1. E4D Case Study: Part A Imperial College Business School
Case study: Energy for Development (E4D)
Business Models for Rural Electrification
(Part A) January 2014
Rajiv Gandhi Centre for Innovation and Entrepreneurship
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For three weeks, the Energy for Development (E4D) team had been working closely
with the local community in Kitonyoni to determine their needs, goals and aspirations
with regards to electrification and business. Plans were underway to construct a
photovoltaic (PV) plant in the main trading zone, and to establish a business entity to
manage the distribution of electricity via a micro-grid system.
Many rural electrification projects had been attempted in the past, where external
donors have supplied and installed the equipment but provided no training or
business model to sustain the system by generating revenues. After a period of time,
the majority of these systems fail and fall into disrepair. The E4D team understood
that to overcome these challenges in Kitonyoni, they had to devise an economically
and socially sustainable model for rural electrification.
Although the concept of installing a solar-powered micro-grid system appeared
simple, there were many issues relating to business model design. Technical
concerns raised by the E4D engineers about optimising the PV system are of course
important, but issues of financing and sustainability in the community are crucial if
the local population is to accept the new system.
When addressing these points, the team recognised a number of societal and
institutional factors that might affect their decisions, such as: Government priorities
concerning the energy grid; political and country risk such as inflation; as well as
community aspects relating to the sustainability of the business enterprise, including
local capability development, ownership and agency risk, and affordability of the
service in relation to existing energy sources.
Taking these difficulties in their stride, the E4D team set out the following objectives
for the months ahead: 1) To design an efficient PV system that meets the needs of
local households and businesses in Kitonyoni, considering installation and operation
& management (O&M) costs; 2) Devise a revenue model which is sustainable and
affordable, based on an appropriate tariff structure for households and businesses;
3) Propose a project financing model capable of sustaining O&M costs and paying
back capital costs, following an assessment of different governance options typically
adopted in rural electrification initiatives.
These points would require equal consideration if the Kitonyoni project was to
sustain itself. To help in the decision process, the E4D team devised a simulation
tool, which would enable them to experiment with different parameters,
contingencies and business models (see instructions in Appendix 1).
Energy for Development (E4D)
Established in 2010, the Energy for Development (E4D) Network is a non-profit,
humanitarian project led by the University of Southampton’s Sustainable Energy
Research Group and Imperial College Business School. It aims to establish and
implement renewable, off-grid energy solutions, which include a sustainable
business model for East Africa. This involves an internal or external donor providing
the investment, whilst the community takes an interest in running the project and is
provided with training to implement a business model that generates revenues,
sustains the system and allows it to be replicated.
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E4D is currently exploring a similar micro-grid solution based on PV technology in
Oloika, Kenya and Bambouti, Cameroon. The success of these projects will
ultimately depend on the implementation of a proven and sustainable business
model in Kitonyoni, where the aim is to establish an autonomous enterprise to run
the grid and to have completed a full handover by September 2014.
Kitonyoni, Kenya
Kitonyoni is an off-grid, rural market district in Makueni County, Kenya (Figure 1). It
has a total population of 2,590 in an area covering approximately 27 sqkm
(population density = 96 people per sqkm). The district has 479 households and is
divided into 11 administrative villages. The region is currently considered too remote
for grid power; providing an ideal location for E4D.
Figure 1: Map of Kenya and the Kitonyoni sub-location
Kenya is the largest economy by GDP in Southeast and Central Africa, with a
population of over 44 million and an annual per capita income of approximately 1800
USD. According to the World Bank’s latest data, only 16% of Kenya’s population has
access to electricity, dropping as low as 5% in rural areas. The country has a
temperate climate and is a ‘sunbelt’ country with adequate solar resource all year
round. Annual rainfall over most of the country is low and variable, and areas such
as Kitonyoni have such limited water supply that villagers must transport water from
a river bed over 2 kilometres away.
