Sunrise sectors

The small business of saving the world can be a profitable one, too.

Pricey for us, cheap for them
Entrepreneur Harish Hande is a fine example of a man who’s learnt to practise what he once preached. As a student in the States in the early 1990s, he became convinced of the potential of solar power to help the rural poor – and embarked on a PhD on solar financing mechanisms. He came back to India to write it up, living in an off-grid house lit by solar, and immediately set about forming a business to fulfil that potential. That was back in 1995. Ten years later, from its base in Bangalore, his SELCO company has installed 38,000 solar home systems (SHS) across India, proving Hande’s faith that solar could indeed be a sunrise sector, in more ways than one. A typical SHS consists of a 35W PV panel, four compact fluorescent lights and a battery. The panel sits neatly on the rooftop, and charges the battery during the day, so it can turn out at least four hours of light and power each evening. The systems even work during the monsoon, when clouds can veil the power source for days on end – testament to the fact that you don’t need the sun to be shining to harvest solar power. For Westerners accustomed to seeing solar PV as something of a green luxury, it might be surprising to hear that it’s affordable for India’s rural poor. But if you’re reliant on kerosene and batteries, as so many are, then solar is good value by comparison. As Hande puts it: “Solar electricity is expensive for the rich, but it is cheap for the poor.”

“Solar electricity is expensive for the rich, but it is cheap for the poor.”

For people without mains electricity, an array of solar lamps is a tiny miracle. It gives clear, clean light for children to study by, and for their parents to work in. A lamp mounted over the door makes for a safer, more welcoming area outside the house, too. Street vendors don’t have to contend with the problem of kerosene’s smoke and heat spoiling fresh produce. In some areas, it’s even seen as preferable to grid power. As one SELCO customer commented: “My son comes to visit me whenever there’s a test match on TV, because my solar electricity supply is much more reliable than his mains one in town!” One of SELCO’s successes has been to persuade banks that the poor are eminently credit-worthy. It works closely with local self-help groups, which already have some experience in this field, and some of its most persuasive arguments can be couched in language the banks readily understand: money. Or to be more precise: savings. Take the case of one street vendor. Repayments on his solar system were set at 200 rupees (£2.50) a month. Any doubts as to whether he could afford this were soon dispelled when it emerged he would save exactly twice that in kerosene costs. It’s not just financial savings, but carbon ones, too. An average modest household gets through around 120 litres of kerosene each year; if it switches to solar, that means 310 fewer kg of carbon are emitted into the atmosphere. Not much in itself, but multiply that by 38,000... Island lights
Char Montaz is a long, low, green island, sat in the choppy waters of the Bay of Bengal. One of a number of remote ‘chars’, it’s home to a farming and fishing community for whom mains electricity is just a distant dream. And for Asma Huque, that’s an opportunity there for the taking. Together with her sister, Hasna Khan, she runs Prokaushali Sangsad Ltd, a small Dhaka-based consultancy which works exclusively for NGOs and development agencies. “We were working on the island on a World Bank project, when some of the local women came up and said: ‘No one asks us what we want.’ So we talked to them, and together we devised a scheme in which women would be providers as well as users of energy: they’d have a voice in what they need, and control over what they provide.” That scheme turned into a women’s co-op, the CEWDC, in which over 30 local women have been trained to assemble and sell solar electric systems to the island’s homes, schools, mosques and traders. On the co-op’s flat roof, a solar panel pulses power down to the workshops below. Here the co-op members sit at workbenches, chatting away while expertly wielding soldering irons and pliers, assembling lights and charge controllers, and meticulously charting electrical output. Since CEWDC was formed in 1999, it’s grown into quite a business: they’ve sold around 380 solar home systems, and last year turned over £29,000 worth of sales.

“A lot of our husbands were worried at first. Then they saw the money coming in, and now they’re all for it!”

For the women involved, its success has done more than put money in their pockets: it’s transforming their social status, too. As co-op member Shahida puts it: “A lot of our husbands were worried at first: ‘Where are you going? What are you going to get up to?’ Then they saw the money coming in, and now they’re all for it. And they no longer complain that we’re always spending their money, because now we have some of our own. Now our children’s grandparents are saying; ‘We’ll look after the kids – you go and work!’ And the men are encouraging their wives to apply for work here.” In the island’s market, traders are using CEWDC’s solar to light their stalls: everything, from grocery stalls to sewing shops to a shrimp ‘nursery’, is illuminated by solar. On the lane leading down to the harbour, a row of women crouch sorting the fresh fish catch in bright white pools of solar light. The market already had its own diesel generator providing electricity – at a price. But that price is rising fast, as the cost of oil spirals – diesel has rocketed by around 40% in the last year alone. For the first time, that means it’s cheaper to recharge a lamp using PV power. Small wonder that growing numbers of the traders are now defecting to solar... – Martin Wright

22 July 2005

Martin Wright