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edit this page Green Power - Lighting up Rural India by Devyani Hari The following article discusses the use of solar home systems/lanterns that have been successfully employed in India and have displaced carbon emitting fuels such as kerosene and diesel. All information presented is in the context of the Photovoltaic Market Transformation Initiative (PVMTI).
The photovoltaic (PV) Solar Home Systems (SHS) under discussion are sold mostly to rural and semi urban households in India. Many of the regions in rural India are completely off-grid (around 46%); others are connected to the grid but have intermittent or no supply, so there is a real need for these consumers to fi nd alternative power solutions. The SHS provides reliable power for lighting and other low-power appliances, such as radio and television. Customers today understand the benefi ts of installing SHS and see the value of investing in one.Though initial applications of these SHS were restricted to domestic lighting,today there are many instances of installations in schools, small hospitals,community centres, and a multitude of micro-enterprises, where SHS can extend viable working hours into the night and provide power for operations.The SHS have great intangible benefi ts too – smoky and carbon intensive kerosene lights are avoided and people have new leisure and educational opportunities.
However, in the initial years, it was an uphill task for the SHS integrators (entrepreneurs). There were many challenges – a negative image of solar due to bad experiences with unscrupulous operators; solar was considered too expensive and unaffordable since there was no concept of credit sales; customers’ insisted on using available government subsidies, which were not always paid on time and meant the entrepreneurs had to fi nd extra working capital.
- Establishing Credit Sales: The integrators invested considerable time and effort to create awareness of solar energy among various local fi nanciers and to provide loans for the purchase of SHS. At present, around 90% of all sales are credit sales as against the cash sales that existed 4 – 5 years ago. The customers can now pay for these systems over 3 – 5 years with monthly instalments not exceeding the total monthly expenditure on kerosene.Over time, several initiatives were undertaken by the solar integrators to overcome these barriers:
- Prompt and reliable after sales services: There are various models that integrators have adopted. However, whether this is the setting up of their own service infrastructure or developing a strong dealer network, the key to success has been prompt after sales delivery. All integrators have technicians regularly visiting customers thus giving them the comfort level about product reliability. In some cases the entrepreneurs have also trained local people to look after basic maintenance of the systems with their technicians handling more complex issues.
- Establish linkages with the grassroots level organisations: India has a multitude of operatives,self help groups,NGOs etc.operating at the village level.Almost all the entrepreneurs have developed strong partnerships with these organisations. They have been instrumental in marketing, creating awareness, appraising customers and in some cases extending fi nancing for purchase of the SHS (Figure 1).
 Figure 1: Mobile educational service vanSHELL (photo: Shell Solar India) |
- Design for the customer needs:Whether it is technical or fi nancial requirements, some integrators focus on customisation. This refl ects in the type of systems sold and the loan products offered.The systems sold are not standard off the shelf products.Technicians have studied the requirements of the users and solutions are offered based on their need. For example some households have only one light installed but it is installed in a manner that lights up at least 2rooms.
- Move beyond simple lighting:Use of SHS for increasing employment income (Figure 2).In some cases the entrepreneurs have worked with the users to generate additional income from use of SHS. These income streams have then been used to service the loans. An example of this would be the purchase of small lighting systems by street hawkers1 (Figure3). The solar systems generate savings over the use of kerosene amps. These savings are then set aside on a daily basis and repay the monthly instalments to banks.These savings are more than adequate to repay the banks.
 Figure 2: Silk rearing - SELCO installation(photo: ITPI personnel) |
Today, these entrepreneurs have clearly demonstrated that SHS are a viable and affordable option for low income households. Figure 4 shows the installed capacity across India due to PVMTI. Of course no technology will work on a stand alone basis and it needs to be supported by an equally strong fi nancing and service infrastructure.
 Figure 3: Silk rearing - SELCO installation(photo: ITPI personnel) |
From PVMTI’s perspective, what is crucial to the success of a technology are entrepreneurs who are committed to the technology. The companies sponsored by PVMTI have taken a few years to develop the required infrastructure but they run profi table businesses today.What is also needed is for fi nancial institutions to come forward and support such entrepreneurs by offering fl exible financing options that would allow them to pursue their goals. PVMTI has been fl exible in adapting to the changing times and to help the entrepreneurs readjust their business models according to the need of the time.
Image file does not exist - click to upload Funded by the International Finance Corporation (IFC) and the Global Environment Facility GEF), PVMTI promotes sustainable commercialisation of PV technology in the developing world by introducing successful, replicable business models. Since 1998, about US$ 16.6 million have been committed to nine projects in India, Kenya and Morocco and fi nalization of additional projects for the remaining funds is underway. The program has fi nanced 4 projects in India,committing around US$ 10.8 million (as debt, grants, equity and guarantees) to these projects.
Projects/Installations supported by PVMTI in India are shown in Table 1.  Table 1: Projects/Installations supported by PVMTI in India |
The funds available under PVMTI are concessional in nature. However,PVMTI’s strength has been the flexibility it has offered in terms of guarantees and repayments. The program has looked at new and innovative projects and has worked with entrepreneurs to readjust their business strategy when the need arose.
IT Power India Pvt. Ltd. (ITPI), a member of the IT Power Group based out of UK, is a reputable renewable energy and environmental management consultancy fi rm, based in Pondicherry,India with regional offi ces in Pune and New Delhi.
ITPI’s core expertise lies in the following areas: harnessing alternative energy, designing and developing rural electrifi cation systems, managing funds for fi nancing renewable energy technologies, facilitating phase-out of ozone depleting substances, implementing Clean Development Mechanism (CDM), tackling waste management,R&D in appropriate technology for health, and developing and elaborating standards..
Under the PVMTI project, ITPI is part of the External Management Team which manages VMTI’s investments in India and Morocco.
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[top] [end]Contents: Boiling Point 53 - Technologies that really work  . |
Theme Editorial - Taking Science to Hearth - Good technologies - but do they really work - Rocket mud stoves in Kenya - Green Power -Lighting up rural India - The Biogas Programme in Vietnam - Pico hydro for cost-effective lighting - Biomass gasifier systems for thermal applications - GTZ News BP53 - Energy News From Practical Action BP53- What's Cooking On The Solar Cooker Front? - Getting Technologies To The Market - SODIS - Solar Water Disinfection - A story of improving cooking stoves in a Dogon village - Micro-gasification what it is and why it works - What's happening in household energy BP53?
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