Access to Clean Energy: From Pilot Project to Sustainable Enterprise

In 2011, armed with a grant awarded under the Energy and Climate Partnership of the Americas (ECPA), nonprofit organization Trees, Water & People launched an initiative to increase the use of clean technologies in several Latin American countries. That pilot project has since spawned a social enterprise that is making solar lighting products accessible to customers in rural areas of Central America.

It all began with a three-year, $1.2 million ECPA grant awarded by the U.S. State Department to Colorado-based Trees, Water & People (TWP) for an initiative called “Improving Access to Clean Energy in Latin America.” The goal was to develop effective ways to reach off-grid markets with climate-friendly products such as clean cookstoves, solar lanterns, and small solar home systems.

While such products provide tangible benefits—cleaner indoor air, reduced expenditures on conventional energy, and higher-quality lighting and cooking—a major challenge is how to create a sustainable supply chain to reach markets with the greatest need. Last-mile distribution is complex, unpredictable, and expensive. Roads are sometimes impassable, mobile communications are often unreliable, and many rural households have no access to financing.

TWP worked hand in hand with a social enterprise called PowerMundo—which had tackled some of these problems in Peru—and with partners in Nicaragua, Honduras, and El Salvador to develop a sustainable commercial model for hard-to-reach areas in Central America.

After trying several different approaches, TWP found that existing rural institutions such as agricultural cooperatives, nongovernmental organizations, and rural savings and loans groups could be effective distributors and retailers of the clean-technology products. Since such groups often already have a credit relationship with small-scale farmers for agricultural investments, they can provide these same farmers with the payment terms they need to invest in products that have a true impact on their lives.

Last year, TWP took a step toward making the initiative sustainable by establishing a social enterprise called Luciérnaga LLC (the name means “firefly”) to serve Central America with solar lighting products. “We wanted to create a vehicle through which the project could continue to grow,” explained TWP International Director Sebastián Africano.

Luciérnaga fills a business niche by providing a link between manufacturers and small local distributors. It imports solar lighting products in bulk to a central location in El Salvador, handling logistical details and ordering in large enough quantities to keep the price per unit low. The items can then be distributed over land to partners and clients throughout the region, in Nicaragua, Honduras, and Guatemala. Any profits would be reinvested in the company.

The growth of this business model and the birth of Luciérnaga as an independent company with an international presence show how short-term grant funding can be leveraged toward longer-term sustainable development objectives, according to Africano.

Today, TWP is working to standardize its methods in each country and implement a mobile phone-based monitoring system where distributors can keep track of their sales, collections, and warranty processes through a common online database. The goal is to keep costs low and provide a new source of income for rural individuals and institutions while potentially reaching millions of households in Central America that don’t have access to electricity.

Since launching this program, Luciérnaga and PowerMundo have sold close to 10,000 solar lighting products through their networks, providing illumination, device-charging capabilities, healthier households, and over $200 in cash savings per year, per product, to more than 50,000 people in Latin America.

This post was originally published by the Energy and Climate Partnership of Americas. To view the original blog post click here.

Notes from the Field: Lighting Homes in “Last Mile” Communities

by Richard Fox, Executive Director

I recently returned from visiting our friends at PowerMundo in Peru. What a great trip!  PowerMundo and TWP are currently partnering on a project with the Energy and Climate Partnership of the Americas (ECPA).  Together, we are distributing Cleantech solar products, primarily to “last mile” communities in rural areas of Central America and Peru, as part of our State Department funded project Improving Access to Clean Energy in Latin America.

Cleantech solar products are a high quality, low-cost solution to energy poverty – illuminating homes and providing mobile phone charging at the household level. These innovative products reduce daily energy expenses and indoor air pollution associated with current alternatives for home lighting (such as kerosene), and they pay for themselves within 6 – 18 months.

I am constantly inspired by the collaborations we have formed to help increase the deployment of these renewable, energy efficient technologies. This work is helping to reduce emissions in Latin America while increasing low carbon economic growth. A win-win-win for people, the environment, and local economies.

