Nana Asamoah-Manu Program Lead, Lighting Africa, Kenya

Transcription

1 Nana Asamoah-Manu Program Lead, Lighting Africa, Kenya

2 Agenda 1. Great challenge. Great potential. Great Opportunity 2. The Lighting Africa/ Lighting Global Approach 3. The Lighting Global Quality Assurance Component 4. The Kenya Story. Progress through multipronged effort

3 Over the next 15 years, Africa will rapidly surpass Asia to become the largest unelectrified market in the world Un-electrified population, millions By 2030 roughly 1.3 billion people will remain un-electrified. With Africa s unelectrified projected to grow to 700 million, gains made in other regions will be largely negated.

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5 Transformative technology in a dynamic market 5

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8 Off-grid solar now delivers more: Lighting and beyond Pico-PV (< 10Wp) Superior lighting vs. kerosene Cell-phone charging SHS < 100 Wp Multiple light points + cellphone charging Also: TV, fans 8

9 Compared to 10 years ago, the same solar system can deliver a lot more energy services thanks to efficiency gains Ten years ago, 40W solar panel powered: Single 25 W incandescent bulb for 5 hours per day Today, same 40W solar panel powers: Four LED lights for 5 hours, and Color TV for 4 hours, and Phone charger for 3 hours, and Radio for 6 hours 9

10 IFC/ WB program response

11 Driving the Market - The Lighting Africa Experience 11

12 Catalyzing market development Lighting Africa/ Global operates along the market transformation curve, focusing on specific market support/development activities Business Model Development Proof of concept Maturity Profitability Breakeven Technology/business model advanceme Advisory services Investment MARKET INTELLIGENCE QUALITY ASSURANCE BUSINESS SUPPORT CONSUMER EDUCATION Catalyzing mainstream investment with Financial Institutions Catalyzing venture financing Addressing regulatory constraints 12

13 Off-Grid Solar Energy Systems Cost-effective solution Variety of system types, prices, and quality levels Quality assurance needed to protect buyer interests and avoid market spoiling

14 Over the past five years, the off-grid solar market has been growing rapidly, and future projections look good.

15 Key Principles for Lighting Global QA 1) Ensure that products are durable and perform as advertised through rigorous testing 2) Publish results for products that meet the standards through the Lighting Global website to ensure transparency 3) Seek a reasonable balance between quality and affordability when setting standards 4) Maintain a predictable, stable framework so that stakeholders know what to expect

16 Lighting Global Quality Assurance Primary Program Elements Lighting Global QA Framework Test methods and standards Testing, Verification, & Surveillance Communicating Quality to Market Stakeholder Engagement Off-Grid Solar Sector Technical Specification , Ed. 3.0 Quality Standard ISO accreditation using ILAC affiliated organizations /products Development Agencies Consumer Awareness Campaigns 16 Governments

17 Country Adoption of IEC TS and LG Quality Standards Kenya Ethiopia Tanzania Countries that reference IEC TS and LGQA Pakistan Afghanistan Pakistan, and Afghanistan have initiated adoption of harmonized QA ECOWAS has adopted QA standards that reference IEC TS and are similar to LG QA (but not fully harmonized) ECOWAS Countries: Benin, Burkina Faso, Liberia, Gambia, Ghana, Guinea, Côte d'ivoire, Guinea-Bissau, Mali, Niger, Nigeria, Senegal, Sierra Leone, Togo, and Cape Verde.

18 Lighting Global Quality Assurance Program Partners Lighting Global QA Partners Lighting Global Test Laboratory Network UNIVERSITY OF NAIROBI

19 Long-term Vision for Quality Assurance History: IFC and World Bank recognized the initial need for QA for off-grid solar back in The Lighting Global QA program has played a key role in off-grid solar market development and consumer protection. A harmonized international framework will help ensure future success. Realized need for QA: Started to develop test method Lighting Africa Quality Test Method (LA-QTM) Developed by Fraunhofer ISE IEC TS , Ed. 2.0 Published Lighting Asia Launched Lighting Global Launched Lighting Global works with CLASP, GOGLA, and other partners to create a sustainable QA organization IFC/World Bank Initiated Lighting Africa Program > 200 Off-Grid Products Tested >70 Companies served >20 Million Quality-Assured Products Sold >25 Technical and Eco-Design Notes Published LG QA Expands to SHS kits Government adoption of QA with reference to IEC and LG Stds

20 Lighting Global has expanded its QA framework to include solar home system kits

21 Rigorous and Harmonized QA Effort is Essential for Long Term Off-Grid Solar Success Sales of Quality Assured Off- Grid Pico Solar Products in Africa and Asia Harmonized QA means: QA programs utilize single set of (IEC) test methods and standards Companies test their products once at a qualified lab and then can enter multiple markets Harmonization benefits companies, governments, & end-users by keeping costs low & allowing innovative products quick market entry

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23 Lighting Africa The Kenya story

24 Household lighting data Kenya (2009 Census) District Electricity Lantern Tin Lamp Solar Total NAIROBI 712,859 72% 128,173 13% 123,551 13% % 985,016 CENTRAL 383,076 31% 422,101 34% 367,069 30% 32, % 1,224,742 COAST 220,503 30% 142,251 19% 340,281 47% 5, % 731,199 EASTERN 146,328 11% 558,645 43% 447,687 35% 48, % 1,284,838 NYANZA 94,018 8% 314,184 26% 751,889 63% 11, % 1,188,287 NORTH EASTERN 17,642 6% 89,516 29% 63,579 20% % 312,661 RIFT VALLEY 365,205 17% 774,690 36% 686,871 32% 37, % 2,137,136 WESTERN 50,109 6% 240,827 27% 592,199 66% 5, % 904,075 KENYA 1,989,740 23% 2,670,387 30% 3,373,126 38% 142, % 8,767,954

