Innovation in distributed energy services for sustainable development: case studies from sub-Saharan Africa
Five sub-Saharan African ventures, and the three things every one of them does
The Sustainable Development Goals place weight on affordable, reliable and sustainable energy, yet in 2022 some 0.9 billion people in sub-Saharan Africa lacked access to clean cooking, with seven countries below 10% access, and international public financial flows for clean energy in developing countries stood at only half their 2016 peak. We explore whether there are commonalities in how innovations addressing this gap are emerging across the region, and specifically how the challenge of serving low-income communities and customers is being addressed. We apply a qualitative inductive approach to five companies across three case studies spanning solar irrigation, solar cold storage and clean cooking, synthesising them along three concurrent dimensions: product and service innovation, process and business model innovation, and supply chain innovation.
The cases are Aptech Africa and SunCulture in solar irrigation, Koolboks in solar refrigeration, and KOKO Networks and KopaGas in clean cooking, with the figures below compiled from company and secondary sources rather than from primary data collection. Aptech Africa has installed over 1000 solar and water pumping projects across Africa and generated more than 6 million USD in revenue in 2021. Koolboks has entered markets in 18 countries, of which 13 are in sub-Saharan Africa. KOKO Networks grew its customer base from 20,000 in early 2020 to 950,000 by June 2023, operates in eight major Kenyan cities and employs more than 1800 staff, up from 500 in 2019; carbon finance revenues there helped lower the cost of stoves by around 85% and fuel by 25% to 40%, providing consumer subsidies in the order of 100 million USD. KopaGas, constrained by access to finance, had reached only 3500 households by August 2019 before Circle Gas acquired its technology for 25 million USD in January 2020.
We find three commonalities across every case. Each features some element of product or service bundling; each business model comprises pay-as-you-go with digital payment options that allow incremental and flexible payments; and each piggybacks on existing supply chain infrastructure and local networks. Affordability is addressed by eliminating minimum payment or deposit requirements, and accessibility by being in the vicinity of, and responsive to the needs of, customers. We argue that a system of interconnected innovations spanning product and service processes, business models, and supply chains is crucial to ensure access and affordability for low-income populations, and that deepening pro-poor innovation capabilities in the region requires a focus on the full innovation chain, with special emphasis on the affordable and convenient delivery of energy services.
@article{pachauri_innovation_2024,
title = {Innovation in distributed energy services for sustainable development: case studies from sub-{Saharan} {Africa}},
volume = {19},
copyright = {All rights reserved},
url = {https://doi.org/10.1088/1748-9326/ad8460},
doi = {10.1088/1748-9326/ad8460},
number = {11},
journal = {Environmental Research Letters},
author = {Pachauri, Shonali and Coldrey, Olivia and Falchetta, Giacomo and Pelz, Setu},
year = {2024},
pages = {114090},
}