Strategic Challenges for Rural Electrification (RE)
Rural electrification (RE) is wrought with challenges. The rural setting is
characterised by scattered clusters of poor communities with low population
densities; where consumers are dispersed geographically and have limited ability to
pay for services. Even for simpler products such as rechargeable lighting systems,
targeting rural consumers, dispersion, low profit margins, and access to consumers
make efforts complicated and unable to achieve economically viable scale.
Decentralised off-grid rural electrification solutions such as solar subsequently fail to
succeed on a large scale in developing countries. Most of the challenges in this
sector relate to problems of access (affordability) and governance (ownership and
financing), resulting in a lack of sustainability of installed systems.
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Problems of Access
Rural communities are characterised by limited transport access, low population
density and limited consumer income and consumption. The distance of rural
communities from the grid increases the cost of energy provision per kWh resulting
in a larger gap in energy provision. The consumption of energy also remains low due
to limited access to facilities such as televisions, computers and refrigerators. This
results in a lower rate of return for the investor compared to the high investment in
capital costs, due to the fact consumers need and use less because they cannot
afford to do otherwise. Lack of energy provision subsequently depresses
consumption behaviour and limits economic growth and social development.
Income levels in agricultural communities such as Kitonyoni are highly variable
depending on whether it is high or low season, making pricing and microfinance
solutions important. The fact that many households are not accustomed to receiving
energy bills or in some cases even paying for electricity presents further challenges
to changing consumer behaviours.
Problems of Governance
In developing countries, project financing can be problematic. To be attractive to
private investors, a business must break-even within five years or else it is unlikely to
succeed in the long-run. Profitability and rate of return for the investor limits private
sector interest in rural electrification projects. In resource limited settings, where the
community is highly fragmented, community engagement is vital to ensure that
appropriate solutions are developed and financed by investors and the community.
In low income communities when service delivery is coupled with community
participation, the benefits are realised more effectively through a sense of ownership
and pride.
When exploring community ownership models, agency risk presents a significant
challenge. Lack of proper leadership at the community level can make local
engagement difficult, whilst self-seeking behaviour by local agents presents a clear
and present problem. This has been identified by numerous NGOs unwilling to
operate in the Kitonyoni district for instance.
Societal and Institutional Considerations
Existing Energy Sources
Only 5% of Africa has access to electricity. Most homes rely on costly and potentially
dangerous sources of energy such as open fires, oil, gas and kerosene. Access to
electricity would provide a higher quality of life both economically and socially. In
order drive consumers away from non-renewables, it is important to secure ‘buy-in’
from the community as well as offer a value proposition for solar which is cheaper
than existing alternative energy sources.
Building Local Capabilities
It is important to consider community aspects relating to sustainability of the service,
especially when adopting community ownership models. Local capability
development and training would be required in the following areas in order to ensure
the business enterprise is run effectively:
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- The basic technical aspects of running the plant, hence maximising its potential
- Account keeping in order that the accounts are accurate.
- How to manage customer relations and administer surveys (needs assessments)
- How to advertise the product to the local population and teach them how to use it
- The concept of the business model and how it can be sustainable.
Country/Political Risk
The Kenyan government established the Rural Electrification Authority in 2006 to
accelerate the pace of rural electrification in the country. The Ministry of Energy has
a mandate to extend the grid into rural areas and is committed to promoting
electricity generation from renewable energy sources. While there are opportunities
resulting from this mandate, the time-frame and levels of such investments may vary
according to government priorities; hence realistic constraints should be applied.
In parts of Africa, high inflation has also thrown projects off track as the costs
increase unexpectedly and the concessionaries are unable to make a profit. In
Kenya, inflation has reached as high as 25% in times of political unrest, such as
during elections (Figure 2).
Figure 2: Inflation in Kenya (Annual %)
Source: World Bank
Typical RE Business Models
To overcome the strategic and institutional difficulties present within the rural
context, a number of business models for sustaining solar energy projects have been
explored in developing countries including: cash, credit and leasing arrangements
which address problems of accessing end users, as well as service and cooperative
models tackling broader concerns of governance (summarised below).
