We are the first to recognize our team it does not have the resources or bandwidth to single-handedly expand Integrated Energy Centres. Instead we seek to expand through partners with branches, offices or interventions across cities and towns in South India, which can receive enquiries for IECs in local slums and migrant communities, and undergo the first steps of community outreach and financial linkage. We currently target over ten additional IECs per year, being implemented with strong local partnerships through an entrepreneur model. In this way, replicability with remain one of the key forms of achieving scale and impact across our region and additional areas of opportunity.
In keeping with the vision of energy access for all, we are developing a toolkit that outlines the process of establishing an IEC, including need assessments, program design, implementation and dissemination. Being a creative commons project, the toolkit encourages potential stakeholders to replicate, build upon and adapt the IEC model to communities with a need energy.
IECs were designed to organically fit its host-community wherein each IEC is designed to suit the local context in which it operates-creating innovative models both physically and programmatically. Below, some key information of the IEC model, to help interested individuals, organizations and potential partners consider and better understand Integrated Energy Centres.
1. Centre Typology: Depending on the functions that need to be housed, space availability and need for portability, IEC’s present multiple physical innovations. In the existence of infrastructure, IEC’s have been housed within schools, institutes, homes and local shops
2. Service Customization: Apart from the provision of basic energy, IEC’s are hubs of community engagement and feedback. Deeper understanding of community needs through these informal information loops creates in-roads for innovation in other technological services. Solar based systems such as mobile charging (ROI=~1yr), fridge(ROI=~5yrs), community TV (ROI=~3yrs), projector(ROI=~3yrs), water purifier(ROI=~7yrs) have been made available through IEC’s. Our Team continues to innovate the services offered through IECs to offer a quality range and depth of energy services.
3. Ownership Models:The income generated by the IEC through the various services provided is expected to recover all expenditures, including running, maintenance and capital costs. There are 4 main models:
Entrepreneur run: This model seeks out an entrepreneur from the community, who takes out a loan and purchases a solar powered battery charging system to then rent out individual lamps to households in the community. The entrepreneur is provided with access to financing sources and technical system support. His income is the margin he keeps of total rent he/she collects per month minus
Operator run: Under the operator-model, the solar charged battery system is rented out to a community by SELCO. Operators provide similar services as entrepreneurs in exchange for a monthly wage of INR500 for every 20 lights. As in the entrepreneur-run model, operators are in charge of charging the batteries, distributing these to the renters in the community, collecting the rent and liaising with SELCO in case of any technical difficulty.
Partner run: The partner-operated model replicates the operator-run model except that the IEC is generally integrated into the partner’s work-space. The main difference between the partner- and operator-run model is that partners, rather than receiving a monthly wage for their efforts, receive free solar lighting for the provision of their services.
Community-run: Under a community-owned model, the IEC is purchased by the community as whole – through joint savings – and is managed by operators selected by the community. Often, these selected operators alternate amongst each other to coordinate with the SELCO Foundation team. Just like any other IEC, the community-owned centre distributes solar-charged batteries in the evening to its customers.
Along with the structure of IECs, the toolkit comprises best practices and learning, and identifies opportunities for customization, adaptation and continued focus on the local community and context, following Human Centrered Design methods. We are excited to work on this tool and look forward to sharing it with interested parties.
For more information, please contact the Urban Community Lab
Multiple approaches have been adopted to tackle the problems faced by the world’s poor. The most predominant channels are through public sector or targeted philanthropic programs. While these channels continue to exist there is an emerging breed of hybrid organizations that use market forces to solve social-environmental-poverty issues. In order to grow one the most fundamental need is capital. These factors influence the enterprises’ ability to attract the right type of capital to fund multiple stages of growth. However, there is little documentation that puts forward the practitioner’s perspective around investor dynamics which heavily influences its ability to create sustainable growth and achieve long term scale.
At SELCO Foundation, the Policy Team has been exploring the largely shared viewpoint by social enterprises that although there has been a widespread effort to capture the difficulties in accessing capital for social enterprises, there is limited insight expectation gaps between the investment and practitioner community.
