Renewable Energy Jobs Access

Renewable Energy Jobs Access
Renewable Energy
Jobs & Access
June 2012
Cover Photo
© Bright Green Energy Foundation
Solar panels being installed in Bangladesh
Unless expressly stated otherwise, the findings, interpretations and conclusions expressed herein are
those of the various IRENA staff members, contributors, consultants and advisers to the IRENA Secretariat who prepared the work and do not necessarily represent the views of the International Renewable
Energy Agency or its Members. The designations employed and the presentation of materials herein
do not imply the expression of any opinion whatsoever on the part of the Secretariat of the International Renewable Energy Agency concerning the legal status of any country, territory, city or area or of
its authorities, or concerning the delimitation of its frontiers or boundaries. The term “country” as used
in this material also refers, as appropriate, to territories or areas.
Contents
Foreword6
Acknowledgements8
Acronyms9
Executive Summary11
1. Introduction15
2. Energy Access Overview17
2.1. The State of Energy Access17
2.2. Renewable Energy Technologies and Energy Access19
2.3. Barriers to Energy Access and Solutions21
2.4. Benefits of Energy Access23
3. Employment Data - Review of Existing Literature
25
3.1. A Relative Dearth of Employment Information25
3.2. Developments by Selected Renewable Energy Technologies
27
3.2.1. Photovoltaic Solar Home Systems27
3.2.2. Portable Solar Lights30
3.2.3. Solar Water Heaters30
3.2.4. Improved Cookstoves31
3.2.5. Biogas — Cooking and Heating33
4. Case Study Analysis35
4.1. Overview of Case Studies35
4.2. Individual Case Studies35
4.2.1. Solar Projects37
4.2.1.1. ARE-Rural Energy Foundation SolarNow Projects in Sub-Saharan Africa
37
4.2.1.2. ARE-Nice International Project in Gambia38
4.2.1.3. ARE-Sunlabob Project in Laos39
4.2.1.4. E+Co Project A in Nicaragua42
4.2.1.5. E+Co Project B in Nicaragua43
4.2.1.6. E+Co Project A in Tanzania44
4.2.1.7. E+Co Project B in Tanzania45
4.2.2. Small Hydro Projects46
4.2.2.1. E+Co Project A in Honduras46
4.2.2.2. E+Co Project B in Guatemala47
4.2.2.3. UNDP/WB Project in Nepal48
4.2.3. Improved Cookstoves Projects51
4.2.3.1. GIZ FAFASO Project in Burkina Faso
51
4.2.4. Projects with a mix of Technologies53
4.2.4.1. GVEP The Developing Energy Enterprises Project in East Africa
53
5. Lessons Learnt57
5.1. Supply Chain: Imports and Domestic Sourcing
57
5.2. Employment Characteristics58
5.3. Skills and Training62
5.4. Improving Primary Data63
6. Conclusions67
Bibliography75
LIST OF FIGURES
Figure 1. Number of People Lacking Access to Electricity and Modern Fuels
17
Figure 2. Structure of Solar Lantern Rental System (stakeholders and their responsibilities)
40
Figure 3. Direct Micro Hydro Plant Employment (1998-2011)
50
Figure 4. Number of FAFASO Trainees52
Figure 5. Share of Renewable Energy Technologies, by DEEP EA Businesses
54
Figure 6. Total Employees, by Country (2010-2011)55
Figure 7. Illustrative Supply Chains for various Renewable Technologies in Developing Countries
57
Figure 8. Female Entrepreneurs in Kenya, Tanzania, and Uganda Case Studies, by Renewable 62
Energy Technology (as of late 2011)
LIST OF TABLES
Table 1. Lack of Electricity Access, by Region (2009)
18
Table 2. Populations Relying on Traditional Use of Biomass for Cooking (2009)
19
Table 3. Applications of Renewable Energy Technologies21
Table 4. Potential Barriers to Renewable Energy Deployment in Rural Areas
22
Table 5. Estimated Employment Factors in India’s Renewable Energy Sector
26
Table 6. Potential Employment Creation through Off-Grid Renewable Electricity
27
Table 7. Solar Home Systems in Use in Selected Developing Countries
28
Table 8. Employment Effects of Biogas Digester Construction in China (2006-2010)
33
Table 9. IRENA Partner Organisations35
Table 10. Case Study Overview: Projects, Countries, and Types of Renewable Energy Technologies, by Region
36
Table 11. Supply Chain Aspects of the Case Studies
59
Table 12. Monthly Salaries at Hydro and Solar Companies in Central America and Tanzania
61
Table 13. Share of Female Staff at Hydro and Solar Companies in Central America and Tanzania
61
Table 14. Jobs, Skills and Training at Enterprises included in the Case Studies
64
LIST OF BOXES
Box 1. Options for Extending Electricity Access 20
Box 2. Standards and Quality Assurance 63
Foreword
Achieving universal access to modern energy services is critical for improving the well-being, productivity and health
of millions of people who currently suffer the depredations of energy poverty. Deployment of decentralised renewable energy solutions can have a transformative impact in this context. Meeting the objectives of the United Nations’
International Year of Sustainable Energy for All will be essential to achieving the Millennium Development Goals.
While attention has been devoted to a broad range of issues surrounding rural energy access, the employment aspect
has received comparatively scant attention to date. This IRENA report is among the first to address this topic in depth,
bringing to light successful projects from around the developing world and giving greater visibility to this essential
dimension of the energy access debate. The study also touches on financing models and on broader linkages, examining the extent to which the supply chain for renewable energy projects is integrated into the local economy and is thus
able to generate additional downstream employment.
The report finds that energy access through renewable energy technologies can generate significant employment
along the value chain and improve rural livelihoods. Furthermore, the potential for employment opportunities and
income generation is considerably enhanced when renewable energy projects are well integrated with local commercial activities. The decentralised nature of renewable energy technologies makes them well suited to the rural
context. Many of the skills required to deploy these technologies can be easily developed locally, thus limiting the need
for imported expertise. The employment effect of energy access through renewable energy technologies adds to the
well documented benefits of reduced household energy expenditures, improved health, greater opportunities for
educational advancement, and creation of income generating activities, that all allow for a better quality of life.
I am confident that findings from this report will contribute to achieving IRENA’s mandate and encourage policy makers
to consider this fundamental socio-economic aspect of renewable energy deployment in the context of access to energy.
Adnan Z. Amin
Director General of the International Renewable Energy Agency (IRENA)
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6
Women moulding clay stoves in Burkina Faso (GIZ)
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R e newa ble Energy Job s and A c c e s s
Acknowledgements
This study has benefited from the valuable contributions and collaborative effort of many people, including staff from
IRENA and both internal and external peer reviewers. Hugo Lucas, Rabia Ferroukhi and Noor Ghazal Aswad from the
Policy Advice and Capacity Building Directorate at IRENA are the coordinating lead authors of this publication and
managed the project to completion. Michael Renner, a Senior Researcher at the Worldwatch Institute and independent
consultant, is the lead author.
Thanks are extended to the institutions which provided the case study data, namely the Alliance for Rural Electrification
(ARE), Energy Through Enterprise (E+Co), Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), Global
Village Energy Partnership (GVEP) and United Nations Development Programme/ World Bank (UNDP/WB). The support and co-operation of these organisations throughout the project timeframe is much appreciated. Many of the
photographs included in this report were kindly contributed by these organizations.
We wish to thank the following experts, in alphabetical order, for their insights and constructive guidance during the
peer review process: Simon Bawakyillenuo (Institute of Statistical, Social and Economic Research), Solomone Fifita
(Secretariat of the Pacific Community), Satish Gautam (UNDP/WB), Ramiro Trujillo (Transtech – Ingeniería), Marek
Harsdorff (International Labour Organization), Gina Rodolico (Energy Through Enterprise), Simon Rolland (Alliance
for Rural Electrification), Kavita Rai (Global Village Energy Partnership), and Andrea Reikat (Deutsche Gesellschaft für
Internationale Zusammenarbeit -GIZ).
We would also like to thank Stephanie Clarke for her careful review of the final text, Sandra Rojas for her work on layout
and design, Olivier Lavagne d’Ortigue for his contribution on the job forecasts, and Julia Wichmann for her work in
gathering the case study data.
Questions and comments should be addressed to:
The Policy Advice and Capacity Building Directorate (PACB)
International Renewable Energy Agency
C 67 Office Building, Khalidiyah (32nd) Street
PO Box 236
UNITED ARAB EMIRATES
Email: [email protected]
© IRENA, 2012
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Acronyms
Ah Ampere-hour
ARE Alliance for Rural Electrification
AGECC The UN Advisory Group on Energy and Climate Change
BSP Biogas Support Programme [Nepal]
BMZ Bundesministerium für Wirtschaftliche Zusammenarbeit und Entwicklung (The German Ministry of Economic Cooperation and Development)
CFA Communaute Financiere Africaine (West African Franc)
DEEP EA Developing Energy Enterprise Programme East Africa [GVEP programme]
DGIS Directoraat Generaal Internationale Samenwerking (Directorate-General of Development Cooperation) in the Dutch Ministry of Foreign Affairs
E+Co Energy Through Enterprise
ESMAP Energy Sector Management Assistance Program [Multi-donor trust fund administered by the World Bank]
FAFASO Foyers Améliorés au Burkina Faso [GIZ project]
FOMILENIO Fondo del Milenio (Entity created to act on behalf the Government of El Salvador under an agreement with the U.S. Millennium Challenge Corporation)
GEF Global Environment Facility
GERES Groupe Energies Renouvelables, Environnement et Solidarités [France/Cambodia]
GIZ Deutsche Gesellschaft für Internationale Zusammenarbeit [Germany; formerly GTZ]
GIZ-EnDev Deutsche Gesellschaft für Internationale Zusammenarbeit - The Dutch-German Energy Partnership Energising Development
GVEP Global Village Energy Partnership
HH Household
IADB Inter-American Development Bank
ICS Improved Cookstove
ICT Information, Communication and Technology
IEA International Energy Agency
ILO International Labour Organization
IDCOL Infrastructure Development Company Limited [Bangladesh]
kW kilo-Watt
kWh kilo-Watt-hour
LEDs Light-Emitting Diodes
m Cubic metre
MHP Micro-Hydro Plant
MHFG Micro Hydro Functional Groups [Nepal]
3
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R e newa ble Energy Job s and A c c e s s
MFI Microfinance Institution
MNRE Ministry of New and Renewable Energy [India]
MW Mega-Watt
MWh Mega-Watt- hour
NGO Non-Governmental Organisation
NLS New Lao Stove [Cambodia]
PERZA4 Programa de Electrificacion Rural en Zonas Aisladas [Nicaragua]
PV Photovoltaic
PO Participating Organisation
REDP/RERL Rural Energy Development Programme / Renewable Energy for Rural Livelihood [Nepal; UNDP/World Bank supported]
REF Rural Energy Foundation [Netherlands]
REN21 Renewable Energy Policy Network for the 21st Century
RERED Renewable Energy for Rural Economic Development Program [Sri Lanka]
RET Renewable Energy Technology
SHP Small Hydro Power
SHS Solar Home System
SLRS Solar Lantern Rental System [Sunlabob; Laos]
SPV Solar photovoltaic
SWH Solar Water Heater
TV Television
TWh Tera-Watt-hour = 1 billion kWh
UNCTAD United Nations Conference on Trade and Development
UNDESA United Nations Department of Economic and Social Affairs
UNDP United Nations Development Programme
UNEP United Nations Environment Programme
UNIDO United Nations Industrial Development Organization
WB World Bank
Wp Watt-peak
WHO World Health Organization
WRI World Resources Institute
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Executive Summary
The United Nations declared 2012 the International Year of Sustainable Energy for All, with the goal of supporting
universal energy access by 2030. This comes in recognition of the fact that hundreds of millions of people, especially in
rural areas, do not have access to affordable, reliable, and clean sources of energy. Traditional biomass—firewood, charcoal, manure and crop residues—still plays an important role, but leads to severe health and environmental problems
including indoor air pollution, deforestation, soil erosion, and black carbon emissions that contribute to climate change.
Renewable energy technologies, including solar photovoltaic, small-scale wind, hydro, and biogas are becoming
cheaper, more efficient and better adapted to the needs of rural populations in developing countries not being served
by electricity grids. Improved cookstoves also play an important role since they allow for the more efficient use of
biofuels. However, current information on job creation through renewable energy technologies in rural areas is quite
sparse. Job creation figures are rarely being tracked in any systematic manner as there are few reporting channels, and
many of the enterprises and projects working to enhance energy access are small and dispersed.
This report is among the first to delve into the topic of job creation in the context of rural access to energy. It presents
twelve first-hand case studies from practitioners in Central America, Sub-Saharan Africa, and Asia, across a set of
renewable energy technologies, including biogas, small-scale hydropower, improved cookstoves, solar home systems
and other solar technologies. The projects cover a range of activities, including support for the sale, installation and
maintenance of small solar systems; small-scale production of improved cooking stoves; investment and training in
small hydropower plants; advice to business start-ups and marketing and networking for producers; among others.
The findings indicate that energy access through renewable energy technologies can generate significant employment:
reaching the objective of sustainable energy for all could create almost 4 million direct jobs by 2030 in the off-grid
electricity sector alone. Small-scale renewable energy technologies are well adapted to the rural context as the bulk of
the skills and training required for their deployment can be developed locally. Importantly, this limits the need for developing countries to rely on foreign know-how and expertise. However, the case studies show that, in addition to formal
or full-time employment, entrepreneurs in remote rural areas often take on labourers in highly informal arrangements in
order to retain the flexibility needed for what are often fluctuating and uncertain business circumstances.
The findings of this report indicate that in designing and implementing policies to increase the number of renewable
energy jobs, policy makers may want to consider the following:
Job Creation
As illustrated by the case studies, renewable energy jobs in rural areas of the developing world can be created in certain segments of the industry’s value chain. A key question concerns the extent to which the renewable energy sector
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R e newa ble Energy Job s and A c c e s s
is integrated into the local economy both via the supply chain (upstream linkages) and downstream businesses that
are made possible by the provision of energy services. The case studies suggest that many, but not all, manufactured
inputs such as photovoltaic panels, solar lanterns, and turbines for hydropower plants are imported from other countries. However, there is some domestic assembly of imported solar components, and batteries are often manufactured
domestically. For improved cookstoves, supply chains are mostly domestic in nature. This is especially true for clay
stoves, but in the case of metal stoves, scrap-metal is often imported. Likewise, for biogas plants, the bulk of inputs,
especially construction materials, are likely to be sourced domestically.
Most developing countries continue to play a limited role with regards to the manufacturing of renewable energy
equipment and components. However, there is greater employment potential in the downstream linkages, particularly
in the distribution, sales, installation, operation, and service of such systems. Thepotential for employment opportunities and income generation is considerably enhanced when renewable energy projects are well integrated with local
commercial activities, either through up-scaling of existing small businesses or the creation of new ones.
Improving Skills
Small-scale renewable energy technologies are generally well adapted to the rural context. Many of the required skills
and training can be developed locally, thus limiting the need for imported expertise.
Nevertheless, developing appropriate skills along the renewables value chain remains critical to strengthening the rural
renewable energy sector. In many cases, training can be done on-site or on the job. This is especially true for many
micro-enterprises, and particularly those that rely on informal and temporary labour in addition to regular employees.
The case studies show that broader training encompassing the development of business skills is essential, as well as
in product standards, and quality control, among others. Marketing skills are especially needed for renewable energy
technologies that are sold individually to households such as solar home systems and solar lanterns.
Gender Impacts
Women derive some of the most important benefits from improving energy access. In rural areas, the burden of gathering fuelwood falls heavily on them, requiring hours of back-breaking work each day. Renewable energy technologies
especially if combined with energy efficient cookstoves, reduce or eliminate this burden.