Cash: In the cash and carry model, users buy an individual power supply system on
a cash basis. The ownership of the system is transferred over to the customer who
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assumes responsibility for maintenance of the system. The advantage of this model
is there are few stakeholders and the governance (i.e. customer monitoring and
control of equipment) requirements are low. The end-user also has a sense of
ownership and a reason to maintain the system. However, drawbacks of this model
include low incomes preventing direct purchase of power systems, isolation from
maintenance and lack in understanding of the technology.
Credit: In this model credit is provided to either the dealer or end-user. The credit
can be provided as a lump sum or in instalments. The advantage of this micro-credit
approach is that the initial barrier of high investment to individual households is
lowered. Success relies on the presence of a funding agency that is the primary
sponsor, as well as the terms and conditions of the loan.
Leasing: Another option is for the customer to lease the PV system (such as a
rechargeable lighting system) from the system owner through the payment of regular
lease fees. The drawback is that the customer doesn’t own the system and there is
limited incentive to manage and keep the system performing well.
Service: In the energy service model, equipment and systems are owned by
governments or private companies and concessionaries through the formation of
Energy Supply Companies (ESCOs). The fee for service model has gained
prominence in recent years as the financial and technical responsibilities lie within
one organisation, thus reducing the risks. Through regulations, ESCOs can achieve
faster and wider coverage.
Cooperatives: The concept of cooperatives has been widely applied in the field of
agricultural markets, both globally and in Africa. The advantage of cooperatives in
agriculture is that resource poor farmers can tap into markets where transaction
costs are debilitatingly high. The formation of hybrid business models and
cooperatives has been extended to rural electrification projects in parts of Africa
whereby local businesses and households take a stake in the venture, making end
user contributions in the form of entrance fees and share purchases. This provides
an incentive as the community then benefits from the successful adoption and
maintenance of the system through the receipt of dividends.
E4D Energy Model
In many rural areas, the cost of bringing the national grid to the region is and will
remain expensive. This cost is recouped through high (and increasing) connection
charges. This means that even in areas where the grid is present, the proportion of
businesses and households that have a connection is still low as they cannot afford
a connection. A renewable off-grid solution is cheaper in comparison and can
incorporate business models which provide payment plans for businesses to pay for
their connection in instalments, ensuring a reliable electricity connection is affordable
to the majority.
The E4D energy model is based on a photovoltaic (PV) micro-grid in combination
with a rechargeable lighting system, managed by a local business entity (see
illustration in Figure 3). It will provide direct electricity to all the businesses in the
main trading centre. The health centre and school will also benefit from the micro
grid, which provides full AC power and the use of most electrical equipment.
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The businesses will pay a tariff based on their electricity consumption. For the
households, a dispensary will distribute lanterns with lighting and mobile phone
charging capabilities. The lanterns comprise a battery unit which can be recharged
by some of the businesses in the trading centre and by the business enterprise
established to operate the grid.
Figure 3: E4D Energy Distribution Model
Current Situation in Kitonyoni
By September 2012, following extensive consultation with the local population of
Kitonyoni during the planning and design stages, E4D engineers had begun working
with local contractors and villagers to construct the solar power plant and micro-grid.
A comprehensive survey had been carried out amongst local businesses and
households in order to understand the community’s energy needs, behaviours and
their willingness to pay. The results of this study are intended to inform the system
design, pricing strategy and tariff structure adopted by E4D as part of their chosen
business model.
There are currently 35 businesses and 479 households who could potentially
subscribe to electricity services in Kitonyoni. The plant must provide enough capacity
to meet both current and projected demand over the system’s lifetime (20 years). In
order to drive this demand however, E4D must encourage consumers to move away
from traditional sources of energy and onto the micro-grid and RLS system.
