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Cleantech Insights | Don’t let large-scale solar eclipse the market for the poor.
by Daniel Coles | August 5th 2011
Posted in Cleantech & IT, Company Insight, Lighting, Solar
Tags: Barefoot Power, Carbon Emissions, d.light, Developing World, Eight19, Fenix International, Glowstar,Kerosene Lighting, micro-energy, Micro-Energy Markets, Microconsignment, Nokero, PiSAT, Rural Lighting, Solar Lamps, Solar Lighting, Solarnest
Whilst being a massive advocate for the push to make solar technology more affordable to reduce the industry’s reliance on feed in tariffs, I have come to realise it has somewhat taken the attention away from another important application of solar: to provide light for people in developing countries. It is a market that is potentially worth billions.
Currently 1.6 billion people live without electricity, with the majority of them burning kerosene to produce light. This comes with numerous problems: kerosene lighting is more expensive per unit of light than what we pay in the developed world for electric lighting, and there are huge health implications attached with using kerosene – breathing in the indoor air pollution from kerosene lamps is equivalent to smoking two packs of cigarettes a day! Furthermore the environmental effect of 1.6 billion people using kerosene fuel accounts for approximately 9% of global carbon emissions from lighting.
So the challenge we are now facing is to make solar lighting products available to developing world countries at an affordable price. Easier said than done.
Currently there is not one proven approach to market entry for providing solar energy in developing rural areas. Each country differs in terms of its infrastructure, entrepreneurial capabilities and non-profit funding. This means that to reach the grassroots market, it is important for solar companies to partner with entrepreneurs, non-profit organizations, microfinance organizations, importers, distributors and retailers.
One promising model that I am particularly fond of is microconsignment. Microconsignment is a way for village entrepreneurs to sell innovative and important products where there is no established market — such as solar lamps – without having to take on debt. Instead, villagers are given the products and the training to sell them. Once they make the sale, they repay the supplier and keep a portion of the proceeds as a commission. Done right, microconsignment provides new business for villagers, helps make life healthier and more prosperous for their neighbours, and brings solar lamp developers access to new markets.
For example, Barefoot Power is a company involved in this with installation of its lighting technology resulting in an estimated 95% reduction in expenditure in comparison to kerosene lighting over a 10 year period. Barefoot trains entrepreneurs to develop and expand the scope of its brand, and educates supply chain partners (including importers, distributors and static retailers) to develop training programs and micro-energy markets in various countries.
Other companies tackling this problem in a different way include: D.Light, Eight19, Fenix International, Glowstar,Nokero, PiSAT, and Solarnest.
For a full 6 page profile on D.Lights business, see the D.Light Company Insight Profile on our new interactive webtool, i3.
It is evident that due to the size of the market and obvious need for solar technology as a replacement to kerosene that it has potential.
It will be interesting to see which innovative mix of business model and technology will “crack the nut” by making solar lamps accessible and affordable to people in the developing world.
Tags: Barefoot Power, Carbon Emissions, d.light, Developing World, Eight19, Fenix International, Glowstar,Kerosene Lighting, micro-energy, Micro-Energy Markets, Microconsignment, Nokero, PiSAT, Rural Lighting, Solar Lamps, Solar Lighting, Solarnest
Whilst being a massive advocate for the push to make solar technology more affordable to reduce the industry’s reliance on feed in tariffs, I have come to realise it has somewhat taken the attention away from another important application of solar: to provide light for people in developing countries. It is a market that is potentially worth billions.
Currently 1.6 billion people live without electricity, with the majority of them burning kerosene to produce light. This comes with numerous problems: kerosene lighting is more expensive per unit of light than what we pay in the developed world for electric lighting, and there are huge health implications attached with using kerosene – breathing in the indoor air pollution from kerosene lamps is equivalent to smoking two packs of cigarettes a day! Furthermore the environmental effect of 1.6 billion people using kerosene fuel accounts for approximately 9% of global carbon emissions from lighting.
So the challenge we are now facing is to make solar lighting products available to developing world countries at an affordable price. Easier said than done.
Currently there is not one proven approach to market entry for providing solar energy in developing rural areas. Each country differs in terms of its infrastructure, entrepreneurial capabilities and non-profit funding. This means that to reach the grassroots market, it is important for solar companies to partner with entrepreneurs, non-profit organizations, microfinance organizations, importers, distributors and retailers.
One promising model that I am particularly fond of is microconsignment. Microconsignment is a way for village entrepreneurs to sell innovative and important products where there is no established market — such as solar lamps – without having to take on debt. Instead, villagers are given the products and the training to sell them. Once they make the sale, they repay the supplier and keep a portion of the proceeds as a commission. Done right, microconsignment provides new business for villagers, helps make life healthier and more prosperous for their neighbours, and brings solar lamp developers access to new markets.
For example, Barefoot Power is a company involved in this with installation of its lighting technology resulting in an estimated 95% reduction in expenditure in comparison to kerosene lighting over a 10 year period. Barefoot trains entrepreneurs to develop and expand the scope of its brand, and educates supply chain partners (including importers, distributors and static retailers) to develop training programs and micro-energy markets in various countries.
Other companies tackling this problem in a different way include: D.Light, Eight19, Fenix International, Glowstar,Nokero, PiSAT, and Solarnest.
For a full 6 page profile on D.Lights business, see the D.Light Company Insight Profile on our new interactive webtool, i3.
It is evident that due to the size of the market and obvious need for solar technology as a replacement to kerosene that it has potential.
It will be interesting to see which innovative mix of business model and technology will “crack the nut” by making solar lamps accessible and affordable to people in the developing world.
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