In a recent article titled, Power to the People, The Economist provided a helpful round-up of some of the latest energy innovations targeting the 1.5B people who have unreliable or intermittent access to electricity and other modern energy sources. I’ll use the short-hand term “energy outsiders” to refer to this group.
Here are a few of things that stood out to me:
- Most of the energy outsiders live in rural areas (cities are most often electrified)
- Any way you look at it, the trajectory of the current solutions are insufficient for delivering affordable and reliable energy to most of the energy outsiders
- Innovation is needed on multiple fronts including energy generation, energy storage, energy-powered devices and business models for all of these. [That is, just saying we'll get everyone on the electrical grid won't work.]
- Solar is important, but biomass energy generation is also important and can deliver 24×7.
- Microfinance banks may have an interesting opportunity to finance energy-related investments — although they are going to be most interested in efforts which generate income for borrowers (not just consumption) in order to have a higher likelihood for loan repayment.
- There are health and environmental benefits when people switch from kerosene or wood fuel to LPG/propane (See my previous post on Vidagas)
A few micro-energy business highlights:
- D.light, the market leader in low cost solar lights, charges $10 for its basic model. They believe they need to get the retail price down to $5 to make it universally affordable.
- Husk Power Systems has created a promising “mini-grid” product which uses old diesel generators refitted to burn rice husks supplying power to 600 families. Pilots demonstrating financial sustainability. [I saw a similar unit earlier this year in a village in the Irrawaddy Delta of Myanmar.]
- India-based Selco Solar is seeking to differentiate itself by focusing on income-generating reasons to purchase their solar products. Their first product is a solar-powered electric sewing machine and they have a hybrid (solar/biomass) banana drying machine in the works.
- MicroEnergy Credits has an interesting approach for extending the global carbon trading credits down to individual poor households who switch to greener technologies.
I think there is a lot of potential for bottoms-up approaches to bring electricity, lighting and electric-powered devices to the energy outsiders. I think we’ll see most growth around solutions which have a strong ROI (that is, generate income) for the purchaser (or whatever the business model is).
Please share about other micro-energy innovations and ideas in the comments.