Development Economics

The Economics of Solar Lanterns with Mobile Charging Stations

Develop Economies is back after a brief hiatus.   I have finished up my work on my current project and am now taking some time to appreciate some of the aspects of Ghana I hadn’t had a chance to enjoy previously.  I spent a few days living with a rice farmer about 45 minutes by motorbike from Atsusuare in a small community along a lake fed by the Volta River.  I did some work in the field (very minor – I can’t say I’m a great farmer), came across two cobra snakes, and biked an hour each way to the next village with electricity to charge my cell phone and camera.  It was the first time I have ever actually experienced rural living, with no electricity, no running water, limited transportation (you have to call a motorbike to pick you from the neighboring town), and the persistent threat of snakebites, malaria, and other calamities that hang around waterlogged fields of paddy rice.  I have discussed on this blog the different solutions to the problems of rural energy delivery and distributed power generation, to the problem of inefficiency of burning charcoal and the use of clean-burning cookstoves, and others.  But I had never actually seen any of it or experienced it with my own eyes. In terms of solar lanterns with mobile phone charging capacities, there is a huge need.  People have to travel an hour each way to get to the nearest community that is connected to the grid.  Once there, they have to pay 50 pesewas (about 30 cents) to charge their phones, and need to wait for two hours for the charge to complete.  They do this routine three times a week.  That means that 12 hours out of every week are spent on the activity (unless they couple it with a trip to the market, where they may also have electricity, or to see Manchester United play Chelsea, which is also necessitates the trip).   That is 12 hours of lost productivity, plus $1.20 for charging the phone each week. For lighting, they use battery-powered lanterns, which provide a lot of good light.  They cost 3 Ghc (~$2) and require two batteries, which cost 80 pesewas (~$0.50) for the pair.  The batteries last for three weeks.  So, the upfront cost of the lantern is low, but the all-in cost per year is closer to $15.  That is relatively low for a quality source of light, and has a low weekly cost, which is amenable to the cash flow of farmers and other people living in rural communities and working in the informal sector. (more…)

Development Economics

Next Billion Post: Energy to the BOP Made “Simple”

For my second post at Next Billion, I wrote about a company called Simpa Networks.  Simpa was founded by Jacob Winiecki and Mike MacHarg, two people I have known since I started out in the development game.  Here is a tangential story about the smallness of the world. I used to work for a consulting firm in Boston.  I wanted to work in development but wasn’t sure how to get in the door.  I knew I was interested in solar energy and read about a lot of exciting things revolving around energy solutions in the developing world.  I went on NextBillion, a blog about market-driven solutions to poverty alleviation, and looked up posts on solar energy.   I came across a post on a Brazilian NGO called Ideaas, an organization that focuses on clean energy for the poor.  Mike MacHarg had posted a comment about integrating micropayments into the Ideaas business model.  He had a Duke email address, so I reached out to him to talk about what he was doing.  He happened to be passing through Boston on the way to a wedding in Vermont, so we met up for coffee.  He introduced me to Jacob Winiecki, who he’d been working with at Arc Finance, another NGO focusing on rural energy delivery.   We talked on the phone, I told him I was applying to Kiva.  Arc Finance, as it turned out, was trying to work with Kiva to get an energy loan portfolio going on the website.  They were piloting a solar lantern program with an MFI in the Philippines and wanted to get the loans up on Kiva’s site. A month later I was accepted to the Kiva Fellows program and given my assignment in the Philippines.  As it turned out, I was placed with NWTF, the very same MFI that Arc Finance was doing a pilot with.  So, when I got down to Bacolod, I worked together with Kiva, Arc Finance, and NWTF to get the loans up on the website.  We were the first MFI in Kiva history to post clean energy loans. Now, things have come full circle.  Jacob and Mike started Simpa, and I am writing a profile on the company for the website that started the cycle a year and a half ago.  You can read my full piece here.  Below is the transcript of an interview I had with Jacob Winiecki to write the piece. (more…)