The case studies illustrate that women have an important role in producing improved cookstoves and briquettemaking (which require less capital and less mobility), but far less so in solar technologies and biogas ventures due to
various limitations. These include: mobility, capital requirements, and the perception that technology is better served
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
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by men – all of which preclude a larger role for females in many rural settings. Social structures and
traditions also have an impact: some female entrepreneurs are limited in their activities by the need to
remain in the household or help in the field. As such, in most renewable energy technologies enterprises,
female employees are a minority, especially in managerial and technical positions.
Standards and Quality Assurance
Experience suggests that using quality materials, equipment and components is critical, not only to the
sustainable development of the renewable energy industry in rural areas, but also to local job creation.
Quality assurance helps to reinforce to prospective rural community customers that renewable energy
is a credible and suitable alternative to traditional forms of energy. To facilitate this requires appropriate national-level administrative structures, as well as building capacity and technical expertise among
importers, distributors and retailers of renewable energy technologies equipment. Governments are
principally responsible for putting such standards and quality assurance measures in place.
Improving Primary Data
There is a need for better and more systematic efforts to track and monitor rural renewable energy
employment in developing countries. Additional case studies are needed to ensure the availability of a
robust set of examples for each renewable energy technology within different regions. This will allow for
an enhanced connection to be made between specific local micro-conditions and the broader country
context, including national policy-making. Local case studies could also be temporally extended to improve the evaluation of development impacts over a longer period of time. Establishing time-series data
and monitoring qualitative aspects of employment would also facilitate a broader understanding of the
evolution of the employment sector in rural areas. This requires drawing up common criteria, metrics,
and reporting standards for rural case studies in order to make findings as comparable as possible and
to support long-term monitoring and assessments.
The purpose of this report has been to explore the topic of job creation in the context of rural access
to energy. The use of case studies has allowed for a multi-faceted analysis, highlighting where linkages
between local job creation and renewable energy deployment occur. These include important aspects
such as job creation by technology, integration of the renewable energy sector into local economies,
skills and training, the gender impact well as standards and quality assurance measures. This report
represents the initial step of an on-going effort to collect and monitor information through case studies
on this important socio-economic dimension. It is envisaged that this report, and future initiatives, will
support decision makers in designing rural energy policy.
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R e newa ble Energy Job s and A c c e s s
Women purchasing briquettes for ccokstoves in Uganda (GVEP).
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1. Introduction
T
he United Nations has designated 2012 as the “International Year for Sustainable Energy for All.” The UN
Secretary-General has set three objectives for 2030—achieving universal access to modern energy services;
doubling the rate of improvement in energy efficiency; and doubling the share of renewable energy in the global
mix. This comes in recognition of the fact that large numbers of people in developing countries do not have access to
affordable, reliable and clean sources of energy. Expanding access to modern energy services is essential for reducing
poverty, improving health and increasing productivity. Energy access is also a prerequisite for achieving a number of
the Millennium Development Goals (United Nations Development Programme (UNDP), 2008).
This report addresses a dimension of energy access that has to date received only limited attention: employment. It is
among the first to draw a comprehensive picture of how the deployment of modern renewable energy sources in rural
areas of the developing world contributes to the creation of jobs and livelihoods. Much attention has been devoted
to the technical aspects, the changing economics and the need for financing mechanisms. However, to make energy
access a reality also requires that sufficient numbers of individuals are trained in the skills needed to manufacture,
distribute, sell, install, operate and maintain renewable energy systems, ranging from solar home systems (SHS) to
micro-hydro plants (MHP) to household biogas digesters.
The employment dimension of renewable energy development has received growing attention in recent years, although
most studies have focused on those few countries that play a leading role in manufacturing renewable energy technologies (RETs). Similarly, most of these studies have concentrated more on industrial-scale solar photovoltaics (SPV) than
on the pico solar systems that play a role for poor communities in the developing world; more on large hydro than small
hydro; and more on biofuels for powering automobiles in cities than on biomass for village energy needs.
As this report discusses, the bulk of the literature on this subject does not engage the employment dimension in rural
contexts or makes only passing reference to it. Yet there is tremendous potential for employment in processing renewable
energy inputs (biomass), in producing, selling, installing and servicing both the equipment that transforms renewable
energy sources into usable energy (solar panels and lanterns, wind turbines, biogas digesters, cookstoves, etc.), and the
equipment or appliances that turn energy into desired services (heat, light, refrigeration, mechanical power, etc.).
It remains difficult to estimate how many jobs could be generated by fulfilling the goal of the International Year for
Sustainable Energy for All. However, some of the present employment figures indicate significant potential. Already,
India estimates that its off-grid SPV sector employs 72 000 people and its biogas sector 85 000 people. China’s
biogas industry has employed some 90 000 people in 2006-2010, and its solar water heating (SWH) sector - where
it is the world’s undisputed leader - may involve as many as 800 000 people. But smaller countries too, are beginning
to create some substantial employment in off-grid renewable energy. Bangladesh has an estimated 60 000 people
who are involved in the SHS sector, a figure that will grow larger as a bigger share of its rural population gains access
to solar electricity. This report offers a rough estimate of almost 4 million direct jobs in off-grid renewable electricity
generation that could be created by 2030 if the Energy Access for All scenario is fulfilled. Additional employment
would be generated in renewable technologies for cooking and heating.
Beyond the renewable energy sector, another employment dimension is found in the downstream micro-businesses
that are either newly created or able to expand due to improved energy access. Increased economic transactions are
possible when stores and other businesses can stay open into the evening thanks to lighting. Furthermore, there are
less-readily quantifiable impacts. They include time spent on education or income generating activities (previously
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R e newa ble Energy Job s and A c c e s s
spent collecting fuelwood, for example), greater productivity that results from better-quality or more reliable lighting;
better health and therefore more productive lives resulting from eliminating air pollution associated with conventional
cooking fuels (kerosene or fuelwood) and from better vaccination made possible by reliable refrigeration; children’s
ability to study at night and the educational gains that may lead to more productive economies in future years.
An important finding is that rural RET projects typically do not need highly qualified skills. This means that rather than
requiring extensive foreign expertise and personnel training, energy access can be provided by relying on people with
fairly basic technical and business skills. The resulting employment from the dissemination of RETs offers important
economic opportunities for the “bottom of the pyramid.”
Section 2 of this report gives a brief overview of the energy access situation in developing countries with regard to
electricity, modern fuels and cookstoves. It reviews the available estimates of numbers of people lacking access to
modern energy and energy services. The section then discusses possibilities to improve access with the assistance of
renewable energy options, the benefits of doing so, as well as the obstacles and ways to overcome them.
Section 3 provides a review of the available literature, highlighting what is known about employment opportunities
that emerge from expanding renewable energy in rural areas. The discussion focuses on a number of key RETs, including SHS, solar lanterns, SWH systems, and biogas digesters for cooking and heating, as well as ICS. For each of these,
selected country experiences are presented.
Section 4 is based on a series of case studies, provided by IRENA partner organisations, companies and development
projects in Central America, Sub-Saharan Africa, and Asia that are intended to improve rural energy access and build
local capacity. These ventures rely on a broad range of renewable energy sources and associated approaches, including biogas, briquette-making, small-scale hydropower, ICS, SHS and other solar technologies. The case studies offer
specific data on employment and related experiences. Furthermore, the discussion of these case studies touches on
financing aspects, and examines to what extent the supply chain for renewable energy projects is integrated into the
local economy and is thus able to generate additional downstream employment. In addition to jobs that are directly
linked to the deployment of renewable energy, there are a number of associated benefits (reduced household energy
expenditures, improved health, greater opportunities for educational advances, and others) that allow people to live
more productive lives and have more time to pursue income-generating opportunities. While these are often difficult
to quantify, they nonetheless carry great importance for local communities. Lessons Learnt from these case studies
are presented in section 5.
Finally, Section 6 provides policy-makers with recommendations on how best to enhance job creation in the context
of RET deplyment in rural areas.
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2. Energy Access Overview
T
his section first provides a brief overview of the extent to which different regions and countries of the
developing world currently lack access to modern,
clean energy. It then examines opportunities and investment needs for expanding access before discussing
some key obstacles.
Hundreds of millions of people remain trapped in energy
poverty - suffering from inadequate access to energy and
especially to modern, clean energy sources. Traditional
biomass (fuelwood, charcoal, manure and crop residues)
still plays an important role in cooking, lighting and space
heating needs for large numbers of people in developing
countries, especially in rural areas. Not only is traditional
bioenergy use energetically inefficient, its production
and use also generate severe health and environmental
problems, including indoor air pollution, forest and
woodland degradation, soil erosion and black carbon
emissions that contribute to global warming (United
Nations Environment Programme (UNEP), n.d.).
2.1. The State of Energy Access
More than 1.3 billion people worldwide are without
electricity access and another 1 billion have unreliable access. At least 2.7 billion people lack access to
modern fuels. Traditional biomass plays an important role for these populations, but it is inefficient
and generates severe health and environmental
problems. Modern renewable energy sources offer
economic, health and educational benefits. ICS
also play an important role since they allow people
either to make use of more modern fuels, or use
traditional fuels much more efficiently, reducing or
avoiding dangerous indoor air pollutants.
There is a significant a difference between traditional
and modern biomass usage. The latter includes not only
energy for heating and cooking, but also transportation fuels and electricity generation (Goldemberg and
Teixeiro Coelho, 2004). The range of modern sources of
renewable energy extends far beyond biomass to include
various forms of solar energy and wind and hydro power.
Figure 1. Number of People Lacking Access to Electricity and Modern Fuels
No Electricity Access
Unreliable Electricity
No Modern Fuels
0
500
1000
1500
Millions of people
Sources: IEA, 2011-a; AGECC, 2010.
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R e newa ble Energy Job s and A c c e s s
2000
2500
3000
According to estimates by the International Energy
Agency (IEA, 2011-a), there are more than 1.3 billion
people currently without any access to electricity. The
UN Advisory Group on Energy and Climate Change
estimates that another 1 billion people have unreliable
access; intermittent or poor quality electricity due to
insufficient grid capacity, aging equipment, inadequate
management and other reasons (AGECC, 2010). At least
2.7 billion people (IEA, 2011-a) and possibly more than
3 billion people (UNDP and WHO, 2009) lack access
to modern fuels for cooking and heating (see Figure 1).
Instead, they rely on burning wood, charcoal, dung, straw,
or coal. Approximately 830 million people have access to
ICS and they are mostly found in China. In Sub-Saharan
Africa, only 34 million people have access to such stoves
(UNDP and WHO, 2009).
The largest populations presently lacking access to
electricity are in Sub-Saharan Africa and South Asia.
The two regions combined account for more than 80%
of all people worldwide without access to electricity (see
Table 1). The problem is most pronounced in rural areas
of Sub-Saharan Africa, where the electrification rate is
just 14%. In contrast, 60% of south Asia’s rural population
has access to power.
In absolute terms, India has by far the most people - 289
million - lacking electricity. Another six countries have
populations of at least 50 million lacking access and
seven more have populations of at least 20 million lacking access. Within different regions of the developing
world, there is considerable variation among individual
countries. Unlike the rest of the world, electrification in
Africa is not keeping pace with population growth. The
continent’s population without access to electricity is
projected to grow to 630 million people (Lighting Africa,
2010-a). By 2030, the number may grow to 700 million,
unless policies change (Lighting Africa, 2010-b).
With regard to cooking fuels, ICS play an important role
since they allow people either to make use of modern
fuels, or use traditional fuels much more efficiently. ICS
can double or triple the thermal efficiency of cooking
fuels, thereby reducing dangerous indoor air pollutants
that cause pulmonary disease and premature death
among many people from smoke inhalation and reducing black carbon emissions that contribute to climate
change. Reducing or eliminating the long hours that
women and children spend foraging for fuelwood
frees up valuable time, can have a positive impact on
gender equality and reduces pressures on forests and
ecosystems.
The Renewable Energy Policy Network for the 21st
Century (REN21) Global Status Report notes that significant progress has been made in promoting the spread of
ICS in more recent years (REN21, 2011). However, half of
all developing countries do not have reliable data for ICS.
Table 1. Lack of Electricity Access, by Region (2009)
Population without Electricity
Millions
Africa
»»North Africa
»»Sub-Saharan Africa
Developing Asia
»»China and East Asia
»»South Asia
%; rounded
Total
Total
Urban
Rural
587
58
31
75
2
1
0
2
585
70
40
86
675
19
6
27
182
9
4
14
493
32
11
40
Latin America
31
7
1
26
Middle East
21
10
1
28
1 314
25
9
37
All Developing Countries
Note: OECD and Transition Economies are not included in the table since they have near universal electrification; 3 million, or 0.2%, of their inhabitants lack access to electricity.
Source: Adapted from IEA, 2011-a.
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The largest populations relying on traditional biomass for
cooking purposes are found in the developing regions of
Asia, with by far the largest number in India (836 million)
and more than 100 million in each of Pakistan, Bangladesh
and Indonesia. Altogether, 54% of the total population of
developing Asia relies on traditional biomass. In Africa,
the absolute number is smaller (657 million people), but
the share is higher (65%; see Table 2).
Table 2. Populations Relying on Traditional Use
of Biomass for Cooking (2009)
Regions and Selected
Countries
Africa
Developing Asia
Latin America
Developing Countries
Population
Millions
%; rounded
657
65
1 921
54
85
19
2 662
51
Source: IEA, 2011-b, p.11.
2.2. Renewable Energy
Technologies and Energy Access
In the past several decades, access to electricity has
expanded principally through extending the grid
and relying on fossil fuel-generated power. Remote
rural areas often do not benefit from grid extension
and fossil fuels inflict substantial environmental and
human costs, while also imposing import dependencies in most countries. Mini-grid and off-grid
systems, based on small-scale renewable energy
applications such as solar energy, hydropower and
biogas, as well as ICS, offer increasingly attractive,
reliable and affordable solutions and provide an
opportunity for small and micro enterprise business models to be propagated. However, funding
for RETs applications remains inadequate.
A growing number of governments, international agencies, non-governmental organisation (NGOs) and businesses are working to overcome energy poverty. To date,
68 developing country governments have adopted formal targets for improving access to electricity, although
a far smaller number have targets for providing access to
modern fuels (17 countries) and ICS (11 countries [UNDP
& WHO, 2009]).
19
R e newa ble Energy Job s and A c c e s s
From 1990 to 2008, close to 2 billion more people secured electricity access (UNDESA, 2011). China, Vietnam,
Thailand, Sri Lanka, South Africa and Brazil are among
the countries that have had considerable success in expanding rural access since the 1990s, principally through
large-scale grid-based electrification programmes,
which have tended to rely mostly on fossil fuel-based
generating technologies and large hydropower (AGECC,
2010). India raised the share of its rural population with
electricity access from 56% to 75% between 2006 and
2009. In Vietnam, the share surged from less than 5% in
the mid-1970s to 98% currently (IEA, 2011-b).
Access to electricity can be provided in three ways,
namely grid extension, mini-grid or off-grid (see Box
1). In urban areas, the cost per mega-Watt-hour (MWh)
for grid extension is lower than that of mini-grids or offgrid solutions. However, the cost of extending the grid
to remote or sparsely populated rural areas can be very
high, particularly in difficult terrain. Furthermore, long
distance transmission lines typically suffer high technical
losses (IEA, 2011-b).
A number of RETs offer viable options for both off-grid
and mini-grid solutions for energy access in rural areas
of the developing world. They include small hydropower
plants, small wind turbines, biogas and other forms
of bio-energy, as well as a range of solar technologies.
Hybrid systems mix a number of these options and are
often tied into a village-scale mini-grid of anywhere from
10 to 1 000 kilo Watt (kW [REN21, 2011]).
Off-grid renewable energy solutions offer a better
perspective for expanding energy access in rural areas.
Developing this potential is a technical issue only up to
a point. It is necessary to develop the structures and
organisational capacity that underpin reliable renewable
energy systems - robust supply chains with sufficiently
strong upstream and downstream linkages local enterprises, financing mechanisms and human capital (technical, economic and managerial skills).
