of both of these early mechanisms, providing stable revenue guarantees for investors while also avoiding the risk of overbuilding. They do this by determining both price and quantity in advance. Promoting renewable energy through auctions is important, because experience with the use of auctions can guide future efforts. Among the examples of the benefits to be obtained from generating electricity from renewable sources are (i) increasing countries' energy security by reducing their dependency on fossil fuel imports, (ii) reducing greenhouse gas emissions as part of a worldwide effort to mitigate climate change, (iii) promoting electrification while reducing the need for isolated applications such as diesel generators, and (iv) minimizing local pollution. Auctions are an effective way to stimulate competition among investors, provide price disclosure while eliciting the right amount of investment, and offer revenue stability via long-term contracting.
  • Publication
    Promoting Renewable Energy through Auctions : The Case of China
    (World Bank, Washington, DC, 2014-06-13) Wang, Xiaodong; Barroso, Luiz; Elizondo, Gabriela
    This knowledge note singles out auctions as an important mechanism that has been implemented in a growing number of countries in recent decades. It features a case study of auctions designed to promote the generation of electricity from renewable sources in China. Although feed-in tariffs are now the cornerstone of China's renewable energy policy, auctions have played and continue to play a role in identifying market prices for renewable energy in the country. Experience with the auctioning of wind and solar concessions enabled the Chinese authorities to modify auctions over time to yield accurate information about the costs of generation from renewable sources, allowing them to set feed-in tariffs at efficient levels. This case study is interesting, because China has set aggressive renewable energy targets and introduced policy incentives for rapid market development. Initial renewable energy prices showed significant variation, and the government s targets were not achieved prior to 2005. The most important milestone in the development of renewable energy in China was the 2005 Renewable Energy Law. China has applied successive adjustments to concessions auctions to improve their usefulness in setting appropriate feed-in tariffs. The key lesson from China's experience with auctioning of concessions is that winning bid prices that are lower than actual costs wind up deterring the development of renewable energy.
  • Publication
    Promoting Renewable Energy through Auctions : The Case of Brazil
    (World Bank, Washington, DC, 2014-06-13) Elizondo Azuela, Gabriela; Barroso, Luiz; Cunha, Gabriel
    This knowledge note singles out auctions as an important mechanism that has been implemented in a growing number of countries in recent decades. It features a case study of auctions designed to promote the generation of electricity from renewable sources in Brazil. The Brazilian experience with wind energy auctions illustrates that even carefully designed policies often must be reconsidered in the light of a complex and changing environment. Many considerations need to be taken into account to ensure competitive prices while also delivering the required renewable energy supply. This case study is interesting, because Brazil's initial success with developing wind capacity had unforeseen consequences. Challenges introduced in the first stage of wind power development had to be solved in the second. The chief challenges were (i) the Brazilian system had to be able to balance supply and demand more accurately; (ii) investors were overoptimistic about the amount of electricity able to be generated; and (iii) the government's arrangements for coordinating the planning of generation and transmission left too little room for error. The benefits offered to the auctioned plants were reduced, as was government involvement in planning and coordinating transmission expansion. The key lesson from this case study is that existing policies should be challenged and revised in response to a changing environment.
  • Publication
    Field Performance Evaluation of Amorphous Silicon (a-Si) Photovoltaic Systems in Kenya : Methods and Measurements in Support of a Sustainable Commercial Solar Energy Industry
    (World Bank, Washington, DC, 2000-08) Duke, Richard D.; Graham, Shannon; Hankins, Mark; Jacobson, Arne; Kammen, Daniel M.; Osawa, Bernard; Pulver, Simone; Walther, Erika
    The study reviews the active market for photo-voltaic (PV) solar home systems (SHSs) in Kenya, with cumulative sales in excess of 100,000 units, and current sales of approximately 20,000 modules per year. It further identifies that small single junction amorphous silicon (a-Si) modules dominate the market, largely due to their lower retail price, relative to similar sizes of crystalline PV modules. Despite this commercial success, there is concern about the performance of single junction a-Si modules, both in terms of uneven technological quality record, and uncertain short-term degradation, which occurs when this type of PV module is initially exposed to the sun. The study confirms that modules made by two of the three companies dominating the Kenyan a-Si PV market, offer long-term performance, roughly compared to crystalline PV, confirming also that quality brands of single junction a-Si modules provide a highly cost-effective alternative to crystalline modules for SHSs, particularly for households only able to afford relatively small systems. The success of this brand, despite its considerably higher price per measured Wp, indicate that rural consumers are ill-equipped to compare the relative performance of different module brands, and that risks and limitations associated with these systems, suggest a cautious approach.

