ISES 2013  - Day 2 - Jørund Buen (Co-Founder, Differ) - Game Changers in Energy Markets
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ISES 2013 - Day 2 - Jørund Buen (Co-Founder, Differ) - Game Changers in Energy Markets

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How Does The Energy Market Adapt to Renewable Investments? ...

How Does The Energy Market Adapt to Renewable Investments?


Carbon trading and other policies empowering carbon clean technology affect the energy market. These new incentives for changing the energy mix being introduced in the market result in a more complicated system. This session will give insight in today’s energy market, carbon trading and future outlook.

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    ISES 2013  - Day 2 - Jørund Buen (Co-Founder, Differ) - Game Changers in Energy Markets ISES 2013 - Day 2 - Jørund Buen (Co-Founder, Differ) - Game Changers in Energy Markets Presentation Transcript

    • Brighterlite: Bringing solar electricity to 1 million Kenyans in less than 5 years Jørund Buen Co-Founder, Differ ISES2013 14 June 2013
    • About Differ > Norwegian company founded and run by successful people within financial, renewable energy and energy efficiency businesses  www.differgroup.com > Our mission: Spearheading the scale up of small-scale carbon reduction  New ventures and finance  Advisory and analysis > Main focus on:  Africa and Asia  Renewables and energy efficiency > Team members have founded and developed 10+ companies in the renewable energy and clean tech sectors across Europe, Africa, Asia and America – in particular:  Renewable Energy Corporation (REC)  Point Carbon  Solar Vision (South Africa, installed 1000 solar systems/month in 2001)
    • Differ Business Development Differ involves directly in business development with local players to overcome barriers and to grow successfully together > Business models & strategy > Financing solutions > Systems and technical solutions > Sales and distribution > Early stage of development > Active involvement > Long-term partnerships
    • Major recent technology/market shifts  LED lights (90-95 % less kWh/yr) are becoming widespread.  Mobile phones (~1 kWh/yr) reaches 80 % market penetration in Africa.  LED TVs (80-90% power reduction) now at similar price.  A family can have telephones, radio, four lamps, PC and TV for 2 kWh/week !  Cost is 50-85 % below IEA estimate in “World Energy Outlook”.
    • Solar Home Systems - Brighterlite > Apply the idea from the Norwegian cottages – install SHS  Light for reading  Electricity for charging  Replacing kerosene > What’s different from Norway?  They cannot afford the investment  Not available in the shops  Not reliable service and maintenance competence > Suppliers in India, Thailand and Germany  Importing to Kenya  Assembled there > Containers as service centers > Payment via mobile phone
    • Opportunity: Social and business entrepreneurship  80% of Africans have mobile phones  Only 40 % have electricity  Light emitting diode (LED) lamps & TVs consume very little power (80- 95% reduction), and becoming cost-competitive; PCs as well  A family can have telephones, radio, four lamps, PC and TV for 2 kWh/week, at 50-100USD/person: half the “World Energy Outlook” cost estimate  Socio-economic development impact of light, telephone, TV, PC and internet is dramatic  The private desire for the same is great!
    • Our perspective on solar PV rural electrification • Solar photovoltaic (PV) module prices have dropped by factor 5 • LED lamps & TV lower consumption by factor 5+ • Mobile payments ease rural high volume business dramatically The competitiveness of off-grid solar has dramatically improved Differ and Basecamp competence & network will be used to: - Offer low cost solar electricity to the main rural population of Kenya - Use proven micro finance concepts to secure payments and avoid theft - Build an effective, low cost organization - Secure high volume, low cost purchasing
    • Solar home system roll-out in rural Africa: Changing the game FROM TODAY’S TOWARDS Single system sales Minimum 300 units sale/area High price Low price No organized maintenance Organized maintenance Expensive or no financing Large scale financing High purchaser risk Informed vendor risk Purchasing PV system Monthly purchase of PV energy - Credit sale & maintenance - Lease - Fee-for-service - Payment by mobile phone - IT based customer system
    • Brighterlite initial product offering
    • Ongoing test sale very successful! 0 100 200 300 400 500 600 700 1 2 3 4 5 6 7 8 9 10 11 People w/solar electricity Signed contracts • 100 % monthly payment rate requires successful concept, IT system and staff • 100 % monthly payment rate so far achieved
    • Stepwise scale-up and roll-out Step 1: Feasibility study (done) Step 2: Pilot phase Step 3: Large scale roll-out - Concept demonstrated on ”home turf” - Market exists - M-PESA works (330 customers) (2000 people) Concept scalability - Statistical documentation for scale-up financing - 3 service centers on ”neutral territories” with recruited organization & customers - 1500 customers (10 000) Roll-out - Direct transition from pilot phase - Target 1000 customers per month asap
    • Importance of mobile payments > ”Weak” bank regulations enabled Safaricom to offer simple banking services over mobile, called M-PESA (mobile money)  80% have mobile phones, 60% have M-PESA  The rest know someone who does > This is extremely practical  Removes need for cash collection, lowers risk  Can be done by practically every Kenyan, even illiterate people!  Completed payments pop up on the screens in Nairobi and Oslo headquarters shortly after completion  Provides fantastic information and overview > Increases need for central IT system to handle transactions
    • Further scaling through carbon finance? > Today: The Clean Development Mechanism (CDM)  Offsets emissions in developed countries on project basis > Tomorrow: Climate finance and new carbon market mechanisms  Sector-wide payments based on e.g. sold solar home systems meeting requirements Basic Standard Advanced Professional Full Minimum Service Level (#/duration) (#/duration) (#/duration) (#/duration) Indoor lamps 3 / 4 hrs 3 / 4 hrs 5 / 4 hrs 12 / 8 hrs Y Cell phone or Radio 1 / Cont. 2 / Cont. 4 / Cont. 4 / Cont. Y Television 0 1 / 3 hrs 1 / 8 hrs 1 / Cont. Y PC or fan 0 1 / 3 hrs 2 / 8 hrs 3 / Cont. Y Outdoor lamps 0 0 1 / 4 hrs 5 / 4 hrs Y Refrigerator 0 0 1 / Cont. 1 / Cont. Y Air cooling/heating N N N Y Y Water pump N N N Y Y Sust. Requirements (hours/yr) (hours/yr) (hours/yr) (hours/yr) (hours/yr) Uptime (guaranteed) 95% two years after installation 95% two years after installation 95% two years after installation 95% 99%
    • www.brighterlite.net