Grid-Connected Rooftop Solar PV Systems
Grid-Connected Rooftop Solar PV Systems
Business Model Description
Install grid-connected rooftop solar panels for domestic and commercial use, notably fish processors, cold storage facilities, hotels, and public institutions, abiding by the Public Utilities Corporation (PUC) network limitations: a) domestic consumers are allowed to install PV panels to generate up to 100 % of their monthly consumption, b) commercial consumers who produce more than 10kW, are allowed to generate up to 50% of their monthly consumption. Each application is filed to Seychelles Energy Commission (SEC) and subject to PUC’s analysis and inspection, regarding the impact on the grid and net-metering billing arrangements.
Expected Impact
Increase clean energy access and share in the national mix, helping business continuity and cost reduction as well as modernization of the grid.
How is this information gathered?
Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.
Disclaimer
UNDP, the Private Finance for the SDGs, and their affiliates (collectively “UNDP”) do not seek or solicit investment for programmes, projects, or opportunities described on this site (collectively “Programmes”) or any other Programmes, and nothing on this page should constitute a solicitation for investment. The actors listed on this site are not partners of UNDP, and their inclusion should not be construed as an endorsement or recommendation by UNDP for any relationship or investment.
The descriptions on this page are provided for informational purposes only. Only companies and enterprises that appear under the case study tab have been validated and vetted through UNDP programmes such as the Growth Stage Impact Ventures (GSIV), Business Call to Action (BCtA), or through other UN agencies. Even then, under no circumstances should their appearance on this website be construed as an endorsement for any relationship or investment. UNDP assumes no liability for investment losses directly or indirectly resulting from recommendations made, implied, or inferred by its research. Likewise, UNDP assumes no claim to investment gains directly or indirectly resulting from trading profits, investment management, or advisory fees obtained by following investment recommendations made, implied, or inferred by its research.
Investment involves risk, and all investments should be made with the supervision of a professional investment manager or advisor. The materials on the website are not an offer to sell or a solicitation of an offer to buy any investment, security, or commodity, nor shall any security be offered or sold to any person, in any jurisdiction in which such offer would be unlawful under the securities laws of such jurisdiction.
Country & Regions
- Seychelles: Greater Victoria
- Seychelles: Rural Mahé
- Seychelles: Praslin
- Seychelles: La Digue
Sector Classification
Renewable Resources and Alternative Energy
Development need
Seychelles' energy supply is generated from imported fossil fuels, accounting for about 25% of the country's net imports. Therefore, securing energy supply and price stability is intrinsically bound to the cost of fuel, pressure on the national budget and foreign debt sustainability. In addition, 95% of the country's greenhouse gas (GHG) emissions come from the energy sector (1, 2, 3).
Policy priority
Seychelles' updated 2021 Nationally Determined Contribution (NDC) targets are 15.5% energy efficiency and 15% renewable share in national electricity production by 2030. Seychelles' 100% Renewable Energy Strategy foresees total energy sector decarbonization by 2050. NDCs include 293,8 ktCO2e economy-wide reduction in greenhouse gas emissions by 2030 (1, 4).
Gender inequalities and marginalization issues
In Seychelles, more than half of the households are headed by females. Poverty Profiling 2017/2018 by the National Bureau of Statistics (NBS) reveals that households with one woman (living out of union) at the head, aged 25 to 62, are more likely to be affected by income poverty. Hence, energy security in terms of affordability and continued access remains crucial for women's perception of safety and livelihood (5, 6).
Investment opportunities Introduction
Seychelles consistently ranks among the top three countries in Africa regarding governance and the top ten in foundations for economic opportunity. Reliability of the supply of electricity and the off-taker enhance solar energy use as Mahé alone has the theoretical potential to supply 125MW of solar energy through rooftop installations (12, 15).
