Experts discuss ways to approach off-grid clean energy electrification in rural India and beyond
- 09 September 2013
LONDON: Today the World Bank Institute's Climate Change Practice and The Climate Group hosted a live webinar exploring the franchise approach for off-grid electrification.
The webinar, led by Anil Raj, CEO and Co-Founder of OMC Power and Jim Walker, Co-founder and International Programmes & Strategy Director, The Climate Group, shapes a two-week long e-discussion which has now begun online, and marks the first step in the World Bank Institute and The Climate Group's quest to explore effective business models that the private sector could use to supply energy for off-grid customers.
Private sector opportunity
The context for the webinar is the increasing business opportunity that is being created by plummeting costs for renewable energy technologies, mobile-phone enabled metering and high-efficiency household appliances. It is becoming widely understood that if the private sector implements financially sustainable models today, it could play a pivotal role in accelerating off-grid rural electrification around the world.
After Monali Ranade, Senior Environmental Specialist, World Bank Institute Climate Change Practice introduced the webinar, Anil Raj, CEO and Co-Founder of OMC Power, who was dialling in from Stockholm, stressed the many benefits of using the franchising approach to connect off-grid regions. He said: ‘No other approach to electrification can compare to the speed of deploying micro power plants and a distribution network involving franchisees”
Then emphasizing the importance of involving local stakeholders, Anil Raj stated: “Adding a component of local capital to the mix is perhaps the best validation of the business assumptions. Local investors will understand the market and have a unique perspective and deep understanding of the business risks. A simple and compelling proposition that is easy to understand will attract a large number of potential franchisees in rural areas.”
Next, opening with the important statistic, “40% of India is still not connected to the grid – a population that could eventually be connected through renewable energy”, Jim Walker, Co-founder and International Programmes & Strategy Director, The Climate Group, explained how The Climate Group is working with funding from the National Postcode Lottery of the Netherlands, to explore different delivery methods for scaling up off-grid electrification models in India. He described the innovative ‘A-B-C’ micro-grid business model (anchor, business, community - mainly using telecom masts), among other business models that The Climate Group is hoping to pilot as part of our work in India.
While the project is still in consultation mode, Jim Walker outlined four core delivery models that could steer the project:
- Hand-held products like Solsource, which is low cost and easy to install and maintain
- Home lighting systems
- Micro-grids like OMC Power and Gram Power
- Community electrification such as Philips’ Light Centers, which offer light after dark for important community spaces like hospitals and schools
Jim Walker also reiterated how franchising for off-grid energy scale-up is important because it allows rural entrepreneurs to ‘build businesses for themselves, not by themselves’. He said: “For our project, we do not want to be giving grants or free products and services, simply because they foster dependency. We want to empower people to be self-reliant by identifying rural electrification business models that can be scaled up rapidly. Franchising is a key to accelerating scale up and we are interested in exploring this idea further as part of our work in India.”
The implementation phase of The Climate Group's project is planned to start in the latter part of this year. If you’d like to be part of our work or interested in learning more about this project, please contact Subaskar Sitsabeshan, Programme Analyst at email@example.com.