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Saturday, 28 February 2015

MORE EAST AFRICANS TURN TO SOLAR POWER

M-Kopa Solar managing director Jesse Moore and Safaricom chief executive officer Bob Collymore.
East Africans are increasingly using solar energy for lighting as companies scramble for a piece of the promising market.

Even as a large number of East Africans rely on kerosene, batteries and candles for lighting, a Nairobi-based company with a presence in Uganda and Tanzania, has connected more than 140,000 homes in Kenya and 20,000 in Uganda and Tanzania to solar power in the past two years.

M-Kopa partnered with Safaricom in late 2012 to launch the first commercial offering, globally, that combines mobile payments with GSM sensor technology to sell solar power systems to households in Kenya on a daily payment plan.

Sensors in the solar systems monitor payments. After 12 months of regular payments, the consumer is allowed to own the system with no more payments.

“This market has been ignited by new and improving solar equipment, and much of it has been made affordable to the mass market by pay-as-you-go offerings or other consumer financing models,” said Jesse Moore, managing director and co-founder of M-Kopa.
The company expects its market in Kenya to grow over seven times in three years, riding on the mobile payments.

“At M-Kopa alone, we expect to power at least a million homes in three years,” said Mr Moore. “The Kenyan solar category has grown quickly because consumers are being offered more and more solar options at different price points and affordable payment options.”

READ: Solar on credit helping to light up rural homes

A study by M-Kopa and InterMedia, an independent global consultancy specialising in strategic research and evaluation, shows that only 14 per cent of the 300 households surveyed in Kenya use solar as their primary lighting and charging source while Kenya Power estimates that 30 per cent of the population has access to the grid. That means up to 56 per cent rely on kerosene, batteries and candles.

The survey also looked at respondents’ energy spending. Off-grid homes, without solar, are spending on average Ksh24,820 ($272) per annum, 55 per cent of this on kerosene. The balance is spent on batteries, third-party phone charging, torches and candles.

M-Kopa has developed solar home systems that power lighting, phone charging and radio. Providing this on a payment plan that is on average 40 per cent cheaper than kerosene, batteries and candles has enabled the company to build on scale — it now connects 500 or more homes a day, it says.

As of January 2015, M-Kopa had more than 500 full-time staff across East Africa and a network of 1,000 direct sales agents. It had also commenced licensing its technology to partners in other markets.

In Rwanda, Gigawatt Global Company is establishing a$23.7 million solar field, East Africa’s first. The field, made up of 28,360 photovoltaic panels on a 20-hectare (50-acre) plot of land, supplies six per cent of the country’s power consumption. According to the power purchase agreement, it will be harnessing sunlight for 25 years.

In Uganda, two consortia plan to be generating 20 Megawatts of electricity. The consortium of Access Power MEA, of the United Arab Emirates (UAE), and Spain’s TSK Electronica will invest $17 million while that of Italian firm Building Energy Spa and Uganda’s Simba Telecom Ltd will inject $15.5 million in another plant.

The East African

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