Key bottlenecks Introduction
Isolated and limited land capacity for large-scale ground installations, insufficient number of the local workforce and technical experts for growing sector needs, hardship in access to blended and concessional financing, sector's highly political and regulated image, subsidized tariff scheme and cap in production of grid-connected energy are main bottlenecks (16).
Alternative Energy
Development need
Although Seychelles has universal access to electricity, only up to 5% of energy needs are supplied by renewable resources, accentuating the need for improving national energy security, meeting the rising demand, targeting subregional disparities in energy infrastructure, and reducing transport and tourism-related greenhouse gas (GHG) emissions (1, 8).
Policy priority
Seychelles Vision 2033 and National Development Strategy 2019-2023, strategize environmental sustainability and energy security in the country, as energy imports account for 12% of the total government budget annually. The targets share of renewable energy in electricity supply is 15% by 2030, according to Seychelles' updated 2021 Nationally Determined Contribution (NDC) (4, 9, 10).
Gender inequalities and marginalization issues
In Seychelles, parastatals are the main employer in the energy sector, including electricity, gas, steam, and air conditioning supply, with a higher share of the expatriate male workforce, which might undermine the participation of the local female workforce in the renewable energy sector. Subregional storage and battery investments are required as 90% of the nation's population live in three main inner islands with grid connectivity (3, 11).
Investment opportunities introduction
The Seychelles Energy Efficiency and Renewable Energy Programme (SEEREP) financing, the net-metering programme by the Public Utilities Corporation (PUC) and tax incentives promote alternative energy development with adequate land use as in the case of rooftop and floating PV systems in land-scarce inner islands and off-grid solution in outer islands (13, 14).
Key bottlenecks introduction
In grid-connected areas, dominant roofing structure, steep and made from corrugated iron sheets, voltage fluctuations, which affect the inverter, and subsidized household tariffs constrain private-led investments. The high cost of finance and battery investments, especially in Outer Islands, limited incentives, and equipment costs limit the scale of implementations (16).
Solar Technology and Project Developers
Pipeline Opportunity
Grid-Connected Rooftop Solar PV Systems
Install grid-connected rooftop solar panels for domestic and commercial use, notably fish processors, cold storage facilities, hotels, and public institutions, abiding by the Public Utilities Corporation (PUC) network limitations: a) domestic consumers are allowed to install PV panels to generate up to 100 % of their monthly consumption, b) commercial consumers who produce more than 10kW, are allowed to generate up to 50% of their monthly consumption. Each application is filed to Seychelles Energy Commission (SEC) and subject to PUC’s analysis and inspection, regarding the impact on the grid and net-metering billing arrangements.
Business Case
Market Size and Environment
Total electricity consumption exceeding 400 million kWh
Electricity consumption in Seychelles reached 402 million kWh in 2020, having increased by 25% in the last five years and by 55% in the previous ten years (18, 19).
6.3 MW installed rooftop solar PV capacity in Seychelles is expected to increase by 800 kW per year (20).
Electricity consumption from renewable resources in Seychelles was 41 TJ in 2018. Renewable energy supply was 73 TJ for the same year, 24% of which was supplied from solar. Renewable electricity consumption grew by 62.7% between 2013-18 (8).
Indicative Return
> 25%
Stakeholder consultation with a prominent solar energy supplier in Seychelles reveals that the payback period is less than four years for a rooftop solar investment that generates more than 600 kWh per month (21).
Investment Timeframe
Short Term (0–5 years)
Stakeholder consultation with a prominent solar energy supplier in Seychelles reveals that the payback period is less than four years for a rooftop solar investment that generates more than 600 kWh per month (21).
Ticket Size
< USD 500,000
Market Risks & Scale Obstacles
Market - Highly Regulated
Business - Supply Chain Constraints
Business - Supply Chain Constraints
Impact Case
Sustainable Development Need
Seychelles' energy grid is dependent on fossil fuels to generate electricity, aggravating the challenges around cutting greenhouse gas (GHG) emissions according to the Nationally Determined Contribution (NDC) target and sustaining the budgetary discipline.