Combining SELCO’s own investment story with a roundtable discussion between a set of investors and practitioners to jointly discuss:
Expectation gaps from both sides, investors and practitioners, and its impact on organization sustainability
Recommendations that could help guide the growing social investment community and practitioners on the development of sustainable social enterprises. For instance, what kinds of terms or investments instruments would best suit energy enterprises?
The workshop was held on April 7th 2014 and saw attendance from 30 participants-SELCO’s own key funders and other like minded investors, incubation centres, energy enterprises. SELCO intends to work on some of these recommendations and put them into action prior to the next meeting in April 2015.
Building the right investor team:
Frontline Organizations: It is quite challenging to understand the realities on the ground particularly if the team is remotely located with limited bandwidth. It is observed that many who join investment circles have limited field experience and therefore understanding the language of the entrepreneur poses a steep learning curve.
Limited Bandwidth: Investor teams can be small, very often located out of the country and this limits capacity to travel and spend time with investees regularly.
Ground level realism not acknowledged: Experience with ground level realities is not given much importance over qualifications. The latter will naturally help make more informed due diligence decisions however without the appropriate people in the team this realism is lost.
Finding aligned investors among investor circles: It has been difficult to find aligned investors looking at impact first, modest returns. In some cases, there are investors ready to invest in high risk, demonstrable models in order to bridge the gap for other investors, however latter stage investors who have a highly commercial vision can lead to divergent views on future of organization and hence drives a wedge in trying to combine scarce resources towards multiple needs of the organization that can lead to long term growth.
Advocating with the missing middle: Important to recognize that returns cannot be market rate there is an element of subsidy that needs to be injected into the system. This is the way all other industries have grown so unfair to say that this sector should focus on profits without an adequate amount of soft funding as well. There is large institutional funding that can be tapped into but requires loud, collective voice to release it to practitioners. The onus cannot only fall on practitioners but the investor community and other intermediary bodies need to lobby for this release.
Change the terms of engagement: The predominant language is in how profitable the business can be in the future and this is dictated by profit first investor community. Other stakeholder are lending themselves to this language and is probably one of the leading reasons why it is felt entrepreneurs are also largely speaking the same profit first language. This language of negotiation and reporting of impact needs to change otherwise it is a losing battle.
Accountability beyond just the entrepreneur:
Impact of investors vs impact investors: Looking back at the MFI crisis very few questioned the model that was in place and the kind of lending practices. The original vision was to lend for livelihoods but once this was found not to be very promising, rather than digging deeper to understand why and correct these issues, they expanded their lending portfolio which ultimately led to an unsustainable model deepening poverty. There is a danger in repeating this general reluctance to reform the present model. Nobody wants to lose money and this risk averseness is not developing the appropriate instruments, risk appetite of entrepreneurs etc.
Source of funding: There is sometimes a severe disconnect between the intent of the monies the investment vehicles have in their discretion and the conditions dictated to the potential investee companies. The practitioners feel that there lies a contradiction.
Partnerships vs hierarchical relationships
There is an engagement disconnect between investors and entrepreneurs to solve bottlenecks. This is further compounded by the due diligence process or interactions with teams or amount of control sought and how it is exercised which can lead to a general climate of mistrust that is built between the entrepreneurs and their investors. Entrepreneurs need to engage with investors and spend time understanding their perspective also. Over time one can align with like minded investors even if it calls for a few mistakes. There needs to be a balanced approach and one cannot be seen to take more risk that the other because that puts the partnership on a competitive footing.
Ongoing dialogue: There is a need for ongoing dialogue between investors with entrepreneurs. Need for a mechanism like an alliance, circle of investors
More hype, less depth:
Beauty Contests: Pitching on both sides is akin to beauty contests which brings a high degree of visibility but with fewer meaningful impacts to justify the enormous amount of publicity. This could in part be due to a gap in appropriate impact reporting frameworks but also due to the need to garner high visibility to attract big investments in today’s hyper connected world. However, this is more apparent in urbanized entrepreneurs who have access to these social media tools, language, and events. This can be misleading to investors but also inculcates an unhealthy culture among entrepreneurs more concerned with visibility than field work.
