Tony Seba, Stanford University lecturer and Silicon Valley entrepreneur, has predicted that solar will be the dominant power source by 2020. Translight Solar, a company based in Accra Ghana will have to play an important role to make his prediction come true.
It is planning to sell solar systems to residential customers on a monthly lease. The business model has two twists. It aims to benefit customers by reducing electricity wastage. It will reduce risks for financiers by switching off the electricity if the customer does not pay.
The solar leasing model is not new. SolarCity (now a subsidiary of Tesla), pioneered the “no-money-down-solar” leasing model in the residential solar market in the United States.
SolarCity installed solar panels on house roofs and homeowners paid for the power over 20 years. Since then hundreds of companies across the world have tried this model (and its variants) across the world. The leasing model allows customers to buy solar power in the same way that they have been paying for electricity from the grid.
Though the prices of solar panels have been falling, it is still expensive for a customer to install a solar generating plant on her rooftop. She would rather pay for the monthly electricity bill. Solar is still a new technology. Most customers ask: “Is this for real? Is this reliable?”
He was intrigued by the promise to reduce electricity prices. He returned to Ghana in 2014 to sell solar in Africa. The year coincided with a time of persistent electricity outage in Ghana (called “
Outages of more than twelve-hour durations were not un-common. Translight’s initial set of customers were bank employees who bought these solar systems using loans from their employers. It also installed systems in schools and small businesses under a government scheme.
Translight Solar’s business model innovation of leasing solar systems while enforcing payment is not new in Africa. Pay as you Go (PAYG) solar could electrify rural Africa. PAYG companies rents consumers a solar home system in rural areas. Consumers use mobile phones to make payments on a daily, weekly or monthly basis.
Companies minimize the cost of collections by automating the receipt of payments, while remote rural customers (often unbanked) get immediate access to basic electricity without having to take out a loan. This model has taken East Africa by storm. Thousands of customers have signed up. Foundations, impact funds, venture capital funds and companies have invested in PAYG companies in East Africa.
Translight Solar’s innovation lies in taking this model to larger urban homes. Most of Ghana’s population (unlike East African nations) have access to electricity. The solar home systems supplied by PAYG companies are less than 100W capacity (many are as small as 10W). They can light only one or two lights and a mobile charger. A radio is often the only device that can connect to the system. Translight Solar’s smallest offering uses a 1000 W panel.
It can power a modern home in Accra with 20 lights, two computers one refrigerator and one television. The largest offering has a panel size of more than 5000 W and can power 40 lights, six computers, three refrigerators and three televisions. The smallest system can additionally power up four fans. The largest can power up even more electrical appliances including one air conditioner. This is important in the hot weather of Ghana.
It was not easy for Translight Solar to develop this remote switch off functionality for the larger systems. The smaller PAYG systems in East Africa produce Direct Current (DC) electricity which is fed to low wattage LED lights. Urban homes need Alternating Current (AC) electricity for refrigerators and air conditioners. The small rural homes have no other power source other than the solar power stored in the battery. The urban home consumes a small part of the solar power produced during the day.
The additional solar power produced is stored in the battery. During the evenings the house can draw upon either the stored solar power or the electricity supplied by the grid. Most solar systems come with remote monitoring facilities.
They allow owners to check on their mobile phones the electricity produced and consumed every day. There are dozens of rooftop developers across Asia and Africa. I have not come across another company which has extended the ability to monitor to the ability to switch off.
This is likely to be a game changer to help houses in rapidly growing urban
Contracts are hard to enforce. Court procedures could be cumbersome and time-consuming. The ability to enforce payments is a way to manage this risk.
Translight Solar plans to provide additional benefits to its customers. The solution can provide a ‘smart home” solution to fast-growing cities of the emerging world. Homeowners can control energy use from appliances through their cell phones.
For instance, they can set the times when the washing machine should come on during the peak hours of sunlight. They can remotely turn the television off to allow the kids to finish their homework. Heavier motor loads will get automatically switched off during periods of power outage.
Translight Solar is an incubatee of the Ghana Climate Innovation Center. The Climate Innovation Centers (CICs) are part of the World Bank’s infoDev program. The CICs support innovative entrepreneurs to develop climate-friendly technologies in emerging countries. The CIC in Ghana has been supported by the governments of Denmark and the Netherlands. Nyanteh feels that support from the CIC was key in his journey so far. “They really gave us the confidence.” The CIC also provided a grant of USD 25,000.
Nyanteh has been able to make the grant go a long way and develop the product. He has been able to do so by collaborating with Chinese electronic and inverter companies through the Ghana Energy Commission’s Renewable Energy Technology Transfer (RETT). uncommon.
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Nyanteh is planning to launch in early 2019 and is working with E&Y in Ghana to help with uncommon capital raise. E&Y is one of the partners who has set up the Ghana CIC. If successful, Translight Solar’s name will surely reach the ears of Tony Seba.
Credit: medium.com
