Solar Products for Poor Rural Communities as a Business

Can sales of solar products and services be a commercially viable business in poor rural communities? Although enthusiasm for off-grid electrification among researchers and practitioners is widespread, the determinants of commercial success in this domain remain poorly understood. In collaboration with a local social enterprise, Boond Engineering, and Development, a small investment of USD 5,000 was made to establish an energy center in the Unnao. The energy center became profitable immediately and generated seven dollars of business in solar home systems for every dollar invested during the 6-month evaluation period. Factors contributing to the success of the project included robust marketing, a strong banking partnership, the high quality of products, and continuous evaluation of staff performance. Challenges included a bias in sales toward large solar home systems, the limited access to finance for poor households, and access to working capital. Overall, the energy center model holds considerable promise for alleviating energy poverty in rural India on a large scale. MORSEL was responsible for conducting Baseline and Endline surveys in 38 villages, as well as overseeing the implementation of the field experiment on a daily basis. The survey was funded by the Earth Institute at Columbia University under an Earth Clinic grant.