Average case vs best case scenarios: This overhype can lead to rosy, best case scenario projections that do not necessarily reflect the practical situation. If these rosy projections made during fundraising do not come to pass the entrepreneur is reluctant to reassess their strategy and recalibrate investor expectations.
Imbalanced views on investment criteria: For practitioners, the differing requirements from various investors, the kinds of documents required, the overemphasis on excel sheets vs field realities which contribute to longer approval periods can lead to frustration among practitioners. For smaller entrepreneurs (less than Rs. 50 lakhs) unable to articulate their plans through excel sheets there are few alternatives developed to suit their ability to communicate their vision. On the other hand, investors view excel sheets are the simplest tool out there as part of the due diligence process especially when dealing with unsophisticated entrepreneurs. Entrepreneurs need to understand and trust that some conditions are put in there to give early investor some leverage with later investor, and are not going to be used against them. There is a need for a certain amount of accountability and one cannot forego that to ease access to funds. In addition even if investments are built on relationships in order to maintain continuity (lessen delays) there is a need for records and hence the importance of these documents in the event individuals moves from the original investment team.
Long approval periods: Cumbersome approval processes can entail a minimum of 6 months to 1 year or more just to clear approvals. This is then followed by release of funding which can take upto 6 months. This is untenable – needs to made much shorter and faster and less painful.
Careful use of commercial capital: Practitioners need to be mindful of not overpromising to investors but instead focus on core of work and organic growth. There is an emerging need to raise funds and grow as fast as possible without creating processes and strengthening the core values of the organization. This can also lead to false perceptions of growth and ability to scale.
Blended investments: Mismatch between big and small monies and there is a need to combine grant funds with matching investor funds at different stages. There is no standardized instruments that have demonstrated this appropriate mix of investments and there is a need for this. The time taken to approve investments is too long and this can stifle critical growth periods for entrepreneurs.
Overhyping, overselling Innovation: Replication needs to be given its due rather than the over emphasis on innovation. While innovation is an important facet of the organization it is increasingly being given an overriding importance over the ability of the organization to replicate sustainable processes.
Oversimplification of problems: Complexity of issues not acknowledged in that different regions call for different solutions. The expectation of return cannot be uniform and it’s a flawed approach to think that the same model or solution will work everywhere. There is an under appreciation of contexts.
Policy frameworks: Need to complement the industry and gain inputs from practitioners themselves. This need not always occur at the national level but can also lower decentralized levels as well. Policy frameworks need to be readjusted as well to stimulate the growing industry in order to mitigate risks for both parties fairly. The conversation gets heated up
Cultivating a change in mindset:
Annual meetings that brings together these likeminded players to further this change in attitude towards sustainable long term investing as a continuation of this meeting. Each invitee will be expected to bring an additional participant to expand the community of likeminded investors and practitioners at different levels.
Forming an Alliance:
Practitioners: Bringing together collective voices in the space will make it easier to engage and lobby with different actors particularly government and policy makers. It also brings in continuity that is not dependent on any one organization or entity but is representative of the larger industry or sector. In this regard, coordinated efforts have lead to the creation of CLEAN earlier this year which can be that collective voice.
Investor Circles: Bringing together different types of investors- high risk funds, intermediaries and long term patient capital into an aligned thinking and also assist in advocating for changes in line with practitioner alliances. This group is also better placed to influence its own circles on a changing attitude towards modest returns and sustainable investing.
Incubation Centers: as intermediary vehicles who can bring in newer players early into this mindset and also serve as advisors between investors and entrepreneurs. Ultimately they are the middle organizations connecting these two entities and therefore they too need to be clued into these conversations.
Exposure programs for Investors and practitioners:
Exchange Program: Moving beyond traditional sense of engagement and exploring an exchange program that enables the investors to witness and engage directly with enterprises on the ground to have a deeper understanding of ground level realities.
Practitioners joining advisory boards: Practitioners participating in advisory boards to assist in due diligence process to bring in a ground level perspective.