Business Entity
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Households: Energy consumption amongst households currently involves the
burning of firewood for cooking and the use of refillable paraffin lamps for lighting.
The highest demand for electricity amongst households is for the purpose of lighting
and mobile phone charging. Based on survey data, households would require
enough electricity to provide up to 25 hours of lighting and at least two mobile phone
charges per week. Using the Rechargeable Lighting Systems (RLS), this would
require two charges per week at approximately 0.02 kWh per charge.
Businesses: The main business activities include: Posho mills, electronics
businesses, mobile phone charging, pharmacy, shops (duka), tuck shops (kiosks),
groceries, a hotel, bicycle repairs, butchers and carpenters (see examples in Table
1). Businesses located within the main trading centre benefit from a direct line from
the PV plant, enabling the use of electrical lighting and longer opening hours, as well
as power for equipment and mobile phone charging.
Table 1: Types of Businesses in Kitonyoni
Type of
Business
Products/Services
Current Energy
requirements
Additional
energy
requirements
Opening
hours
'Hotel' (café) Githeri, ugali,
vegetables, tea
Petrol Generator (0.5 l/day)
used for charging battery,
for TV and phone charging
Hairdressing
equipment
5am-
8.30pm
General &
Hardware store
Maize, Mbati
(corrugated steel),
cement, paraffin
Lighting (0.5l/week
paraffin, torch, phone)
Welding 8am-
6pm
Shop, TV hall Viewing football
matches
Generator
'Kinyozi' (barber) Hairdressing and
mobile phone
charging
3 Car batteries (recharge in
Kathonzweni) used for
mobile phone charging and
clippers
Water heating 8am-
6pm
Butcher's Goat meat (cooked
and uncooked)
Lighting (candles, 2/day) Refrigerator/
freezer
8am-
8pm
Pharmacy Drugs Lighting (paraffin
1.2l/month)
10am-
9pm
In the baseline survey, each business expressed different energy requirements,
ranging from at least 5 businesses currently using a 3KVA generator to several
smaller businesses requiring only basic lighting/charging facilities. Based on a needs
assessment of all 35 businesses, the average energy consumption per business is
projected to be 0.23 kWh/week.
Local Services: The total consumption required by public amenities in the main
trading zone is estimated at 3 kWh/week. This includes the health centre being able
to benefit from electrical lighting, refrigeration and sterilisation as well as the school
which will have electrical lighting and the ability to use electronic equipment such as
a computer.
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Optimising the PV System
The PV installation has been custom-made in the UK and shipped to the site in two
standard shipping containers, which will form part of the plant. The modular design
makes it easy to replicate and resize to the village’s requirements (Figure 4).
The capacity and lifetime of the grid is affected by the number of modules and how
they are configured within the PV system, as is the cost. All of these must be
considered when optimising the system design to meet local energy demand. In
order to help the team decide the most appropriate design, E4D engineers have
provided a list of configuration options (Appendix 1).
Figure 4: Modular Design of the PV System
The modular design affects the types of appliances and usage levels which can be
sustained on the micro-grid. Therefore in order to provide an affordable and effective
service that meets the current and future needs of the community, it is for important
for E4D engineers not to under- or over-design the system.
Each system configuration comprises a set of PV arrays which can be increased or
decreased based on the required capacity (kW). In order to provide a reliable source
of electricity, storage is included in the system in the form of a battery bank. The
battery bank contains a number of 2V, 800Ah batteries connected in series to meet
the required level of storage. This ensures the system can cope with peak demands
occurring early morning and evening when a solar source is low or absent.
The charging of the batteries is controlled via charge controllers which prevent over
charging, maintaining a longer battery life. The DC power produced from the
batteries feeds into inverter(s), which convert the DC into useable AC power. The AC
power then feeds into a micro-grid which local businesses, schools and the hospital
can connect to. For an element of redundancy, the system is split into two grids; an
10KW BACKUP
GENERATOR
(Optional)
- - - -
PV Arrays (KW)
Charge
Controllers
Battery System (V)
Inverters (KW)
System supplies two AC grids.
