Solar panel, battery and freight prices to Africa

The barrel sets the price of the alternative to solar. Wherever the grid is absent or unstable, electricity comes from a generator, and its cost follows diesel, hence Brent, the benchmark for European, African and Middle Eastern crude, and WTI, the American benchmark. The prices shown are the nearest contract at the previous close, collected automatically. When the barrel rises, the payback of a solar-plus-storage plant shortens with nothing changing on the equipment side.

A FOB China price, for free on board, is the price of the equipment loaded on the vessel at the Chinese port, excluding transport, insurance, customs duties and distributor margin. It is the starting point of every negotiation. The indices shown are the weekly reference quotes for TOPCon photovoltaic modules, LFP battery cells and packs and storage containers, with their one-week and one-month change. Below them, partner suppliers publish their prices delivered to an African port, which shows the real gap between the factory price and the price paid locally.

A module's price is negotiated to the cent, the cost of shipping it rarely is. Yet it is a purchase line in its own right, and it varies twofold depending on the port of entry. Every week we track the cost of a 40-foot high-cube container leaving Shanghai, the main export port for Chinese modules and batteries, to eight ports chosen to cover every region of the continent. Quotes come from CEVA Logistics, one of the world's largest freight forwarders. Per watt, freight adds 1 to 2 euro cents to the delivered price.

Three local variables separate the FOB price from the cost of a project. The exchange rate against the dollar, the manufacturers' billing currency, which makes each order dearer or cheaper. The central bank's policy rate, which sets the cost of money borrowed locally and weighs on the tariff of the electricity produced. And the freight for a 40-foot container from Shanghai, quoted by CEVA Logistics, to the port of entry: Casablanca, Port Said, Abidjan, Lagos, Djibouti, Mombasa, Toamasina or Cape Town. Eight countries, chosen to cover every region of the continent, each with the date of its reading.

Rates are expressed in units of local currency per US dollar: a rising figure means the currency is weakening and imports cost more. Two pivot rates complete the picture, the yuan, the factories' currency, and the euro, the currency of many lenders and the anchor of the CFA franc. Seven-day and one-month changes are computed on daily reference rates, and the chart covers three months to tell a shock from a trend.

An African solar project is rarely financed in local currency. The yield on the ten-year US Treasury is the dollar risk-free benchmark: every project debt is priced at that rate plus a premium. The six-month Euribor plays the same role for euro financing, common in West Africa and the Maghreb. The one-year LPR is China's reference lending rate, the one at which manufacturers and their banks price supplier credit. The first two are read daily at the source; the third is set once a month by the Chinese central bank.

Three figures are enough to judge the case for solar in a country. Sunshine, expressed in equivalent hours of full sun per day, or Peak Sun Hours, which drives the output of an installed kilowatt-peak. The grid electricity price for a household, in dollars per kilowatt-hour, which sets what solar has to beat. And the price of a litre of diesel, which sets what it replaces off-grid. The map covers all 54 countries, from the Global Solar Atlas, GlobalPetrolPrices and national regulators, and is reviewed every quarter.