Pilot Model Investment Instruments: In order to invest more and invest early there is a need to look at a variety of ticket sizes in different forms. Currently there is a mismatch between big and small monies. For example soft funds are necessary in early stages especially for non tangible expenses (cost vs revenue) that can be used to raise equity funds targeted at organization growth. Therefore, In addition to outlining new sustainable blended investment instruments, it would add of value to demonstrate its viability in reality. This can also demonstrate a new model of partnership between investors and practitioners.
Shorten the due diligence process
Standardizing application and assessment procedures: In order to ensure smoother negotiations, shorten due diligence periods and prepare practitioners. Perhaps a set of model documents can be developed by the broader impact investment community that can reduce time and resources-financial/human (refer model templates from National Venture Capital Association, http://tinyurl.com/ykdxq57)
Domestic Frontline Investor Organizations:</span> Whose proximity will help gain a better understanding of the practitioner and also assist the “remote” decision making team and minimize waiting periods for the practitioner. Also staffed appropriately with folks mindful of ground level realities.
Develop an impact reporting framework: Keeping the metrics simple but effective enough to communicate impactful processes and results of the organization will also help as an additional tool in the investment due diligence stage. This work is already initiated to undertake a larger robust study to develop a reporting framework with appropriate indicators .
Strengthen the Role of Incubator Vehicles: Incubation centres can serve an intermediary role between investors and practitioners. They can be an effective first level interaction that can translate expectations from both sides particularly for smaller entrepreneurs who can engage their counsel to facilitate negotiations.
Expand into other technology players in the energy access space that also shapes early on a holistic thinking around the need for a variety of instruments needed for multi-pronged solutions to solve the scale of the energy problem across the world.
1 ‘Clean Energy Access Network’ (CLEAN) was created in 2014 in India as an overarching alliance that capitalizes on the strengths and expertise of existing networks or interested organizations. The network will focus on areas around clean energy, energy access and decentralized energy while creating the capacity to deliver innovative solutions for other parts of the developing world.
2 CII-Centre for Sustainable Development is working with SELCO Foundation as one of the partners to develop a reporting framework for social enterprises. The intent is to relook at existing indicators that capture impact within the organization (its practices) and results (its outputs) across sectors and differing approaches adopted by enterprises.
Towards Convergence of rural development initiatives – Model Village Scheme (Saansad Adarsh Gram Yojana).
Energy access has been identified as an integral component in rural development all over the world. Especially for developing countries this translates into a great opportunity to tackle issues of poverty and climate change simultaneously using decentralized renewable energy (DRE) technologies. These technologies have already proved their mettle in terms of providing basic facilities of lighting, mobile charging and advanced livelihood opportunities. So the inclusion of these technologies becomes inevitable while devising various schemes in rural development. Unfortunately such a holistic design thinking was absent in many of our earlier schemes and policies where a clear role of DRE technologies were not recognized. SELCO Foundation has been advocating for an integrated approach in these schemes starting with National Rural Livelihoods Mission (NRLM) in Karnataka with regular interactions and close engagement with the Karnataka State Rural Livelihoods Promotion Society (KSRLPS ). A large number of similar programmes were observed to have potential for an integrated approach where energy interventions could play a vital role. Saansad Adarsh Gram Yojana (SAGY) popularly known as ‘MP’s Model Village Scheme’ is a new initiative by the Central Government that leverages on the capacity of the Member of the Parliament to transform villages into Adarsh Grams (model villages) of holistic development in on social, human, economic and personal fronts. The scheme envisages a participatory development model that can bring together the village community, government organizations and private partners. It is worth mentioning that the scheme has emphasized the use of renewable energy technologies especially solar wherever it is possible.
