15Wp solar panel facing North running 3 LED lights and one DC phone charger.

I have been working with Mr. Said Kibwana, our local partner in charge of the Iringa franchise  for the past month. This area has different particularities, which Mr. Kibwana shared with us, that led EGG to look into offering small-scale decentralized solar system installations:

1. With altitude higher than 1,500 meters above sea level, Iringa is located in a mountainous region. The surrounding off-grid villages are located in either cloudy and rainy hills or in very sunny plains. Given this situation and considering both the remoteness and the difficult access of some villages, offering both battery-swapping services and individual solar systems installation & maintenance allows the EGG franchise in Iringa to provide services that can address the diverse needs of local residents.
2. Many EGG potential customers are farmers. They do not have much capital available for large expenses, except on one or two occasions a year that coincide with the harvest season. Selling their harvest provides them with a large one-time income, and they usually spend a big part of it on different systems expected to improve their living conditions. At that time, they have enough money to afford individual solar installations, which are the preferred systems preferred of those that live in sunny areas.
3. Mr Kibwana and I went to see existing solar installations. Most of them were broken or not working well. This sorry sight is the result of the absence of organizations that could provide good after sales services and good solar technicians to the Iringa area. Consequently, people are disappointed with this technology. The need for qualified technicians and follow up maintenance was strongly communicated by the local communities.

As a result of these observations, EGG-energy decided to design and offer solar home systems as an alternative to the battery swapping service for areas where this technology is appropriated. Because EGG is focused on providing electrical services to several customer segments, three solar options have been created, in the same way as we have designed several battery swapping systems:

1. 15Wp Solar system: 1,2 or 3 LED low consumption bulbs, and possibility to charge a cell-phone.
2. 40Wp Solar system:  cell-phone charging businesses (up to 15 phones per day).
3. 100Wp solar system: big color TV, 1 to 6 LED bulbs and possibility to charge a cell-phone.

Battery swapping customers and solar customers can benefit from all EGG services:

• Battery swapping customers: many of them don’t have the upfront capital to invest in solar systems directly. EGG gives them the opportunity to first buy a battery swapping service and later upgrade it to solar for a small additional fee.

• Solar customers: in case of extended cloudy and rainy weather (solar systems are designed to have an autonomy between 3 and 7 days), EGG offers to charge their battery for a small fee and provide them with a temporary one while theirs is being charged.

To help stimulate the local economy and keep costs within our customers’ affordability, we attempt to minimize our reliance on imported products. To that end, EGG decided to work with local metalworkers to have the solar system frames made in Iringa. After one week of work with them explaining EGG requirements, we arrived to a good prototype. A few more adjustments are needed to validate the final EGG frame design and start the standardized frame production in Iringa, but we’re off to a great start!

I will keep reporting from time to time on progress at the Iringa franchise with respect to new solar and battery swapping projects.

Till then,

Hugo

In addition to Jodie and me, two new employees were hired a few weeks ago to help us with corporate support activities in Dar es Salaam:

Sophia Nyoni, office assistant:

Sophia started to work for EGG-energy 3 weeks ago. After discovering our activities and visiting our stations in Mbagala and Chanika, she is now responsible for gathering, archiving and classifying operational data, translating internal and external documents, conducting surveys on the field and running errands. Welcome Sophia!

About Sophia:

Sophia is a 23 years old Tanzanian. After finishing her advanced level studies in Loyola secondary school, she worked as a data collector in a faith based organisation known as Catholic Relief Services (helping the most vulnerable children in orphans). After this first experience, she was hired as a field officer in Global Fund “PACT” organisation (also working to improve children’s lives). Before joining EGG-energy, Sophia was working as a research assistant in an organisation called “AMEND”, which is responsible for road traffic and injuries.

Herry Nasser, Office Manager and Accounts Assistant:

Herry started to work with EGG-energy at the beginning of February. He is in charge of payroll and manages our company’s relationships with local institutions regarding staff and administrative issues. More specifically, he is responsible for all human resources related issues. He will also assist with company accounting and purchasing. Welcome Herry!

