While wealthy industrialized countries are struggling to convince their populations to adopt solar energy, dozens of villagers in rural Laos are standing in line to sign up with a small energy company that provides solar power.
Less than half of the 5.7 million people living in Laos are connected to the electrical grid, and most of them live in cities and towns. The majority of the population, who are without electricity, live mostly in the countryside and depend on firewood and kerosene for energy, according to the Integrated Regional Information Network.
The government has pledged to electrify 90 percent of the country by 2020, yet the prospect of bringing expensive transformers and electrical lines to remote rural villages is daunting to the officials in charge. In contrast, the entrepreneurs at Sunlabob Rural Energy are not at all discouraged, and instead see a promising business opportunity. By renting out solar-based systems, it can help poor villagers access electricity without huge government expenditures and subsidies or conventional foreign development assistance.
The company began by renting solar-powered lanterns to individual villagers. The lanterns are competitive in cost with polluting kerosene lamps and, after 15 hours, the lanterns can be recharged at the village’s central solar collection facility for a small fee. All the fees go toward maintaining the recharging station.
On a larger scale, Sunlabob rents equipment to entire villages. The company contracts with one franchisee in the village who is trained to do the installation. Sunlabob also trains one villager as a technician to provide technical support. A village committee rents the equipment and then sublets it to individual households. In return for their rent, the families receive the equipment along with all servicing and repairs.
By renting, the village avoids the high costs of purchasing a start-up system. Maintenance is provided by the technician with back-up from the franchisee. The combination of sunshine and guaranteed maintenance makes the solar system sustainable and opens technical and entrepreneurial opportunities to the village.
Building on its success in Laos, Sunlabob is seeking to expand to Cambodia and Indonesia with the future possibility of even more franchises in Africa and Latin America.