Having pioneered the concept of model solar villages in Karnataka, SELCO is engaging with the scheme in order to integrate energy related inputs in health, education, livelihoods and skill development. In addition to this the idea is to bring in the aspects of safe drinking water and low cost infrastructure facilities that go beyond energy interventions. In a way we approach this scheme as a possible opportunity for the government to create a “hub for convergence” of various schemes with coordinated action and optimal utilization of funds. We have been closely following the processes under the scheme both from the perspective of policy and that of actual implementation. We believe that there is ample scope in adopting a cross sectoral approach in the field of development as there is a multiplicity of schemes in the existing scenario and most of them have not produced desired results. In the electricity sector, even after decades of rural electrification initiatives, close to 300 million people are still lacking access. This has a direct link to poverty with low productivity, lack of access to decent health and education activities etc. With the concepts like developing Adarsh Grams (model villages), we believe that government is looking to move towards a more holistic approach taking into consideration possible opportunities for convergence of various schemes (at ministry and department level) for effective implementation.
SELCO Foundation started in 2010 with the aim to innovate. Disruptive impact innovation is fueled by co-creative ecosystems. A huge challenge – much easier said than done. But the team has never been looking for easy shortcuts to development, so this suits us well. The term “Eco” is derived from the Greek word “Oikos” which means “the whole house” or “the place to live in”. Hence, ecosystem calls upon a collective approach – sensing and acting towards improving the environment, social, intellectual and economic aspects as a whole.
Sustainable development as we define it – is the holistic and inclusive promotion of well-being, health, education and livelihoods. By holistic we refer to a trans-disciplinary approach bringing technical, social, financial, governance, capacity building, policy and enterprise issues together; whereas, inclusive refers to creating better equal opportunities from a socio-economic standpoint.
As the world is becoming more vulnerable to the impacts of climate change, inequitable wealth distribution, unsustainable production and consumption patterns, SELCO Foundation’s role becomes all the more critical. We cannot afford to think in silos and ego-systems anymore. One needs to move beyond just pointing fingers and to come together to create positive outcomes for all.
Diversity within teams and people who challenge each other and the organization have been critical for the growth and learning curve of the team as a whole.
Rural labs’ challenges of partnerships and taking pilots to scale; Urban labs’ issues of city stakeholders and insecurity of migrant populations and the Tribal labs’ challenge of working with very remote settlements, basic rights and cashless economies – the three community labs provide us with a key ground reality connect which is the source of all our design and agendas. Livelihoods, Vulnerability and Education have been key focus areas. The education team consistently grows stronger every quarter with the impact of hands-on sustainability and invention education programs for middle and high school students. The ecosystem support areas of policy, design and technology and incubation continue to be built as critical pillars of the foundation.
As new leadership challenges emerge across the world, breaking away from traditional thought processes of design, engineering, management and economics, the foundation too envisions its future work outcomes.
The direct outcomes, however, have always been less important than the impact, journey and the processes. There is still so much to learn, develop and question. For many of us who have joined hands it has become a journey, full of ups and downs, like a family. Some storm out of the house, some form unending bonds (with people and concepts) and others even find their calling.
It’s important for organizations and individuals today to make the journey from ego-systems to ecosystems. And we’re happy that we have been on that very path from an organizational and a global perspective. Our interventions will remain as good and strong as the internal state and thought process of our teams, people and partners. We wish to take more risks, failures, learnings and a few significant breakthroughs all towards long term impacts. We invite people (everyone) to join us towards imagining and realising positive change as a reality moving from frameworks, buzz words and jargon to commitment and action. We have been in a state of evolution, and always will continue to evolve until many of the foundation’s goals become significant models, concepts and thought processes to be scaled through replication.
It has been an exciting, nail biting, intellectually stimulating roller coaster 5 years where new friendships have been built, new communities and people have joined, new programs and projects emerged, new thought processes and approaches developed, new and efficient planning and administration systems operationalized, new methodologies to conduct activities and to get the best results … and the new list continues. Hope you enjoy reading the very first edition of SELCO Foundation newsletter!
The need: For paddy farmers who own less than 2-3 acres of agricultural land, investing in large scale combined harvesting technology is not feasible. In remote and hilly areas there is the added constraint of finding labour or transporting the crop to nearby towns, where paddy harvesting technology can be accessed.
Current methods of manual threshing involve beating a stack on a wooden board (as pictured). This process is taxing and time taking. Also, due to the high demand for labor and increasing labor costs, this method of threshing is becoming expensive.
