EGG-energy

Today Jamie and I went to see the results of the two household installations in Mvuti, get feedback and swap the first batteries!

One of the two installations at a sewer

They look great and results are very encouraging!

- The household owners loved the syste, when asked to give feedback about positives and negatives, only positives were mentioned
- The son of the chairman confirmed that there is strong demand and proposed to make a list of the potential future customers
- They are happy to pay the price asked for the service and do realize a saving with regards to kerosene and AA batteries. The light provided is much better than the one they had before.
- We were even asked by people from other villages to come install the system.
A teacher from another village: “But what is your timeline? Can we expect to have this light soon? We are fed up with using kerosene…”

- Emmanuel

Here are Jamie and Deus (IB Energy, our local partner) installing one of our lighting systems:

Jamie and I signed the first households to start piloting our service next week. These customers will help us refine our offering, and make sure we are providing a proper battery size.  We offered a range of products through retailers in Dar and a free subscription to our battery.

A few takeaways

First, the upfront cost of the lights, radios and mobile phone chargers didn’t turn out to be an issue with our customer base, despite us offering them at the relatively high retail price of small stores.

Second, communicating a temporary pilot service with no promise of continuity, with charging fees and with the households having to buy the lights and wires was surprisingly easy. We should be prepared for a different reaction for when the trial is over and the families have become used to having lighting in the house.

Finally, the social status boost from being the one household with lights can’t be overstated. The purchase process is a group effort with every available villager offering a perspective for the negotiated service. And for the next two months life revolves around the piloting households.

All in all, very promising results when reflected against some of the biggest questions we have going forward. One thing was very clear already now: the demand is there.

- Jukka

Emmanuel and I took the prototype kit out, and continued focus group interviews in Mvuti, an hour’s drive outside of Dar. After blowing up two inverters and having to restock for tools, Jamie really hit the home running with the proto box. It now hosts our battery, two types of lights, a mobile charger and a radio. We have yet to find a person who didn’t offer to buy the kit instantaneously after seeing it!

Several villagers gave us an hour of their time. Discussing with them confirmed that doing forward-looking market studies with the bottom of the pyramid households is a challenge here: the low-income villagers don’t really know how much they earn on an annual basis, let alone spend on energy. This makes internalizing savings on an annual basis, and thus estimating the monetary value of our service, difficult. On the other end, every village official knows the spiel that appeals to Western funders. Doing interviews is very much like going through an aid agency annual report.

We tested the concept of doing distribution through dukas, the small kiosks that sell everything from grain to shampoo to the kerosene that pervades villages in Tanzania. After recognizing the upside of all-around access, the discussion went negative: the interviewees fear that duka owners will play with the prices and introduce inferior quality batteries to the cycle.

We keep running into this phenomenon. Tanzanians don’t seem to count on the long-term existence of businesses or projects. At the same time, the quality of products you find here varies dramatically. One of the outcomes is that our focus groups want to buy the product upfront, so as not have to worry about whether we’ll still be there the following day.

Nobody questions the value of our service. And the price is right too. Communicating our model and commitment to the end customer: here lies the rub.

- Jukka

On Friday July 17, Jukka, Jamie and I visited a small town at the periphery of Dar es Salaam, about one hour away from the city.  We were accompanied by Deus, one of our partners in Tanzania. The community has approximately 1,900 households, no electricity and is five kilometers from the closest power line.

Town center

Fruit sellers

We arrived at the town center, and were directed to the town officials: the chairman, the coordinator for the youth association, the secretary of the association and the representative for water resources.  They were very enthusiastic and keen on seeing us develop the charging stations as soon as possible.  The officials stressed their people’s will and financial ability to have such a service and welcomed us in their town, with the hope that we would choose this location for our pilot.

The town/village officials

We interviewed several different people to assess the market:

• Mratibu, the town coordinator: Mratibu is a farmer who earns his income from farming cassavas, passion fruits and spinach in this garden. He uses kerosene, AA batteries, firewood and charcoal for his energy needs.  His overall energy bill for lighting and radio could be reduced by 85% with EGG-energy batteries.  Mratibu uses a radio and torch, as well as a generator, and if he had access to electricity, he would buy a TV and another radio.  Mratibu is most concerned about sending his children to school; reducing his energy bill would allow him to feel more secure about doing so.

