2 nd International Scientific Conference on “Energy and Climate Change”

1. 2nd International Scientific Conference on “Energy and Climate Change” Organised by Energy Policy and Development Centre (KEPA) Athens, 8-9 October 2009 Portable Battery Lanterns : Paying for the service, not the hardware By Andy Schroeter, Director, Sunlabob Renewable Energy Ltd

2. Rural Electrification in Developing Countries • Current Situation: • Worldwide 1.6 billion people do not have access to electricity • Four out of five people without access to electricity live in rural areas of the developing world, mainly in South Asia and Sub-Saharan Africa Rural populations have to rely on home-made kerosene lamps! World Bank, 2001 Percentage of the population with access in 2000: 3 - 33% 33 – 66% <66%

3. Background (1) • Lao PDR – Country Data • Population: 5.6 million (2005); several sparsely populated remote regions; 50% of population under 20 years old • Geographical situation: 236,800 km2, bordered by China, Vietnam, Cambodia, Thailand, Myanmar; landlocked; mountainous • Political regime: People’s Democratic Republic, government began decentralizing control and encouraging private enterprise in 1986 • GDP real growth rate: 7.5% (2008 est.) • Environment - current issues: unexploded ordnance; deforestation; soil erosion; limited access to potable water

4. Background (2) • Energy situation in the Lao PDR • Electrification rate (2005) = 58% (50% national grid + 8% isolated mini-hydropower plants / solar PV systems / generators / car batteries) • highest = 96% in Vientiane Capital • lowest = 9% is in the province of Phongsaly • Total installed power generation capacity = 673 MW (99.8% hydropower + 0.2% diesel generators and solar photovoltaic systems) • Large exports and imports of power to and from the neighbouring countries • No national transmission line  many towns receive electricity from neighbouring countries (Thailand, Vietnam, China)

5. What is Sunlabob? Private Energy Provider for off-grid areas • Renting out SHS for fixed monthly tariffs • Selling KWh in villages with Village Hybrid Grids • Selling light per hour with portable battery lamps • Selling drinking water, purified by solar power

6. Solar Lanterns “Recharging Fees for Lanterns can buy Hours of Solar Light – and replace kerosene”

7. Solar Lantern Rental System (SLRS) • Operation: • Small entrepreneur in village rents solar array and charges solar lanterns for a cost covering fee • Sustainability through commercial viability • Benefits: • Reliable and cost-saving alternative to kerosene lamps: improved health (smoke reduction), cheaper than kerosene, saving fossil fuels, brighter lighting, safety • Central charging with guaranteed operating hours • Automated data collection allows for carbon accountability and entering the carbon markets

8. Charging Station System control unit solar photovoltaic modules, in series (300 Wp) Battery charging unit (STECA PL2085) Management software for data handling Technology: Brief Description • Lantern Units • 4W compact fluorescent lamp (cold cathode) • Sealed AGM-type lead-acid battery (12V, 7.5Ah) • Microprocessor for data collection • Stable housing

9. Central charging station (Village Entrepreneur) Households Operational Rental Scheme installation & servicing recharged lamps cost covering rent empty lamps

10. loans Investment Fund Private Investors Village Technician Exchange Cycle with recharging fee Involvement of Partners and Financial Transactions (Laos) PROOF OF CONCEPT Charging station in the village Sunlabob owns rents Public Donors Village Energy Fund rents Trust Fund re-invests Investments Returns owns Village Energy Committee Lamps in the village grants

11. Involvement of Partners and Financial Transactions(other countries) loans Investment Fund Private Investors Village Technician Exchange Cycle with recharging fee Country Partner Charging station in the village owns rents sells charging stations sells lamps Sunlabob Public Donors facilitates PPP model Village Energy Fund sells lamps rents Trust Fund re-invests Investments Returns owns Village Energy Committee Lamps in the village grants

12. Involvement of Partners and Financial Transactions (Afghanistan) loans Investment Fund Village Technician Exchange Cycle with recharging fee Country Partner Charging station in the village owns rents rents loan Private Investors Public Donors Capacity building provide funds for lamps purchase lease Trust Fund Investments Returns Micro financing ‘rotating fund’ Lamps in the village grants

13. Impacts (1) MDG 1: Eradicate extreme poverty and hunger • Creating local businesses (village entrepreneur) • Providing technical/admin training → opportunities for further income-generating activities • Providing additional hours of good-quality lighting → opportunities for further income-generating activities • Providing access to information (radio/TV)

14. Impacts (2) MDG 7: Ensure environmental sustainability • Reducing kerosene consumption and CO2 emissions • Providing an affordable service with renewable energy (solar PV) • Reducing indoor air pollution (smoke, fumes) • Providing the opportunity to enter the carbon markets • Reducing the risk of household fires

15. Impacts (3) MDG 8: Develop a global partnership for development • Involvement and empowerment of local communities (suppliers, distributors, end-users) • Creating Village Energy Committees • Private-Public Partnership • South-South cooperation

16. SLRS Highlights Sunlabob won the Ashden Award in 2007 for the concept... … the Lighting Africa Development Marketplace Award from the World Bank in 2008... … and the UNEP Sasakawa Prize in 2008!

17. SLRS Roll-out Plan • Roll-out plan in Laos: • Phase 1 (month 1-9): installation of 10-12 charging stations and operation under real operating conditions • Phase 2 (month 10-24): fixing operational problems that might have arisen from phase 1 and up-scaling the system by a further 50-80 stations • Phase 3 (month 25-48): 250+ charging stations operational • Roll-out Plan outside Laos: • Uganda: 25 million people without access to electricity, price of kerosene: 10-15 USD for kerosene per month • Afghanistan: around 27 million people without access to electricity • Indonesia: 70 million people without access to electricity

18. Future Developments: Global Expansion Afghanistan Vietnam LAOS Cambodia Uganda Indonesia Tanzania Afghanistan South America Vietnam LAOS Cambodia Uganda Indonesia Tanzania

19. Risk Analysis Competition Risk Outline: New potential development projects for rural electrification Mitigating factors: Sunlabob’s experience and track record Grid Connection Risk Outline: Villagers may chose to switch to grid power when available Mitigating factors: SLRS easy re-location High grid-connection cost Partner Involvement Risk Outline: Finding initial funding for the franchisee is complex Mitigating factors: Sunlabob support the Public sector to facilitate the Public –Private Partnership model

20. Conclusion Summary of Investment Benefits Fully developed business model and plan ready for implementation Commercial returns for a developmental type impact project Carbon income upside Summary of Strengths • Tried and tested concept and technology • Scalable implementation plan with significant upside through international expansion • 10 years of market experience

21. Entrepreneurs trained

22. PPP Investment Programme for Rural Electrification in … the rest of the world!

23. 2nd International Scientific Conference on “Energy and Climate Change” Organised by Energy Policy and Development Centre (KEPA) Athens, 8-9 October 2009 Thank you for your attention!