Financial feasibility analysis of Grid connected photovoltaic projects in Rwanda. Case study: Gigawatt global Rwanda

Abstract

Developing states are shifting from reliance on hydro-carbon based energy output generation which is intensive polluting energy sources into more diversified and environmentally friendly energy source with special interest in clean energy including sun based energy sources. The study aimed at investigating the financial viability of the sun based energy output plant in Rwanda. RETscreen and Homer Pro software were utilized for analyzing the lattice connected Gigawatt global sun based energy output plant as case study. The results revealed that the net present value is positive US $ 49,490,000, indicating that the project is theoretically feasible. A benefit-to-cost ratio of 1.5 indicates a project that is cost-effective. While the research utilizing Homer Pro software shows that the substantial initial expenditure may be returned in 7.3 years, the net present cost and levelised cost of energy are $120,401,802 and 0.224$/kWh, respectively. The incentives and subsidies are crucial financial parameters to consider for reducing the cost of energy to the end consumer through governmental intervention as well as motivating incumbent investors in the energy sector, especially in the sun based electrical energy market in Rwanda, as full electrical energy access is targeted by the government.