25 Household lighting data Rural areas (2009 Census) District Electricit y Lantern Tin Lamp Solar Total NAIROBI CENTRAL 108, % 318,036 42% 292,647 39% 28, % 759,769 COAST 13, % 65,904 20% 232,575 70% 4, % 330,162 EASTERN 43, % 423,285 44% 382,355 40% 41, % 964,478 NYANZA 21, % 221,415 26% 601,500 70% 8, % 865,197 NORTH EASTERN % 68,753 28% 51,967 21% % 248,941 RIFT VALLEY 69, % 569,673 38% 560,477 38% 30, % 1,482,720 WESTERN 16, % 180,547 25% 496,072 70% 4, % 710,067 KENYA 273, % 1,847,613 34% 2,617,593 49% 118, % 5,361,334

26 ..Key challenges in the sector Low consumer awareness A2F for retailers/ consumers A2F for importers A2F for manufacturers

27 Different models of consumer awareness

28 Consumer education: Roadshow & Forum sessions

29 Awareness campaign - Integrated radio Retail/ Corporate/ Workshops Forums SMS/ Other ATL Roadshows

30 Significant progress in the Government of Kenya s universal electrification efforts

31 Acknowledging the exemplary performance of Kenya s grid extension 2017 % grid connected Q2 '16 - Q1'17 Q3'17

32 Lighting Africa And now the off-grid trend

33 Kenya Annualized sales for quality solar lanterns & kits

34 Kenya Annualized sales for quality solar lanterns & kits

35 Cumulative sales Kenya in millions Jan - Dec 2009 June - Dec 2010 Jan - June 2011 July - Dec 2011 Jan - June 2012 July - Dec 2012 Jan - June 2013 July - Dec 2013 Jan - June 2014 July - Dec Jan - June Jul - Dec 2015 Jan - June 2016 Jul - Dec 2016

36 % age of sales in AFRICA by country Rest of Africa 46% Rest of Africa 32% AFRICA Country Sales Jan - Jun 2016 Kenya 25% Nigeria 7% AFRICA Country Sales Jul - Dec 2016 Kenya 34% Nigeria 7% Ethiopia 15% Tanzania 7% Ethiopia 16% Tanzania 11%

37 The SE4all Methodology now guides impact measurement Improved energy access Number of people reached with improved energy systems. -Simply based on x5 multiplier being average number of people per household - It assumed same impact irrespective of product specifications Energy needs met (based on SE4All methodology) Number of people with Tier 1 and Tier 2 energy access currently, based on the Sustainable Energy for All Tracking Framework.

38 RETAIL PENETRATION Current market penetration of solar lighting units is 21%. This is a four fold increase from Largely driven by finance, good product experience and consumer awareness Retail stores (76%) are the main outlets carrying solar lighting products. 1 2 Solar lanterns account for 79% of the products handled by retailers. Home systems (37%) are gaining traction across the supply chain due to the multiple lighting function 3 PAYG solar home systems accounted for 12% of the products carried by suppliers. There is a growing demand for these products 4 n=8,167

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40 SALES THROUGH OTHER CHANNELS TARGET CHANNELS Easy access to finance for solar has increased the use of solar products. MFI s leverage on Merry Go Rounds and Group Investments to push for Solar loans. MFI S SACCO S PAYG RETAILERS BRAND OWNERS High penetration of mobile phones driving the use of solar lighting systems. 79%penetration* Charging PAYG leveraging on the penetration of mobile phones to push for solar Innovation & trendy designs encouraging adoption of products by consumers Increased consumer awareness & availability of credit for consumers is driving adoption of solar lamps by consumers Consumer education on availability of quality products is needed to push growth and encourage adoption Opportunity for further growth lies in partnerships; Corporates Chama s, schools, trade exhibitions last Mile Entrepreneurs to build capacity and effectively implement low distribution costs * Ipsos survey 2015

41 CONSUMER INTERVIEWS 1 Consumer Satisfaction is high (96%) Largely driven by nature of products used by the respondents targeted in the survey (users of quality accredited product) 2 Price key for purchase decisions Solar consumers mainly look out for price and product functionality when making purchase decisions for solar products 3 Consumer upscaling Driven by increased need for lighting, good product experience and availability of credit/finance. Need to educate/increase consumer awareness on availability of solar loans/credit facilities 4 Solar impact to consumers Children can study for longer hours & finish homework (66%) Households save money (51%) Savings used to feed household (68%) Pay tuition/school fees (53%)

42 Lighting Africa Expansion: Building on Kenya lessons IFC Focus Countries: Nigeria Ethiopia Tanzania Kenya * WB preparing K-OSAP $150m program for 14 underserved counties in Kenya

43 Project Context Objectives And Scope Components and Implementation To increase access to energy services in 14 underserved counties of Kenya $150 million allocation with FY17 delivery Targets Households, Communities, Water pumping Targets Capacity Building K-OSAP components 1. Mini-grids 2. Standalone home systems for households 3. Standalone home systems for community facilities 4. Solar Water Pumping for drinking water 5. Technical Assistance (County Capacity Building, Consumer Awareness, Cooking Solutions, Strategic Planning and Program Management Unit) K-OSAP will target 14 counties defined as marginalized areas by the CRA Implementation of National Electrification Strategy Investments identified by Geospatial Plan K-OSAP Implementation arrangements MoEP, REA, KPLC and WSTF will be implementing agencies at the national level County Government Representatives will be part of steering and technical working group set up to oversee project design and implementation Project Implementation Team within MoEP Allocation Allocation Mini-grids $40m Households $30m Community Facilities $30m Water Pumping $30m Technical Assistance $15m Carbon Finance $5m $155m 43 Geographic focus

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45 Asanteni Sana