Summary

The energy access landscape has been moving rapidly in the past few years: new technologies, emerging leaders, Pay-as-you-Go, momentum for renewables, etc. This report investigates barriers and solutions to scale for market-based approaches offering cleaner energy access to low-income customers in developing countries, for home and small scale productive uses. The objective is not to provide an exhaustive view across all technologies and geographies, but rather to learn from a selection of the most innovative and successful practitioners, representing solutions with high potential and innovation dynamics: solar lanterns, solar home systems, clean energy microgrids, solar irrigation pumps, and improved cook stoves.

The findings are based on an in-depth review of the performance and work of 26 practitioners, selected after a global scan of over 300 organizations. While the lessons drawn from them may not be applicable in all situations, they will hopefully inspire other practitioners, as well as donors, investors, companies, and policy makers, in their efforts to provide access to energy for all.

Key Insights

  1. The most successful geographies for solar lanterns sales are starting to saturate, while other entire regions remain largely untapped. The main issue remains the lack of adequate distribution channels in rural areas. Download the full report to learn about Hystra’s recommendations to overcome the challenges of solar energy to reach poor, remote areas.

  2. Many Solar Home System companies prioritized quick customer acquisition over portfolio quality. Practitioners need to revisit their growth strategy by focusing on customer retention and satisfaction

  3. Financing remains hard to secure for Clean Energy Microgrids because of the high-risk environment and the relatively small size of all actors. Governments should play a role in de-risking this field beyond tariff exemptions, e.g. land regulations and anti-corruption measures

  4. Some farmers remain unconvinced of buying Solar Irrigation Pumps despite clear long-term gains, due to very high upfront costs compared to alternative irrigation solutions. Innovative business models to reduce investment risks for farmers are being tested and should be encouraged further, e.g. joint programs with microgrid operators

  5. Marketing and sales best practices for Improved Cook Stoves fail to spread. Only a few players sell more than a few thousand units per month. In the short term, it’s recommended to replicate existing successful models for basic ICS. Donors and NGOs could help the sector by providing technical assistance and prompting best practice sharing