The private sector mobilised USD 436 million for developing the energy sector in Small Island Developing States (SIDS) between 2013-2020. Still, no transaction took place in Seychelles, in contrast to other Indian Ocean SIDS, including upper-middle-income economies (22).
Although Seychelles has universal access to electricity, energy infrastructure, consisting mainly of power generators that use Heavy Fuel Oil (HFO), is environmentally harmful, ageing, inefficient, and unreliable. Low actual generation capacity -52% of 129 MW installed power capacity- is largely due to ageing generators (23).
Gender & Marginalisation
Electricity supply is a particular concern in La Digue, which depends on the island of Praslin for transmitting energy through two undersea cables that have insufficient capacity to transfer all the electricity needed during peak time, causing costly and frequent power outages (23).
Expected Development Outcome
Increasing renewable energy generation with grid-connected rooftop installations reduces greenhouse gas (GHG) emissions from the energy sector and overreliance on imported fossil fuels.
Scaling up rooftop installations proliferates renewable energy operations in Seychelles, including talent development and equipment supply, furthering private finance mobilisation to the country.
Replacing the old and inefficient energy infrastructure with renewable technologies contributes to the modernisation of the grid. In addition, it enables powering key industries, such as fish processing and tourism, and emerging infrastructural needs, such as an electric vehicle (EV) charging points, with green energy.
Gender & Marginalisation
Renewable energy generation from rooftop solar installations in La Digue, where challenges of a fragile ecosystem, land scarcity, and deficient utility services are more pressing than the other central islands, will secure energy supply for remote and vulnerable communities of the island (26).
Primary SDGs addressed
7.2.1 Renewable energy share in the total final energy consumption
1.99% in 2019 (1).
15% by 2030 (4).
13.2.2 Total greenhouse gas emissions per year
790 ktCO2e in 2019 (24).
Reduction in total Greenhouse Gas (GHG) emissions by 293.8 ktCO2e in 2030 (26.4%) compared to business as usual (BAU) scenario (4).
Secondary SDGs addressed
Directly impacted stakeholders
People
Gender inequality and/or marginalization
Planet
Corporates
Public sector
Indirectly impacted stakeholders
People
Gender inequality and/or marginalization
Planet
Corporates
Public sector
Outcome Risks
Rooftop PV technologies are foreign-dependent; expanding such facilities without improving local technology may increase dependence on imports and deteriorate the trade balance.
Lacking adequate infrastructure to recycle end-of-life solar panels may exacerbate risks associated with the export of waste, such as soil contamination and illegal dumping of hazardous waste.
Impact Risks
The high cost of solar panels and associated installation costs may impede low-income households' affordability.
Uptake by households may be low due to prevalent roof structure: steep and made from corrugated iron sheets which rust in 10 years, earlier than PV panels which are given a 25-years guarantee (21).
Integrating solar energy from rooftop PV installations into the grid might be challenging as inverters stop working when the voltage fluctuation is too high (21).
Impact Classification
What
Scaling up solar rooftop installations decreases reliance on petroleum products, contributes to the modernization of the grid, and accelerates the renewable energy transition in Seychelles.
Risk
Roof-mounted solar PV technologies may not be affordable for the poor, and installations may be inapplicable due to existing roof structures.
Contribution
Roof-mounted solar PV installations and floating PV and hybrid solar systems increase the renewable energy share in the national grid.
Impact Thesis
Increase clean energy access and share in the national mix, helping business continuity and cost reduction as well as modernization of the grid.
Enabling Environment
Policy Environment
Seychelles Energy Policy (2010-2030) sets the long-term energy strategy of the country, which includes a target of supplying 5% of Seychelles' energy from renewable sources by 2020, 15% by 2030 and 100% in the long term (2).
Seychelles’ Updated Nationally Determined Contribution (NDC), 2021: maintains the power sector targets from the previous NDC, including 15% energy efficiency improvement and powering 15% of the national mix by renewable sources in 2030 (4).
