Off-grid renewable energy has witnessed enormous growth over the last decade. Since 2008 capacity has increased and the number of people in rural communities served by the technology has witnessed double growth.
The high costs of grid electricity is what has prompted initiatives in the off grid sub-sector, promoting the growth of socio-economic activities among its residents beyond the grid.
Today, over 500,000 people in Kenya, Uganda and Tanzania are receiving access to low-cost, secure renewable energy and benefit from the socio-economic impact access it delivers according to Energy Progress Report 2016 by the World Bank.
The report, tracking global achievements in sustainable energy, notes that off-grid solar-based systems have increased access to electricity in most rural areas in East Africa with Kenya leading with 60 per cent access, followed by Tanzania at 36 per cent and Uganda at 27 per cent.
As the industry is already gaining traction service providers like Mobisol, Azuri Technologies and M-KOPA are cropping and slowly exploiting the sector with their Pay-As-You-Go (PAYG) lighting products.
The solar products uses a manageable financing mechanism which is made affordable to their customers, allowing them to pay using mobile money on a daily or weekly basis.
The solar firms are appealing to consumers with a pay-as-you-go model with daily payments of as low as Ksh49. A key factor also behind the growth of PAYG home electrification systems has been their business model, which is designed to respond to the needs of rural households and their ability to pay.
This significant uptake of PAYG has also been made possible by the decreasing prices of solar panel systems in Africa.
According to a new report from Global Off-Grid Lighting Association (GOGLA), ‘Powering Opportunity: The Economic Impact of Off-grid Solar’, nearly 60 per cent off-grid solar owners undertake more work and enterprise within just three months of using an off-grid solar home system.
The global association for the off-grid solar energy industry has revealed that households using small scale-solar power in East Africa are reporting a rise in economic activity, with an improvement in income and job opportunities.
The research, funded by The UK’s Department for International Development (DfID) and conducted by Altai Consulting, was based on data collected from over 2,300 small-scale Pay-as-you-go (PAYG) solar owners in Kenya, Mozambique, Rwanda, Tanzania and Uganda in the first quarter of 2018.
With more power for enterprise such as retail and entertainment, together with increased working hours, over a third of respondents reported an average income increase of US $35 a month, more than half the average monthly GDP per capita of the countries surveyed.
“Over 10 per cent have started a new business, and 7 per cent report getting a new job,” the report read in part.
The off-grid renewable energy solutions are being deployed to provide electricity services for a wide range of end-uses, including for powering agriculture, telecommunication infrastructure, healthcare centers, schools, and rural enterprises.
“Provision of power at home has also unlocked productivity, with 44 per cent of the respondents reporting they are using previously dark and unproductive hours to work,” the report said.
Furthermore, over 90 per cent of households replacing toxic kerosene lamps, used by millions in the developing world, claim both improved health and feeling safe.
GOGLA’s impact report comes as global leaders gather to discuss how to meet the world’s Sustainable Development Goals (SDG’s).
With the focus on “Transformation towards sustainable and resilient societies”, the group is seeking insight on how to meet SDG’s including SD7 ‘Ensuring access to affordable, reliable, sustainable and modern energy for all by 2030’.
“This report shows that the net economic and social benefits off-grid solar are a huge opportunity for national governments of the developing world. Governments tell us they are interested in jobs and economic impact.” Koen Peters, Executive Director of GOGLA
He added that the report shows, off-grid solar is directly delivering such impacts and significantly. “We call on policy makers, treasury and energy departments to work together with off-grid companies, banks and institutions to break down barriers to off-grid solar and build a pathway to accelerate energy access,” He said.
Currently, 1 billion people across Africa and Asia, about one in seven people on earth, have no access to electricity.
With falling prices, increased efficiency and financial innovation, such as pay-as-you-go consumer finance, over 120 million people have now shifted from toxic kerosene lamps, candles and diesel generators to clean off-grid solar electricity since 2010.
Off-grid solar power has also meant access to previously unobtainable products and services, such as televisions and phone charging opening up opportunities for work and leisure. The vast majority (94 per cent) report an improvement in quality of life with solar.
The lighting Association hopes that Off-grid solutions will be at the heart of delivering universal electricity access by bundling off-grid renewables with efficient appliances and lighting, giving households better quality energy services at a substantially lower cost, making off-grid access more affordable and reliable.