Are pro-poor renewables approaching a tipping point? Guest post by John Magrath
June 17, 2011
I was at the annual conference of the Ashden Awards for Sustainable Energy this week in London to hear presentations by this year’s award winners, watch films of their work and listen to a panel debate that included Matthew Lockwood and Mike Mason (of which more below). As always, the winners – both from the UK and internationally – were fascinating and inspiring. In the international field perhaps just as interesting were the emerging trends. It was webcast with the UK winners in the morning and international winners after lunch. Madeleine Bunting has also blogged (on the international part) in The Guardian.
First the international winners. They were: ToughStuff International (robust, cheap solar systems for light and phone charging in East Africa); Toyola Energy Ltd (hugely successful sales of clean cook stoves in Ghana and West Africa, which also scooped the Ashdens “Gold Award” top prize); Husk Power (electricity generation using rice husks and distribution of the power through mini-grids in Bihar, India – see pic); Abellon Clean Energy Ltd ( biomass pellets replacing lignite in big industrial plants in Gujarat, India) and Aga Khan Planning and Building Services (house insulation and energy efficiency in northern Pakistan).
To find out more and to see the excellent films (from Rockhopper) – which may not be uploaded yet but should be within the next few days – go to the Ashden website.
Now for those international trends. First, all these winning organisations and their programmes are demonstrably big – each is reaching hundreds of thousands of people. They are expanding rapidly, including across borders, and are successful businesses (with the partial exception of the Aga Khan Foundation programme, which is a rather different sort of animal). Those characteristics have been increasingly evident in Ashden winners over the last five years or so.
The second I detected was a new “buzz” around this year’s conference – it was noticeable how many representatives were there from finance institutions and foundations, trusts and investment funds. They were asking questions keenly about capital and business models, barriers, opportunities and solutions, and clearly sense business opportunities.
One of the biggest problems for renewable start-up businesses has always been lack of capital, and notably, the reluctance of capital providers to take risks on what they see as relatively untried products (often being sold to very poor people). That is still true, but maybe it is beginning to change. For one thing, renewable technology is getting better and better (cheaper, more robust); for another, successful business models, sales systems, distribution networks and so on are getting established. But clean energy investors themselves are also “maturing”. E + Co for example – who have backed Toyola – have been going for 17 years now, they’ve learned where and how to invest (including by making mistakes), they’ve shown it is possible to get good returns on investment, and they are now scaling up further. So perhaps we’re on the cusp, and we’ll see investors move en masse to follow the leaders…
So to the debate which, perhaps surprisingly, ultimately found much common ground. Mike Mason, founder of Climate Care and now advisor to the government of the Maldives, which has declared it will become carbon neutral within a decade, was typically provocative. He noted how hard it will be to become carbon neutral, as opposed to just shaving 10, 20 or 30 per cent off emissions. People want and need electricity, for example, and want – and demand – more of it the more they get. A myriad of individuals installing their own house-by-house systems isn’t enough. You need to connect them all in a grid, because grids allow the manipulation of inputs from a diversified mixture of energy sources as conditions vary. (Furthermore, by bulk-buying solar panels for the entire nation, the government could get enormous discounts from Chinese manufacturers). Or taking Kenya as an example the problem is that the energy sources, whether biomass or geothermal, are not where people are. “You have to shift electrons in very large quantities from where they are generated to where they are needed, in Kenya the problem is you can’t make it in the place you want to buy it”. But the problem with big grids, in Mike’s experience, is that national institutional structures generally get in the way of them working properly.
Matthew Lockwood, on the other hand, pointed out that national grids don’t and can’t supply everyone who wants electricity (except maybe on a small island like one of the Maldives). When they are supposed to, as in much of India, they are hopelessly unreliable. But, you can do as Husk Power is doing and set up mini-grids (65 so far and aiming for over 2,000 by 2014), each operated locally, but also networked and centrally monitored by computer; a combination of almost 19th Century gasifier and 21st Century IT.
In the end Mike and Matthew agreed on two key areas. Modern mini-grids can deliver most of the economies of scale needed along with most of the required lack of interference from bureaucrats in the middle; and for grids, as solar and other renewable generating technologies get cheaper and better, much the biggest issue is the need to develop cheaper and more reliable means of storage, and that is where global R and D should be directed.
Finally, here’s an advance plug – Oxfam, Christian Aid and Practical Action have been working together to create a web-based “toolkit” about renewable energy, aimed at people in NGOs and CSOs anywhere who are thinking of using renewables in their programmes, but are unsure where to start. This toolkit will tell you much of what you want to know, and where to go to find out more, with a clear and simple narrative, inspiring video and audio clips and encyclopaedic links. It will be hosted on the “Practical Answers” website of Practical Action, and also be available on CD for those whose connectivity is poor. It should be ready and launched in about three to four weeks – watch this space, as they say….
John Magrath is an Oxfam researcher currently working on renewable energy
And while you’re waiting for the winner videos to go up, here’s a 4 minute retrospective on the first 10 years of the awards