Seychelles Vision 2033: the long-term national vision, envisages that the country's energy needs will be provided by renewable energy and efficient technologies (9).
Seychelles National Development Strategy (NDS), 2019-2023: focuses on using renewable energy to achieve targets of energy security and economic resilience (10).
Reserved Economic Activities Policy, April 2020: provides for ensuring that certain economic activities that are doable and affordable to the Seychellois investors and businesses shall remain reserved for them; the list includes electrical contractors (34).
Financial Environment
Financial incentives: Seychelles Energy Efficiency & Renewable Energy Program (SEEREP) loan and GOS-UNDP-GEF Solar PV Rebate Scheme were put in place but haven't achieved scale due to application issues related to roofing and stability of the grid as well as subsidized domestic price (21).
Fiscal incentives: Imported renewable energy-related commodities, including imported solar panels, are exempt from goods and services tax (28).
Other incentives: Mauritius Commercial Bank (MCB) Seychelles offers corporate and personal green loans to increase investments in sustainable practices and renewable energy, particularly rooftop installations at home (32, 33).
Regulatory Environment
Seychelles Energy Act (2012): provides the legal basis for development and utilization of energy resources in Seychelles, functions of the regulator, Seychelles Energy Commission (SEC), establishment of Seychelles Energy Board, and the tendering procedure for independent power producers (IPPs) (25).
Public Utilities Corporation Act (1986) establishes the corporation with the mandate of supplying electricity and water in Seychelles (27).
Seychelles Investment Act, 2010: broadly defines investment and investor’s nationality - based on citizenship or the level of control - and makes all foreign investments subject to screening by Seychelles Investment Board (SIB), giving the latter a business facilitation role (29, 30).
Seychelles Meteorology Act, 2015: establishes the Seychelles Meteorological Authority, responsible with the provision of forecasts for weather and climate phenomena and monitoring climate change (33).
S.I. 76. - Seychelles Investment (Economic Activities) Regulations, 2022: lists engineering (design) services, in particular for mechanical and electrical installations for buildings as an activity a non-Seychellois may invest in with the requirement to conduct an Economic Needs Test (ENT) (35).
Marketplace Participants
Private Sector
Sun Tech Seychelles, Energy Solutions Seychelles (ESS), VetiverTech, Complete Energy Solutions (CES), Masdar, Qair, Sustainable Power Solutions (SPS), Mettle Solar Investments, Gridworks, Trinity International LLP, Multiconsult Norge AS.
Government
The Ministry of Agriculture, Climate Change and Environment, the Ministry of Investment, Entrepreneurship and Industry, Public Utilities Corporation (PUC), Seychelles Energy Commission (SEC), The Seychelles Investment Board (SIB), Islands Development Company (IDC).
Multilaterals
The United Nations Development Programme (UNDP), the Global Environment Facility (GEF), International Renewable Energy Agency (IRENA), Abu Dhabi Fund for Development (ADFD), Institute for Environmental Analytics (IEA), African Legal Support Facility (ALSF).
Non-Profit
Sustainability for Seychelles (S4S), University of Seychelles (UniSey), Clinton Foundation.
