In advance of the World Economic Forum on Africa, Sameer Hajee, CEO of Nuru Energy, discusses the need for a new approach to energy poverty.
The world is finally starting to realize that if we don’t address energy poverty, we are going to fail in our efforts to achieve the Millennium Development Goals (MDGs).
For those of you who are unaware, two billion people – a third of the world’s population – still do not have any access to modern sources of energy. Almost 700 million of these people are in Africa.
At the Forum, I have the privilege of sitting on a dedicated panel – New Solutions: Ending Energy Poverty – to discuss this very issue, one that underpins poverty in Africa.
For us, the Forum will provide an opportunity to showcase our observations of energy poverty, compiled from spending four years working in villages across East Africa and India.
To start the discussion, let me debunk a few myths that we have come across in the past four years:
- Myth: The base of the pyramid (BOP) should enjoy the same access to electricity that we do in the developed world.
Reality: In an ideal world, this would, of course, be the ultimate solution. But let’s face it, access to grid electricity for the majority of rural Africans is a distant proposition, and there are insurmountable costs and logistical problems. If we want to address the issue immediately, we need to start focusing on hyper-local solutions that get people access today (tonight!).
- Myth: We need to provide the poor with enough energy to power TVs and fridges, as well as to light their homes.
Reality: The primary energy needs of the poor are basic: cooking, task light, mobile-phone charging and radio. Access to a little bit of power can have a tremendous impact on development – we’ve seen it first-hand. We need to start looking at the issue from the local perspective, not ours.Of the four primary energy needs, the BOP spends the most on lighting. Up to 40% of the hard-earned income is spent on kerosene that is burned for light. In fact, kerosene is a US$ 17 billion-a-year industry in Africa (vested interests, anyone?). It is no coincidence that the two billion people without access to electricity are the same two billion people living on less than US$ 2 a day.
- Myth: Solar lamps and home solar-lighting systems are the panacea.
Reality: Much attention has been given to introducing solar light to the poor. However, two hurdles exist, both of which have been plaguing small solar companies for at least a decade. First, the high upfront cost of solar is prohibitive. For the poorest of the poor, US$ 10 for a solar lamp is a fortune, and end-user financing via microfinance banks has proven to be unscalable. Second, in many African countries there are three or more months of rainy season. What happens then?
At the Forum, I am looking forward to describing Nuru Energy’s truly innovative, scalable and sustainable approach to solving the immediate energy needs of the rural poor. This solution literally harnesses the human power of a village-level entrepreneur who then sells the energy that she/he generates to recharge low-power devices, such as our Nuru Lights or mobile phones. This is a hyper-local solution that takes a free and ubiquitous energy source and converts it into economic opportunity and low-power electricity.
By creating further awareness of what Nuru Energy is doing, we hope to spark the interest of new donors, new investors and new potential partners who can help us to solve the problem where the need is the greatest— in the villages where tonight two billion people will literally be in the dark.
Author: Sameer Hajee is co-founder and Chief Executive Officer of Nuru Energy. Watch our animated video and learn more about Nuru Energy at www.nuruenergy.com and like us on facebook: www.facebook.com/nuruenergy
Photo: Power lines tower above shacks in Khayelitsha township, near Cape Town, South Africa. A third of the world’s population still does not have any access to modern sources of energy.
Photo Credit: Mike Hutchings / Reuters