• Jacob, a carpenter: Jacob’s  income comes from two sites: one in the village and one in Dar es Salaam.  Jacob uses charcoal, kerosene, AA batteries and a car battery. He also uses a torch, a bulb, and kerosene lamps, and has installed wiring in his house. Jacob is very happy with his bulb, which provides him with light and improves his quality of life.  He uses the additional hours with lighting to extend his working day. His total spending on lighting and radio could be reduced by 81% with EGG-energy’s service

• Agnes, a household mother: Agnes is in charge of a household of six other people, including her husband and five children.  Her main sources of income are nuts collection and sales, which she does every three days.  She has no radio or bulb and uses kerosene lamps.  EGG-energy’s service would enable a 65% savings from her energy bill.

Inhabitants burning their waste

A typical household

• Msafiri, a battery charger: Msafiri earns his income by charging car and phone batteries.  He owns a motorcycle to charge the car batteries in Chanika, 5 km away, and solar panels to charge the phone batteries.

The motorcycle with the car batteries

The solar panels on the roof

The visit proved quite promising.  The demand for EGG-energy’s service is undoubtedly there.  Families want better lighting than the dim glimmer of kerosene lamps, hope to preserve their health, and to work and study longer at night.  They also seem to have the financial means to purchase the batteries and are eager to realize the savings of 35% or more from their current spending on energy.

-Emmanuel

Site visit to Mvuti, 17 July, Emmanuel Cassimatis

On Friday July 17, Jukka, Jamie and I visited Mvuti, a small town/village at the periphery of Dar Es Salaam about 1 hour away from the town.  We were accompanied by Emmanuel, one of our partners in Tanzania. The community has approximately 1,900 households, no electricity and is 5 kilometers from the closest power line.

Mvuti’s town center

Mvuti’s town center

Fruit sellers at Mvuti

Fruit sellers at Mvuti

We arrived at the town center, and were directed to the town officials: the chairman, the coordinator for the youth association, the secretary of the association and the representative for water resources.  They were very enthusiastic and keen on seeing us develop the charging stations as soon as possible.  The officials stressed their people’s will and financial ability to have such a service and welcomed us in their village, with the hope that we would choose this location for our pilot.

The town/village officials

We interviewed several different people to assess the market:

• Mratibu, the town coordinator: Mratibu is a farmer who earns his income from farming cassavas, passion fruits and spinach in this garden. He uses kerosene, AA batteries, firewood and charcoal for his energy needs.  His overall energy bill for lighting and radio could be reduced by 85% with Egg-tech batteries.  Mratibu uses a radio and torch, as well as a generator, and if he had access to electricity, he would buy a TV and another radio.  Mratibu is, most concerned about sending his children to school, and reducing his energy bill would allow him to feel more secure about doing so.

• Jacob, a carpenter: Jacob is a carpenter. His income comes from two sites, one in the village and one in Dar es Salaam.  Jacob uses charcoal, kerosene, AA batteries and a car battery. His lighting and radio energy could be reduced by 81% with Egg-tech.

Jacob uses a torch, a bulb and kerosene lamps. He has also, and installed wiring in his house.  He is very happy with his bulb, which provides him with light and improves his quality of life.  He does use the additional hours with lighting to extend his working day.

• Agnes, a household mother: Agnes is in charge of a household of sixother people, including her husband and five children.  Her main sources of income are nuts collection and sales, which she does every three days.  She has no radio for AA batteries, or bulb and uses kerosene lamps.  Egg-tech’s service would enable a 65% savings from her energy bill.

A typical household

Inhabitants burning their waste

• Msafiri, a battery charger: Msafiri earns his income by charging car and phone batteries.  He owns a motorcycle to charge the car batteries in Dar Es Salaam, and solar panels to charge the phone batteries.

The motorcycle with the car batteries

The solar panels on the roof

The visit proved quitepromising.  The demand for EGG-tech’s service is undoubtedly there.  Families want better lighting than the dim glimmer of kerosene lamps, hope topreserve their health, and to work and study longer at night.  They also seem to have the financial means to purchase the batteries and are eager to realize the savings of 35% or more from their current spending on energy.,

The EGG-energy team just returned from a trip to a rural community several hours outside of Dar.   TANESCO’s transmission lines do not reach this area, but one of the residents runs a 10kW generator that powers a grain mill and lights for ten dukas (small convenience stores) and other small businesses in town.  The generator—manufactured in China—runs from 4 pm until midnight.

