Africa's solar growth hit as China trims subsidies

China’s decision to end value-added tax rebates on solar panel exports and phase out incentives for making battery storage equipment could push up the cost of solar installations in Africa, which relies heavily on imported Chinese technology.

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The changes, expected to take effect April 1 for solar panels and beginning next year for batteries, may complicate efforts to expand renewable energy to close vast electricity gaps across Africa, though experts say the impact likely will be manageable.

“We are likely to see solar panel prices increase in Africa because most of the inputs come from China,” said Wan-gari Muchiri, an energy analyst focused on Africa's clean energy sector. “Removing the rebate will add to existing costs, especially when you consider shipping, logistics, and other import fees.”

Africa already pays significantly more for solar equipment than other regions because of transport costs, smaller import volumes and tariffs.