Can Mobile Technologies Solve Energy Poverty in India?

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Geetanjali is a 20-year-old Indian girl; she comes from a poor family; and her dream is to open her own designer shop when she graduates from college. Thanks tomobile enabled electricity, her dream may come true much sooner that she expected.

Energy Poverty in India

Geetanjali lives in a slum near Bangalore, one of India’s biggest cities; and, like 75 million people throughout the country, her family has had to struggle with energy poverty for years. Where they live, there are actually electric lines; but their house was built without a permit and they could not get connected to the grid.

And, even though they could have accessed it, they would probably have experienced 8-10 hours of electricity cuts every, as it is often the case in the poor neighborhoods. In India, experts say that under-electrification hits about 80 million people.

Geetanjali’s parents do not have much money, and up to last year they would use kerosene lanterns to address their lighting needs after dark, whether it was for cooking, studying, sewing, or simply for eating. However, kerosene light was inefficient, lasted no more than one hour and caused strong indoor pollution. For Geetanjali, it made it very hard to study long hours after dark and in the longer run it would have been a major hurdle to her success.

Of course, her parents could have purchased car batteries. Battery-powered light is often brighter, and it would have enabled them to charge small devices too. For them, it was not the right solution, though. As fuel price has constantly increased over the past decade, car batteries have a cost too, and to some households, it can account for 30 percent of their spending. Besides, they would have had to go regularly to the charging plant and leave the batteries there for two days, which they thought was not so convenient.

Geetanjali’s parents wanted to go solar, just like their neighbors did a few years before. But, however convinced they were about the benefits of solar home system, they had to wait until October 2013 before they could switch to a solar solution when this was made possible by an innovative energy company called Simpa.

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Selling Solar Home System Like Cell Phones

Simpa was started in 2011 by two dynamic American entrepreneurs who strived to expand the access to off-grid solar solutions to the base of the Indian economic pyramid. To achieve this ambitious objective, they came up with a simple idea, which was to replicate the success of India’s mobile revolution in the energy sector.

In India, there are 850 million cell phones throughout the country, and it took less than ten years to reach both the richest and the poorest. According to Michael Marcharg, Simpa’s co-founder, the key factors to this incredible success were the fall in handset prices but also the pay-as-you-go model, which has enabled the lowest-income people to adapt their consumption to their actual revenues.

For Marchag, many disadvantaged households actually have the money to pay for the ongoing costs of a solar home system; but often they cannot make the upfront investment. They need time to raise the required funds and as their revenues are highly variable, they need to be able to pay as they go. This is why Simpa worked on a software solution that allows both progressive payment and flexible pricing.

Indian people can therefore get Simpa’s solar home system for a $20-40 initial payment. To have electricity, the users have to purchase prepaid cards of 50, 100 and 500 rupees, on which there is a code. With this simple code, they are able to activate the whole system and generate as much power as they prepaid for.

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By purchasing these energy credits, Simpa’s customers do not pay for the light only; they also pay down the cost of the product itself. To most people, it takes them three to five years before they can reimburse the full purchase price; but once it is done, they own the solar home system and can enjoy free electricity for 10+ years.

For low-income households, this progressive payment model makes all the difference, and it is not surprising that Simpa expects to reach more than 60,000 Indian households by 2015. Taking the example of Geetanjali, her parents could indeed afford to pay outright for Simpa’s solar home system; and, for 100 rupees only, they can now get electricity for one or two weeks in a row.

For them, life is much easier. They can power their home with 25-50 watts lamps, but also charge a cell phone, a fan, a mixer or even a television.

As for Geetanjali, she can now practice painting and sewing until midnight, maximizing her chances to achieve her dream!

How Mobile Phones Can Illuminate Rural Cambodia

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Have you ever been to Cambodia? If so, have you noticed that everyone there has a mobile phone? Whether you are in Phnom Penh, Siem Reap or even in the countryside, you’ll find people talking on their cell phone all the time.

Mobile Technology for Development

As in other developing countries, mobile penetration is very high in Cambodia. More than two-thirds of the populationuses a cell phone on a regular basis, and there is a pretty good GSM coverage in most regions.

For the country, which is one of the poorest in Southeast Asia, this is very good news, as it may contribute to a sustainable development momentum. Mobile phones have proven to be a great technology to empower the Base of the Pyramid in other countries, and there are benefits that you may not even imagine. For instance, did you know that cell phones can help people have a better access to electricity, even in the most remote rural areas?

In India, Simpa Networks has developed a Pay-As-You-Go model to enable 60,000 off-grid households to buy solar home systems by 2015. In Cambodia, a project using mobile technology has recently been started by Kamworks, a social startup whose objective is to bring innovative solar energy solutions to the rural poor.

Electricity Situation in Rural Cambodia

The need for affordable and accessible energy is huge. Today, 10.5 million Cambodians live without grid electrical power. Experts say the situation is particularly critical in rural areas where nearly 70 percent of the households have no access to electricity. Why is it so?

In many regions, there is no grid power at all; and, where people could be connected, they often cannot afford it. Most villagers have no choice but use kerosene lamps or car battery-powered lights. In the longer run, unfortunately, these products are not only expensive, but they are also inefficient, dangerous, unhealthy, and polluting.

Solar Energy Solutions

When Kamworks was started in 2006, the idea was to offer sustainable alternatives to the rural people; and this is why the company’s founders opted for solar solutions. With an average of five hours of full sun each day, Cambodia is a perfect place for solar lanterns and home systems. In addition, since fuel price has increased over the years, solar technology has become more and more competitive as its price has fallen. Then economic benefits of solar have proven to be real and short-term as well as long-term.

Difficulties usually arise, though, when it’s time to pay for a solar system. While many villagers are willing to buy solar products, the majority cannot afford the high up-front investment. To solve this issue and enable its customers to have access to solar power, Kamworks has had to be creative over the years and develop various business models. In 2007, it started renting products, and this has turned out to be among the most effective solutions. Yet there is still a major problem: higher collection costs for the company, and sustaining such a model was difficult in the long run.

Today, the answer will come from cell phones and mobile payment technology. Customers renting Kamworks’ solar home systems will soon be able to pay for the rental fees through their mobiles. For the company, this will be easier to manage; and for the customers, as they won’t have to pay upfront for the product any longer. So they will be more likely to make the leap, and go solar for their electrical needs.

Access to Energy is the First Step to Development

Of course, you could wonder, “Why is it so important to have power?” Specialists agree that access to electricity is actually a key to sustainable development. To put it clearly – where there is no light, both economic and human development goals are harder to achieve.

In Cambodia, night falls at around 6 pm. Keeping the light on until late weighs on villagers’ financial resources, and ultimately it can have an impact on livelihood, education and even quality of life.

But imagine – if the Base of the Pyramid had an easy access to affordable electricity, it could transform their lives. Children would be able to study in better conditions after dark; businesses would operate longer hours; and farmers could even have access to modern tools to produce more. Last but not least – they would stop poisoning themselves with kerosene-induced indoor pollution.

No wonder the United Nations placed the question of sustainable energies on the global agenda for the coming decade and we should celebrate innovations like mobile payments for Kamworks solar systems.