Small Hydro Power. There is no single agreed definition
to demarcate large from Small Hydro Power (SHP), but
most countries consider 10 MW the threshold. SHP is
often the cheapest option for rural electrification over
the lifetime of a system, although initial capital outlays
can be quite substantial (ARE, 2011b). Among small
hydro facilities, mini hydro is usually defined as less than
1 MW (1 000 kW), micro-hydro is less than 100 kW and
Box 1
Options for Extending Electricity Access
Grid extension. Extension of existing transmission and distribution infrastructure to connect
additional communities. This is most feasible in
or near urban areas or in otherwise sufficiently
dense communities.
Mini-grid. Local low-voltage grids fed by multiple small-scale energy sources and are often
run by a village co-operative or an individual
entrepreneur.
Off-grid. Decentralised power-generation, via
SHS or other small-scale options. This is usually
the only realistic option for remote rural locations,
where populations are not concentrated enough
or are too poor to afford the previous two options.
Source: IEA, 2011-b, p. 11.
pico-hydro is under 5 kW. Hydropower at the micro
level is typically used by developing countries other
than China. Micro and pico hydro are typical choices for
small communities or local-level enterprises. It provides
a feasible supply of energy in remote communities
and allows local community involvement (Niez, 2010;
Kumar et al., 2011).
Solar Energy. A wide range of solar technologies are available to provide electricity to communities in rural areas.
These extend from local photovoltaic (PV) power plants
to SHS, pico solar systems (solar lanterns, e.g.). More
powerful PV systems offer a broad range of uses, including small motive power applications. SHS are stand-alone
PV systems that can fulfil a household’s basic electricity
needs (lights, radios, small televisions [TV]) in rural areas
not connected to the grid. A typical SHS ranges from
20 - 100 Watts-peak (Wp) but could go as high as 250
Wp; it includes a solar panel, a charge controller and a
battery for energy storage. Pico solar systems are typically equipped with compact fluorescent lamps (CFLs) or
with light emitting diodes (LEDs). They can also power
various appliances, including mobile phones, small radios
and a range of USB-devices. SWH produce clean hot water, typically include a roof-mounted solar collector and
a storage tank that may also be roof-mounted or on the
ground.
Small Wind Power. The U.S. Department of Energy’s
National Renewable Energy Laboratory defines small
wind turbines as those with 100 kW capacity or less
(NREL, 2011). REN21 (2011) further distinguishes household wind turbines as anything from 0.1 to 3 kW in
capacity. At the end of 2010, more than 656 000 small
wind units with a capacity of 443 MW were installed
worldwide (WWEA, 2012).
Biogas. Aside from industrial-scale applications, biogas
is typically used on a household scale in rural areas of the
developing world for cooking and heating and to a lesser
extent for lighting. Biogas digesters come in many forms
and sizes. A small household system typically entails manure collection (unless it is fed with food waste or crop
residues), an anaerobic digester, effluent storage (which
has value as fertiliser and possible other uses), and gas
handling. In general, it is a low-cost option, even though
for low-income communities in the poorest countries, financing is often needed to cover up-front costs (Climate
Tech Wiki, n.d.-a).
RETs have a wide range of possible applications in
enabling energy access where it is lacking as well as in
replacing fossil fuels and conventionally-generated electricity, as Table 3 suggests. These uses include lighting
and refrigerating at homes, businesses, schools and in
public places. For lighting and refrigeration, rural communities typically rely on candles, kerosene, small diesel
generators and batteries. For communications needs,
the conventional energy sources are dry cell batteries
and generators. For cooking, wood, dung and straw
play a major role. Process power and pumping energy is
mostly derived from diesel engines.
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
20
Table 3. Applications of Renewable Energy Technologies
Lighting /
Refrigeration
(Homes, stores,
schools, street
lights, vaccine
storage)
Communications
(TVs, radios,
phones,
Internet)
P
P
P
P
SHS
Pico-scale SPV
Cooking
(Homes,
commercial
stoves)
Heating /
cooling
(Hot water,
crop drying,
etc.)
Process
power
(Small
industry)
P
Solar thermal
P
Solar cookers
P
Solar crop dryers
P
SPV pumps
Small hydro
P
P
Small wind
P
P
P
Mechanical
wind pumps
Household-scale
biogas digester
P
P
Biomass gasifier
P
P
P
P
Mini-grid / hybrid
Water
pumping
(Agriculture,
drinking
water)
ICS
P
P
P
P
P
P
P
P
Source: Adapted from REN21, 2011.
2.3. Barriers and solutions
to Energy Access
Off-grid solutions face some obstacles, including
up-front consumer costs that may surpass cashflow, lack of appropriate technical skills, inadequate
supply chains and distribution networks, weak
business skills and others. Subsidies are often
needed to overcome the weak financial means of
many rural households. Yet, there is also a need
to develop commercially viable micro-enterprises.
Microfinance schemes can play an important role in
this context, but need to accommodate households’
cash flow. Other important aspects of enabling the
spread of renewable energy include greater awareness building, ensuring product quality, offering
after-sales services, consulting with communities,
encouraging the use of local materials where possible and providing adequate training.
21
R e newa ble Energy Job s and A c c e s s
Given the range of obstacles to grid extension to rural
areas, off-grid solutions are an important alternative in
remote rural communities. Still, decentralised RETs do
confront a number of challenges of their own. Table 4
offers an overview of potential barriers which need to be
overcome.
The discussion here focuses primarily on ways to overcome up-front financing problems as a key dimension of
providing broader energy access in poor rural areas, but
also briefly engages a number of other needed measures.
>> Overcoming Up-front Costs: Poor households spend a
fairly significant amount of money on kerosene and other
conventional sources of energy - resources that can, in
principle, be redirected toward the purchase of renewable energy equipment. On average, conventional energy
expenditures run to USD 1 800 per family over a decade,
whereas a simple SHS might cost USD 300 (Pope, 2012).
The challenge is to overcome the upfront costs, which
are often too steep for the rural poor relative to their
available cash flow and limited access to credit. The
World Bank (2008) estimates that in poor off-grid areas,
Table 4. Potential Barriers to Renewable Energy Deployment in Rural Areas
Market and Customer
Information
Legal Issues, Regulations and
Administrative Barriers
»»Lack of information about potential markets/ customer needs and preferences
»»Consumers lack awareness of RET products and their benefits
»»Lack of land title or title uncertainties, which can limit ability to sign contracts
»»Lack
of regulatory predictability and long-term vision concerning rural
electrification strategies and planning
»»Approval
of time
processes for RET projects may take a considerable amount
»»Unfair competition from conventional energy sources (subsidies)
»»Import tariffs increase costs of RETs and could make them prohibitively
expensive
Remoteness, Physical
infrastructure
Skills and Training
»»Remote communities are difficult to reach (increased costs for sales, after-sales service; repair; question of spare parts availability)
»»Harsh
natural environment, extreme weather can degrade or destroy
equipment
»»Difficult to recruit and retain staff with adequate technical skills to install,
maintain, repair RETs
»»Limited business skills (literacy, book-keeping, computer-related)
»»Customers lack information/ skills needed to properly operate RETs
Cost and Access to Financial
Services
»»Up-front costs can be high compared to cash flow
»»Lack of access to credit (for entrepreneurs and end users); local banks
need experience and greater awareness of how to finance RETs
»»Customers do not have access to financial services to make payments
(bank accounts)
Supply Chains and Service
Delivery Channels
»»Insufficient development of supply chains
»»Retail and logistics services are limited in low-income communities
»»Geographical mismatch of sources and centres of energy consumption
»»Private companies face high costs of going into rural areas; often preferring donor contracts and capital cities
Performance of RETs
»»Poor
quality products can undermine reputation of RETs and diminish
customer trust
»»If
promised economics (payback period, etc.) fails to materialise, customer trust may suffer
Gender
»»The fact that men are responsible for household investment in most rural
developing regions but not for lighting and cooking energy often hinders investment in RET
Source: Adapted from Gradl and Knobloch, 2011; Deutsche Bank (DB) Climate Change Advisors, 2011; CEPAL, 2004.
2-3% of households are able to pay cash for electricity
services. Microcredit can expand the market to 20-30%
of rural residents and micro leasing and fee-for-service
arrangements could further expand it to up to 70% of
households. The remaining 30% or so - the poorest of the
poor - may require fully subsidised services.
>> Development of Commercial Enterprises: Government
subsidies and donor grants can thus play an important
function in terms of overcoming financing hurdles.
However, it is important to calibrate subsidies so that they
do not undermine the development of a viable commercial market. The danger is that once the financing from
a grant-driven project comes to an end, there may not
be a lasting benefit. Especially in remote areas, small and
micro-enterprises can, in principle, be effective actors in
the delivery of energy products and services. Support for
local micro-enterprises, generating robust supply chains
and networks and building adequate local supply and
demand, carry great importance.
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
22
>> Microfinance: Microfinance schemes can be effectively combined with renewable energy deployment in
rural areas. The global microfinance sector is quite large
- comprising about 10 000 individual institutions (microfinance institutions- MFIs) and serving more than 155
million clients. So far, however, a still rather small number
- some 30 to 40 MFIs - offer loans in the energy sector,
according to a 2010 study (Micro Energy International
and PlaNet Finance Deutschland, 2010). Expanding
microfinance and learning from the most successful efforts is crucial. A critical part of the equation is the nature
of payment collection systems. Flexible schedules may
be necessary to accommodate rural customers’ limited
financial abilities and avoid over-taxing their cash flow.
Micro-finance schemes often operate on the basis of a
community-responsibility for payments.
>> Knowledge and Awareness of RETs: At the most fun-
damental level, even basic knowledge about the availability of RETs is lacking among remote rural populations.
Indeed, the transition to RETs involves far more than simply making a given technology available. Dissemination
requires active marketing and public awareness campaigns including pilot programmes, demonstrations in
villages and similar kinds of efforts, as well as support
for marketing.
>> Product Quality Guarantees: Ensuring the quality
and reliability of RETs is essential to build and maintain
a sense among prospective rural community customers
that renewable energy is a suitable alternative to traditional forms of energy. Government regulations establishing and enforcing appropriate product standards and
requirements for manufacturers and installers to provide
product warranties play an important role.
>> After-Sales Service: The provision of regular maintenance/repair and availability of spare parts are important
aspects of quality assurance. This requires adequate
training of personnel and working, as much as possible,
through networks of local stores and establishing microfranchises. It also requires the inclusion of the issue of
operation and maintenance (O&M) in long-term business
models.
>> Design and Consultation: The design of RETs, espe-
cially ICS, can have an impact on how readily or widely
they are being adopted. Appropriate consultation with local communities, as well as government or donor-funded
23
R e newa ble Energy Job s and A c c e s s
projects, for adaptation to local needs can facilitate the
diffusion of RETs.
>> Imports: For RETs and equipment that are not read-
ily available domestically, providing waivers on import
duties can make a decisive difference in terms of their
affordability.
>> Training: Adequately trained personnel is critical for
the proper installation and maintenance of RET systems.
Education and training on RET for access to energy
should be facilitated, promoted and institutionalised to
assure sustainability. Training programmes may vary
from more formalised efforts especially for engineers
and technicians to less formal and on-the-job training for
other personnel. Part of the training that may be needed
is to educate customers in the proper use and upkeep of
RETs.
Economic and technical aspects play a strong role in
efforts to improve energy access, but strong political
commitment should not be overlooked as a critical factor. Designing and implementing robust policies in favour
of RETs should entail incentives for poor rural households
(including subsidies as needed), an enabling environment
for the private sector to invest in RETs, creating a level
playing field between grid electricity and stand-alone
systems. Well-designed plans by beneficiary countries
are needed to ensure the sustainability of donor-initiated
RET projects, which too often fail to bring about the desired results because of a lack of sustainability measures
and indicators.
2.4. Benefits of Energy Access
Renewable energy is becoming increasingly attractive for use in rural areas of the developing world.
It allows people to redirect the many hours that are
otherwise spent on fuelwood gathering and related
activities toward income-generating activities,
improves indoor health, offers better conditions
for children studying at home, enables stores to
stay open longer and may enable new businesses
to start up. Distributing, installing, operating and
maintaining RETs in rural areas have the potential
for substantial employment creation.
RETs are getting cheaper, smaller and more efficient, as
well as better adapted for the needs of users particularly
in developing countries (REN21, 2011). Renewable energy,
whether in the form of electricity or fuels, offers a range
of important benefits. Though the particular circumstances vary, they include health and educational gains,
improved living standards, greater household incomes,
employment opportunities in the supply chain and in
downstream enterprises.
>> Economics: Because the energy efficiency of kerosene
is very low, providing light costs as much as USD 3 per
kilo Watt-hour per kWh. This is higher than the cost of
solar lighting at about USD 2.2 kWh in poor countries
(UNDESA, 2011). The overall economics of renewables is
becoming increasingly favourable. A 2008 World Bank
evaluation estimated that household lighting adds between USD 5 and 16 per month in income gains for poor
households in developing countries (World Bank, 2008).
Factoring in enhanced entertainment, time savings, education and home productivity, the benefits of access to
electricity could be even higher.
>> New Business: RET installations can enable new local
business start-ups. For example, mobile phone charging
has become an increasingly important local business in
rural areas of developing countries. A third of the world’s
off-grid population, or some 1.6 billion people, now use a
mobile phone. But at present, phone charging often can
be difficult or expensive and RETs provide a solution. In
Uganda, where more than 90% of the rural population
has no access to the grid, almost half live near mobile
phone broadcast towers (Energypedia, 2011-a). RETs
may also provide a boost to existing businesses, by allowing them to stay open into the evening hours, which
brings more customers and in ideal circumstances more
employment.
that women and children gain time for education, leisure,
or economic activity by using more efficient cooking
technologies.
>> Education and Information: In households, the
higher-quality light output of solar lamps compared with
kerosene lamps allows more study time for children and
thus aids in their education. According to the 2011 Human
Development Report, in South Africa electrification has
helped increase the likelihood of women participating in
the labour market, while in Vietnam it boosted income
and schooling rates (UNDP, 2011). Access to radios, TVs,
and computers can provide farmers and fishermen with
weather forecasts or information on crop and other market prices (UNCTAD, 2010).
>> Health: A key benefit associated with modern fuels and
ICS is reduced indoor pollution and higher fuel efficiency.
Air pollution from cooking and heating with traditional
sources of energy causes worldwide annually almost 2
million deaths, through pneumonia, chronic lung disease
and lung cancer. An estimated 44% of those who die are
children. Among adult deaths, 60% are women (UNDP
and WHO, 2009). Better health — avoiding respiratory
infections and other problems caused by indoor smoke
— permits more productive lives. Furthermore, electricity enables refrigeration of vaccines and use of medical
equipment in rural health clinics.
>> Gender Equality: Access to renewable energy could
allow poor people to devote more of their time to education, health services and other needs, thereby helping improve gender equity. In Cambodia, for instance,
gathering wood, boiling water and cooking — activities
that typically are seen as women’s responsibilities —
take as much as three to four hours a day (World Bank,
2010). The availability of electricity allows easier drawing of water using electric pumps or motorised milling
machines for grinding grain (UNCTAD, 2010). The same
United Nations Conference on Trade and Development
(UNCTAD) study notes that dietary choices improve and
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
24
3. Employment Data - Review
of Existing Literature
T
his section draws on existing literature to examine
what is known about employment opportunities
in providing access to energy in rural areas of
developing countries. It begins by assessing the relative
dearth of information in the existing literature, and then
examines the employment dimension of selected RETs
for which more information is available—a more detailed
discussion of SHS is followed by briefer discussions of
portable solar, SWH, ICS and biogas.
3.1. A Relative Dearth of
Employment Information
Renewable energy-related employment in rural
areas of the developing world is not being tracked
in any systematic manner. Neither are specific
conditions that would paint a picture of the quality
of such jobs, including wages, working hours, skills
development and training. More attention is also
needed with regard to the distinction between formal employment and more informal arrangements.
