Energy for Development Technical and Business Issues in
Energy for Development: Technical and Business Issues in Serving the Unserved with PV John Rogers, Vice President Soluz, Inc. MIT - D-Lab I September 2006 www. Soluz. USA. com
Presentation Overview • Technology • Market – The rural energy challenge – Where PV fits in • Soluz business model – Soluz Honduras experiences • Moving forward, scaling up www. Soluz. USA. com
Soluz, Inc. • Business and technology development company • Distributed micro-power technology commercialization • Core expertise: rural energy delivery in developing countries • REDCO developer – Rural energy delivery companies www. Soluz. USA. com
Soluz, Inc. • 1993 – Soluz, Inc. • 1995 – Soluz Dominicana • 1998 – Soluz Honduras • 1996 – Global Transition Consulting – Worldwide advisory services www. Soluz. USA. com
Technology www. Soluz. USA. com
Technology Sunlight goes in. Electricity comes out. www. Soluz. USA. com
Market – Rural Electrification • World population: – Unconnected: – Biomass users: www. Soluz. USA. com
Market – Rural Electrification • World population: 6 B – Unconnected: 1. 6 B (300 M+ households) – Biomass users: 2. 4 B www. Soluz. USA. com
Market – Rural Electrification • World population: 6 B – Unconnected: 1. 6 B (300 M+ households) – Biomass users: 2. 4 B • Latin America: 400 M – Unconnected: 60 M (10 M+ households) www. Soluz. USA. com
Market – Rural Electrification • World population: 6 B – Unconnected: 1. 6 B (300 M+ households) – Biomass users: 2. 4 B • Latin America: 400 M – Unconnected: 60 M (10 M+ households) What can an enterprise do to reduce this energy divide and make a profit? www. Soluz. USA. com
Rural Energy Sources, Costs ($/k. Wh) What are people using? What does it cost? www. Soluz. USA. com
Rural Energy Sources, Costs ($/k. Wh) www. Soluz. USA. com
Monthly Energy Expenditures What are people spending? www. Soluz. USA. com
Monthly Energy Expenditures www. Soluz. USA. com
PV Where does it fit in? www. Soluz. USA. com
Rural Electrification – Grid vs. PV www. Soluz. USA. com
Rural Electrification – Market for PV PV is viable for pre-electrification, for: • Dispersed households and enterprises, • With low energy needs, • Seeking high value, more energy, lower cost (per unit) www. Soluz. USA. com
Rural Elec. – Communal Niche for PV PV is viable for rural public services for communities: • Rapid, cost-effective – Schools – Lighting, A/V, computers – Clinics – Lighting, refrigeration – Potable-water pumping – Street and security/area lighting www. Soluz. USA. com
Soluz Business Model • Basic business challenges – Target/serve poor, dispersed populations – Provide reliable, remote, quality service – Service customers efficiently • Potential solutions – Target able customers with right products, right payment plans – Establish local delivery structure – Attract/apply “smart subsidies” (? ) www. Soluz. USA. com
Typical Soluz PV System www. Soluz. USA. com
Typical SELCO PV System www. Soluz. USA. com
Monthly Energy Expenditures www. Soluz. USA. com
Offerings – Possible Market Penetration www. Soluz. USA. com
Offerings – Rental • $5 -20/month • Easiest for rapidly capturing new customers • Rental company assumes technology and sector planning risks • Particularly good for pre-electrification – If the grid arrives, the PV can be redeployed www. Soluz. USA. com
Rural Energy Sources, Costs ($/k. Wh) www. Soluz. USA. com
Honduras www. Soluz. USA. com • Population: 6+M • Population without grid access: 2. 5 M • Households off-grid: 500, 000+
Soluz Honduras – Infrastructure NATIONAL OFFICE Service Center www. Soluz. USA. com Service Center
Soluz Honduras – Progress • Raised investment – $1. 55 M • Built innovative business model • Reached rural customers – 5, 000+ – Unsubsidized offers – Cash – Micro-credit – 1, 300+ systems sold – Micro-rental – 2, 500+ customers served • ~100, 000 payments collected • Total collections – $2. 6 M+ www. Soluz. USA. com
Soluz Honduras – Progress Rural applications www. Soluz. USA. com