TWP’s International Director, Sebastian Africano, joined me with our Honduras partners, Ben Osorto and Ivan Caballero, to facilitate South-South collaboration between Central America and Peru while providing some project review and fiscal oversight duties.  On top of meeting our business obligations, we were particularly glad to get up in the high mountainous Quechua towns in the Cusco area.

Richard Fox and Lisa Kubiske (center) visit with clean cookstove beneficiaries in Honduras.

On this same trip, I also made my way to Central America, where I spent the afternoon with Lisa Kubiske, the U.S. Ambassador to Honduras.  After a delightful lunch, we visited with Tim Longworth at Zamarano University,  located in the valley of the Yeguare River in Honduras. Here, we saw the Stove Testing Facility at the university and demonstrated some of our Cleantech products to the Ambassador. While in the area, we also had the opportunity to visit some of our clean cookstove recipients and received valuable feedback about how the stoves performed in the most important facility – people’s homes!

Today, billions of people around the world are still without access to electricity in their homes, and billions more are still cooking over an open fire to cook every single meal. Regional cooperation and collaborations like this are helping to light homes around the world and bring safe cooking solutions to families. Stay tuned for more updates!

To learn more please visit our website.

Photo of the Week: Lighting Up Rural Peru

 

In partnership with PowerMundo, we are working to light up homes throughout Peru with “cleantech” solar products that provide rural families with safe, clean, and inexpensive energy. (Photo: PowerMundo 2012)

Learn more about our work with PowerMundo at our website!

Notes from the Field: Lighting Up Rural Peru

by Paul Winkel, PowerMundo Peru

Solar lights are illuminating the homes and minds of children living in rural Peru. (Photo: PowerMundo 2012)

Around the world, 1.4 billion people still have no access to electricity. In cooperation with the U.S. Department of State’s Energy and Climate Partnership of the Americas, Trees, Water & People (TWP) and our partners are working to bring light and energy to rural communities in Central America and Peru. Paul Winkel, who works with TWP partner PowerMundo to distribute solar lights and cell phone chargers, offers his reflections:

When I was a teacher, we often spoke amongst ourselves of that special moment when we “lit up a child’s life.” Those times where we could see a child come alive and truly connect, when you felt you were making the biggest difference.

I don’t think any of us really understood the full meaning of that saying – light is so common in our lives that we do not appreciate its power, and so it passes merely into metaphor. But here in Peru millions live in the dark, and in my few months I have truly seen lives illuminated. Not just children, but entire families now light up because of our work, and that light radiates in incredible ways.

It seemed such a simple idea when I left home…yet the best usually are. A small plastic device that fits in your hand – a light and cell phone charger that changes lives. And not as a gift, that’s the best part. These people are not “poor” – many live amongst some of the greatest natural wealth I have ever seen. They do not need our charity or one-off projects. All they need is the market for a solution; and we’re here to help create it.

Learn more about Trees, Water & People’s Cleantech Program here.

Photo of the Week: Solar Energy in Rural Peru

Powermundo, our partners on the ground in Peru, provide solar lighting to families living in rural areas. Together, we are working with Powermundo and the Energy and Climate Partnership of the Americas to improve access to clean energy in Latin America. (Photo Credit: Powermundo 2012)

Learn more about our work with the Energy and Climate Partnership of the Americas here.

Notes from the Field: Closing the Energy Poverty Gap in Latin America

by Sebastian Africano, International Director

This is the seventh year that I have had the pleasure of visiting the beautiful country of Nicaragua, a country that continues to inspire and amaze me with every visit.  The capital Managua, compared to years past, is booming – commerce is active, people are jovial, and the streets are lively.  The country enjoyed a growth rate of almost 5% last year, a level not seen for over 10 years, and it is visibly evident.  Add to that a level of safety more akin to its model southern neighbor Costa Rica, than its more similar northern neighbor Honduras (Nicaragua has 15% the homicide rate of Honduras), and you have a unique and promising set of conditions in a region characterized by high levels of poverty and violence and low indices of human development.