In most developing countries, sales, installations,
operations and maintenance are more important
for job generation than manufacturing of renewable energy equipment.
Recent years have seen rapidly growing interest in the notion of “green jobs”— jobs in economic activities that are
environment-friendly. Renewable energy development
has been regarded as a key area of greening economies,
and there is an ever-growing list of studies that examine
employment implications of individual RETs and applications or particular country experiences.
But relatively limited attention has been devoted to
the deployment of renewable energy in rural areas of
developing countries. In its 2011 Global Status Report,
the REN21 Network laments the fact that such statistics
25
R e newa ble Energy Job s and A c c e s s
“are not being collected systematically” and explains that
relevant data are available for individual programmes
and countries, but not across the developing world as a
whole (REN21, 2011).
This gap in knowledge exists even though the links between social and economic development, and modern
sustainable sources of energy are well recognised. The
IPCC’s Special Report on Renewable Energy Sources and
Climate Change Mitigation (Moomaw, et al., 2011) underscores that access to clean and reliable energy is critical
for “economic activity, income generation, poverty alleviation, health, education and gender equality.”
Yet, relatively little is known about the employment
implications of providing energy access in rural areas
of the developing world. A paper presented at the UN
Research Institute for Social Development (UNRISD,
2011) conference in October 2011, notes that “statistics
on job creation and labour within this sector are not
collected at all and little is understood about the labour
market and conditions within the sector.” The UNRISD
paper notes a lack of information concerning “a range of
social indicators such as the total number of jobs created,
the types of jobs, payments, gender, working hours, etc.”
(Bimesdoerfer, Kantz and Siegel, 2011).
Indeed, a review of key publications — including reports
by the World Bank, IEA, the AGECC, UN agencies like
UNEP, UNDP, or UNCTAD, the Global Alliance for Clean
Cookstoves and others - confirms this conclusion. With
few exceptions, such publications contain generic references to opportunities for job creation, but do not follow
up with any detailed data or analysis.
What is true for broad assessments also holds up for many
individual ventures. In Sri Lanka, for instance, the Renewable
Energy for Rural Economic Development project and
Sarvodaya Economic Enterprises Development Services
have enabled the installation of more than 130 000 SHS
units and several thousand households obtain electricity
from micro-hydro minigrids (RERED, n.d.). But the project
measures neither the jobs created nor the labour conditions
or requirements (Bimesdoerfer, Kantz and Siegel, 2011).
It should be noted, however, that some efforts are being
made to estimate job creation in the context of energy
access. India’s Ministry for New and Renewable Energy
(MNRE), for example, has calculated employment factors
derived from case studies of companies or projects in its
renewable energy sector (see Table 5).
The particular conditions and circumstances of renewable energy deployment vary from country to country.
India’s employment factors may thus be applicable
elsewhere only within limits. Nonetheless, they can serve
at least as a rough guide for estimating employment
arising from the deployment of renewable energy in rural
areas of the developing world. Translating the estimates
of needed renewable electricity generation under the
Energy for All case from the IEA World Energy Outlook
2011 into needed capacity by 2030 yields an estimate of
close to 148 000 MW for all off-grid sources.
Applying the Indian job factors to these capacity figures
yields an estimate of almost 4 million direct jobs by 2030
in the electricity sector alone. Table 6 offers details of this
calculation. Additional employment will be generated as
access to renewable cooking fuels and ICS expands, but
efforts to calculate specific figures are complicated by
the diverse and fragmented nature of the cooking energy
markets.
In many developing countries, sales, installations, operations and maintenance will likely be more important in
terms of employment generation or livelihood support
than manufacturing of renewable energy equipment.
This is particularly the case if renewable energy projects
are locally well integrated, so that income generation and
employment opportunities emerge from downstream
commercial activities. Such opportunities may come
in the form of scaling up of existing small businesses
or setting up new ones. Local economic opportunities
are more likely to materialise where there are adequate
skill-building and training efforts. Equally critical is the
promotion of local research, development and demonstration programmes, as well as efforts to adapt renewable energy systems to local needs and circumstances
Table 5. Estimated Employment Factors in India’s Renewable Energy Sector
Jobs per MW of
Capacity
SPV, Off-Grid
»»Direct employment
»»Indirect employment
»»Total employment
n.a.
30
60
90
Biomass Power, Grid
»»Direct employment
»»Indirect employment b
»»Total employment c
4-8 MW
15a
28
43
Biomass Gasifier
»»Employment in Manufacturing
»»Employment in Operations
20 kW
100
200
Small Hydropower
»»Direct employment
»»Indirect employment
»»Total employment
Typical Plant
Size
n.a.
4
1
5
Of which 40% is skilled labour. b Fuel collection, handling, processing. c Employment in utilities only; manufacturing of power equipment not included.
Source: Calculated from MNRE and CII, 2010.
a
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
26
Table 6. Potential Employment Creation through Off-Grid Renewable Electricity
Energy Use
(TWh)
Load Factor
(%)
Capacity
(MW)
Job Factor
(Jobs per MW)
Employment
(Thousands)
Solar
169.2
25
77 260
30
2 318
Small Hydro
37.6
70
6 132
4
31
Biomass
98.7
80
14 084
15
211
Wind
131.6
30
50 076
22
1 102
Total
437.1
147 552
3 661
Note: Given that the table offers a very rough sketch of potential job creation, the employment figures in the final column have been rounded to
the nearest thousand.
Source: IRENA estimates based on IEA 2011-b and CII 2010.
(as has been done successfully by Grameen Shakti in
Bangladesh, SELCO in India and others).
Not all the work associated with extending energy access necessarily involves formal employment. As the
case studies presented later in this report attest, small
entrepreneurs in remote rural areas often take on labour
in highly informal arrangements, to retain the flexibility
needed under fluctuating and uncertain business circumstances. The construction and operations of household
or village equipment like small biogas digesters or picohydro plants may also not always entail formal employment. Casual employment or community-level involvement may be the more typical types of arrangements.
One area where a focused effort is needed concerns
training. The success of rural renewable energy projects
ultimately rides on qualified, trained staff. Each step along
the supply chain requires different types of skills and occupations, including manufacturing workers, engineers,
technicians, sales staff, managers and entrepreneurs.
In this broad array of occupational profiles, some jobs
require formal training and high technical qualifications.
Still, the vast majority of jobs require few high level skills
that are more easily imparted through easily accessible
training and mentoring efforts. Local capacity-building
for entrepreneurs, small and micro enterprises, is key
to rural electrification programmes and the creation of
green jobs. The World Bank’s Energy Sector Management
Assistance Program (ESMAP) has started to provide
targeted training via its Energy Small and Medium
Enterprise Development Programme (Bimesdoerfer,
Kantz and Siegel, 2011). Local training institutions such
as the Barefoot College based in Rajasthan, India, play a
critical role. Barefoot College is working with grassroots
partner organisations on solar electrification and other
27
R e newa ble Energy Job s and A c c e s s
projects in two Asian, one Latin American and 16 SubSaharan African countries, providing training for installation and repair services (Barefoot College, n.d.).
3.2. Developments by Selected
Renewable Energy Technologies
This section examines some trends in the deployment of
renewable energy sources in mini-grid or off-grid applications, with a view toward the employment dimension.
It first offers an analysis of PV SHS, portable solar lights,
SWH, ICS and biogas. For each of these RETs, it offers
a brief look at selected country experiences. Small and
micro-hydropower is also an important RET for many rural areas. For biomass, comparatively little information is
available about employment impacts beyond a number
of specific projects.
3.2.1. Photovoltaic Solar Home Systems
The number of SHS deployed in developing
countries now surpasses 3.6 million. India and
China have relatively large numbers installed, but
Bangladesh is the global leader with 1.2 million SHS.
It has had a particularly successful experience with
the help of microfinance and a strong vocational
system for training solar technicians, employing
an estimated 60 000 people along the SHS supply
chain. Bangladesh’s experience contrasts with that
of Kenya, which has Africa’s largest number of SHS,
but has encountered difficulties with the quality of
solar panels and remains highly import dependent.
In lower-income rural communities, efforts to improve
electricity access often focus on SHS. REN21 (2011)
reports that worldwide small PV systems provide electric
power to only a few million households. Altogether, “just
one percent of the world’s solar panel production has
been installed in developing countries.” (Woody, 2009).
Energypedia reports that in 2002, an estimated 1.3
million SHS had been installed in developing countries
(Energypedia, 2011-a). Table 7 offers an overview for
more recent years, listing selected countries for which
such information is available. It suggests that the number
today is at least 3.6 million, thus indicating strong growth.
However, data gaps remain, the information provided is
for a range of years and the numbers in the table do not
permit a firm conclusion about numbers of SHS deployed
in the developing world as a whole.
Country Experiences
A growing number of developing countries are gaining
experience in rural off-grid electrification efforts with
the help of solar technologies. India estimates that its
off-grid SPV sector now employs about 72 000 people.
Out of this number, some 48 000 are indirect jobs, including dealers, marketing staff, lantern manufacturers
manufacturers of SHS kits, battery manufacturers, lamp
manufacturers and others (MNRE and CII, 2010).
This sub-section discusses the successful experience of
Bangladesh, the country with the largest number of SHS
installed, contrasting it with those of Kenya, Tanzania and
Sri Lanka. It suggests that training and financing are critical elements of rural electrification.
Bangladesh. Bangladesh has successfully developed
a domestic solar industry, for a number of reasons
(UNDESA, 2011):
»»Relying on its vocational education system and
pursuing on-the-job training, Bangladesh was able
to build a capability to operate and maintain off-grid
solar equipment and to create ancillary businesses;
»»Domestic research played an important role, helping
to reduce the cost of PV panels, adapt the technology
to local needs and develop accessories, such as
mobile phone battery chargers;
»»Bangladeshi government enforced equipment quality
standards;
»»Co-ordination among firms, regulators and universities
proved to be an important element of Bangladesh’s
success.
Table 7. Solar Home Systems in Use in Selected Developing Countries
Country / Region
Year
Numbers
Asia
Bangladesh
2011
About 1 200 000
India
2010
600 000
China
2008
> 400 000
Indonesia
n.a.
250 000
Sri Lanka
2011
132 000
Nepal
n.a.
69 000
n.a.
80 000
Kenya
2005
300 000
Morocco
n.a.
128 000
South Africa
n.a.
150 000
Zimbabwe
n.a.
113 000
Tanzania
n.a.
65 000
Latin America
Mexico
Africa
890 000
Sources: REN21, 2011; IDCOL, 2011-a; RERED, n.d.; Energypedia, 2011-a; Lighting Africa 2010-a.
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
28
At first, most of the panel components were imported
from countries like Singapore, India and China, but today,
Bangladesh has the capability to produce them domestically (UNDESA, 2011). Bangladeshi firm Rahimafrooz
Renewable Energy manufactures rechargeable solar
batteries, charge controllers and fluorescent lamps and
has also developed a solar-powered irrigation system.
It set up Bangladesh’s first solar panel assembly plant
and has signed a memorandum of understanding with
India’s TATA BP Solar to build another 5 MW plant (Power
Today, 2010).
Microfinance has played a critical role in the spread of
SHS in the Bangladeshi countryside. With financing from
international development banks and bilateral donors,
the state-owned Infrastructure Development Company
Limited (IDCOL) is managing the Rural Electrification
and Renewable Energy Development Project (REN21,
2011). IDCOL provides participating organisations (PO)
with subsidies and concessional loans to purchase PV
systems in bulk. There are about 30 POs, but the leading
force in this effort has been Grameen Shakti, which set
up in 1996 and has been able to build on the successful
and previously existing network and micro-lending experience of the Grameen Bank (IDCOL, 2011-a).
Between 1996 and 2003, some 10 000 SHS were sold to
Bangladeshi households. Installations have since grown
rapidly, reaching a cumulative 320 000 at the end of
2009 and 1.2 million at the end of 2011 (IDCOL, 2011-a).
Today, an estimated 30 000 units are sold each month
(REN21, 2011). The goal is to install 7.5 million systems by
2015, which would serve half of the total rural population of Bangladesh. In June 2010, the government of
Bangladesh issued a road map for extending electrification to all Bangladeshis (Bimesdoerfer, Kantz and Siegel,
2011).
This widening success story has had some important employment impacts. The rapid expansion of Bangladesh’s
solar sector has created jobs for an estimated 60 000
people (Barua, 2011). The country’s renewable energy
sector (including SHS, biogas and ICS) is expected to
provide jobs for at least 100 000 persons by 2014
(Strietska-Ilina, et al., 2011).
Solar manufacturing accounts for a small portion of the
jobs (Mondal, Iqbal and Mehedi, 2010). The bulk of jobs
belong to young field assistants with basic technical
and vocational skills who sell and install SHS, provide
29
R e newa ble Energy Job s and A c c e s s
maintenance, and as part of Bangladesh’s microfinance
network, collect monthly payments on solar loans
(Bimesdoerfer, Kantz and Siegel, 2011). The leading PO,
Grameen Shakti, directly employs more than 7 500
individuals. It also operates 45 rural technology centres
that are run by female engineers. The centres have so far
trained about 10 000 students; more than 1 000 female
technicians were trained to install, assemble components
and maintain SHS (UNDESA, 2011; Strietska-Ilina, et al.,
2011).
These developments are very encouraging, but it is important to improve the information regarding temporary
versus permanent jobs and the broader prospects for
sustaining these efforts by building commercially viable
structures. Such questions are prompted in part by the
contrasting experience in Sri Lanka, briefly discussed
below.
In contrast, many countries have not been as successful
and therefore have not been able to generate as much
employment as Bangladesh. For example, despite some
successes experienced in Kenya (it is Africa’s leader in
SHS installations) its solar industry confronts a number
of problems hampering its growth and thus that of job
creation. These include lack of domestic financing and
therefore ability to pay, quality standards of imported PV
panels, inadequate expertise and training as well as weak
regulatory framework (UNDESA, 2011). Additional problems faced by Tanzania, for example, include difficulties
in enforcing control of quality standards (Hankins, Saini
and Kirai, 2009).
Skill gaps still exist in many developing countries particularly for electrical engineers and technicians — key occupations for SPV (Strietska-Ilina, et al., 2011). To benefit
from the potentially large-scale employment opportunities as solar energy use expands, training programmes
for assembly, sales, installation, maintenance and repair
are essential. Vocational training of villagers is also a key
task. In Laos, for instance, training has been carried out
by the commercial enterprise Sunlabob (also see the
case study section), which is a pioneer in building local
skilled workforces in rural areas (Bimesdoerfer, Kantz,
and Siegel, 2011). In Uganda, where the government
hopes to boost the share of renewables from 4 to 60%
of total energy use by 2017, some workforce training has
been carried out by international consultants (StrietskaIlina, et al., 2011).
In general, country experiences suggest the central
importance of training programmes — both in the solar
sector itself as well as in the downstream applications
of solar technologies. Bangladesh’s success shows that
training needs to be pursued not on a project-by-project
basis, but in terms of a more general vocational structure. The country has also shown how important proper
financing and financing mechanisms are to a rural electrification efforts.
3.2.2. Portable Solar Lights
For solar lanterns, India has by far the largest market. African countries may be on the cusp of rapid
growth in demand for solar lanterns, but because
they are not involved in manufacturing them,
job opportunities will principally be in sales and
distribution.
India is the country with the largest market for solar lanterns, with an estimated 700 000 - 800 000 units as of
2010 (Energypedia, 2011-a; REN21, 2011). The global market potential is difficult to predict, but principally huge,
given the large numbers of people who have no access to
electricity and rely on kerosene for their lighting needs.