About Herry:

Herry, 28 years old, was born in Tanzania and has lived in many Southern African countries. He first went to high school in Zimbabwe and then to college in South Africa. After getting a diploma in sales and marketing and a diploma in Information Technology in Cape Town, South Africa, Herry got his first job in a travel agency in Cape Town as a Sales and Marketing officer.  Then he came back to live in Dar Es Salaam and worked more than 5 years for a Health insurance company, first as a corporate relationship officer and then as an office manager. Just before EGG-energy, Herry spent a few months in England which he enjoyed discovering.

When none of us is out in the field, there are now 8 persons in the office. It was time to move to a larger company space, which we are scheduled to do very soon.

EGG-energy head quarter team:

Jamie Yang (CEO), Solomon Faraji (COO), Samson Msami (Subscription Manager), Sophia & Herry, Jodie Wu (Consultant Sales & Marketing), 2 fellows: Anne Raymond and myself.

My next post will certainly be written from the new office and we look forward to hosting you there!

Till then,

Hugo

Said Kibwana in front of his franchise's office and charging station

When I traveled to Iringa last November, I enjoyed a peaceful stay at Said Kibwana’s farm in Ingomtwa, a village about 60km outside Iringa town.  He was using his farmhouse as a base for EGG-energy operations at the time, as the franchise was still new and he had not yet rented an office in town.  For the past two months, Mr. Kibwana has been adding customers in villages around Ingomtwa, streamlining his record-keeping and distribution systems, and setting up an office on one of Iringa’s busiest streets.  I returned to Iringa at the end of January for an 10-day visit.  Though I was not able to watch the sunset over newly plowed corn fields or see my breath in the cold morning air as I could at the farm, I was able to help Kibwana ready the new station and prepare to expand the franchise.

The EGG station and its neighbors

The Iringa franchise currently has 19 customers.  Each customer has at least one battery for lights, and six have an additional battery to power a mobile phone charging business.  Due to our initial focus in and around Ingomtwa, all current customers are located in villages at least 20km from the charging station in Iringa.  To bring EGG’s service to these rural areas, Kibwana has developed an innovative distribution network.  He charges the batteries at the grid-connected station in Iringa, then uses buses, motorcycles, bicycles and people on foot to deliver the batteries to distributors in several different villages.  Customers can then swap their battery at the local distributor. This distribution network demonstrates one of the benefits of working with a local franchisee, as use of public transport to lower distribution costs requires Kibwana’s in-depth knowledge of the area and close relationships with local people.

Street view east from station along Kalenga Rd.

Over the next month, we plan to strengthen EGG-energy’s presence in Iringa town, and to acquire customers who live in the semi-urban area close to the new station.  Although grid electricity is available in the town, many residents cannot afford it.  Given the relatively high population density we hope to build a base of EGG customers within easy walking or bicycling distance of the new station.  These customers will help increase the size and reputation of the Kibwana’s EGG-energy franchise in Iringa without adding strain to the rural distribution network.

Hugo Niccolai and I will continue to report on Iringa as the station grows.

View of Iringa from the hills above town

My work for EGG-energy is part of a 2 year project, EnR’Sud (http://enrsud.posterous.com/), which I designed for a year before setting off to work for 5 different social organizations specialized in Decentralized Rural Electrification (DRE) in South-East Asia, Africa and South America. EnR’Sud stands for Energies Renouvelables’ Sud, which is French for Renewable Energy – South. Its sponsors include French companies active in the energy sector such as Schneider Electric and électricité de France (EDF), a group of engineering schools named l’Institut National Polytechnique de Toulouse as well as other institutions and private companies (http://enrsud.posterous.com/pages/les-partenaires).

My goal for the EnR’Sud project is to learn from successful DRE companies and projects around the world so as to create and distribute tools and methods that will make the multiplication of DRE initiatives easier, and which will stimulate the development of new entrepreneurial approaches from DRE applications. The biggest challenge of this study is to compare and contrast the factors that were essential to the success of these social enterprises in developing sustainable market-based solutions to the social and economic problems faced by rural people in remote areas.

2011: South East Asia

Let me introduce you to the three companies I have worked for in 2011. They represent 3 different approaches dedicated to the same purpose.