One grid for essential loads
(school and dispensary) and the
other grid for non-essential loads
(businesses and church).
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‘essential grid’, which supplies the local hospital and school and a ‘non-essential
grid’ supplying businesses. To ensure the system copes with peak load demands, a
10kW back-up generator can also be included in the system.
Kitonyoni has no water supply and villagers have to transport water from a river bed
over 2km away. The canopy of the solar plant in each case has therefore been
designed to collect up to 20,000 litres of water in tanks during the rainy season to
use throughout the year, offering an additional ‘pull’ factor to local villagers.
System Costs Summary
Both installation and replacement costs of the PV system depend on the
configuration chosen. The following cost summary breaks down additional expenses
that contribute to the total capital costs of the project. Capital costs were higher in
Kitonyoni due to the nature of it being a pilot project and the fact the installation was
assembled and delivered from the UK. Operating expenditure is reflected in the
annual O&M costs, and could vary depending on whether any technical work is
required following the installation.
Table 2: E4D Cost Summary1
Cost Summary Description
Installation costs Depend on the configuration option chosen
(Appendix 2), includes unit costs for:
- PV solar array
- Inverters
- Batteries
- Generator (optional)
- Grid connection costs ($136 per connection)
Miscellaneous costs Other costs incurred in the installation of the PV
plant (labour, materials, delivery, and contingency);
Amount should reflect the size of the PV, selected
from the pull down menu in the simulation.
Operation & Management Estimated at $2,500 includes management and
administration; night watchman (annual salaries);
any necessary technical labour.
Replacement costs Replacement parts over a 20 year system lifetime,
include discounted cost of batteries in year 10
($3,200) and inverters in year 15 ($3,000)
Devising a Sustainable Revenue Model
Traditional revenue models for electrification rely on a tariff setting which directly
meets the capital and running costs of electricity grids, often with a tenuous link to
affordability. If the tariffs are fixed too low, then utility companies struggle to meet the
capital and operating costs; if the tariff is set high, there is a substantial risk of low
consumer adoption and poor customer retention. E4D has collected information on
the community’s willingness to pay and social/economic situation to devise an
appropriate revenue model for charging households and businesses in Kitonyoni.
1
CAPEX and OPEX are determined by the inputs selected on the system module of the simulation.
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Often communities start paying for solar home systems and find that the tariff or
deposit repayment scheme is not manageable. Financing models such as subsidies
have been used to develop pricing models and ensure that the customers can afford
repayment. Microcredit can also be brought into the projects to offer more flexible
repayment mechanisms enabling communities to raise deposits and capital costs
over a longer period of time to tide over irregular income sources. The local micro-
financing organisation in Kitonyoni is a company called K-Rep.
Potential revenue models might involve households and businesses paying a set
energy tariff ($ amount per kWh), or a fixed monthly charge ($ amount per month) or
both. This could depend on whether the subscribers are on the grid or the RLS; as
well as their usage levels, economic status and payment habits.
