Toronto-based SkyPower plans to develop 1,000 megawatts of solar projects in Kenya over five years as part of a four-phase agreement with the Kenyan Ministry of Energy and Petroleum.
It’s one of the largest in a streak of major deals for the company, which was rebuilt after the collapse in 2008 of previous owner Lehman Brothers Holdings.
In March, SkyPower signed a deal with the Egyptian government to develop 3,000 megawatts of solar PV projects, while agreements to develop 350 megawatts were signed earlier in the summer with the states of Madhya Pradesh and Telangana in India. In May 2014, it struck a deal in Nigeria to build 3,000 megawatts over several years.
Whether SkyPower actually follows through on its development plans remains a big question, as it will need to raise billions of dollars in financing. Its growth of deal flow, however, is in no way unique.
The rapidly falling cost of solar PV means the technology is at a commercial tipping point. “Solar is about to explode worldwide,” former U.S. vice-president and Nobel Laureate Al Gore said during a visit to Toronto in July. That same month, a Nevada utility controlled by investment icon Warren Buffett struck a long-term power purchase agreement (PPA) with First Solar that will see it get solar electricity for just 4 cents per kilowatt-hour.
At that price, solar is easily competitive with coal and natural gas and far less expensive than nuclear. “Nobody thought it would be possible in this timeframe, but it’s happening before our eyes,” Gore said.
Meanwhile, First Solar hinted it’s the first of many to come. “We expect to see more PPAs pricing out at comparable levels,” it said in a statement.