Created in 1996 by Muhammad Yunus as one of the « Grameen Sisters » – social companies that satellite around the initial micro-credit institution, the well-known Grameen Bank (http://en.wikipedia.org/wiki/Grameen_Bank) – Grameen Shakti (GS) was established as a « Social Business » with the aim of promoting the use of affordable, clean, modern, and sustainable energy technologies by the people of rural Bangladesh.

Individual solar home systems (SHS), biogas plants and improved cook stoves are their three main products proposed to their customers.

Grameen Shatki’ business model is based on micro-credit: the beneficiaries have different payment options from a 100% down payment to a 3 years payback period. This loan is provided by a Bangladeshi financial institution supported by the World Bank (IDCOL, Infrastructure Development Company Limited), but it is GS that collects monthly payments made by the end beneficiaries and is accountable for paying back IDCOL. In addition to making the larger loan, IDCOL subsidizes a small % of each system.

In order to be as close to its customers as possible, GS operations are divided over more than 1,200[1] offices, from the Head Quarter located in Dhaka to Divisional, Regional and Branch offices in all regions of Bangladesh. With more than 10,000 employees and 20,000 SHS installed per month, GS became financially sustainable within 4 years of its operations. The rapid expansion of its programs as well as their choice to localize services at the community level helped them drive costs down.

Sunlabob (http://www.sunlabob.com/) is a Lao commercial company. It was set up in 2000 by its current CEO, Andy Schroeter, and has been licensed for power operations since 2001. It offers renewable energy products and provides commercially viable energy services to remote areas, focusing on places that the national electricity grid will not reach for many years.

Sunlabob Renewable Energy Co Ltd. is well known for its expertise in solar lanterns projects, its core business since the creation of the company. However, with today more than 70 employees, the company provides a much wider range of services in urban and off-grid rural areas. On-grid solar installations, water-pumping and water treatment systems, solar lanterns and individual solar home systems, and micro hydro power plants are part of their current product portfolio. Since 2008, when Sunlabob launched an Energy Efficiency department, the company has been not only focusing on rural areas, but also working with urban ones, conducting energy audits, energy efficiency consultancies for buildings and factories, and supplying and installing energy-efficient materials.

Sunlabob projects in off-grid areas are divided in three categories: solar lantern stations financed by international development aid institutions (http://www.sunlabob.com/solar-rechargeable-lamps.html), rural electrification tenders (mainly to implement thousands of solar home systems in developing countries), and individuals or organizations (conducting development projects in rural Laos) that need Sunlabob’s renewable energy services. Sunlabob’s expertise in international tenders is more and more recognized thanks to a strong engineering department and a permanent tender team of several employees.

Sunlabob’s business model is different from Grameen Shakti’s in the sense that they don’t solely rely on their own rural electrification model, the solar lanterns, but propose many renewable energy services adapted to a wide range of clients. After many years of experience with solar lanterns, they decided to focus on quality, sustainability, and maintenance of the systems, and not charge the end-users. Indeed the hardware, training and installation are 100% financed by international organizations (NGOs, foundations, governmental institutions…) but Sunlabob has developed an innovative solution to ensure the capability of the beneficiaries to maintain the equipments properly during the overall life of their system by themselves.

This solution is a simple business model, based on a fee-for-service concept. Kerosene lamps are replaced with high-quality solar lanterns and a very simple charging system that doesn’t require any prior knowledge in electrical engineering. The Sunlabob business model provides opportunities for micro-enterprise formation in the villages and clean energy distribution.

Paris Manila Technology Corporation (PAMATEC, http://www.pamatec.com.ph/) is a French-Filipino corporation founded in 1988 by Hubert d’Aboville. PAMATEC, historical distributor and installer of electrical equipments, is today specialized in the fields of Power Distribution, DC Power Systems & UPS, New Renewable Energy, Weighing Scales and is involved in different special projects, such as Rural Electrification, Traffic Management Systems and Diesel Powered Mini Grids.