Identifying existing technology: After scoping existing technologies nationally and globally the portable paddy thresher from Premier Magnetos in West Bengal was identified as the most feasible option. It came in a pedal or motor operated version, was portable and was tried and tested in other regions. The next step was to procure the machine and test it in the Karnataka context.
Honing the model: Two farmers were identified and the thresher was field tested and found to reduce time, labour and scattering losses. The main concern was the cost of the product as compared to the use per season. Most farmers had 1-2 paddy harvest per year and threshing takes place for 1-2 weeks in a year in total. Many farmers were hesitant to pay Rs. 18,000 for a machine that they would use only a couple of times a year. However one farmer looked at it differently. He began to rent the machine out to neighboring farmers, in a 50-60 kms radius, for a per day fee. In a matter of two harvests he was able to make up the cost of the machine and wanted to buy another one.
Based on this case we are conducting an extended pilot looking at replication in other geographies as well.
Replicating the process/model: The idea with each project is to develop processes or models that can be replicated in other scenarios and for other products/services. For example, the thresher could be substituted for any other machine or service that could be delivered using the above model. Though at first the cost of a product might seem like a barrier to adoption the right model could make it affordable.
Education lab at SELCO Foundation is working towards inspiring a new generation of youth that focuses on solving the problems of the 3 billion+ energy underserved populations of the world by being:
Sensitive, inclusive, sustainable
Innovators with a bottom-up perspective, who can work seamlessly across varying cultural and geographical contexts
Socially entrepreneurial in spirit
Invention education introduces the concept of invention to the children of rural underserved communities and also mentors them throughout their schooling to address their issues through invention.The whole program is based on the belief that underserved communities need to be empowered to solve their issues in their community.Sustainable Science Labs looks to create greater awareness about environmental issues and sustainability.
Inventions have played an important role in shaping the course and development of the society.Inventions are radical new ideas and perspectives for change.They serve to address the pressing needs.Inventions can have both positive and negative influences.For example-inventions such as plastics,atom bomb,CFC Freon,DDT(pesticide) etc have all created damage more than benefits. Hence, it is very important that while cultivating the problem solving approach in our future generations, it is incumbent they are able to look through the lens of sustainability (financial,social,environmental and cultural) while understanding problems,brainstorming about solutions and designing inventions accordingly.Inventions should be such that they are able to create avenues for asset creation,provide upliftment and at the same time do not cause harm to environment and the ecosystem i.e. be drivers of sustainable development innovations that have a potential to trigger a change. This was the underlying factor for us to think about merging Invention Education and Sustainable science labs and come up with an Integrated course called Invention and Sustainability studies.
This course envisions the creation and development of scientifically and environmentally literate productive members of society who manifest skills as critical problem solvers, responsible stewards of nature, innovative and creative citizens, informed decision makers, and effective communicators who work on providing sustainable solutions to the prevailing problems of the society. In this course, the students question the current practices, analyze and understand alternatives that would be sustainable in the long-run.Energy needs are met through alternative energy solutions, when economically feasible. In this process the students implement Sustainable living practices in their schools and communities.The students also turn share their knowledge with community members for greater impact and thus become advocates of change.Concepts and skills in Life Sciences, Physics, Chemistry, and Earth Sciences customized to local requirements and resource availability are intertwined and organized around situations and problems that challenge and arouse students’ curiosity.Various hands-on, minds-on, and hearts-on activities are used to develop students’ interest and let them become active learners instead of just relying solely on textbooks to obtain the knowledge.The concepts and skills are integrated rather than discipline-based, stressing the connections across science topics and other disciplines as well as applications of concepts and thinking skills to real life.
If we all worked to put long-term impacts before short-term convenience, we really could make the world a better place.
The Technology Team in SELCO Foundation has organically grown in the last two years to support the work of the labs and other practitioners, and more recently it has started to look at how it can support the energy access ecosystem in India. A few key outputs are the development of products for the agriculture and garment sectors as well as development of testing facilities in-house to support our ground partners and the wider industry with low-cost product testing making use of the SELCO family’s grounded experience.
