Pay for Performance Energy Access Markets

Abstract

Few examples of pay-for-performance service delivery models have been as successful, particularly in the development context, as the “Energy Access” market. Originally the domain of non-governmental organizations and government rural electrification programs in developing countries, the energy access sector has transitioned to a vibrant marketplace with potential for continued scaling. The market has developed to the point, enabled by rapid reductions in solar PV and lighting prices, expanded telecom coverage, innovation in machine-to-machine technology development, and “last-mile” business models, that traditional aid now is seen as a threat to further market growth. This article examines the trends that enabled the rapid deployment of off-grid solar markets based on pay-as-you-go electricity service that is yielding significant health and economic benefits for those living in many of the most remote communities in developing countries.

Sections 15.1, 15.2, 15.3, 15.4, 15.4.1, 15.4.2, 15.4.2.1, 15.4.2.2, 15.4.2.3, 15.4.2.4 and 15.4.3 were written by Dexter Gauntlet, unless otherwise attributed, and are based on his research that first appeared in the Navigant Research report entitled Solar PV Consumer Products, dated May 2014, and used by permission of Navigant Consulting, Inc. Remaining sections adapted with kind permission from Springer Science + Business Media: Decentralized Solutions for Developing Economies, The Synergies Between Mobile Phone Access and Off Grid Energy Solutions. 2015.