From 2004 to the end of 2009, PAMATEC implemented its first large-scale rural electrification project, the Philippine Rural Electrification Service (PRES) project. PRES is considered as the largest countryside power project in the Philippines. Thanks to a partnership between the governments of Philippines and France, the project brings electricity to 18,000 households in the province of Masbate, one of the Philippines’s poorest. PRES was implemented by PAMATEC with a French corporate partner, ETDE (Groupe Bouygues). The 17.5 Million € needed by the electrification component of the program was financed by the Filipino-French protocol. Aside from this, PRES offered basic services such as lighting for “barangay” halls and school buildings, provision of vaccine refrigeration and lighting for rural health units as well as provision of streetlights to major thoroughfares. Electricity was provided via the installation of mini-grids powered by diesel and photovoltaic (PV) systems (respectively 12,800 and 5,200 connections).  The maintenance costs are supposed to be covered by monthly payments from the customers.

While rural electrification is GS and Sunlabob’s core business, it is not PAMATEC’s. They got the opportunity to jump into it by being the link between French and Pilipino governments for this huge project. Since then they decided to incorporate it to their main activities and have participated to several tenders inside the Philippines.

What I learned from these companies  and what I wish to learn from EGG-Energy

Each experience was unique and each model I discovered has its own strengths and weaknesses. In Bangladesh, I saw a company as no others in rural electrification: more than 3.5 million beneficiaries in early 2011, a micro-credit system well managed thanks to the Grameen Bank influence in the country, and a geographic organisation of the offices optimizing sales, marketing and technical supports to be as close as possible to the customers. The company has created a business model that matches perfectly the characteristics of the country it serves: a small and flat land with one of highest inhabitants density in the world.

Having worked for nearly 7 months as Sunlabob’s Solar Lanterns project manager, I was able to see what factors govern the dynamics of these social companies created by foreigners. As many people come for missions between 6 months and 2 years, it is difficult to build a good and durable team spirit. Andy Schroeter succeeds in that sense by creating a strongly motivated local staff in all departments of the company. Working regularly with the technical team I could see how enthusiastic and proud they were to work for a social company like Sunlabob. With all the skills they learned on renewable energies throughout the years and their motivation to participate to the company’s expansion, the success of professional installations is guaranteed.

An other key factor Sunlabob understands after many years working on rural electrification projects, is to provide the simplest technology possible in association with the most reliable and high quality products: changing their home made lantern to the Phocos Pico Lantern is a good illustration of this strategy. Note that the recent arrival of Northern big companies such as Schneider Electric or Phocos in this market enables the creation of high quality products at an affordable price. This is one of my biggest observations last year, as I also observed it in Grameen Shakti buying large quantities of Schneider Electric LED lights.

Why EGG?

When I discovered EGG-energy 18 months ago, I was really enthused and wished to incorporate it to my EnR’Sud project for many reasons. The two major ones were the following:

First, their business model is based on a service that people from the BoP can afford to pay themselves. With 80% of the population living within five kilometers of a transmission line and less than 15% having access to electricity, EGG-energy’s model is completely in line with the Tanzanian context.

Second, after having worked for companies with more than 10 years of experience, I loved the opportunity to join a dynamic start-up 100% focused on rural electrification. I hope this helps me better understand the challenges faced to succeed in this domain!

I will be reporting from time to time on the EGG initiatives that I will be involved with – It’s already been a busy month, and I look forward to the coming ones!

Till then,

Hugo.

Samson - Membership Manager

Samson joined EGG in March 2011, and is an asset to the company. Based in our Dar office, he manages the database and helps with many other administrative, accounting, and organizational tasks.  Samson is currently attending school part time to pursue a degree in business, and has previous work experience in accounting.

Abbas - Chanika Site Manager

Abbas has worked for EGG-energy since 2010.  He was recently promoted to the site manger position, where he has shown great energy and initiative.  His previous jobs include revenue collection for the city of Dar es Salaam’s environmental services, and merchandising for Coca Cola.

Jonathan - Chanika Station Manager

Jonathan has been working with EGG-energy since early 2010.  Before joining the team, he served in the Tanzanian Navy.  Jonathan is responsible for managing the battery-swapping at Chanika, and keeps the charging station well organized.  In this picture, he is measuring the voltage of a battery.