Decentralised energy systems are becoming more and more affordable as technology improves and the costs of components decrease. These technology improvements are within all parts of the system, and an understanding of the system as a whole, rather than just the generation source, is essential for optimisation of systems to improve energy access. This includes the load, storage, generation and system control; each of these parts has benefited from recent technological advances. The SELCO Foundation technology team’s main purpose is to bring these new technologies to energy access practitioners in India. We do this by directly working with them to develop new products and innovative systems as well as looking at interventions for the wider ecosystem.
The wide adoption of Solar PV internationally has greatly reduced the cost of panels. This was driven by a mass market resulting in economies of scale. However, although energy access practitioners are often not looking for anywhere near the scale of grid connected PV plant, they have none the less benefited greatly. A similar phenomenon is likely to occur in storage systems with the increasing adoption of electric or hybrid vehicles: the cells used in these batteries are also used in laptops and could be used in a solar home system.
Lead acid batteries struggle in many situations to provide a low cost storage solution. In particular there are two specifications that often limit their use: the cycle life of the battery at high C rating (the rate at which it is discharged or charged) and that their weight. Storage is therefore one key technology to investigate and the team is working closely on it. In particular we are currently reviewing different technologies available for critical applications and will move to lab and field tests of this technology.
Another key area is the energy consumption side. Energy efficiency is the first key to a lower cost system. At the first level, this could include replacing CFL with LED lights, or replacing an AC motor in a machine with a DC one. At the second level we try to understand in detail how a load is used to design the optimism solution. For example: a mill may be available to run on and off for 8 hours in a day, but the actual running time may only be 2 hours. We call this a duty cycle (in this case it is 25%) and we are training field staff to assess and collect this data from the end-users.
Apart from this core technology work, the team also looks at work for the energy access ecosystem. Two current projects include assessments of key past installations as well as reviews of new products. These will both aim to improve technology awareness amongst different practitioners.
We first began exploring the issue of Value Added Tax (VAT) on Renewable Energy devices and spare parts in early 2013. Since VAT is a state subject, with RE devices and spare parts attracting 5.5% VAT in Karnataka, the state Energy and Finance departments became crucial stakeholders to any effort. It was important to illustrate that this imposition of VAT on one hand and the provision of a Central Government subsidy on solar systems on the other hand are contradictory in effect. The final result is that the benefit for the end user availed from subsidy is greatly reduced and works out to less than 25% of the original intended benefit.
Solar home lighting system in rural India
After engaging persistently with key decision makers on the issue over the last 2 years, the Government of Karnataka announced an exemption of Value Added Tax (VAT) on certain solar Panels and Invertors, in the State Budget for FY 2015-16. The final notification from the Finance Department came on 1st August putting the exemption into effect. This move complements existing programmes such as Surya Raitha scheme, subsidies for Solar water pumps and promotion of Roof top solar that promote alternate, cleaner sources of energy, providing confidence to solar enterprises and companies that the state is serious about this sector.
We do, however, have some distance to go. The Goods and Services Tax (GST) that will likely come into effect from April 2016, will replace VAT and ensuring that a GST exemption is relevant for all Renewable Energy devices and spare parts is critical. The goal continues to be to ensure that end users who are moving to greener, cleaner and more renewable sources of energy are not burdened with the additional cost of VAT/GST on their systems.
The need for affordable, clean and reliable electricity for the rural and urban poor is undeniable. Despite improvements in grid expansion in the country, quality and reliability are still far from ideal. Developing decentralized energy solutions for households, livelihoods and community spaces can address this challenge. However, for any clean energy solution to really be successful on the ground, a conducive environment is critical- Technology, Finance, Skill development, Local entrepreneurship and Policy.
Syndicate bank and Sri Subramanya- former CEO of TATA BP Solar (now TATA Power) have played a key role in building this ecosystem for energy access. They were awarded the Suryamitra award for 2016 for their continued efforts in promoting clean energy for rural communities.
SELCO India recognizes individuals and organizations with Suryamitra awards for their continual and unstinting support to reach out and lift individuals out of energy poverty thereby improving the quality of their life.