Target Locations
Seychelles: Greater Victoria
Seychelles: Rural Mahé
Seychelles: Praslin
Seychelles: La Digue
References
- (1) Republic of Seychelles Ministry of Finance, Trade, Investment & Economic Planning, Economic Planning Department. 2020. Goal 7: Ensure access to affordable, reliable, sustainable and modern energy for all. In Voluntary National Review 2020. https://sustainabledevelopment.un.org/content/documents/26382VNR_2020_Seychelles_Report.pdf
- (2) Ministry of Environment, Energy and Climate Change (MEECC). 2010. Proposal for Energy Policy of the Republic of Seychelles, 2010 – 2030. https://investinseychelles.com/downloads/renewable-energy-documents/seychelles-energy-policy/viewdocument/22
- (3) Government of Seychelles. 2020. Seychelles’ National Climate Change Policy. Ministry of Environment, Energy and Climate Change, Seychelles. http://www.meecc.gov.sc/wp-content/uploads/2019/10/seychelles-national-climate-change-policy-may-2020.pdf
- (4) Republic of Seychelles Climate Change and Energy Department of the Ministry of Agriculture, Climate Change and Environment. 2021. Seychelles’ Updated Nationally Determined Contribution. https://www4.unfccc.int/sites/ndcstaging/PublishedDocuments/Seychelles%20First/Seychelles%20-%20NDC_Jul30th%202021%20_Final.pdf
- (5) National Bureau of Statistics Seychelles. 2019. Poverty Profiling Regional Survey Report 2017/2018 Survey. https://www.nbs.gov.sc/downloads/poverty-profiling-report-2017-2018/viewdocument
- (6) Power Africa. 2017. Exploring the Relationship Between Energy Access and Gender-Based Violence. https://powerafrica.medium.com/exploring-the-relationship-between-energy-access-and-gender-based-violence-ee8d9e320437
- (7) Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH. 2020. Greenhouse Gas Inventory & Mitigation Strategies for the Refrigeration and Air Conditioning Sector in the Seychelles. https://www.green-cooling-initiative.org/fileadmin/user_upload/RAC-Inventory-SEY-20201217-web-alternative.pdf
- (8) International Renewable Energy Agency (IRENA). 2021. Energy Profile Seychelles. https://www.irena.org/IRENADocuments/Statistical_Profiles/Africa/Seychelles_Africa_RE_SP.pdf
- (9) Ministry of Finance, Trade, Investment and Economic Planning. 2019. Seychelles Vision 2033. http://www.finance.gov.sc/uploads/files/Vision_2033.pdf
- (10) Ministry of Finance, Trade, Investment and Economic Planning. 2019. Seychelles National Development Strategy 2019-2023. http://www.finance.gov.sc/uploads/files/Seychelles_National_Development_Strategy_2019_2023_new.pdf
- (11) National Bureau of Statistics. 2021. Statitical Bulletin Formal Employment and Earnings 2020/Q4. https://www.nbs.gov.sc/downloads/employment-earnings-2020-q4/viewdocument
- (12) Mo Ibrahim Foundation. 2020. Ibrahim Index of African Governance. https://mo.ibrahim.foundation/sites/default/files/2020-11/2020-index-report.pdf
- (13) Public Utilities Corporation (PUC). 2021. Application procedure for Photovoltaic (PV) installation. https://www.puc.sc/wp-content/uploads/2021/06/Application-procedure-for-Photovoltaic-PV-installation.pdf
- (14) Seychelles News Agency. 2019. Pro-environment legislation in Seychelles will demand energy efficient appliances and buildings. http://www.seychellesnewsagency.com/articles/10688/Pro-environment+legislation+in+Seychelles+will+demand+energy+efficient+appliances+and+buildings
- (15) Europa-Universität Flensburg Center for Sustainable Energy Systems (CSES). 2017. A 100% renewable Seychelles A plan to change the Seychelles’ power supply to 100% renewables, its costs and possible benefits. https://www.uni-flensburg.de/fileadmin/content/abteilungen/industrial/dokumente/downloads/veroeffentlichungen/diskussionsbeitraege/znes-discussionpapers-008-100ee-mahe.pdf
- (16) UNDP Project Team stakeholder consultation conducted jointly with public authorities, a key national supplier of solar equipment in Seychelles and a foreign solar project development firm operating in Seychelles, in May 2022.