Users also downloaded

Showing related downloaded files

  • Publication
    Digital Progress and Trends Report 2023
    (Washington, DC: World Bank, 2024-03-05) World Bank
    Digitalization is the transformational opportunity of our time. The digital sector has become a powerhouse of innovation, economic growth, and job creation. Value added in the IT services sector grew at 8 percent annually during 2000–22, nearly twice as fast as the global economy. Employment growth in IT services reached 7 percent annually, six times higher than total employment growth. The diffusion and adoption of digital technologies are just as critical as their invention. Digital uptake has accelerated since the COVID-19 pandemic, with 1.5 billion new internet users added from 2018 to 2022. The share of firms investing in digital solutions around the world has more than doubled from 2020 to 2022. Low-income countries, vulnerable populations, and small firms, however, have been falling behind, while transformative digital innovations such as artificial intelligence (AI) have been accelerating in higher-income countries. Although more than 90 percent of the population in high-income countries was online in 2022, only one in four people in low-income countries used the internet, and the speed of their connection was typically only a small fraction of that in wealthier countries. As businesses in technologically advanced countries integrate generative AI into their products and services, less than half of the businesses in many low- and middle-income countries have an internet connection. The growing digital divide is exacerbating the poverty and productivity gaps between richer and poorer economies. The Digital Progress and Trends Report series will track global digitalization progress and highlight policy trends, debates, and implications for low- and middle-income countries. The series adds to the global efforts to study the progress and trends of digitalization in two main ways: · By compiling, curating, and analyzing data from diverse sources to present a comprehensive picture of digitalization in low- and middle-income countries, including in-depth analyses on understudied topics. · By developing insights on policy opportunities, challenges, and debates and reflecting the perspectives of various stakeholders and the World Bank’s operational experiences. This report, the first in the series, aims to inform evidence-based policy making and motivate action among internal and external audiences and stakeholders. The report will bring global attention to high-performing countries that have valuable experience to share as well as to areas where efforts will need to be redoubled.
  • Publication
    Global Economic Prospects, June 2025
    (Washington, DC: World Bank, 2025-06-10) World Bank
    The global economy is facing another substantial headwind, emanating largely from an increase in trade tensions and heightened global policy uncertainty. For emerging market and developing economies (EMDEs), the ability to boost job creation and reduce extreme poverty has declined. Key downside risks include a further escalation of trade barriers and continued policy uncertainty. These challenges are exacerbated by subdued foreign direct investment into EMDEs. Global cooperation is needed to restore a more stable international trade environment and scale up support for vulnerable countries grappling with conflict, debt burdens, and climate change. Domestic policy action is also critical to contain inflation risks and strengthen fiscal resilience. To accelerate job creation and long-term growth, structural reforms must focus on raising institutional quality, attracting private investment, and strengthening human capital and labor markets. Countries in fragile and conflict situations face daunting development challenges that will require tailored domestic policy reforms and well-coordinated multilateral support.
  • Publication
    The Container Port Performance Index 2023
    (Washington, DC: World Bank, 2024-07-18) World Bank
    The Container Port Performance Index (CPPI) measures the time container ships spend in port, making it an important point of reference for stakeholders in the global economy. These stakeholders include port authorities and operators, national governments, supranational organizations, development agencies, and other public and private players in trade and logistics. The index highlights where vessel time in container ports could be improved. Streamlining these processes would benefit all parties involved, including shipping lines, national governments, and consumers. This fourth edition of the CPPI relies on data from 405 container ports with at least 24 container ship port calls in the calendar year 2023. As in earlier editions of the CPPI, the ranking employs two different methodological approaches: an administrative (technical) approach and a statistical approach (using matrix factorization). Combining these two approaches ensures that the overall ranking of container ports reflects actual port performance as closely as possible while also being statistically robust. The CPPI methodology assesses the sequential steps of a container ship port call. ‘Total port hours’ refers to the total time elapsed from the moment a ship arrives at the port until the vessel leaves the berth after completing its cargo operations. The CPPI uses time as an indicator because time is very important to shipping lines, ports, and the entire logistics chain. However, time, as captured by the CPPI, is not the only way to measure port efficiency, so it does not tell the entire story of a port’s performance. Factors that can influence the time vessels spend in ports can be location-specific and under the port’s control (endogenous) or external and beyond the control of the port (exogenous). The CPPI measures time spent in container ports, strictly based on quantitative data only, which do not reveal the underlying factors or root causes of extended port times. A detailed port-specific diagnostic would be required to assess the contribution of underlying factors to the time a vessel spends in port. A very low ranking or a significant change in ranking may warrant special attention, for which the World Bank generally recommends a detailed diagnostic.
  • Publication
    Business Ready 2024
    (Washington, DC: World Bank, 2024-10-03) World Bank
    Business Ready (B-READY) is a new World Bank Group corporate flagship report that evaluates the business and investment climate worldwide. It replaces and improves upon the Doing Business project. B-READY provides a comprehensive data set and description of the factors that strengthen the private sector, not only by advancing the interests of individual firms but also by elevating the interests of workers, consumers, potential new enterprises, and the natural environment. This 2024 report introduces a new analytical framework that benchmarks economies based on three pillars: Regulatory Framework, Public Services, and Operational Efficiency. The analysis centers on 10 topics essential for private sector development that correspond to various stages of the life cycle of a firm. The report also offers insights into three cross-cutting themes that are relevant for modern economies: digital adoption, environmental sustainability, and gender. B-READY draws on a robust data collection process that includes specially tailored expert questionnaires and firm-level surveys. The 2024 report, which covers 50 economies, serves as the first in a series that will expand in geographical coverage and refine its methodology over time, supporting reform advocacy, policy guidance, and further analysis and research.
  • Publication
    Global Economic Prospects, January 2025
    (Washington, DC: World Bank, 2025-01-16) World Bank
    Global growth is expected to hold steady at 2.7 percent in 2025-26. However, the global economy appears to be settling at a low growth rate that will be insufficient to foster sustained economic development—with the possibility of further headwinds from heightened policy uncertainty and adverse trade policy shifts, geopolitical tensions, persistent inflation, and climate-related natural disasters. Against this backdrop, emerging market and developing economies are set to enter the second quarter of the twenty-first century with per capita incomes on a trajectory that implies substantially slower catch-up toward advanced-economy living standards than they previously experienced. Without course corrections, most low-income countries are unlikely to graduate to middle-income status by the middle of the century. Policy action at both global and national levels is needed to foster a more favorable external environment, enhance macroeconomic stability, reduce structural constraints, address the effects of climate change, and thus accelerate long-term growth and development.