Currently, annual expenditures for kerosene amount to
an estimated USD 40 billion globally — some USD 17 billion in Africa and USD 23 billion in Asia (Rowlands-Rees,
2011). Lighting Africa, a programme run jointly by IFC and
the World Bank, argues that the solar portable light market is poised for rapid growth over the next five years,
as the technology is improving, better business models
and distribution networks emerge, and cost continues to
decline. Lighting Africa (2010-a) predicts that 5-6 million
African households and small businesses will own solar
portable lights by 2015 even under business as usual
trends, and as many as 12 million under more favourable
circumstances.
The employment implications of a growing solar lantern
market remain to be seen. The bulk of the world’s lantern
production is low-cost and takes place in China. The Poor
People’s Energy Outlook (Practical Action, 2012) notes
that “although local manufacture [in other developing
countries] would create more local jobs than distributing
imported lanterns, at present, this is not as viable from an
end cost point of view.”
Solar lanterns and similar products do not need any installation, and the implication is that there is less need for
technicians and repair personnel than for SHS, and thus
fewer employment opportunities. Employment opportunities in most developing countries would thus appear to
be principally in marketing, distribution and sales.
About 110 companies are active in the solar portable
light manufacturing industry worldwide. About 40% of
all manufacturers are headquartered in India (with 30%
of global sales), 34% in China (42% of sales), 20% in industrialised countries (19% of sales). Less than 5% of the
companies are in Africa (Lighting Africa, 2010-a).
3.2.3. Solar Water Heaters
China is the leader in the SWH industry, with an
estimated 800 000 people employed. Limited
affordability still constricts the spread of such
systems in much of the developing world. But the
potential is large.
In the SWH industry, China is the undisputed global
leader - largely owing to the strength of its domestic
market, but the country is also an important exporter.
The country’s Ministry of Human Resources and Social
Security estimates that 800 000 people are employed
in this industry (ILS and MOHRSS, 2010). India, as mentioned above, has an estimated i.e., 41 000 solar thermal
jobs.
Country Experiences
South Africa initiated a “1 Million Solar Water Heaters
Programme” in November 2008, to be completed by 2014.
Some 156 000 systems were installed as of November
2011. Among the objectives of the programme is the
creation of a “competitive and sustainable local SWH
equipment manufacturing, installation and maintenance
industry in South Africa”, as well as job creation (South
African Department of Energy, n.d.). South Africa’s SWH
suppliers have expanded 20-fold between 1997 and 2011.
Some 122 are accredited under the programme, along
with 351 distributors and 180 independent installers
(Eskom, 2011). In 2009, SWH manufacturing employment
stood at about 200, with another 150 persons in sales
and administration, 400 in installation, giving a total of
slightly more than 700 direct jobs (Eskom, 2009). This is
up from an estimate of 300 in 2002 (Agama, 2003).
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
30
The biggest obstacles to greater SWH use in South Africa
include relatively high cost, supply chain constraints and
limited local supply capacity, including a shortage of
fully-trained plumbers. In response, the Department of
Public Enterprises’ Employment and Skills Development
Agency developed a programme to train plumbers in
SWH installation and maintenance, and to attract new
entrants to the trade (South African Department of
Energy, 2009).
In Ethiopia’s capital Addis Ababa, the removal of government electricity and fuel subsidies increased demand for SWH. By 2006, at least five local companies
manufactured SWH. Several other companies are importers of equipment, typically from China, and about
ten companies are active in the installations business.
The greater local economic activity generated local
skilled employment and increased local cash flow. Still,
only about 10% of the city’s population is thought to be
able to afford the upfront cost of a SWH (UN-Energy,
2007). In rural areas, affordability is presumably even
lower.
3.2.4. Improved Cookstoves
An estimated 830 million people have access to ICS
— mostly in China, but less so in Sub-Saharan Africa.
Much of ICS manufacturing takes place locally,
offering important employment opportunities. In
Cambodia, production of 290 000 improved stoves
annually has led to at least 1 100 local jobs, and has
supported skill-building and greater incomes.
The most prevalent type of ICS is the improved biomass
cookstove. Unlike traditional stoves, for which fuel efficiency has not been a key consideration, such a stove
reduces the need for fuelwood (thus reducing pressure
on forests), charcoal, or other biomass fuels through
more efficient combustion. Other types of ICS use
cleaner fuels (including biogas, methane, ethanol, etc.)
and also offer higher efficiency, but their affordability
in rural areas of the developing world is still limited. The
cleanest type, the electric cookstove, is rarely used due
to high cost and limited availability of electricity in rural
areas of the developing world (Differ, 2012). Biogas systems and solar cookers occupy small niches of the market
in most countries, sometimes limited by affordability or
31
R e newa ble Energy Job s and A c c e s s
practicability, and sometimes by cultural preferences and
traditions (ClimateTechWiki, n.d.-a). Solar cookers do not
require any fuels and do not emit air pollutants, but are
inconvenient because they almost double the amount of
time it takes to boil water relative to traditional stoves
and other ICSs (Differ, 2012).
According to a 2009 World Health Organization (WHO)/
UNDP survey of 140 countries, an estimated 3 billion
people rely on solid fuels such as wood, straw, dung, and
coal for their cooking needs. About 830 million people
have access to ICS. Based on an average figure of five
persons per household, this means 166 million households. Of these, 116 million are in China, more than 13 million in other East or Southeast Asian countries, 20 million
in South Asia, more than 8 million in Latin America, and
7 million in Sub-Saharan Africa (UNDP and WHO, 2009;
REN21, 2011).
Other sources put the number of ICS in China at 189
million and 35 million in India. In Kenya, Thailand and
Sri Lanka, significant numbers have also been disseminated (ClimateTechWiki, n.d.-a). Currently, more than
160 programmes exist to promote ICS throughout the
developing world (Chum et al., 2011). The Global Alliance
for Clean Cookstoves, launched in 2010, has the goal of
promoting more than 100 million stoves by 2020 (REN21,
2011).
ICS production varies widely. Some takes place on a
large-scale, with centralised production and distribution
channels and upwards of 100 000 stoves produced annually by some firms. By contrast, small-scale local production is undertaken by trained artisans. It is lower-cost
and requires little or no transportation to reach intended
customers and offers local employment opportunities
in rural areas. There is now also a growing trend toward
semi-industrial production of improved biomass stoves,
with imported components, local production and assembly (Chum et al., 2011; Differ, 2012).
Depending on the type of stove and its durability, together with the supply chain of materials and inputs required
for producing stoves, more labour may be required for an
improved stove than a traditional one (see the following
Cambodian discussion). A highly-efficient mass assembly
in a country like China is likely to churn out large numbers
with comparatively few people, whereas the small-scale,
hand-produced production typical of many developing
countries requires more labour.
Country Experiences
The production of cookstoves in rural areas often takes
place in informal settings and information on employment
and livelihoods is sparse. The work of Groupe Energies
Renouvelables, Environnement et Solidarités (GERES) in
Cambodia offers some important insights with regard to
employment impacts. This sub-section also offers a few
additional observations based on experiences in Mexico
and Kenya.
GERES introduced the efficient New Lao Stove (NLS)
in Cambodia in 1998, with funding from the European
Union, UNDP, World Bank ESMAP, and others. Annual
NLS sales reached more than 290 000 stoves in 2010. In
March of that year, the milestone of 1 million stoves was
reached; 10% of all Cambodian households have adopted
the stove. The NLS’s higher efficiency has translated into
some 5 000 hectares of forests being spared during the
first decade and families have saved the equivalent of
USD 9 million in fuelwood costs (GERES, 2010).
In 2004, stove manufacturing and distribution enterprises set up a professional association known as
ICOPRODAC (Improved Cookstove Producers and
Distributors Association in Cambodia). Some 113 enterprises are members. A GERES survey offers some
insights into employment and skills aspects. It found
that NLS producers employ an average of 10-14 workers
each, with skills relating to moulding, carving, cutting,
punching, bucketing and assembly. These figures do
not include family members who may be involved as
well. Also, 1-2 additional workers per enterprise may be
employed at peak production times. By contrast, enterprises producing traditional stoves employ an average of
only 3 workers each because they are quicker to produce
(fewer parts to assemble, etc.). Producers rely largely on
their own families and tend to hire few external workers.
These GERES findings offer evidence that ICS can be
beneficial not only for environment and health, but also
for employment — not only in the sense of greater quantities of labour, but also qualitatively. The new stoves require greater skills and workers are therefore better paid.
NLS stoves are reported to last 2-3 times longer than the
traditional variant (AFD & GERES, 2009).
GERES has provided training to producers making the
new stoves. In a 2010 report, the group makes reference
to an aggregate figure of 1 100 local jobs (GERES, 2010).
It is not clear whether this figure refers only to stove
manufacturers or also distributors. Also, it is not clear
whether any of these can be considered newly created
jobs or simply represents people who have switched
from traditional stove production to NLS.
The NLS is sold at a price almost three times higher than the
traditional version, reflecting higher raw materials and labour
costs and higher margins for retailers (AFD & GERES, 2009).
This fact has put somewhat of a limit on the stove’s distribution. In 2001, GERES also developed the more affordable
“Neang Kongrey Stove” intended for poor rural communities
(World Bank, 2010). About 180 000 stoves have been sold
since they were introduced (GERES, n.d.).
The World Bank has helped train a small group of ten
female potters in producing the Neang Kongrey Stove.
After one year, a single potter produced on average more
than 200 stoves per month, or about 2 400 in a year.
The goal is to train traditional stove makers, open new
facilities, and strengthen and expand distribution channels (World Bank, 2010). It is efforts like these in support
of specific skills training and overall local human capital
development that are key to expanding energy access.
In Africa, the Kenya Ceramic Jiko charcoal stove has been
successful. By 2001, it had been disseminated to more
than two million households, and its design was replicated across many other countries in Sub-Saharan Africa.
Components were produced by 15 major enterprises and
more than 100 independent trained artisans. However,
because Kenya has no certification programmes for
such stoves, the Kenya Ceramic Jiko has been plagued
by quality control problems from the beginning (Bailis et
al., 2009). As with SPV panels and other RETs, quality
assurance — the need for training, as well as standardsetting and enforcement — is an important, though at
times neglected, element of a successful effort to expand
energy access. These qualitative aspects need to be part
of a comprehensive employment agenda.
There seem to be no broad-based figures indicating
employment in ICS production by country, let alone
globally. At any rate, mass-production implies very different labour intensities than the small- or micro-scale
production that takes place in rural areas of the developing world. But the findings from Cambodia suggest that
ICS may well require more labour input than traditional
stoves. It is still clear that ICS entail a range of important
socio-economic benefits, even if it is unclear how these
might translate into jobs.
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
32
3.2.5. Biogas - Cooking and Heating
Most of the developing world’s 44 million biogas
plants are found in China, where some 90 000 jobs
were created during 2006-2010. Although there is
a growing domestic biogas industry in India, some
problems have emerged with regard to materials,
construction practices, as well as with maintenance
of plants. Nepal, by contrast, seems to have fared
much better, creating some 11 000 direct and indirect jobs.
REN21’s 2011 Global Status Report estimates that worldwide more than 44 million households use biogas generated in small-scale digesters (REN21, 2011). The use of
household-size biogas digesters has proliferated in China
and India in particular, but much less so in most other
developing nations.
Country Experiences
This sub-section briefly discusses the experience of four
countries - China, India, Nepal, and Bangladesh. In quantitative terms, China towers over every other country
in the number of biogas plants installed. The number
of India’s biogas plants, although impressive, needs
to address quality concerns. The efforts in Nepal and
Bangladesh are at a considerably smaller scale, and most
other Asian countries are in relatively early stages of their
biogas programmes. Vietnam’s programme has provided
training and work for more than 1 800 local masons, and
Cambodia’s is providing employment to 450 persons;
370 farmers and 80 technicians (ARE, 2012; NBP, 2011).
China. China leads the world in the number of installed
household biogas plants. The country completed about
400 000 units by 1975. The official 1985 target of 20
million units was missed by a wide mark (with less than
4 million by 1984 due to a lack of maintenance skills
[UNDESA, 2011]). But by 2006, the number had risen to
about 18 million (ClimateTechWiki, n.d.-b). Following a renewed push by the Ministry of Agriculture, an astounding
22 million household systems were added between 2006
and 2010, reaching a total of 40 million systems in early
2011 (REN21, 2011). This effort created close to 90 000
jobs, as shown in Table 8. The goal is to install 80 million
household-scale units by 2020 (Raninger et al., 2011).
State subsidies were a key factor behind the rapid expansion of the biogas sector. Between 2000 -2010, the
Ministry of Agriculture invested more than CNY 24 billion
(or about USD 3.8 billion) into construction of biogas
plants, with annual investment support reaching an average of CNY 5-6 billion (about USD 0.8-1 billion) in recent
years. Additional investment subsidies come from the
provincial and municipal governments. As of 2010, some
4 000 companies were involved in planning, construction and maintenance activities. However, the role of subsidies is expected to gradually decline in coming years
(Raninger et al., 2011; GIZ, n.d.). In its 2007 “Medium and
Long-Term Development Plan for Renewable Energy”,
China’s National Development and Reform Commission
set government subsidies at CNY 1000 (or about
USD 158) per household biogas digester, or roughly
one-third the total cost. The subsidy comes in the form
of building materials and equipment that are provided,
as well as expertise lent by technicians, while households
provide labour (Energypedia, 2011-b).
Table 8. Employment Effects of Biogas Digester Construction in China (2006-2010)
Sector
Indirect Jobs
Total
Construction
4 500
6 600
11 100
Non-metal Mineral Products
13 100
35 100
48 200
Electronics, Machinery and Equipment
Manufacturing
2 400
8 700
11 100
500
2 100
2 600
Technical Service Industry
3 400
3 500
6 900
Residential Service and other services
2 400
7 700
10 100
26 300
63 600
89 900
Metal Smelting and Pressing
TOTAL
Source: International Labour Organization (ILO), 2010.
33
Direct Jobs
R e newa ble Energy Job s and A c c e s s
India. With a total of 4.1 million family-size biogas plants
(with 1 to 6 m3 capacity) installed, India is a distant second to China (MNRE and CII, 2010). MNRE estimated
that some 12 million plants could be supported on the
available dung (Arora, et al, 2010). Just slightly more than
100 000 such plants were installed during financial year
2008–2009, saving 120 000 tons of fuelwood. The Indian
government estimates the number of current jobs in the
biogas sector at 85 000 (MNRE and CII, 2010), and eventually some 200 000 jobs could be created. An October
2010 assessment concludes that Indian manufacturers
of biogas plants are “steadily improving their technology and products, which has led to an establishment
of Indian companies in the global market. Thus, foreign
companies trying to break into the Indian market face
strong competition from established Indian companies in
the Indian market who have knowledge of local conditions and requirements.” (Arora et al., 2010).
India’s experience with biogas is mixed. Nominally, it has
a large and growing number of plants. However, a large
number of household-scale plants face some difficulties,
with the main reason being the lack of appropriate skills
among installers and training for users. Households are
typically neither made aware of the need for maintenance nor trained to perform it properly. Consequently,
most of the plants become non-functional within a year
of construction (this is an experience that has also been
made in Burkina Faso, for instance).
Nepal. The Biogas Support Programme (BSP), which
is funded by the Netherlands and Germany, brings together the private sector, MFI, community groups and
NGOs, has allowed a steady expansion of biogas use.
Adding 25 000 plants in 2010, the country now has a
total of about 225 000 systems (REN21, 2011). Typically,
a third of the cost (USD 280 - 360 for a 6 m3 plant) is
paid in kind, with the beneficiary household providing
labour and materials. As a result of BSP, a private biogas
business sector has emerged in Nepal, with more than
55 construction companies, 15 biogas appliance manufacturers and 80 finance institutions (UNCTAD, 2010).
By the end of 2005, 11 000 direct and indirect biogas
jobs were created (ADDCP, 2009).UNCTAD refers to an
additional 65 000 jobs through spin-offs, but does not
offer any description or analysis of what these jobs entail
(UNCTAD, 2010).