When SELCO first began interventions in Karnataka around 1995- technology and financing for end users were two missing gaps. In the leadership of Syndicate bank and Sri Subramanya, SELCO found supporters and experts who were equally dedicated to bridging these gaps.
“Syndicate Bank is a big bank for small farmers and livelihoods” says Sri Arun Shrivastava, Managing Director and CEO who received the award on behalf of Syndicate Bank.
Image caption (L to R): Sri M. Suresh (G. M. KREDL) watches on as Sri Arun Shrivastava (Managing Director and CEO, Syndicate Bank) is being felicitated by Sri K.M. Udupa (Managing Trustee, Bharatiya Vikasa Trust, Manipal). Standing in the row behind: are Sri S. M. Desai (DGM), Sri B. R. Hiremath (AGM), Sri J. K. Panda (Chief Manager) and Sri S. B. Katti (Rtd. Senior Manager) of the Priority Sector Credit Department (PSCD) of Syndicate Bank, Bangalore office. Behind them on right- Sri Thomas Pullenkav (advisor, SELCO India) and Smt. Revathi K (President, SELCO India)
Under the leadership of Sri Arun Shrivastava the bank has actively chosen to go beyond solar lighting in Karnataka into more challenging areas such as Kalahandi in Odisha to finance solar home energy systems. It has also taken a much needed step of using the MUDRA scheme to finance energy solutions for livelihoods including Sewing machines to Roti rolling machines. Over the course of the year, Syndicate bank branches across 4 states will be extending credit to more than 90 entrepreneurs to access decentralized solar solutions for their livelihoods, thereby facilitating local entrepreneurship and productivity.
Image caption: Sri M. Suresh (G. M. KREDL) and Sri Mohan Hegde (COO, SELCO India) watches on as Sri K.M. Udupa (Managing Trustee, Bharatiya Vikasa Trust, Manipal) felicitates Sri Subramanya CEO of TATA BP Solar (now TATA Power). Sri Harish Hande (Chairman, SELCO India), Sri Thomas Pullenkav (advisor, SELCO India) and Smt. Revathi K are seen on the right.
The next Suryamitra Awardee Sri Subramanya- the former CEO of TATA BP Solar (now TATA Power) continues to argue for the need of government to increase off-grid deployment manifold given the vastness of the country and the current state of electrification. Sri Subramanya said, Newspapers and publications should start focusing on socio economic issues of water, health, energy and the kind of solutions that are being created around them and not just the problems. Nowadays all we hear is megawatts and gigawatts but it is the small, off-grid, decentralised systems that will serve the most rural and remote settlements. Truly small is beautiful!” The need for energy equity is also well recognized by him. He continues to advise enterprises within the sector and thereby push for improvements in energy deployment.
Suryamitra Awards were presided over by Sri Harish Hande, Chairman SELCO India and Sri K.M. Udupa, Managing Trustee, Bharatiya Vikasa Trust, Manipal. The celebration was attended by representatives of all the branches of SELCO India and members from the SELCO Foundation. The event ended with Sri Hande asking, When will we take our responsibility as an individual or organization to solve people’s problems instead of expecting all the solutions from the government? Can we challenge the present development paradigm and suggest solutions that are replicable and highly inclusive of the poor?”
Image caption(L to R): Sri Ningappa Bedasur (Program Coordinator) and facilitators Kum. Mamthaz and Kum. Sumithra , of Education Lab, Ujire and Yadgir are seen with innovations from Invention and Sustainability Education program that runs in 23 government schools, classes 6th to 9th across South and North Karnataka.
Image caption(L to R): Seen here are health and livelihood applications powered by sustainable energy along with Anoop (intern, SELCO Foundation), visitors and Madhu (tech-livelihoods associate, SELCO Foundation)
The event also showcased sustainable energy applications in health, education and livelihood. These included solar powered sewing machines, hair trimmer, de-husker, Tur Dal pruner (livelihoods); solar powered projector (education); portable medical kit (health); home and shepherd lighting systems.