Implementation strategies for renewable energy services in low-income, rural areas
This issue brief is the first in a series of three that focus on expanding the delivery of affordable, renewable energy in developing countries. It describes the core business strategies employed by a group of socially oriented energy enterprises and organizations working to provide distributed, renewable energy services to low-income, rural communities and provides examples of how these strategies were implemented.
The enterprises and organizations described here promote the social, economic, and environmental benefits of delivering clean energy services to individuals and communities that are not well served by traditional energy providers. Their business models combine social and environmental objectives with entrepreneurship. Although these enterprises function across different countries and contexts, they are characterized by a common focus on clean, affordable, accessible, and scalable energy solutions. Millions of underserved people in 11 countries around the world have benefited from the work of the enterprises highlighted here.
This series is rooted in a three-day workshop held by the World Resources Institute (WRI) and the DOEN Foundation in March 2012 as well as follow up interviews that gathered the experiences of 25 socially oriented energy enterprises, organizations, and financiers who understand the energy needs of low-income consumers in developing countries.
Over the course of the workshop and interviews, participants identified four core strategies common to their business models: (1) understanding consumer needs, preferences, and capacity to pay; (2) demonstrating the value of a new technology or energy service delivery model; (3) building and maintaining consumer trust in the product and the supply chain; and (4) designing financing and payment schemes that fit within consumer energy budgets.
This brief examines each of these strategies, first through exploring its rationale and then by considering specific examples of its implementation. Although the energy access solutions discussed still face obstacles for scale up, several socially oriented energy enterprises and organizations have proven that with the right delivery mechanisms, and effective and efficient financing, many consumers can access affordable, cleaner energy services.