Bangladesh. Bangladesh had about 21 700 biogas plants
installed as of the end of 2011 (IDCOL, 2011-b; Wadud,
2012). The country has a target of adding 27 000 plants
in 2010-2012, ranging in capacity from 1.2 to 4.8 m3
per day of gas production (IDCOL, 2009). The 2010-12
Implementation Plan for Bangladesh’s National Domestic
Biogas and Manure Programme (NDBMP) expects that
162 000 people will benefit during this time and that 3 300
jobs could be generated. It is further anticipated that there
will be about 25 000 additional beneficiaries through
“capacity development activities.” This is principally in
reference to training sessions and on-the-job training offered to new masons in construction, maintenance, and
slurry utilisation. Additional training will also be provided
to NGOs, agriculture extension workers, and others to
ensure households’ proper use of the biogas plants. The
Implementation Plan argues that biogas plants will help
reduce poverty through savings on energy expenditure
and increase agriculture production by using the residue
that comes as a by-product of biogas generation as
high-quality fertiliser. Women are to have a strong role
in the biogas programme and thus empowering them in
decision-making (IDCOL, 2009).
Pilot projects have been carried out in countries like
Ghana, Kenya, Niger, Burkina Faso, Mali, Ethiopia, Senegal
and Rwanda both for cooking and decentralised electrification efforts (UNIDO, 2009). A 2009 assessment found
that Rwanda’s Domestic Biogas programme “is one of the
best designed biogas programmes in Africa,” but difficulties with initiating a credit programme kept the number
of plant installations to just 11% of the planned 3 450 units
in 2007-2008 (Heegde, Michel and de Wilde, 2009). In
South Africa, a feasibility study done for the Department
of Minerals and Energy in preparing its own national biogas programme identified over 310 000 households that
could participate (Engineering News, 2008).
This brief discussion of selected country experiences
suggests that the manner in which biogas development is undertaken makes a critical difference to the
success of such efforts, and by implication, the quality
and sustainability of jobs in the biogas sector. China’s
performance stands in stark contrast to the problems
India has experienced in terms of quality and reliability.
However, as additional countries invest in expanding
their biogas facilities, more case studies are needed to
expand lessons learnt and compare best practices. The
introduction of biogas digesters has proved difficult in
most African countries, with adverse factors including
high capital costs, insufficient feedstock and water, and
negative public perceptions.
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
34
4. Case Study Analysis
T
o assess employment impacts, analysts often
rely on input-output studies, employment factors
(such as in the case of India in the previous section), and modelling tools.1 There are some disadvantages associated with such quantitative approaches. They
often require assumptions that may heavily influence
outcomes; involve a high degree of generalisation and
aggregation; and do not normally capture local context
and complexities well. By contrast, case studies allow a
closer examination of particular, on-the-ground circumstances as well as non-economic- i.e., social, political
and environmental -factors that influence outcomes. On
the other hand, a drawback of case studies, particularly
those that focus on small communities, is that it may not
be possible to draw broad, generalising conclusions.
4.1. Overview of Case studies
This section of the report is based on a total of 15 case
studies that were contributed by IRENA partners: ARE,
E+Co, GIZ, GVEP and UNDP/World Bank (see Table 9).
These organisations have supported the projects and
businesses examined in the case studies in variety of
ways, i.e., through grants, investments, training activities, mentoring, etc. Table 10 lists these case studies and
offers summary information about where the projects
concerned operate and which RETs they employ. The
majority (nine) are in Sub-Saharan Africa, four operate in
Central America, with two in Asia. Given that populations
of Sub-Saharan African countries suffer the most from
lack of energy access, this focus is entirely appropriate.
The Table also offers an overview of the types of renewable energy applications that are used by the case studies.
4.2. Individual case studies
The companies and projects included in this study come
from diverse backgrounds. Most of them are private
companies, but donor-supported projects, commercial
entities and environmental NGOs are also included. The
projects also engage in a wide range of activities, including support for sales, installations and maintenance of
Table 9. IRENA Partner Organisations
Description
1
35
ARE (Alliance for Rural
Electrification)
International business association based in Brussels, focusing on the
promotion and the development of off-grid renewable energy for rural
electrification in developing countries
E+Co (Energy Through Enterprise)
Investing in clean energy in developing countries. Established in 1995
with headquarters in New Jersey, has offices in 8 locations worldwide
and works in over 20 developing countries
GIZ (Deutsche Gesellschaft für
Internationale Zusammenarbeit)
German development co-operation agency established in 1975,
headquartered in Eschborn, operating in many fields in more than 130
countries
GVEP International (Global
Village Energy Partnership)
Non-profit organisation established in 2006 and headquartered in
London, working to increase access to modern energy and reduce
poverty. Projects across Africa, Latin America and the Caribbean
UNDP (UN Development
Programme)
UNDP is a United Nations agency with 135 country offices worldwide and
working in 177 countries
WB (World Bank)
An international financial institution that has the official goals of
reducing poverty and provides loans to developing countries
For more information on this topic, see IRENA (2012).
R e newa ble Energy Job s and A c c e s s
Table 10. Case Study Overview: Projects, Countries, and Types of Renewable Energy Technologies, by Region
Operating in
Region / Country
(Number of Case Studies)
Support/ Company
Sponsor or Project
Biogas
Briquettes1
Hydro
ICS
SHS
PicoSolar
SWH,
Solar
Water
Pumps
Central America
Honduras
E+Co
Hydro A
P
Guatemala
E+Co
Hydro B
P
Nicaragua
E+Co
Solar A
P
P
Nicaragua, El Salvador,
Panama, Honduras,
Guatemala
E+Co
Solar B
P
P
Tanzania
E+Co
Solar A
P
Tanzania
E+Co
Solar B
Sub-Saharan Africa
Burkina Faso
GIZ
FAFASO
P
P
3
P
Kenya
GVEP
DEEP EA 4
P
P
P
P
P
P
Uganda
GVEP
DEEP EA 4
P
P
P
P
P
P
Tanzania
GVEP
DEEP EA
P
P
P
P
P
Kenya
GVEP
SCODE
Burkina Faso, Mali,
Senegal, Ghana, Ethiopia,
Tanzania, Uganda, Zambia,
Mozambique
ARE
REF–SolarNow 5
Gambia, Tanzania, Zambia
ARE
NICE
International
ARE
Sunlabob
UNDP/
WB
REDP/
RERL 6
4
P
P
P
P
P
P
Asia
Laos
Nepal
P
P
P
P
P
Note: No real company names are given for the six E+Co cases.
Briquettes are “low cost alternative to environmentally damaging fuels such as fuelwood, kerosene and charcoal. They are similar in appearance
to regular charcoal but they are made out of charcoal waste, agricultural residues or sawdust, which are normally considered unusable waste.”
1
www.gvepinternational.org/en/business/briquettes.
2
Includes solar water heating, solar drying (produce) and solar irrigation pumps.
3
Foyers Améliorés au Burkina Faso.
4
Developing Energy Enterprise Programme East Africa.
Rural Energy Foundation (SolarNow has a network of 120 authorised dealers; teams in individual countries may have anywhere from 20 to 100
local staff (SolarNow, n.d.).
5
6
Rural Energy Development Programme / Renewable Energy for Rural Livelihood.
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
36
small solar systems; production of ICS on a small- or
micro-scale; investments and training in small hydropower plants; advice for business start-ups, marketing
and networking for producers. Many of the case studies
also concern micro-enterprises which employ a very
small number of people and sometimes there are no
employees at all beyond the entrepreneur or only casual
labourers who may not be working year-round.
4.2.1. Solar Projects
4.2.1.1. ARE-Rural Energy Foundation
SolarNow Projects in Sub-Saharan Africa
The Rural Energy Foundation (REF) is a non-profit organisation founded in 2003 and based in the Netherlands.
In 2010, REF won the EU Sustainable Energy Europe
Award and the International Ashden Award (2006). By
strengthening entrepreneurship and the supply chain,
REF hopes to increase the use of solar energy in rural
Africa. Currently REF carries out operations in 8 SubSaharan African countries – Burkina Faso, Ethiopia, Mali,
Mozambique, Senegal, Tanzania, Uganda and Zambia
(operations in some other countries, including Sudan
and in Ghana, were discontinued because the local
conditions—ranging from the market situation to safety
considerations—were unfavourable).
REF started its SolarNow programme in 2007, an initiative
to identify and support suitable local retailers and distributors, technicians and sales personnel; training them in solar
energy technology, marketing, sales and business administration, thus helping them start up and expand businesses
selling solar energy products. REF focuses primarily on SHS
and solar lanterns. The SHS promoted by REF use modules
in the range of 11-50 Wp, capable of charging mobile phones
and running small electrical appliances. The solar lanterns
typically use a 1-10 Wp PV module.
Since 2007, REF has sold over 57 000 SHS costing USD
250 to 630 each. REF has also sold some 36 000 lanterns.
Their cost is much more moderate, ranging from USD
25 to 90. The initial objective was to provide access to
affordable solar energy to 110 000 households and small
businesses. The number of people reached as of late 2011
has already surpassed 492 000, indicating greater-thanexpected success. Marketing campaigns, such as village
demonstrations, newsletters and radio shows, play a
crucial role in stimulating awareness and demand for solar
technologies.
37
R e newa ble Energy Job s and A c c e s s
JOBS AND TRAINING
REF seeks to develop a sustainable supply chain, providing employment and income opportunities to local
people and increasing their skills. Product quality, reputation and client trust (buffeted by the quality of good
after-sales service and warranties) are key to this effort.
It has proved more efficient to work with local staff than
rely on regional managers and volunteers (as was initially
planned). Local entrepreneurs who adhere to REF’s quality requirements and complete the offered training are allowed to use the SolarNow brand name and become part
of its supply chain. Importantly, REF does not impose a
choice of brands on the retailers, though they are advised
on the best options available, and could lose the right to
use the SolarNow brand name if found to be repeatedly
selling poor quality products. This approach combines
individual initiative with measures to ensure quality and
reliability, thus building and reinforcing a key asset of the
SolarNow network, namely its good reputation.
As of late 2011, there were 200 SolarNow retailers working in the eight African countries. The expansion of local
retail networks has created jobs and provided skillstraining for about 200 technicians. There are no fixed
prices for the solar products. Local SolarNow retailers
are encouraged to study and understand the market,
such as what customers can afford, reinforcing capacity
building as well as the initiative of individual retailers. The
overall capacity of the retailer network is being improved
constantly, through trainings, coaching sessions and
after-sales visits to local retailers.
SUPPLY CHAIN
Upstream Linkages
The PV modules and charge controllers for the products
sold by SolarNow are manufactured in China, the United
States and Europe. Solar systems are assembled and
installed by local technicians who are trained by REF.
A four-day training course provided by REF focuses
on technologies, marketing and sales. REF staff often
visits the technicians on-site, which allows any problems
encountered whilst demonstrating the newest products to be discussed. Furthermore, retailers frequently
visit villages to demonstrate solar products. These visits,
along with REF’s large-scale marketing campaigns, have
proven to be an effective tool to raise awareness of solar
products in rural areas.
Downstream Benefits
The cost of electricity for local communities decreases
significantly with the use of solar technologies. In REF’s
experience, a SHS system pays for itself in one to three
years through savings in kerosene and batteries. REF
estimates that an average household using an SHS saves
about 30% on energy expenses. These savings mean
that less money flows out of the local community. The
money can then be used for other purposes and incomegenerating activities.
FINANCING
Customers pay the full price for SHS and solar lanterns
normally in cash. However, the initial investment is still
a huge burden for many households. In response, REF
developed several financial models to improve the ability
of lower-income households to afford solar technology
and especially to meet the up front costs. REF began to
work with MFIs in 2008, in order to provide local retailers and customers with more affordable loan options.
Encouraging results of a 2010 hire purchase pilot in
Uganda prompted REF to replicate the model in other
countries.
4.2.1.2. ARE-Nice International Project in
Gambia
NICE International BV is a Netherlands-based initiative of
Energy4All Foundation, and operates as a social venture.
It promotes solar-powered information, communications
and technology (ICT) service centres for people living on
less than USD 5 a day, in peri-urban and rural areas with
either no grid access or very poor grid connection. Four
types of services are made accessible: battery charging,
information (access to TV, communication tools, internet),
value-added services (business and banking education)
and income generation (online trading, outsourcing).
The project started in 2006 with two pilot centres in The
Gambia. Five more centres were opened in 2009-2010.
Each is operated as a franchise by a local entrepreneur.
Entrepreneurs are able to run such centres without the
need of a large up-front investment and with additional
funding from several sources, including the EU Energy
Facility, the network will be scaled up to a total of 50
centres in the next few years, supported by three country organisations. By 2014, 16 additional locations will be
established in Gambia, 20 in Tanzania and 14 in Zambia.
SolarNow retailer in Tanzania-2009
The franchise model benefits franchisees via a package
of support services from the NICE Country Organisation,
which is a joint venture between NICE International
and one or more local partners, including banks, telecom firms and internet service providers. The Country
Organisation, in turn, benefits from direct local market
and business expertise. A key advantage of the network
model used by NICE International is that it allows it to
scale-up without compromising or undermining local
entrepreneurship. Experience to date suggests that a
NICE Centre’s services are used by 1 000 people in the
first year of operation, rising to 3 000 by the third year.
On average, each NICE Centre will be located within
easy reach of about 20 000 people. Altogether, the 50
locations are expected to offer access to energy and ICT
services for up to 1 million people, providing opportunities for income-generating activities.
The NICE Centres are mostly grid-connected, but in
some cases run exclusively on their own SPV power
and are thus capable of operating in off-grid locations.
On average, the solar systems produce 7.5 kWh per day.
Although addressing the lack of reliable energy supply
is a key aspect, it is equally important to go beyond
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
38
electricity access and to provide associated development services. Even though internet access in African
countries is spreading, many local providers (internet
café owners) lack skills and knowledge. NICE Centres
can provide capacity-building, coaching and help with
finding financial solutions for these fledgling local
businesses.
JOBS AND TRAINING
Each NICE Country Organisation employs at least a local
managing director, finance manager, technical manager
and a service manager. Each NICE Centre is run by a local
entrepreneur and employs on average five staff members. However, the technical and business skills needed
to successfully operate a NICE Centre are scarce in
developing countries. As such, NICE offers the required
capacity-building at the country level and through the
franchising model, supports individual centres with training and coaching for entrepreneurs.
entrepreneurs (10%). Experience to date suggests that
the centres have helped to:
»»Increase employment and disposable incomes locally;
»»Improve the quality of the workforce available for
local businesses;
»»Provide access to international expertise (technical
and management capacity) for local partners, as
well as information about international markets,
institutions, services and tools;
»»Strengthen the market position of local contractors;
»»Improve the quality, effectiveness and competitiveness
of local businesses through ICT skills and business
networks;
»»Offer low cost access to office facilities with stable
energy supply and high quality equipment;
»»Provide training opportunities to improve business
skills;
»»Serve as a platform for knowledge exchange with
other local entrepreneurs.
SUPPLY CHAIN
Upstream Linkages
The solar systems used by the NICE Centres are advanced systems assembled from components of different suppliers. Solar and ICT equipment are purchased
internationally. Therefore, employment benefits in the
supply chain arise principally outside of Gambia, aside
from jobs related to imports and distribution.
ICT skills are demanded by many employers but are not
taught at most schools, thus making them a major asset
in the labour market for the youth. Regionally and nationally, the centres’ ICT services increase access to and the
quality of education, facilitate and reduce the cost of delivery of information and services (by reducing the need
to travel to the main cities where most basic services are
provided).
Downstream Benefits
Locally, each NICE Centre supports several local businesses, including: internet service providers, technical
installation, maintenance and repair, products and services. Maintenance and support of the equipment is carried out by the NICE Country Organisation, with back-up
from international suppliers. The franchisees pay a lease
fee for the use of the equipment. Technical contractors
to the NICE Centres are trained in specific skills in order
to effectively support the business. There is a certain
degree of dissemination of important technical and business skills locally.