- (17) Karapetyan, Salifa. 2022. Solar power planned for one of world's largest tuna canneries based in Seychelles. Seychelles News Agency: Victoria. http://www.seychellesnewsagency.com/articles/16182/Solar+power+planned+for+one+of+world%27s+largest+tuna+canneries+based+in+Seychelles
- (18) National Bureau of Statistics. 2021. Seychelles in Figures 2021 Edition. Victoria, Seychelles. https://www.nbs.gov.sc/downloads/seychelles-in-figures-2021-edition/download
- (19) National Bureau of Statistics. 2015. Seychelles in Figures 2015 Edition. Victoria, Seychelles. https://www.nbs.gov.sc/downloads/seychelles-in-figures-2015-edition/download
- (20) UNDP Project Team consultation undertakenwith a public stakeholder in May 2022.
- (21) UNDP Project Team stakeholder consultation undertaken with a local solar panel supplier in May, 2022.
- (22) Organisation for Economic Co-operation and Development (OECD). 2022. Development Finance Topics: Small Island Developing States. https://www.oecd.org/dac/financing-sustainable-development/development-finance-topics/small-island-developing-states.htm
- (23) African Development Bank Group. 2021. Country Strategy Paper (CSP) 2021-2025. https://www.afdb.org/en/documents/seychelles-country-strategy-paper-2021-2025
- (24) Climate Watch Historical GHG Emissions. 2022. Washington, DC: World Resources Institute. Available online at: https://www.climatewatchdata.org/ghg-emissions
- (25) Republic of Seychelles. 2012. Energy Act. https://www.climate-laws.org/rails/active_storage/blobs/eyJfcmFpbHMiOnsibWVzc2FnZSI6IkJBaHBBbjhIIiwiZXhwIjpudWxsLCJwdXIiOiJibG9iX2lkIn19--595c7a329005829ff2ce816d82b039d111ecb9a5/f
- (26) Seychelles Nation. 2021. Carrying capacity studies on La Digue. https://nation.sc/articles/9897/carrying-capacity-studies-on-la-digue#:~:text=A%20moratorium%20on%20the%20development,afternoon%20at%20the%20Botanical%20House.
- (27) Republic of Seychelles. 1985. Public Utilities Corporation Act (Cap. 196). http://extwprlegs1.fao.org/docs/pdf/sey116793.pdf
- (28) U.S. Department of State. 2022. 2022 Investment Climate Statements: Seychelles. https://www.state.gov/reports/2022-investment-climate-statements/seychelles/
- (29) The United Nations Conference on Trade and Development (UNCTAD). 2020. Investment Policy Review of Seychelles. United Nations, Geneva. https://unctad.org/system/files/official-document/diaepcb2020d1_en_0.pdf
- (30) Republic of Seychelles. 2010. Seychelles Investment Act. http://www.mofbe.gov.sc/wp-content/uploads/2021/09/Seychelles-Investment-Act-2010.pdf
- (31) Republic of Seychelles. 2015. Meteorology Act, 2015. http://extwprlegs1.fao.org/docs/pdf/sey150949.pdf
- (32) Joubert-Lawen, Rita. 2022. Renewable energy: Make products more accessible to public, says Seychelles Energy Commission. Seychelles News Agency: Victoria, Seychelles. http://www.seychellesnewsagency.com/articles/17255/Renewable+energy+Make+products+more+accessible+to+public%2C+says+Seychelles+Energy+Commission
- (33) Mauritius Commercial Bank (MCB) Seychelles. 2022. https://www.mcbseychelles.com/en/
- (34) The Ministry of Finance, Trade, Investment and Economic Planning. 2020. Policy Paper on Economic Activities Reserved for Seychellois. https://www.investinseychelles.com/component/edocman/reserved-economic-activities-policy-reap-_april-2020/download?Itemid=0
- (35) Ministry of Investment, Entrepreneurship, and Industry. 2022. Seychelles Investment (Economic Activities) Regulations, 2022. https://www.gazette.sc/sites/default/files/2022-07/SI%2076%202022%20-%20Seychelles%20Investment%20%28Economic%20Activities%29%20Regulations%202022.pdf
- (36) UNDP Project Team sensitization meeting with public investment authorities in November 2022.