Lighting is a basic need. However, the up-front investment required to access any modern lighting devices is beyond the financial capacity of the average rural Tanzanian. The absence of reliable technical after sales service also deters the users from investing in the modern devices.
In 2010 Appropriate Rural Technology Institute Tanzania will begin the implementation of the World Bank funded Lighting Rural Tanzania Project in partnership with the Rural Energy Agency (REA), of the Tanzanian Ministry of Energy and Minerals.
The Pilot project intends to demonstrate that solar energy powered lighting can be accessed by the low income rural population using the existing trade channel and its “Mali Kauli” (Mali = Good +Kauli = Word of Honour) credit system. The project will take place in Bagamoyo District of the Pwani region
Product Range Gap – Currently solar powered systems available in Tanzania are large, complex, inverter based, multi light systems priced between USD 450 – USD 2500 and on the other hand simple, single bulb, hand held lights priced between USD 10 – USD 50. There are no options for multi light systems at affordable prices.
ART-TZ Executive Director, Nachiket Potnis receiving the LRTC award from REA and World Bank officials in Arusha, Tanzania
Affordability and access to credit for Solar Lights – In the district selected for the pilot project there are over 70% of the households earning less than USD 15 per week. They are spending between USD 2 to USD 6 per week to purchase batteries for flashlights, charging their mobile phones and buying kerosene or candles for illumination. There is no credit system available to them for purchasing solar lights. Attempts have been made by various organizations on providing lights on credit directly to the end users but have failed as there is no binding/ commitment for repayment. The local communities were not involved in the process
Affordability and access to credit for purchasing solar lights – Barefoot 5 watt Power Packs will be injected into the rural areas using the existing and well established trade channels. The product will be accessible to the rural Tanzanians from their village shop owner/retailer with whom they already have an informal credit understanding (“Mali Kauli”). The retailer has the advantage of knowing his customers repayment capacity and history. The Power Packs will be an additional product in his range.
Reaching the rural end users – The concept of extending solar products to the rural end users using the existing “Mali Kauli” system came about after a study of the trade system in Tanzania for the past 10 years at all levels. Although the method is informal, it is very efficient and effective from the at all levels of the channel. Presenting the solar systems to the targeted end users using their local retailer/s allows them to identify with the product and purchase it just as they purchase Galvanized Roofing Sheets, Cement, Bicycles and Seeds and fertilizers etc.
The “Mali Kauli” system has been working for many generations due to confidence, interdependence and the fear of denial of the next purchase. Using this system to inject renewable energy as a product rather than a technology is being pioneered in this project.
The primary beneficiaries of the project are the low income population and 10 youth trained and equipped as service technicians from the Bagamoyo District, in Pwani Region of Tanzania. The other beneficiaries are the members of the existing trade channel, the district level wholesalers and the village retailers who will be adding a new product to their product range and also benefiting financially. ARTI-TZ will also be a main beneficiary as the project will provide an opportunity to meet its objective – “Suluhisho la Nishati Rahisi kwa Kila Mtanzania” (Affordable Energy Solutions for Every Tanzanian).
The project will benefit 700 low income rural households, 2 local trainers and 10 local youth will receive training and the required equipment to commence their After Sales Service centers with the help of the funding.