Soluz Honduras – Progress www. Soluz. USA. com
Soluz Honduras – Progress www. Soluz. USA. com
Soluz Honduras – Progress www. Soluz. USA. com
Soluz Honduras – Progress Microenterprise www. Soluz. USA. com
Soluz Honduras – Progress Microenterprise www. Soluz. USA. com
Soluz Honduras – Progress Clinic www. Soluz. USA. com
Soluz Honduras – Progress Schools www. Soluz. USA. com
Soluz Dominicana – Progress Community water supply www. Soluz. USA. com
Soluz Honduras – Challenges Any guesses? www. Soluz. USA. com
Hard to starboard! Hard to port! Reverse full! Steer clear, steer clear!… abandon ship? www. Soluz. USA. com
Soluz Honduras – Challenges • • Transactions – 8 -10 deals Hurricane Mitch – Survived, but. . . Churn – Grid, customer instability Restructuring – “Venture fund” debt obligations – Forced focus on cash sales, “cream-skimming” for profitability – Reduced local rural service capacity (rural agents and employees) • Module supply www. Soluz. USA. com
Soluz Honduras – Cash Sales Channels NATIONAL OFFICE Service Center DEALER www. Soluz. USA. com DEALER
Soluz Honduras www. Soluz. USA. com
Honduras – Changes in Environment • Increased government interest • World Bank rural infrastructure project – Lengthy process, but coming soon – Goal: 5, 000 households with PV over 4 years www. Soluz. USA. com
The Subsidy Factor Systems Donated Customer Pays ? 0% Cost Recovery from User www. Soluz. USA. com 100%
Soluz Dominicana www. Soluz. USA. com
Soluz Dominicana and Soluz Honduras www. Soluz. USA. com
Interventions Key elements to increase energy access through enterprises: • Enabling policy environment – rural electrification planning linkage – subsidies by government for the poor • Consumer finance • Innovation funding • Enterprise finance – Debt and equity will flow if above three exist www. Soluz. USA. com
SELCO India www. Soluz. USA. com
SELCO India www. Soluz. USA. com
Scale-Up: Dimensions Source: Rogers, et al. , Innovation in Rural Energy Delivery, 2006 www. Soluz. USA. com
Scale-Up: Range of Needs, Technologies www. Soluz. USA. com
Conclusions • • PV isn’t a panacea for rural energy. . . But it has an important role to play. Learning from leading experiences is key. Accelerating energy access will require attention to the four key elements. www. Soluz. USA. com
Soluz, Inc. 55 Middlesex Street, No. 221 North Chelmsford, MA 01863 -1561 USA Tel: +1 978 -251 -1525 Fax: +1 978 -251 -5291 E-mail: john@Soluz. USA. com www. Soluz. USA. com © Soluz, Inc. 2006 www. Soluz. USA. com
Designing Your Energy System • Loads • Resources and production • Storage www. Soluz. USA. com
Designing Your Energy System • Loads – Power x time = Energy – Watts x hours = Watt-hours – If include inverter, need to consider efficiency www. Soluz. USA. com
Designing Your Energy System • Resources – Solar • Often expressed in sun-hours (k. Wh/m 2/day) • Typical = 4 -6 – Other possibilities • Wind - Can be strong, but highly variable; very sitedependent • Pico-hydro - Need resource • Biogas - Feedstock www. Soluz. USA. com
Designing Your PV System • Production – Power x time = Energy – Watts x hours = Watt-hours – Definitely need efficiency factor – Amps x hours = Amp-hours www. Soluz. USA. com
Designing Your PV System • Storage – Current x time = (Energy) – Amps x hours = Amp-hours – Consider days of autonomy desired – Include efficiency factor www. Soluz. USA. com
Designing Your PV System Example: Loads (12 VDC) Light (10 W) x 4 hours 40 Wh TV (15 W) x 2 hours 30 Wh Radio (3 W) x 10 hours 30 Wh DAILY LOAD 100 Wh Efficiency factor (for inverter) N/A www. Soluz. USA. com
Designing Your PV System Example: Resource and Production Daily load 100 Wh Insolation 5 hours Efficiency factor 0. 7 Extra sizing factor 0. 9 MODULE SIZE 32 -35 W www. Soluz. USA. com
Designing Your PV System Example: Storage Need (/day) 100 Wh Autonomy 5 days Need (total) 500 Wh Max depth of discharge 80% BATTERY CAPACITY 50 -55 Ah www. Soluz. USA. com
Soluz Dominicana www. Soluz. USA. com
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