Households
There are 479 households in Kitonyoni to which the rechargeable lighting systems
(RLS) could be distributed. On average the monthly household income ranges from
16 USD during the low income months to 88 USD in the high income months. In
reality the household income might fall between these two figures. The cost of the
lanterns for lighting and phone charging is 30 USD. Seasonal household incomes
mean most households do not have enough liquid capital to purchase the lantern.2
Once the households are supplied with lanterns, they will be able to go to
businesses in the trading centre or the main business entity to get the battery from
the lantern charged. Based on initial tests, the batteries would have to be recharged
at least twice a week to power one mobile phone and 3.5 hours of daily lighting from
the lantern. Currently the households are spending up to 4.89 USD per week on
paraffin and kerosene. In order to come up with an appropriate pricing model, a
survey was conducted amongst 500 households to determine the existing cost of
energy in Kitonyoni and a benchmarking exercise for grid services in the UK and
Kenya was also carried out:
Table 3: Benchmarking and Survey Data
Agency
Wholesale
Tariff
Actual Tariff
including
Surcharges
Actual
Tariff
USD/kWh
Source
Kenya Power Ltd. 8KES/kWh 20KES/kWh 0.2 KPLC and Nairobi
Electricity Bill
British Gas UK £0.02/kWh £0.2/kWh 0.3 Websaver Tariff,
UK
Existing Cost of
Energy in Kitonyoni
2.02 500 Household
Interviews
2
When exploring possible leasing arrangements, E4D became aware of a similar initiative called
Equinox, which distributes rechargeable lanterns in Rwanda. They observed that if lanterns were
given away for free, they were often lost, misused or sold off. To provide some form of risk coverage,
it is suggested that a deposit for the lantern is taken as a form of end user contribution.
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As national grid systems are heavily subsidised, it is difficult to match those tariffs on
a cost basis. However, the battery recharge cost per week must be less than the
current cost of energy in Kitonyoni so as to provide an incentive for households to
move away from existing energy sources.
Business Tariffs
The businesses in Kitonyoni could be of two types; the first would be a group of
businesses who directly offer charging services to the households and the second
group would comprise of businesses which will benefit from electricity through longer
opening hours and mechanisation of equipment.
Semi-structured interviews were conducted with the businesses to understand
energy demand, willingness to pay and affordability. There are 5 businesses in
Kitonyoni who currently use generators, and spend KES 1860/month (18.6 USD) for
energy. The remaining businesses in Kitonyoni rely on traditional sources of energy,
and they are willing to spend 300KES/month (3 USD/month) for a direct supply of
electricity. Their average monthly profit is about 30 USD so their willingness to pay
represents 10% of their monthly profit.
Businesses offering recharging services to households could potentially also
purchase reserve batteries outright or on a lease. The households would bring the
batteries to the business for recharging, taking a charged battery back with them.
Financing the E4D Project
Although set-up and capital costs in the case of the E4D project in Kitonyoni have
been covered by UK grant funding, the principal investment has been included in the
cost analysis in order to ascertain the break-even point resulting from a variety of
governance and financing options; hence providing a realistic and sustainable
business model which can be replicated in other parts of East Africa. When devising
an appropriate financing model, E4D must consider the project costs alongside a
variety of potential financing options from public and private sources.
Operation and management costs: The annual O&M cost, based on the chosen
system design, must be recovered from income generated by electricity sales. In
addition to the annual O&M costs, there are parts which would need to be replaced
during the system’s life-cycle. For an assumed lifecycle of 15-20 years, replacement
costs of up to 18000 USD (based on historic cost of batteries and inverters) must
also be recoverable from income generated by sales. Bearing in mind that in ten
years time, the cost of batteries and inverters would have greatly decreased, a
discount may need to be applied.
Capital investment costs: Capital costs include grid installation plus an additional
amount covering set-up and administration, calculated at between 48,680 and
124,160 USD depending on the system configuration, plus an additional $20,386 for
delivery and contingency costs. It is likely these costs will not be covered by income
from electricity sales, suggesting suitable financing models and ownership
arrangements must be identified.
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E4D is considering the pros and cons associated with different financing options and
governance modes, including a combination of funding sources. Possible financing
options include: Loan capital, private investment from local entrepreneurs;
government subsidies; and leasing arrangements associated with private or
publically-owned Energy Service Companies (ESCOs), whereby profits are set
against capital costs. Community leaders are engaging with local entrepreneurs from
nearby towns to understand how this might work as a potential financing model.
Hybrid models which encourage community ownership and stakeholder engagement
models for local training and capability development are also being explored.
