Energy and environmental technology Environment

Posted November 1999

FAO study

Impact of solar photovoltaic systems on rural development

Also available in Spanish

Outline and questionnaire
Preminary paper: FAO study for rural electrification in the 21st century
Photovoltaic solar energy systems for the Bedouin, Syria


Photovoltaic (PV) technology has shown its potential as a decentralized form of energy supply in many applications in rural areas: both in flexibility, ease of installation and sustainability over the years. Many experiences have been documented on the barriers to technology diffusion and potential solutions - both in the technical area and in the area of organization, finance and policies. In general, PV technology is reaching commercial maturity and the recent investments in new production capacity by multinational manufacturing companies are expected to create the conditions for further price drops and greater competitiveness.

PV systems have especially shown their potential - in the technical as well as the organizational, economical and financial sense - in the area of decentralized rural electrification. PV systems are now being integrated in large rural electrification programmes in many parts of the world (e.g. Argentina, South Africa, United States, India, Mexico, Zimbabwe). Programmes and studies now address issues related to large-scale market development in rural areas: access to affordable credit, local market infrastructure for installing and servicing the systems, and mechanisms for conducive local policymaking. While several studies have been produced on these aspects, what has been much less studied is the actual impact of PV technology diffusion on rural development.

The term "impact on rural development" often has the connotation of "projects", in the sense of development projects organized by government institutions, NGOs and international organizations. However, it is important to stress that a large part of the distribution and installation of solar systems in rural areas is done through direct commercial sales. Commercial companies have often taken the lead in exploring new uses, markets and organizational mechanisms to diffuse PV-technology. Therefore the study aims at PV systems distributed both through "projects" and commercial sales.

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