Further downstream, reliable access to energy is the
enabler of local development, for the benefit of people at
the base of the economic pyramid. The NICE Centres are
considered ‘supermarkets’ for products and services that
help people in their personal and economic development
(e.g. solar products, IT education, online healthcare, financial and government services). Their focus is on youth
(which represent 50% of users), women (25%), and small
39
R e newa ble Energy Job s and A c c e s s
FINANCING
NICE Centres are set up as local business entities to make
them financially sustainable. Through the fees charged
to customers on a pay-per-use basis for development
services, they are able to generate revenues. The franchise and lease arrangement allows local entrepreneurs
to run a high-tech business without having to make
a large investment. The expansion of NICE Centres
will be financed by franchise fees of the NICE Country
Organisations, a subsidy from the European Union’s
Energy Facility (30%), and private investments (The
Netherlands Development Finance Company, Rabobank,
Schneider Electric). Experience suggests that the NICE
Centres reach a positive cash flow within one year of their
establishment and run at a profit within three years.
4.2.1.3. ARE-Sunlabob Project in Laos
Sunlabob is a private commercial company from Laos,
licensed in 2001. It provides a range of renewable energy
services for remote off-grid areas that are not being
served by the public electricity grid. In addition, the company set up an Energy Efficiency Department in 2008,
which allowed it to focus on urban areas. This department conducts energy audits and efficiency consulting
as well as supplying and installing better energy-efficient
materials. Sunlabob became the first Laotian energy
services company in 2009.
Solar lanterns often fail much earlier than expected, either because low-quality components are used to keep
overall costs down or because batteries are misused or
irregularly charged by users. As a result, kerosene lamps
continue to dominate the off-grid lighting market. To
overcome these problems, Sunlabob has developed an
innovative solution to provide access to electricity in rural
areas. Its award-winning Solar Lantern Rental System
(SLRS) is based on a fee-for-service concept, under
which end users purchase a service rather than a piece of
equipment as such (see Figure 2). Beyond making clean
energy available to poor communities, the model also
aims to create opportunities for micro-enterprise formation and thus for local economic structures that may be
capable of generating lasting broader socio-economic
benefits.
The systems that Sunlabob promotes consist of a solar
charging station operated by a village entrepreneur and
a number of lanterns (typically between 20 and 50) that
are communally owned. A 50-lantern charging station
is comprised of a 120 Wp PV panel, a 100 Ah battery, a
charge controller and a set of charging cables. It takes
about half a day to install the system, an additional day is
required for accounting and technical training and a lamp
is charged in about 2-2.5 hours. Households pay a small
fee for a fully charged solar lantern. When the battery
is depleted, a customer exchanges it for a fully charged
one. Use of a solar lantern offers a 75% reduction in a
typical household’s lighting bill, as well as a better quality and safer lighting than kerosene lamps. Additionally,
lanterns have the capacity to charge mobile phones.
JOBS AND TRAINING
New workplaces are created for people to operate and
oversee the system. A village technician/entrepreneur
is responsible for operating the charging station. This
person collects the fees from households renting the
lanterns, and he is further in charge for running the
micro enterprise associated with the system. A share of
the fee is transferred to the maintenance fund for future
replacement of components, such as batteries and other
Figure 2. Structure of Solar Lantern Rental System (stakeholders and their responsibilities)
Exchange Cycle/
Recharging Fee
SLRS
Rents
Owns
Oversees
Granting
Organisation
Village
Technicians
Village
Energy
Committee
Installs
Trains, and
handsover
SLRS
Sunlabob
Lantern
Maintenance
Fund
Maintenance and
part replacement
Investments
Returns
Manages
Reports
Source: Sunlabob
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
40
maintenance needs. A village energy committee, consisting of three to four people, is selected to oversee system
operations, together with managing the maintenance
fund and general financing. The committee receives a
small income for its activities.
Technical and entrepreneurial capacity-building are
incorporated into the installation process. The village
technician and the committee receive training in system
operation, maintenance, trouble-shooting, as well as
in accounting procedures to track the lanterns and the
system’s finances. Proper training and follow-up visits
after installation are critical to guard against misuse of
the system that can shorten its lifespan. This also ensures
that maintenance funds and spare parts are properly
tracked. Experience suggests that in some cases the village technician and the village energy committee need
to receive additional training.
SUPPLY CHAIN
Upstream Linkages
Biodigester in Kenya
Sunlabob sources all components locally. However, more
sophisticated items are imported from abroad, although
some pre-assembly is done in Laos. Once the system is
installed, it is managed locally.
Downstream Benefits
The SLRS project creates jobs, generates income opportunities, and enables better conditions for micro
enterprises in off-grid communities with the help of
improved lighting. Access to electricity allows engagement in several activities not previously possible, such
as reading and doing homework at night, handicrafts,
using a mobile phone and having access to information
and communication. Local people benefit from reduced
energy bills, significantly lowering the financial burden
on households. The revenue generated by the system
is kept within the community, providing income for the
village entrepreneur and system maintenance and hence
strengthening local economies.
FINANCING
Hardware and system installation are sponsored by a donor organisation. A village energy committee oversees
the operations of each system and the management of
the maintenance fund. Villagers are freed from the high
up-front capital costs that are a key obstacle for many
rural communities in the developing world. Without the
initial cost and risks, growing numbers of villagers have
Sunlabob staff providing training to village technicians on
how to operate and maintain the Solar Lantern Rental System
in Laos (ARE)
41
R e newa ble Energy Job s and A c c e s s
been motivated to try this system out and Sunlabob’s
model has been adopted rapidly.
As mentioned, households pay a small fee, which is
either similar or possibly even lower than the typical
expense for kerosene, for the maintenance of the lanterns. A village technician is responsible for collecting
fees from households renting lanterns and is also in
charge of running the micro-enterprise associated
with the system. A share of the fee is then transferred
to the maintenance fund for future replacement of
components, such as batteries and other maintenance
needs.
4.2.1.4. E+Co Project A in Nicaragua
Solar Company A was established in 1999 as a “spin-off”
of a non-profit student initiative at National Engineering
University in Nicaragua, promoting solar energy and
training local people on solar technologies. It promotes,
sells, installs and services SPV and solar thermal equipment, as well as small-scale wind power systems. The
company also sells energy-efficient appliances such as
garden lights, compact fluorescents, mobile phone chargers and efficient stoves.
Headquartered in Managua, the company has four
branches in the countryside. Initially, the firm focused on
the provinces of Zelaya, Jinotega and Metagalpa, which
had particularly low rates of electricity access. Today, its
activities extend throughout Nicaragua and the majority
of installations have been in rural communities.
The SPV stand-alone systems sold by the company
include 50 Wp, 80 Wp, 100 Wp and 120 Wp modules.
Households make up 85% of the company’s customers;
10% are institutions and 5% are commercial or business
enterprises.
As of December 31st 2010, the company had served 2 118
households. At an average of five persons per household,
this translates into more than 10 000 people benefiting
from energy access. The firm’s 3 000 installed solar systems have generated a cumulative 591 MWh of electricity.
Although Nicaragua remains highly dependent on fossil
fuel-based electricity generation, SPV retail businesses
and MFIs are increasingly providing energy alternatives
and improving overall energy access.
JOBS AND TRAINING
The company employs 13 persons (of whom four are
women) full-time in Managua. These are employed as
managers, technicians and administrative and support
staff. Salaries for non-managers range from USD 200 to
350 per month.
The company has 15 sales representatives in the field
and has created micro-franchises to distribute products
and offer solar solutions. This is providing employment
to the heads of family in charge of local branches as well
as providing income to women in rural co-operatives.
Employee benefits include social security and employer
loans for education, health and house improvements.
In late 2011, the company began to distribute 30% of its
shares to its employees as bonuses.
E+Co has provided training to the company related to
operations, management and finance. The company
enhances skills and capacity among several groups of
people:
»»Local technicians and salesmen are trained to
understand the systems they are selling;
»»Branch managers receive training on installation,
product specifications, battery maintenance, basic
finances, etc.;
»»Women from co-operatives are taught how SPVbased products such as lanterns work and how to
keep track of sales;
»»Buyers are instructed on how to keep their systems
working optimally.
SUPPLY CHAIN
Upstream Linkages
The company purchases all components of the PV systems from international suppliers. Technicians install the
PV panels and produce metal structures to attach panels
to roofs (initial plans to refurbish broken PV panels from
U.S. suppliers proved unworkable). Suppliers are carefully chosen to ensure product quality and to avoid any
negative social impacts (such as child labour) along its
supply chain. However, none of the suppliers are local
to Nicaragua. The company is focused on selling highquality systems, works with firms in Germany (such as
Phocos and SMA) and in the United States (DC Power),
as well as other well-known manufacturers such as Sharp,
Kyocera, etc.
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
42
The company adheres to Nicaragua’s import restrictions
to ensure that batteries comply with adequate safety
and environmental standards. SPV systems sold in rural
areas are distributed via local retailers who keep a small
inventory of SPV panels. The company not only sells
household-scale systems, but also installs larger projects
on behalf of NGOs, governments and international actors.
One example is the Eurosolar2 project that included solar
kits for medicine refrigeration and education (powering
computers) in off-grid rural communities.
Downstream Benefits
One of the important downstream effects the firm has
had is that some SPV system owners are setting up
small grocery shops. SPV systems give them access to
affordable and reliable refrigeration, and allow them to
keep their stores open for longer hours, translating into
greater business and more income generation. Since
E+Co’s investment began, SPV owners have been able to
displace about 1 million litres of kerosene and 4.2 million
paraffin candles, providing substantial savings.
FINANCING
Company operations are based primarily on cash sales
to households and other customers. Since E+Co first
invested in the company, its employees have derived
incomes estimated at USD 47 000. Rural households
usually see their finances improve after the purchase
of a SPV system, as they are able to save the kerosene,
firewood and candle purchase expense. Households also
experience improved health, translating into decreased
medical needs and costs. Household finances may eventually also benefit in terms of educational and safety improvements that become possible with reliable access to
electricity. These are, of course, less tangible and harder
to measure than direct savings on fuel purchases, and
may materialise only over time.
4.2.1.5. E+Co Project B in Nicaragua
Solar Company B was established in 1998, and has 17
branches in Nicaragua. It entered El Salvador in 2009
and is currently implementing a 500-system installation
for the government’s FOMILENIO Programme, which was
created to act on behalf of the Salvadoran government
in the context of an agreement with the U.S. Millennium
Challenge Corporation. In 2010, the company established
a presence in Panama after winning a concession for PV
installations in rural homes, schools, and health centres
(under the aegis of the government’s Rural Electrification
2
43
Office and the Inter-American Development Bank
[IADB]). Further expansion into Honduras began in
November 2011 and is targeted for Guatemala in mid2012. The company benefits from a strong distribution
network, and relies on a computerised accounting system
that keeps track of branch sales and inventory. Unlike
most other solar companies in Nicaragua, the company
has also set up a battery collection programme.
In Nicaragua, the company was one of just three domestic solar companies that became eligible to participate
in the Government/World Bank PERZA2 (Programa de
Electrificacion Rural en Zonas Aisladas) programme that
offered subsidies and micro-financing for PV systems.
The four year project (which ended in 2009) also allowed
the firm to act as a micro-credit financier. A USD 200 000
IADB loan allowed it to set up a successful credit line for
PV end users.
In Panama, the company won a concession with the
government’s Rural Electrification Office (REO). The REO
created a ten year plan to electrify 70 000 households
with the help of PV equipment, as part of the government’s overall goal to raise the national electrification
rate to 95% by the end of 2013. Funding comes from the
Panamanian government and multilateral institutions
such as the IADB.
Company B offers predominantly five PV packages of
14 W, 25 W, 50 W, 75 W and 100 W. All of the PV panels
used by the company include a certificate of guarantee
from the manufacturer for between 10 and 25 years and
if they fail due to a manufacturing problem, they are
replaced by the manufacturer at no cost to the end-user
or to the company. In the 14 years of its existence, the
company has installed more than 50 000 PV systems that
provide electricity to about 300 000 people. It plans to
sell 40 000 systems in the next five years, thus more than
doubling the pace of installations. Additionally, the company sells solar water pumps (providing 163 households
with access to water), SWH other solar-powered equipment and energy-efficient appliances.
JOBS AND TRAINING
As of late 2011, the company employed 98 people in
Nicaragua, El Salvador, and Panama. It expects to add
12-15 positions as it expands to Honduras and Guatemala.
There are also additional indirect jobs among installers
and electricians in the field. The company enhances skills
and capacity among several groups of people:
Programa de Electrificacion Rural en Zonas Aisladas provided a total of USD 2 million.
R e newa ble Energy Job s and A c c e s s
»»Technical staff is trained at a laboratory in Managua.
Staff from rural branches also receives training
there;
»»The company encourages its managers to attend
courses that will result in better operations control
(for example, TIMe training provided by E+Co and
World Resources Institute (WRI)’s New Ventures
is aimed at improving resource management and
monitoring);
»»End users receive basic instructions to learn how
their systems work.
SUPPLY CHAIN
Upstream Linkages
There is no local sourcing of PV equipment or components and hence no benefit for the local economy in terms
of supply as the company imports its entire inventory. It
works with a number of Spanish, German, U.S., Japanese,
Chinese and other manufacturers and suppliers, including Isofoton, Solarworld, Komaes, Sony, Phocos, Black
& Decker, Morningstar, Alari, Magnum, Motorola, Picana,
DEKA, Synthesis Power and Trojan.
Downstream Benefits
Company B generates incomes of about USD 545 000
a year for all of its employees. The installed PV systems
assist with income generating activities in local communities. This includes opening small businesses such
as cell-phone-charging facilities and small shops known
as “pulperias”. Access to electricity allows easy refrigeration of goods and store lighting, hence longer operating
hours. Solar company B also sells refrigerators that have
been adapted to work with the PV systems it sells.
Installation and orientation of a solar PV panel (ARE)
4.2.1.6. E+Co Project A in Tanzania
Solar Company A retails, installs and maintains SPV
systems in both rural and urban areas of Tanzania. The
company is headquartered in Dar es Salaam, Tanzania’s
capital with 2.5 million inhabitants. The office serves as
the overall hub of operations.
Households incur savings by not having to buy kerosene,
candles or wood, allowing them to spend incomes on
other goods or services. Since 2003, the company has
reported kerosene savings of 10.3 million litres among
users of its products (an average household uses about
20 litres per month).
An office in Arusha handles sales and maintenance
activities in the northern rural areas of Tanzania, where
the primary economic activity consists of agriculture.
Karatu is one of the five districts in the Arusha Region of
Tanzania being served by the company. It has a population of 178 434 out of Arusha’s total of 1.3 million people
(2002 census).
FINANCING
Since 2003, E+Co has invested USD 1.8 million in the
company to support its growth. However, PV buyers in
Central America have so far depended mainly on government/foreign donor assistance. There is also significant
capacity for end-user finance. Due to this, the company
has to continue strengthening its sales through MFI’s and
Agricultural Co-operatives.
The company offers PV systems in the 20-500 W range
for households and schools, up to 3 000 W for health
centres and further sells household appliances to be
used with solar equipment (lights, mobile phone chargers, radios, and lanterns). It has sold more than 1 000
PV systems since it was established in 2002 and expects
15-20% sales growth in the next five years. About 80%
of its business consists of contracts with institutions in
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
44
rural areas such as health centres and schools and the
remainder includes commercial enterprises and households. Selling to multiple types of customers and offering
a diverse product range helps to mitigate risks. The company uses a variety of marketing techniques for different
customers, including brochures, participation in trade
fairs, radio and TV advertising, as well as word of mouth.
The company is one of a growing number of PV sellers in
African countries experiencing fast growth in Tanzania.
