It is an unfortunate irony that often the poorest people pay the most for the lowest quality energy. In many areas, the rural poor pay as much as 5 USD per month for kerosene or battery power. SharedSolar is a project that attempts to develop the technology and business case to connect these populations to better, more traditional energy sources. It does so by leveraging existing mobile networks.
With SharedSolar, rural poor consumers make payments based on their usage by using a scratch card and adding credit via SMS. The system uses a micro-grid network to connect consumers to power, and each household uses a unique prepaid metering system. A group of up to 20 consumers (individuals, households, small businesses, or schools) are all located within a 50 meter radius of a single, central power source — such as solar panels — connected via an underground wire.
At the same time, the SharedSolar team is testing and developing its business model to show that a case exists for micro-grids and mobile energy payment. The team launched an initial pilot in 2010 in Pelengana, Mali and currently has systems set up in Uganda and Tanzania.
MobileActive.org spoke with Matt Basinger, project lead for SharedSolar, to learn more about the overlap of mobile technology and rural power.
Payment for Power, via SMS
Basinger credits the project to Vijay Modi, a professor of mechanical engineering at Columbia University. For Modi, SharedSolar was an overlap of two concepts. One was the success of mobile technology and the growth of mobile network access around the world. The second was an interest in energy, specifically rural electrification.
The SharedSolar team turned to what already existed in many rural areas: mobile access.
“Let’s leverage the infrastructure, let’s learn from the model, and let’s apply it to rural electrification,” Basinger said.
SharedSolar households buy a scratch card from a local vendor and send the code via SMS to credit their electric account. The SMS message reaches a payment gateway server. Through this communication, power meters connected to each household are turned on and off, as needed. When the credit is exhausted, the meter shuts off the circuit. SharedSolar is a modular system, so the team can add solar generation capacity or deploy additional systems as demand for electricity increases.
Basinger also explains the technology as a near-term, entry-level solution. The application runs on a local server, in-country, with an attached modem. It can be run on a basic netbook.
Because the SharedSolar system leverages mobile technology, local mobile operators play a role in the system. In Mali, Uganda, and Tanzania, the team is trying to bring local operators on board, develop close partnerships, and purchase services that make the overall business model more sustainable. For now, SharedSolar is “half way” in this process. Basinger said that, ideally, a mobile operator provides three key services (as a paid service):
- Closed user group services (which allow for cheaper messaging)
- Forwarding of SMS messages over HTTP and SMPP
- Toll-free number for consumers (to access the free number on the scratchcard to add credit to their account; a consumer needs to be on a particular network)
Currently, Basinger and his team can go into an area, set up a SharedSolar system, and run it without any extra services from the operator. But in this entry-level scenario, the team pays for all SMS costs (usually around $.10 per SMS). “It’s not ideal, it’s not a sustainable business model,” Basinger said.
Getting some of these services may require finesse. “In Mali, some of the services we requested from operators, and have eventually gotten, are the first time that these services have been provided,” Basinger said.
A long-term goal is to be fully integrated with a telecom. This would include a revenue stream for the operator where instead of receiving a certain amount per SMS, the operator would receive a percentage of all transaction fees, Basinger said.
SharedSolar will deploy 24 systems in the next few months across Mali, Uganda, and Tanzania, and hopes to reach a total of 100 systems in additional countries by the end of the year. In its current iteration, every SharedSolar system contains 1.4 kWh (solar panels), 350 amp hours of batteries at 48 volts, the supporting electronics, and the power meter.
When selecting a site to place the system, there are often land rights or land access issues, Basinger said. And although it hasn’t been an issue yet, the team is aware of the possibility of tampering. For instance, a neighbor could dig up someone else’s wire.
To help counter this, SharedSolar chose a star or spoke-and-wheel topology as opposed to a more traditional end-of-the-wire approach. Also, all wires are on public paths or property and visible to everyone. “The understanding and the training and the communication is a self-policing approach,” Basinger said. Tampering is also further prevented because the wire is the property of the consumer it powers.
Another challenge for SharedSolar comes with trying to develop the business model along side the technology. In addition to reducing costs and improving livelihood for the rural consumers, SharedSolar wants to test the viability of micro-utility power. “What we want to do is take all of the lessons learned, take all of the cost reduction from the engineering efforts, package it, and understand what it would take for this to be something that could go to scale,” Basinger said. To do so requires partnerships on both the manufacturing and distribution side, as well as local micro-utility owner and operators.
Trying to develop the two in parallel “is very tricky because we don’t yet fully understand the market,” Basinger said. He describes it as a “trade off between time versus proving the model versus technology development.”
A picture offers evidence of the potential of SharedSolar. In the photo (below), the red glow in the household on the left is from a traditional energy source in Uganda: a kerosene lamp. The small business on the right is powered via SharedSolar.
Consumer reaction has been positive. When the team installed the first SharedSolar system in Mali last year, Basinger was in the shed where the system and electronics sit. His colleague was in the consumer’s home, about 70 meters from Basinger. The two were talking over the phone as they readied the system. When they flipped the breaker and turned on the power for the first time, Basinger could hear cheers from the household (and over the phone) when the lights came on.
“There is a cost savings that goes along with this, but also a quality and reliability that is very exciting for people,” Basigner said.
SharedSolar is a project of the Modi Research Group at Columbia University. Pictures are by Michael Benedict and reposted here with permission from SharedSolar.org.