Renewables and PAYG
600 million Africans have no access to electricity, and this amount will rather increase than decrease over the next 10 years. if no actions are taken. In Mozambique only 25% of the population has access to the national electricity grid. Some estimations say that an extra 14% have some kind of off-grid energy services, elevating the overall energy access rate to 39%. However, this still means that 16 million Mozambique citizens don’t have access to modern energy services. They are usually low income families, located in rural, isolated and scattered areas.
Private initiatives are filling this gap in energy supply and demand. Amongst them the Pay As You Go (PAYG) business model stands out, and is growing fast in East Africa.
PAYG allows for customers to choose a spread payment-plan and pay in instalments. This means that renewable energy products or services that usually entail a high upfront cost usually prohibitive to low income families become affordable and their impact on the household budget decreases. Thanks to the development of technologies such as mobile money, PAYG model also eases the payment process and can remove credit barriers. A good service contract is also important to ensure cover of the full chain, from retail stores to service engineers that ensure the proper operation and maintenance of the equipments. This kind of service of course requires a minimum customer base critical mass.
Until today Mozambique didn’t have any PAYG renewable energy company, but that reality is about to change.
First Launch in Matola/Maputo
In July 2016 SolarWorks! will launch its PAYG offering in the Matola region just outside Maputo city, where their shop, office and warehouse is located.
Within 12 months the aim is to have 2 other shop openings north of Maputo. From there SolarWorks! aims to grow exponentially towards the north of Mozambique. The goal is to have 100.000 Solar Home Systems installed within 5 years.
This process will face a lot of challenges such as recruiting the right people, logistics, safety, technology integration, education. To overcome them, SolarWorks! is actively seeking for partnerships with the Government, governmental organisations, multinationals, local companies and NGO’s.
Thanks to Mozambique’s huge potential for off-grid renewable energy systems and given the benefits of PAYG models, SolarWorks! is expected to be the first of many other companies to start operating in the Mozambique market.
Several initiatives are already taking place to facilitate this process. It is very important to highlight the work being conducted by DFID – UK’s Department for International Development under the Energy Africa Campaign, as described in this article.
More developments are expected soon and ALER will keep track and support all of them. Stay tuned.
For more detailed information on these and other activities for the promotion of renewable energy in Mozambique check ALER's national status report.
SolarWorks! is a Dutch based company operational since 2008 with offices in The Netherlands, South Africa and Mozambique. SolarWorks! developed one of the markets most advanced solar product range. Its products were among the first to be certified by Lighting Global and more than 100,000 have been sold in over 10 African countries.
In Mozambique, SolarWorks! offers a full range of solutions starting with a solar lantern with phone charging capability – The Solar PowerBall, the Theft Proof Rooflight with motion sensor and our newest upgrade of the Solar Home System.