Pay-as-you-go solar power

• Pages: 22-24

p. 22 2012 | 4

Pay-as-you-go

SOLAR POWER

While for many p eople, elec trical power is a vailable at

the ick of a swi tch, for some 1.6 billion peopl e around

the world without access to grid electricity this remains

a dream. An innovative technological and nancing solu-

tion develop ed by Simpa Networks, howeve r, promises

to transfo rm the lives of som e of the world’s poor est

communities by bringing a clean, low-cost, sustain-

able energ y source into t heir homes. W IPO Magazine

contacted Pa ul Needham, Presid ent and co-founder of

Simpa Net works, to nd out m ore about th is ground-

breaking initiative.

Simpa Networks was esta blished in March 2010 by Mr. Needham,

an infotech entrepreneur and his c olleagues, Jacob Winie cki

and Michael MacHarg, both exper ts in micronance. The

inspiration for setting up the c ompany and rolling out its novel

business model was the rapid adoption of mobile phones in

emerging markets. In the rura l areas of Africa and Asia, “you can

meet some of the poorest people on the planet with some of the

latest telecommunications technologies in their hands, and it’s

changing lives and improvi ng livelihoods”. Mr. Needham notes,

“the prepaid mobile phone has made modern communications

accessible to nearly 6 billion people over the last decade. We

asked ourselves: why not sell sola r like a cell phone?”

Many of the world’s poorest communities re ly on kerosene

lanterns (see WIPO Magazin e 5/2011: Switching on to Solar –

Goodbye Kerosene) to light their homes, spending over US$50

billion annually on a sou rce of lighting that is “dangerous, dirty

and dim”, Mr. Needham observes. “Simpa’s mission is to make

modern energy simple, affordable and accessible to everyone”,

he explains; “it’s a bold mission, but the good news i s that the

technologies to end energ y poverty already exist.”

THE ACCESS CHALL ENGE

Companies around the world are developing and deploying

a range of small-scale distr ibuted solar photovoltaic (PV) sys-

tems for use in rural homes and communities where demand

for energy is rapidly ris ing. The high up-front costs associated

with these technologies, however, are often a barri er to access,

Changing Lives

Mukesh lives w ith his extended fam ily in an informa l

settlement in Banga lore, having resett led from Gujarat

following a dev astating eart hquake. ey have no land title

and lack access t o the electricity gr id. e family earn s

between US$10 and US$15 a day mak ing and selling cr icket

bats. Mukesh is c oncerned about his siblings’ educ ation.

He knows that w ithout light, it is impossible for them to

study in the eveni ngs.

e retail price of a home sol ar system is around US$150,

too much for these households to pay on a n up-front cash

basis. Financi ng such a purchase was al so impossible as

these famil ies had no land title. Conv inced that a home solar

system would per form to meet their needs, they dec ided to

buy a Simpa-powered home solar sy stem. e Simpa pricing

model allowed them to t ry the system and pay on the ba sis

of actual us age in the knowledge that , if the system stopped

working, t hey would not have to pay.

Over the past 12 months , Mukesh and his fami ly have

enjoyed access to relia ble and clean energy. ey use it ever y

day to light thei r homes, charge their mobile phones (which

are essential for t heir business), listen to the radio a nd

even watch telev ision. Mukesh purchases energ y “tops ups”

from a local agent 2 to 4 t imes per month when he has cash

available.

At the end of April 2012, t he family completed its contrac t.

ey now own the system a nd enjoy clean, reliable electr icity

free of charge. e other f amilies in Mukes h’s community

have also either paid o t heir systems or wil l do so soon.