The owner of the generator and the mill also runs a duka.  He sells small batteries, basic staple foods, toiletries, and kerosene, which he brings in from Dar in a 200L container. His customers can also purchase kerosene lamps that are typically fashioned from old tin food cans. Each family owns about three such lamps and travels from as far as 30–60 minutes away to replenish their kerosene supplies.

Besides agricultural products, community members prepare charcoal, which is primarily sold in Dar.

After surveying the energy usage in the area, we went up the hill to visit a secondary school, which serves 300 students between the ages of 12-18.  The class size is typically 40, and some students travel 4-6 km every day to reach the school premises.  Thanks to the generosity of a local NGO, the school is building a dormitory that will house 48 students. School fees are 20,000 TSH.

While the surrounding community gathers its water from bore holes, the school site has three 70,000L water cisterns that collect rainwater from the roofs.  The water is then boiled and used for drinking, but, during dry season, when the cisterns are dried up, students fetch water from a borehole two kilometers away.

On top of a delightful day of information gathering, I had an absolute blast with the kids. They loved the camera and were eager to showcase sophisticated dance moves and spontaneously arranged themselves into the warrior pose.  More than usual, the kids ran around singing ‘mzungu mzungu,’ which means white person. Emmanuel and I are reminded of being a white person on a daily basis;  Jamie is often called ‘mchina’ (Chinaman).

Warrior pose

-Alla

Today the EGG-energy team visited the Dar es Salaam International Trade Fair, Saba Saba (‘seven seven’ in Swahili).

Alla and Jamie at the entrance to Saba Saba

The fair is held every year on July 7th at the Saba Saba grounds near Kurasini in Dar es Salaam. July 7—a national holiday—is also the founding day of the Tanzanian political party TANU, the Tanganyika African National Union, in 1954.

At the fair, Jamie, Manu and I strolled through a myriad of pavilions that showcased companies, government agencies and NGOs from Tanzania and abroad, some from countries as far as China.

Chinese company supplying solar panels to the Tanzanian military displaying its product

Between the alluring aroma of mishkaki (beef kebab) and a timely commemoration of Michael Jackson’s thriller by a Tanzanian duo, we had an opportunity to speak with several food and tea companies to enhance our understanding of distribution in the rural areas and were fortunate to load up on statistical publications provided by various government agencies.

The impressive number of exhibitors and massive crowds at Saba Saba offered a refreshing reminder of the often-overlooked opportunity for businesses to succeed in Africa.

-Alla

This morning, Emmanuel, Jamie and I had the distinct pleasure of presenting EGG-energy’s business plan to the Mayor of Dar es Salaam, Mr. Adam Kimbisa. His initial skepticism quickly gave way to sincere encouragement as he recognized that the lives of countless families who live without electricity near transmission lines could be improved with our battery subscription service. He suggested that we reach out to TANESCO, the national utility, and was particularly pleased to hear that our flexible distribution system would enable local entrepreneurs to offer delivery services to EGG-energy’s customers. Mr. Kimbisa also agreed, much to our pleasure, to declare his public support for our business by inaugurating our first charging station at the pilot site.

-Alla

On one of our first nights out in Dar es Salaam, we found encouragement at the most surprising of places, an Ethiopian restaurant that seemed to have a message prepared specifically for EGG-energy’s ground team:

Addis in Dar welcomed us with an encouraging slogan

-Alla

In our effort to understand the energy sector in Tanzania, we visited the Ubungo 102MW natural gas generation plant owned by TANESCO, Tanzania’s utility company, and operated by a Finnish firm, Wartsila.

TANESCO currently provides electricity to 800,000 customers and is undergoing privatization. The plant tour revealed that the facility is essentially twelve large 20-cylinder car engines.

Inside Wartsila's power plant

Emmanuel observing the inner-workings of the gas-fired generator

EGG-energy chose Tanzania as the entry point into sub-Saharan Africa largely due to its low-emissions energy generation profile: approximately 60% of the power is hydro-generated. Moreover, in the future, our batteries will enable an economically viable platform for off-grid intermittent power generation such as solar or wind.  Tanzania offers a wealth of favorable sites for both technologies, and given current solar PV and trucking prices, we estimate that off-grid generation already makes sense for powering a charging station more than 30 km away from the grid

We are carefully monitoring  the evolution of Tanzania’s regulatory framework for energy, and we hope to take advantage of  opportunities to use our energy storage capabilities to drive renewable energy generation.

-Alla