Issa - Technician

Issa jointed EGG in August, 2011.  He finished secondary school Form 4 in 2010, and has learned technical skills through on-the-job training with EGG.

Mohamed - Technician

Mudi has been an EGG technician since 2010.  Always an outstanding employee and electrician, he has recently been instrumental in helping to set up the new EGG-energy franchise in Iringa.

Mohamed - Technician

Mudi is Jonathan’s eldest son, and has been with EGG since August 2011.

Fortunatus - Mbgala Site Manager

Fortunatus joined EGG in 2010.  His past work experience includes sales, accounting, and warehousing.  He completed an advanced diploma in Accountancy in May of 2010.

Omari - Technician

Omari began work as an EGG-energy technician in November of 2011.  Omari holds a certificate in Electrical Installation from the Vocational Education and Training Authority of Dar es Salaam, and has five years prior work experience as an electrician.

Nabira - Administrative Assistant

Nabira joined EGG in November 2011 to help manage the Mbgala station.  She has completed a Certificate in Law, and is taking evening classes in Dar es Salaam towards a Diploma in Law.

Kiiya - Sales Team Manager

Kiiya joined EGG-energy in August 2011 to lead a team of free-lance salespeople.  He previously worked in sales for a mobile phone service provider.  Kiiya has been successful in helping us reach out to new customers over the past few months, and we hope his team continues their hard work into 2012.

Japhet, Tino & Swebe - Sales Team

These three young men work closely with Kiiya to bring new customers to EGG, and to assess new areas for expansion of our services.  They have been working for EGG-energy since September.

EGG Holiday Party

This photo includes the employees mentioned above, plus Solomon (hiding in back), Jamie and myself (Anne).  In the front row are Reuben and Anya, two MIT Sloan students who are here for two weeks to help EGG with our human resources strategy.

EGG at Cocoa Beach

On behalf of the EGG-energy team in Tanzania, best wishes for a happy, healthy, and successful 2012!

Dec 13th: EGG to participate in morning panel of the GDF Suez’s Conference on Water and Energy Poverty

* cited by co-founder and Director of Corporate Development Alla Jezmir in this Wall Street Journal piece about MBAs taking jobs with a social mission.

* featured as one of the Opportunity Green Business Conference’s 25 finalists.

* nice Article on Fast.CoExist.

The purpose of this new trip was to check in with Mr. Saidi, our franchisee, and to improve our understanding of the Iringa area and EGG’s potential for development there.  Mr. Saidi kindly hosted Mudi and me at his farm in Igomtwa, about 60km south of Iringa in the Mufindi district.  I spent five days in and around Igomtwa, accompanying Mudi as he installed wiring for new customers, talking to local residents of near-by villages about their potential interest in EGG’s services, and gaining from Mr. Saidi insight into large-scale maize farming in southwest Tanzania.  With the information obtained from this trip, we are continuing to assess the viability of EGG-energy in Iringa, and the modifications we should consider for our franchise model to operate successfully in very rural areas.  I will keep you posted as the new franchise develops.

View of the farm

My Iringa adventures continued after I left Mr. Saidi’s farm.  From Igomtwa I traveled by motorcycle and packed minibus southwest to Mafinga, the capital of the Mufindi district.  There I was met by Mr. van Alphen, the founder of an orphanage and support center for children and families affected by HIV, who I first met in Dar in early October.  The center is called Yatima, Moyo kwa Moyo, and is located in Matanana, a small village 22km west from Mafinga along a rough dirt road.  In Swahili, “yatima” means “orphan,” and “moyo kwa moyo” means “heart to heart.”  Mr. van Alphen, or “Mr. Moyo” as he likes to be called, is a Swede who came to Tanzania as a tourist in 2004, fell in love with the place and its children, and committed himself to helping them.

