Technology

Easy energy with mobile pay

 By Andrew Burger

It’s estimated that more than 1.2 billion people around the world lack access to electricity in their homes. For the first, this situation is changing, and rather quickly. Social development-minded startups are using mobile payments and solar photovoltaic (PV) technology to bring affordable, clean, renewable power to local communities across sub-Saharan Africa that have never had access to electricity before. These ¨pay as you go¨ solar energy systems are doing much more than providing emissions- and pollution-free electricity, they are serving as seeds for the development of sustainable local economies by creating jobs, enabling residents to start their own small businesses, providing education and training and improving overall community health.

It’s estimated that somewhere between 1.2 billion and 2 billion people around the world lack access to electricity in their homes. Instead, they turn to traditional energy resources that are costly, polluting and destroy ecosystems, such as kerosene and charcoal. Such habits help perpetuate a cycle of ecological and economic degradation and poverty.

However, this situation is changing, and rather dramatically. For the first time in history, enterprising sustainable energy and development startups are bringing affordable, clean, sustainable energy to rural sub-Saharan African communities by combining mobile payments, solar PV, battery storage and smart meters.

Also offering a growing variety of low-power DC home appliances, such as LED lighting, radios and TV sets, the success of young ventures such as Cambridge, UK-based Azuri Technologies is shattering the commonly held perception that sub-Saharan African communities are too poor to justify making the capital investments needed to provide them with electricity.

¨Pay As You Go¨ home solar power systems such as Azuri’s are doing much more than providing emissions-free electricity. They are improving community health and well-being and sowing the seeds for sustainable community development by creating employment, enabling residents to start their own small businesses and providing valuable skills, education and training.

Africa’s Growing Population of ¨Pay As You Go¨ Solar Homes

Azuri has tapped into various funding sources to build its sustainable energy business. In addition to UK venture capital, that includes funding from USAID and Power Africa, a multi-billion dollar sustainable energy initiative launched by US President Barack Obama in 2013. Azuri has used this venture capital to expand from Kenya across sub-Saharan Africa.

Launching in Nairobi in 2011, tens of thousands of Azuri’s PayGo Energy systems and counting have since been installed in 11 Sub-Saharan countries. The PayGo home energy system provides eight hours of emission-free lighting a day plus enough power for mobile phone charging.

PayGo customers pay a small one-time installation fee and then purchase scratch cards or use an integrated mobile money service to top-up their home solar units. Azuri has found that the system cuts customers’ weekly energy spending by as much as 50 percent. Moreover, customers start saving money and reducing emissions immediately.

With PayGo, Azuri is able to offer a package of clean energy products and services that provides energy self-sufficiency at a lower cost than kerosene. ¨Whereas residents typically spend $2 per week on kerosene, they might pay $1 per week for the basic PayGo system. So, for half the cost they get proper, clean lighting and the ability to charge mobile phones when they want right at home,¨ CEO and co-founder Simon Bransfield-Garth highlighted in an interview.

Looking ahead, the CEO pointed out that some 600 million Africans still lack home access to electricity. ¨As technology improves, we’re looking to deliver more to consumers. The next thing is probably TV sets, but we’re also looking at providing decent Internet access to rural residents,¨ he continued. ¨If you look at what it really takes to level the playing field for Africans, Internet access is great leveler. It has a huge educational benefit, as well as offering entertainment and improving quality of life.¨

We're doing the same sort of thing cleantech innovators in Western markets are doing, but at a price point, product and system scale customized for Africans. We're using the same sort of batteries you find in a Tesla EV, LED lights and adaptive power management to profile customer energy usage and tailor it to their needs

¨Reverse Innovation¨

Prior to launching Azuri, its four co-founders began investigating whether or not there was an opportunity to sell the home solar energy products they had developed in sub-Saharan Africa. ¨We came to the conclusion that the business case for solar in Africa was overwhelming,¨ Bransfield-Garth recounted. ¨Residents overspend on kerosene for lighting, for example, which raised the question as to why solar PV hasn’t been installed all over Africa.¨

Deployment of mobile telecoms networks, widespread use of mobile payment systems and the low cost of small-scale home solar PV systems has changed the energy calculus dramatically. Though small by Western standards, rural residents in sub-Saharan Africa spend a much higher percentage of their incomes on energy than their counterparts in developed countries, Bransfield-Garth pointed out.

Most people living in developed countries don’t realize just how cheap their energy costs are, he added. ¨Africans spend about 80-times more on kerosene than people in the US and Western Europe for electricity.¨

This realization led Azuri further along the path of what Bransfield-Garth called reverse-innovation towards developing PayGo’s business model. As he explained: ¨We found only one utility that works clear right the way across Africa – mobile networks. Most people don’t have bank accounts; about one-third of Kenya’s GDP moves over mPesa, Kenya’s mobile money system.

¨We’re doing the same sort of thing cleantech innovators in Western markets are doing, but at a price point, product and system scale customized for Africans. We’re using the same sort of batteries you find in a Tesla EV, LED lights and adaptive power management to profile customer energy usage and tailor it to their needs.¨

 

This infographic by Abo.net showing the share of population without electricity access and the major energy infrastructures in Africa

Energy in Africa today (source: Iea 2014)

Sustainable Energy Takes Center Stage at Paris Climate Talks

The groundbreaking efforts of enterprising sustainable energy ventures are right in line with UN Sustainable Development Goals (SDGs) and those of the UN Framework Convention on Climate Change (UNFCCC). In recognition of its achievements, the UNFCCC will present Azuri with a UN Momentum for Change Lighthouse Activity Award during the Paris climate conference.

Disappointment followed in the wake of the failure of UNFCCC member nations to create an emissions reduction mechanism during the 2009 climate conference in Copenhagen. UNFCCC Executive Secretary Christiana Figueres decided ¨shining a spotlight¨ on the success and achievements of enterprising sustainable energy and development ventures would help restore optimism and regain momentum, UNFCCC’s Nick Nuttal recounted in an interview.

¨While Copenhagen was not a success, momentum was building worldwide for a wide range of solutions that enable the transition to a low-carbon world, and that has continued,¨ he explained.

That provided the backdrop for the 2012 launch of the UNFCCC’s Momentum for Change program and Lighthouse Activity Awards. ¨Many fascinating and inspiring projects have received awards. At first many were quite small in scale, but we are now presenting awards to much larger projects,¨ Nuttal noted.

¨Azuri is a classic example of how innovative new ventures are employing existing renewable energy and clean technology in creative ways that refute one of the myths regarding sustainable energy — that poor people in developing countries cannot afford clean energy.¨

Another myth Azuri and other sustainable energy ventures in Africa are shattering is that people have to sacrifice something in order to combat climate change, Nuttal continued.

In fact, growing use of distributed, small-scale renewable energy systems is bringing social and environmental, as well as economic, benefits to communities in Africa and developing countries around the world. As Nuttal said, by using them, ¨Africans are lifting up their lives, the lives of their children and their fellow citizens.¨

about the author
Andrew Burger
Andrew Burger has been reporting on energy, technology, political economy, climate and the environment for a variety of online media properties for over five years.