Kenya’s Ministry for Energy has also expressed interest in the project, as part of a
mandate to extend the electricity grid. This opens up the possibility of subsidies on
the tariff per kWh, which will in turn put downward pressure on the tariff charged to
the community. Local support has also been secured from the Assistant Chief of the
district, who has pledged to engage the community around the project. A further trip
is planned in April 2013 to implement the final system and possibly carry out local
training amongst members of the community.
A Sustainable Business Model for Kitonyoni
E4D’s main challenge is to develop a socially and economically sustainable business
model for electrification in Kitonyoni which is also replicable in other parts of rural
East Africa. To accomplish this, the E4D team set out the following tasks:3
1. Provide an optimal system design which meets the needs of local
businesses and households in Kitonyoni, considering the modularity of the PV
system and the costs associated with different design options, as well as the
current and future energy demands of the community.
2. Propose a revenue model which is sustainable and affordable, based on an
appropriate tariff/charge for households and businesses, which considers
local social and economic data: i.e. Low and variable household incomes
(cash vs. credit), and the price of alternative energy sources (benchmarking).
3. Devise a project financing model capable of sustaining O&M costs and
paying back capital costs. This must be linked to the identification of a suitable
governance arrangement, especially those which encourage community
participation and engagement.
3
An excel worksheet attached to the case study provides a set of simulation tools which allows the
E4D team to experiment with different business models and enter their own inputs such as demand
projections, pricing decisions and financing options. The financial statements linked to the graphs
state the financial position of the business entity and how it is affected by different design choices.
Sliders have been included, which allow the team to select from a range of inputs. It is
important NOT to manually enter inputs into the yellow tabs as it will override cell functions
and prevent further changes to the worksheet.
15. E4D Case Study: Part A Imperial College Business School
Appendix 1: Introduction to the E4D Simulation Tool
The simulation tool has four modules: Consumption, System, Pricing and Financing. Each
module links up to financial statements which provide the data for the three graphs, showing
E4D’s cash position and break-even point.
1. Consumption
Use the information provided in
the case study to devise
reasonable assumptions on the
current and future energy
consumption of the local
community.
HINT: Use the energy demand in
final year (y=20) to help inform
your system design choices.
3. Pricing
Devise an appropriate charging model for
subscribers by selecting between an energy
tariff, fixed monthly charge or, both.
HINT: Consider the impact inflation has on the
price of electricity and on the project itself.
3. Financing
The model allows for a range of
financing options and combinations.
End-user contribution is left open to
include entrance fees or deposits on
lanterns for instance.
2. System
Adjust the modules in the PV system to
determine capital costs and optimise the
system design depending on consumption.
(Refer to the configuration options provided
by E4D engineers in Appendix 2).
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Appendix 2: System Design Options provided by E4D Engineers
*Kitonyoni coordinates and irradiance figures were used and a typical load profile was entered.
It is important to note that the daily load can be much higher for each system, but it would result in a decrease in battery
life and an increase in capacity shortage. The daily loads provided maintain a battery life of at least 8 years and a
capacity shortage less than 5%. Adding a generator means capacity shortage is 0% and thus the daily permissible load
will only be limited by battery life constraint.
OPTION*
PV
(KW)
INVERTER
SIZE (KW)
INDIVIDUAL
BATTERY
SIZE
NUMBER OF
BATTERIES
BATTERY
VOLTAGE
GENERATOR
(KW)
DAILY
LOAD
(kWh/day)
BATTERY
LIFE (YRS)
CAPACITY
SHORTAGE
(%)
APPROX
COST
(USD)
1 5 5 2V 800Ah 12 24 0 14 11.1 5 48,680
2 15 5 2V 800Ah 12 24 0 18 8.2 1 88,680
3 15 10 2V 800Ah 24 48 0 35 9 5 95,960
4 15 10 2V 800Ah 24 48 10 38 8.1 0 99,160
5 20 10 2V 800Ah 24 48 0 39 8 4 120,960
6 20 10 2V 800Ah 24 48 10 39 8 0 124,160