Solar power surges in developing nations, creating challenges
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Analysts are tracking a rapid increase in solar energy adoption across developing countries, particularly through off-grid rooftop installations and home systems.
Researchers are using customs records and satellite imagery to measure this growth, as official government statistics often fail to capture the full extent of the change. Sri Lanka and Lebanon have seen particularly large increases in solar capacity, with Yemen now relying on solar for the majority of its lighting needs.
This “leapfrogging”, adopting new technologies without following traditional fossil fuel development, is happening because solar is now a mature, affordable technology, especially with surplus manufacturing capacity from China reaching these markets. In countries like Pakistan and Nigeria, where power grids are unreliable or unavailable to large portions of the population, solar offers a functional and cost-effective alternative. However, this rapid growth presents challenges for existing power utilities.
As wealthier households switch to solar, grid revenue declines, potentially leading to rising electricity rates for those who remain connected and exacerbating economic inequality. Pakistan is already experiencing falling grid electricity sales, and experts warn this could make electricity unaffordable. To avoid a “utility death spiral,” governments must update regulations, integrate solar into official energy statistics, and invest in grid modernization, including battery storage and flexible transmission networks.
Lebanon is attempting this with a World Bank loan, while Nigeria risks repeating Pakistan’s struggles with a weak distribution sector.