Walking to an installation

Mufindi, an area encompassing the towns of Iringa and Mafinga, has one of the highest HIV infection rates in all of Tanzania. One significant reason for this is the presence of large plantations that attract a young and itinerant workforce.  When Mr. Moyo arrived in Tanzania in 2004, there were many very young children in Matanana in need of care because they did not have any living relatives who could support them.  Now, thankfully, improved access to antiretroviral drugs and the subsequent increased life expectancy of HIV positive parents has greatly decreased the number of babies without parents or relatives, shifting Yatima’s focus from childcare to support for school-age kids.

Igomtwa farmhouse

Yatima provides a home for 15 children.  Almost 200 other orphans who live with their extended families come to the center for meals, activities, vocational training, and just a safe place to spend time after school and on weekends.  The center also draws a regular stream of volunteers, mostly from Sweden, who stay for a month or two and, in addition to gaining a valuable experience in rural Tanzania, shower the kids with much needed attention and affection.

Cow pen

The website for Yatima (in Swedish, google translaor worked fine if your Swedish is rusty) is http://www.yatima.se/.  I was inspired by Mr. Moyo’s success in using limited foreign aid to develop local income-generating projects, creating an effective and sustainable effort to improve the health, education, and general wellbeing of Matanana’s orphans.  My intention is that, through an NGO partner, EGG-energy can help Mr. Moyo get a solar system for his center.  If further research into the Matanana area is promising, we may in the future set up an EGG-energy franchise at Yatima to distribute some of the solar electricity to the surrounding community.

To provide a sense of geography, I marked the approximate locations of Mr. Saidi’s farm and the Matanana orphanage on this google map.  Most of the photographs in this post are from my stay in Igomtwa, a few are from Yatima in Matanana.  I hope you enjoy them.

Anne

EGG's Msanga Solar Franchise

Msanga town is located at a dusty crossroads.  There are a few shops, a place to eat cooked lunch, and an area for transport vehicles to load passengers and cargo.  According to census data, in 2002 there were about 1,400 people living in and around Msanga town, and close to 6,000 in the entire ward. Travel to Msanga is significantly bumpier than to the EGG on-grid stations of Chanika and Mbgala. While the latter two can be accessed from Dar in under an hour of driving on good-quality paved roads, the road to Msanga is only paved for the first third of the journey, and takes at least two and a half hours to travel.  Going is slow after the pavement ends, as there are many large holes in the road that force a driver to choose between a speedy trip and the health of his car.

Although Msanga is distant from a smooth road and the power grid, 22 households in the village have EGG-energy electricity. Using Tanzania’s bright sunlight and a solar charging unit developed by Schneider Electric’s BipBop design team, we can provide our customers in Msanga with essentially the same electricity service that we offer at the Chanika and Mbagala grid-based stations.  The Msanga station has the added benefit of not having to worry about the frequent TANESCO (Tanzania’s national power utility) outages.

Solomon, Mbano and Jamie working on the charging system

Solomon, Jamie and I journeyed to Msanga last Thursday to check up on the solar system, make a few minor repairs, and talk with Mbano, EGG’s franchisee.  Mbano owns a small shop in the center of the town where he sells goods such as dry beans, rice, notebooks and bottles of fruit juice.  He also runs a solar-powered mobile-phone charging business in his warehouse.  Although few people in a rural village like Msanga have electricity in their homes (this is changing thanks to EGG!), most have a mobile phone.  It is common for a town to have one or several businesses like Mbano’s where you can pay 300 Shillings (about 20 cents) to charge your cell phone. Since EGG-energy installed an additional solar panel on the roof in July, people now also go to Mbano’s store to swap our batteries.

Schneider charging unit with EGG's batteries

At 22 customers, Msanga is considerably smaller than EGG’s other two stations, but as our first franchise, and first solar-powered station, it is doing well.  With one 150W solar panel, the station is designed to serve up to roughly 25 customers, though the exact capacity depends on how frequently people swap the batteries. Our current estimate is based on customers swapping about one time per week, but we will adjust the projection as swap records reveal a more accurate picture of customer behavior.  As the station adds new customers, or existing customers begin increasing their energy use and swapping frequency, we can add solar panels to increase capacity.  We will continue to monitor progress in Msanga, to adjust the details of our operations there, and to use the lessons learned to refine our model for solar franchises in rural Tanzania.