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The market for PAYG solar – micro-payment schemes that
have become more popular in recent years – continued to grow
in 2015. 68 Under PAYG schemes, customers typically pay a
small upfront fee for a solar charger kit, a portable system and
a control unit that can be used for powering LED lights and
charging devices such as mobile phones. They then pay for
the energy they need, either in advance or on a regular basis
depending on consumption. It is estimated that by the end of
2015, the PAYG model had been commercialised by some 32
companies operating in nearly 30 countries. 69 (p See Figure 34.)
It is most prominent in East African countries (Kenya, Uganda
and Tanzania) and in India, but it is quickly developing in other
regions as well.
Examples of successful PAYG operations include Simpa Networks
(India), SolarNow (Uganda), MKOPA (Kenya), Off Grid Electric
(Rwanda and Tanzania) and Azuri (spread across sub-Saharan
Africa). Greenlight Planet (in East and West Africa, and South
Asia), a market leader that has commercialised about 3 million
solar lighting systems, launched its PAYG model in early 2015. In
Tanzania, Off Grid Electric is installing off-grid solar devices for
more than 10,000 households and businesses per month using
this model. 70
Another category of business model focuses on bundled
packages that sell not only energy equipment but also integrated
services, from simple solar lamps with radios and mobile phones
to aspirational products such as televisions. In Nicaragua,
Barefoot Power sells a small plug-and-play home system, which
can provide lighting services to households, charge a cell phone
and power a portable DVD player. 71
POLICY DEVELOPMENTS
Government policies in developing countries are one of the most
important factors for the deployment of DRE technologies. 72
Robust policy frameworks that address a wide range of market
issues – from regulations and financing to business support and
training – can lead to rapid transformations in energy access. 73
Policies that support DRE deployment include auctions,
dedicated electrification targets, initiatives related to clean
renewable cooking, and fiscal and other incentives that focus
on specific renewable energy technologies (e.g., exemptions on
VAT and import duties). An array of national governments across
Africa, Asia and Latin America announced the expansion of
existing targets and policies for DRE systems or the creation of
new ones during 2015. Kenya, Rwanda and Tanzania all removed
VATs on solar products in 2014–2015. India successfully removed
excise duties on off-grid solar systems in 2014, and, in 2015, Uttar
Pradesh (the Indian state with the most people lacking access
to energy) announced plans to waive its VAT on solar energy
equipment as well. 74 (p See Table 3.)
In Africa, Rwanda approved its new energy policy, which included
a target of reaching 22% of its population with DRE systems
by 2017/2018, thereby increasing its off-grid power generation
to 22 MW. Even before this policy was approved, Rwanda had
partnered with Mobisol and the EU to provide solar PV systems
to 49,000 households and 1,000 schools by 2019, representing a
total installed capacity of 7.9 MW. 75 Tanzania announced a target
of 1 million solar installations by the end of 2017, which is expected
to supply solar electricity to 10% of the nation’s population and to
create over 15,000 solar jobs. 76 Ghana launched a PAYG home
solar programme in collaboration with Azuri Technology to
provide electricity to 100,000 households. 77 Mali is promoting the
sale of 1,500 solar kits with the support of local banks, which will
offer special loans to users. 78
In Asia, the Philippines announced plans to build 150 to 200
micro-hydropower plants to provide electricity to people in remote
regions, with a goal of increasing the country's hydro generating
capacity by 50 MW. 79 Bangladesh declared its intention to install
up to 6 million SHS by 2018 and plans to finance the installation
of about 1,550 solar irrigation pumps by 2017. 80 India announced
plans to install some 8,960 solar agri-pumps in the state of
Maharashtra by the end of 2015; in addition, 500 solar-powered
mini-grids are to be installed by the end of 2016 through the
state’s Smart Power for Rural Development programme, financed
by the Rockefeller Foundation. 81 In early 2016, the Indian state of
Uttar Pradesh introduced its “Mini-grid Policy” encouraging the
development of solar/biogas/biomass mini-grids of up to 500 kW
with an array of incentives, including a 30% investment subsidy. 82
03
In Latin America and the Caribbean, Guyana announced plans
to install 6,000 SHS in its hinterland communities. 83 Under the
National Photovoltaic Household Electrification programme,
Peru intends to install 12,500 solar PV systems to power
500,000 households to ensure that 95% of its population has
access to electricity by the end of 2018. 84
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