Nonetheless, there is still much work to be done in Nicaragua.  Much of the rural population is remote, and lives on the margins of society, with many communities at a full day’s distance or more from Managua’s bustling markets and commerce.  Somewhere around 1/3 of Nicaragua’s people are not connected to grid electricity, a condition which keeps them even further from developing full, productive livelihoods.  It gives me great pleasure to be able to say that Trees, Water & People (TWP) is working to close this gap in my seventh year of collaboration with the people of Nicaragua.

TWP and partners will provide families with solar lighting products that are sustainable, easy-to-use, and affordable.

This year marks the operational launch of TWP’s energy access initiative, a collaborative effort between TWP, our local partners AHDESA in Honduras, PROLEÑA in Nicaragua, and Árboles y Agua para El Pueblo in El Salvador, with support from PowerMundo of Colorado and Peru.  Together, we were awarded a grant from the U.S. State Department’s Energy and Climate Partnership of the Americas, which will allow us to join the effort of bringing clean energy technologies to rural markets throughout Latin America.  By tapping into the vast networks that TWP has developed over 14-years providing energy-saving clean cookstoves to Central America, we are partnering with Power Mundo to also provide solar lighting, solar mobile phone charging, and other life-changing products and services to off-grid rural communities.

As we track the impact of our work, we expect to see rural livelihoods strengthened, levels of education rise, and rural communities become more integrated into the modern lives we in the west enjoy and often take for granted.  Follow our progress on this blog, as well as on the TWP and Power Mundo websites, as the project develops over the next three years.  Thank you for supporting Trees, Water & People, and for allowing us to put your donations to work for the people at the base of the global economy who hold so much promise.

What is “Energy Poverty”?

Energy Poverty can be defined as the lack of adequate modern energy for the basic needs of cooking, warmth and lighting, and essential energy services for schools, health centers and income generation (Practical Action, 2012).

According to PowerMundo, “Over three billion people worldwide do not have access to appropriate technology to meet their basic needs for simple activities such as cooking meals, lighting homes, or purifying water. As a result, billions of people suffer from energy poverty, preventable illnesses, and deplorable living conditions.”

Bringing Renewable Energy to Rural Central America

by Megan Maiolo-Heath, Communications Coordinator

The first shipment of "cleantech" solar products arrive at the Asociación Hondureña para el Desarrollo (AHDESA) office, ready to light the homes of families in Honduras.

According to an October 2010 Wireless Intelligence report, Latin America is now the second largest wireless consuming region with more than 530 million users representing over 11% of the global market. There was also exponential growth noted in the Caribbean region. With prices of phones ranging from USD$30 – USD$100 or more, it is evident that even impoverished people with limited resources will find a way to invest in products they consider important to their lives. This market penetration of cell phones may well serve as a model for selling other high-benefit technological products, but it also provides a significant incentive for the successful introduction and adoption of solar technology, in that all these cell phones need to be frequently and consistently recharged. For the many rural people living off-grid, this is often a considerable problem requiring frequent resolution with associated financial and time costs.

The Fire Fly is a solar lamp with a mobile charging station included.

At Trees, Water & People, we are working to address this issue by providing innovative new products such as solar lanterns with phone charging capability, making it possible to fulfill the increasing need for phone chargers, while at the same time introducing solar technology that provides additional economic and educational benefits, such as allowing families to work or study at night. These gateway renewable energy technologies are opening up great possibilities for lower carbon growth and development while improving access to modern energy products, services, and business opportunities to those currently without regular access.

Our new project will utilize our community development experience and new partnership with experts PowerMundo to provide a variety of inexpensive, high impact “Cleantech” products (i.e. items that improve household productivity and efficiency while reducing energy consumption, cost, waste, and pollution.) These will include items such as solar lanterns, solar cell phone chargers, solar panels, and human powered radios.

As Carl Pope recently wrote in Yale Environment 360, “More than a billion people worldwide lack access to electricity. The best way to bring it to them — while reducing greenhouse gas emissions — is to launch a global initiative to provide solar panels and other forms of distributed renewable power to poor villages and neighborhoods.”

We are proud to be a part of this global initiative, helping to bring impoverished families in Central America access to one of the most basic resources: energy.