Measuring Solar Irradiation a Challenge for Developers and Offtakers in Africa

A 3-5% overestimation of a site’s solar energy generation is likely to have an equivalent impact on revenues over the project’s lifetime

September 12, 2021


Commercial and industrial solar investment firm CrossBoundary Energy’s (CBE) latest report sheds light on how solar energy generation is forecasted, the specific challenges in measuring solar irradiation in Africa, and the negative consequences CrossBoundary Energy has seen as a result of inaccurate estimates.

CrossBoundary Energy finds that variations within the datasets commonly leveraged to estimate solar energy generation in Africa often cause projections to overstate solar irradiation. It argues that if these variations are not addressed during project development, inaccurate irradiance estimates can result in up to a 20% reduction in realized solar savings for commercial and industrial (C&I) solar consumers and a 1-2% reduction in the internal rate of return (IRR) on investment for solar developers and investors.

CrossBoundary Energy aims to set the ball rolling for a broader conversation about raising the C&I industry standard for calculating long-term solar energy generation to deliver better outcomes for clients through the report.

When CrossBoundary Energy measured the irradiation with its ground-based measurement systems, the deviation between actual measured and estimated irradiation differed by 3-5% compared with satellite data. The situation is much worse on close as sites outside of major cities experience even higher deviations. Estimates of sites nestled in highlands, valleys, or next to lakes could vary by 20%. This translates to 20% lower energy savings for solar customers and reduced IRR for businesses outside major metropolitan areas.

Ground-based measurements displayed higher accuracy as they could find even slight variations in the concentration of particles in the atmosphere and captures both direct irradiance and di­ffuse irradiance. The catch is that the distribution of ground-based validation sites is mostly clustered in Europe, South Africa, and overall in temperate regions, with few and sparsely distributed stations serving other parts of Africa, particularly in the tropics.

CrossBoundary Energy states that a study by DNV GL in 2020 confirmed that a 3-5% overestimation of a site’s solar production is likely to have an equivalent impact on revenues over the life of a project.

Solar irradiation inaccuracy is a challenge plaguing the whole industry. However, in regions like the U.S. and Europe, there are a large number of solar developers and customers driving a competitive market for solar irradiation data providers. This, in turn, has resulted in improvements to irradiation measurement accuracy.

The nascent African solar market has a limited number of data providers and ground-based monitoring stations. The majority of measurement stations that do exist are concentrated in urban areas.

CrossBoundary Energy argues that pragmatic action is required to secure continued African solar market growth and achieve the critical mass required to improve data diversity. Solar developers, buyers, and data providers have to interrogate irradiation data better and collaborate on long-term solutions.

It also suggests that solar developers should assess multiple solar irradiation data sources to evaluate a realistic range of solar irradiation. This will help to ensure that projections are not overly optimistic and avoid misrepresentation of project profitability. Businesses evaluating solar for their facilities should add evaluation of irradiation estimates and expected solar production to their bid evaluation processes.

According to a report by The Africa Solar Industry Association (AFSIA),  37 countries in Africa have installed more than 1 GW capacity.

Earlier, the African Union Commission and the International Renewable Energy Agency had agreed to promote renewable energy across the African continent and bolster Africa’s response to the COVID-19 outbreak.


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