This growth is driven by the difficulties in providing reliable electricity services and extending access into the
countryside. Meanwhile, there is rising demand for power
by urban industries and for communications. The small
diesel generators that are prevalent in remote rural areas
are becoming more expensive to run due to increases in
fuel costs. As such, the Tanzanian government is aggressively promoting the reliability, usefulness and safety of
SPV systems via a nationwide SPV awareness campaign
on radio and television. These factors all contribute to the
growing demand for solar products in rural areas.
JOBS AND TRAINING
Company A currently has 14 staff—including four managers, an accountant, a driver, administrative staff/
secretaries, three technicians and three sales officers. All
employees are Tanzanian nationals. Two sales officers,
as are two administration/support staffs are women.
Salaries range from USD 150-200 per month for technicians and sales officers and USD 70-100 per month for
other staff. Information regarding managers’ salaries is
not available. The company has 20 technical contractors
and two drivers on call. It provides health insurance to
its full time employees, as well as housing and transport
allowances and a professional education fund for staff.
The company, along with others in Tanzania, has benefited from numerous technical training programmes offered by UNDP/GEF and other development aid groups.
These training programmes have created a well-trained
pool of technicians available to meet the demands of
growing solar companies. Solar battery recycling remains
a challenge in Tanzania. Some outlets sell used batteries,
but a reliable recycling infrastructure remains to be built
and could become an additional source of jobs.
SUPPLY CHAIN
importers, retailers and end users. The company imports
its inventory from manufacturers and distributors in the
United States, China, India and Germany. The products
imported include: solar panels, solar batteries, regulators,
inverters and solar lights. African Energy, a U.S.-based
distributor, supplies over 80% of the company’s inventory. The company sources its DC lights from Phocos
in Germany and solar lanterns from D.Light (India and
China). The company itself does not produce equipment,
but adds value by installing SPV systems and training
customers to maintain these systems.
Downstream Benefits
The most typical type of business created with the help
of small-scale SPV systems are barber/hair cutting
shops; mobile charging stations; and small enterprises
such as inns and bars. PV systems used for lighting also
helps rural entrepreneurs extend service hours, thereby
increasing the flow of income to the business owners
and improving services to customers. In fact, the cost of
a 135 W PV system used for a mobile phone-charging
business can be earned back within seven months or
less. Given that PV components can last up to ten years,
and PV modules as long as 25 years, a PV-based phone
charging system can generate a stream of revenues for
many years.
FINANCING
The company secured debt financing from E+Co to procure its inventory in 2006 and in 2011. This allowed the
company both to compete for larger government tenders
and to purchase and install the products before payment
was received. The company sells to small clients paying
cash, as well as to larger institutional clients on a contract
basis. This multi-customer approach allows the enterprise
to diversify its product offerings and revenue sources
and therefore to mitigate risks. For future growth, the
company will identify micro-finance partners to facilitate
credit sales. It will pilot its first credit project in early 2012.
4.2.1.7. E+Co Project B in Tanzania
Solar Company B retails, installs, and maintains SHS
(14-80 W) for residential (40% of sales) and institutional
customers (60%). It is headquartered in Mbinga, a periurban town in the Ruvuma region of south-western
Tanzania which is home to about 1.1 million people.
Upstream Linkages
Tanzania does not manufacture solar equipment and
thus the value chain in the country consists of wholesale
45
R e newa ble Energy Job s and A c c e s s
The company estimates that 10% of households in the
region can afford a SHS. The company offers three sizes
of PV panels, ranging from 14 Wp to 56 Wp for households and 80 Wp systems for institutional customers.
The prices range from USD 225 to 1 400. Altogether, the
company has sold close to 300 PV systems since it was
established in 2006 and expects 10-15% sales growth in
the next five years.
JOBS AND TRAINING
The company’s majority owner and managing director is
a trained economist. His long career in Tanzania’s administration prior to setting up Company B has given him the
managerial skills and experience needed to run the firm.
Company B currently has nine employees—including
one manager, two technicians/shopkeepers, one parttime support staff and five sales representatives. Only
one staff member, a technician/shopkeeper, is female.
Salaries for technicians range from USD 100-150 per
month, while support staff earns USD 50-70. 3
The company, along with others in Tanzania, has benefited
from numerous technical training programmes offered
by UNDP/GEF and other development aid groups. These
training programmes have created a well-trained pool of
technicians available to meet the demands of growing
solar companies. The company’s sales technicians were
trained by a joint Swedish International Development
Agency (SIDA)/Ministry of Energy and Minerals (MEM)
programme, additionally one of the salesmen has a
bachelor’s degree in Economics.
SUPPLY CHAIN
Upstream Linkages
There are six large wholesalers of SPV panels and accessories in Dar es Salaam: Solatek, Chloride Exide, BP Solar,
Rex Investments, Zara Solar and Umeme Jua Limited
(UJL). Batteries are purchased from Chloride Excide and
Victron (with one and three year warrantees, respectively). Sundaya, an Indonesian company, is the supplier
of solar lights. Rex Investment and Zara Solar specialise
in SPV panels and accessories for 50 Wp and higher capacities, which are obtained from NAPs, General Electric
(GE) Energy and Steca. Given that all equipment is
manufactured abroad, the economic benefit to Tanzania
is limited to the wholesaling mark-up, as well as local
retailing and installations.
Downstream Benefits
The most typical type of business created with the help
of small-scale SPV systems are barber/hair cutting
shops (four new shops resulted from PV systems sold by
3
Company B); mobile charging stations; and small enterprises such as inns and bars. PV systems used for lighting
also help rural entrepreneurs extend service hours and
thus an increased flow of income.
A rural family in Africa uses about 60 litres of kerosene a
year—the second-largest expenditure after food. PV systems allow substantial savings of kerosene, candles, or
wood, it also offers substantial health benefits. Patients
at rural health clinics benefit from improved quality of
services (night deliveries of babies; refrigeration of medicines, etc.).
FINANCING
In 2007, E+Co provided a USD 50 000 loan to the company to purchase its inventory as the company was unable
to secure local financing. The company sells on a cash basis to residential and institutional customers and sales are
made directly to customers through a shop. Retail prices
range from USD 225 to 650 for household SHS and USD
1 400 for larger institutional systems. Partnership with a
local MFIs and building a track record of successfully running government contracts would be required to scale up
the company’s household market.
4.2.2. Small Hydro Projects
4.2.2.1. E+Co Project A in Honduras
Hydro Company A, a Honduran corporation, developed
a 13.5 MW run-of-the-river hydroelectric project in a rural
town in the Department of Intibucá in western Honduras
(with a population of about 45 000), close to the border
with El Salvador. The project entails a cascade of three
powerhouses on the Intibucá River. The hydroelectric
plant was constructed between 2004 and 2008, on the
site of an abandoned 500 kW facility from the 1940s. In
several phases, capacity was increased from 1.4 MW to
13.5 MW.
Electricity generated by the plant is fed into the national
grid, which supplies an estimated 11 000 people in the local community with power. The project provides a reliable
energy source for communities that are often plagued
by black-outs. In addition, two local communities are
grid-connected as a result of this project, allowing an additional 1 200 people to use electricity for lighting instead
of relying on candles, kerosene and batteries. Such projects contribute to achieving the government’s target of
increasing national electricity coverage to 80% by 2015,
Salaries for the manager and sales representatives are not available and the company does not provide health insurance.
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
46
with equal attention to urban and rural needs. Electricity
access has already improved significantly, from 43% in
1994 to about 70% at present.
JOBS AND TRAINING
The total workforce at the hydropower plant comprises
83 persons. The company’s core management team
(President, General Manager, Administrative Manager
and Project Manager) includes two Canadians and two
Hondurans. There are seven technicians and 62 workers/labourers (of which ten are women). Along with five
female administrative/support staff, the workforce’s
share of women is 24%. Workers and administrative
staff earn USD 250-350 per month and technicians
earn 25-30% more than labourers.4 Since the majority of
the employees of the project are nationals, the income
directly benefits the local economy. However, no medical insurance is provided, although a doctor is on-site
for any emergencies or accidents at work. The company
provides 12 days paid vacation and three paid sick days
for full-time employees.
From 2004 to 2008, more than 100 workers were hired
from the community when the plant was constructed.
These were temporary jobs and employment ended when
the plant was completed. Now, specialised contractors
are hired as needed for tasks such as building construction, turbine installation, or pipe layout. Management
consists of trained and experienced engineers. The managers have trained maintenance and nursery labourers to
perform their jobs.
economic demand. Finally, the company engages with
the local community in a number of activities, including
environmental training and tree-planting programme for
local schools.
FINANCING
The total project cost was USD 16.5 million. E+Co made
several debt and equity investments totalling USD 1.35
million (or 8% of total capital costs). The project was
also able to attract financing from local banks and
international development finance institutions, playing
an essential role in demonstrating more broadly to local
Honduran banks the investment opportunities present in
the hydro sector. The company has also signed an agreement to sell carbon-offset credits generated by the hydro
plant, one of few privately owned projects to successfully
do so, helping to increase the company’s net cash flow.
4.2.2.2. E+Co Project B in Guatemala
Hydro Company B, a Guatemalan private company, upgraded and revitalised an existing 400 kW plant to 1.1 MW.
It is located in the municipality of El Rodeo (36 000 inhabitants) in the Department of San Marcos (total population of
about 800 000). The project will generate approximately
5.7 million kWh of electricity per year. The company is
planning to undertake feasibility studies for additional
hydro projects in Guatemala. As Guatemala’s energy use
grows at 8% annually, renewable energy sources—wind
and solar in addition to hydropower—are expected to play
a major role in meeting the country’s energy demand and
improving rural energy access.
SUPPLY CHAIN
Upstream Linkages
The company bought the main technology components,
the Pelton turbines, from an international supplier. No
data is available to quantify supply-chain impacts.
Construction materials were sourced in Honduras and
thus provided employment locally along with the direct
(but temporary) construction jobs. No data is available to
quantify the impact on the supply chain.
Downstream Benefits
Because it is virtually impossible to trace the point of
power generation origin to the specific households that
use grid-electricity, only generic observations are possible with regard to downstream linkages.
The company also offers a micro-credit programme to its
employees, which has helped generate additional local
4
47
The company does not make manager income data available.
R e newa ble Energy Job s and A c c e s s
Guatemala’s state-owned utility INDE has promoted
the connection of isolated small hydro plants into the
national grid, and the Ministry of Energy and Mines has
promoted a series of private sector incentives for renewable energy development, including exemptions from
income tax, machinery import tax, as well as freeing
carbon credits from taxation. These policies created an
enabling environment for the development of hydropower in Guatemala. Overall access to electricity has risen
from 66% in 1998 to 84% in 2008. Populations of lower
income and un-electrified populations are found mainly
in the rural areas specifically in the northern region of
Guatemala in Peten and Zacapa. A large percentage of
this population is indigenous and is spread across large
portions of land where distribution lines are difficult and
costly to install.
JOBS AND TRAINING
The total workforce at the hydropower plant comprises
14 persons. All are Guatemalan nationals, and thus their
salaries directly benefit the local economy. This comprises one manager, three engineers, and ten operator/
administrative/support staff. Just two (or 14%) of the staff
are female. Support staff and operators earn USD 200300 per month, with a higher rate for operators than for
administrative staff. No salary information is available for
the manager and engineers; however an estimate for the
engineers is that earnings are 15-20% higher than those
of operators. From 2008 to 2009, 96 workers were hired
from the community when the plant was constructed.
These were temporary jobs, however, and employment
ended when the plant was completed.
The company does not provide formal medical insurance.
However, it does pay for employees’ medical treatments
as the need arises. The company provides 21 days of paid
vacation and three paid sick days per year to full time
employees. The project manager is a professional engineer and project developer. His technical team includes
civil and electrical engineers with experience in building
and operating hydro-electric projects. The remaining
staffs receive on-the-job training from the manager and
engineers.
MHP power distribution line (100 kw) in Nepal (UNDP/WB)
4.2.2.3. UNDP/WB Project in Nepal
SUPPLY CHAIN
Upstream Linkages
The company bought the turbine and other electromechanical equipment from an Italian-owned company
manufacturing in Guatemala. The total value was more
than USD 800 000. Construction materials for the initial
infrastructure for the facility (including wood, steel, cement, etc.) were purchased locally.
Downstream Benefits
Because it is virtually impossible to trace the point of
power generation origin to the specific households that
use grid-electricity, only generic observations are possible with regard to any community downstream linkages.
FINANCING
The total project cost was USD 1.54 million. E+Co provided a loan of USD 1.1 million or 72% of the total project
cost. The remaining 28% of the investment cost (USD
437 650) was covered by the company itself, which also
invested USD 286 000 for feasibility studies. The project
has a cost of USD 1 398 per installed kW, a rate judged to
be competitive for Central America.
Renewable Energy for Rural Livelihood (RERL) is a
joint programme of UNDP and the World Bank with
the Government of Nepal. It was initiated in April 2011
upon the successful conclusion of the Rural Energy
Development Programme (REDP), which itself was
started in 1996. In three distinct phases, activities were
scaled up. The main objective is to increase equitable
access to energy services for the poor, women and socially excluded groups. Beyond the provision of energy
services, social inclusion and community mobilisation
are important aspects. In fact, REDP was designed from
the very beginning to be aligned with Nepal’s existing
development strategy and its focus on decentralisation
and community mobilisation.
RERL primarily promote MHPs (10-100 kW), as well as
SHS (10-30 Wp), biogas (4-6 m3), and ICS. From 1996
to 2011, not only did the number of MHPs increase, but
so did the average size of the plants. To date, close to
58 000 households, with 350 000 people, have derived
energy access benefits in the form of multiple applications such as; lighting, refrigeration, communications
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
48
(powering radio, TV, video), operating irrigation pumps
and agro-processing mills, and running a variety of
rural businesses or income-generating activities that
include handicrafts, carpentry, black-smithy and poultryfarming. RERL works with multiple communities, civil
society, donor and private sector partners in tandem at
various levels (community, district, national). The institutionalisation of rural energy development efforts via
a set of committees is a key ingredient in this context.
Simultaneously, there is a strong focus on decentralised
planning and implementation. Transparent decisionmaking and consensus-building are crucial to the success
of this multi-level approach.
One particularly important element is the active community involvement and ownership of the project from the
very beginning, supported by capacity-building efforts.
REDP/RERL requires that all households in a community
participate in programme activities. Village Development
Committees are charged with planning, implementation,
operation and maintenance of community energy systems. Also at the local level, non-governmental organisations and private-sector Rural Energy Service Centres
provide technical and other support. Different community organisations come together in so-called Micro
Hydro Functional Groups (MHFGs) to co-ordinate on the
different aspects of hydro-plants, from project formulation to operations. After they have run successfully for
at least half a year, MHFGs may convert to Micro Hydro
Co-operatives.
At the District level, District Development Committees
are focused on policy and operational frameworks in
support of decentralised energy planning and management, project monitoring and evaluations, as well as assistance to communities. In addition, District Energy and
Environment Sections are supposed to co-ordinate dayto-day activities and mobilise financial and other support. At the central (national) level, RERL provides support to the Ministry of Environment’s Alternative Energy
Promotion Centre—the implementing agency—with a
view toward overall policy co-ordination, support and
lessons learned. Indeed, effective co-ordination is critical
to make the array of different committees and other actors work together and ensure their effectiveness.
JOBS AND TRAINING
As of late 2011, 555 micro-enterprises had been established in REDP/RERL programme areas. Of these, 323 are
MHPs that were completed and put into operation since
1998. The number of new plants completed per year has
fluctuated considerably since 1998, from as few as five
in 2006 to as many as 75 during the following year. A
typical MHP requires two personnel for its operation.
The man-days required for running the growing number
of MHPs has expanded from 8 760 in 1998 to 225 570 in
2010, and 117 895 during the first half of 2011. Figure 3 expresses this information in terms of full-time equivalent
employment; rising from 24 full-time equivalent jobs in
1998 to 618 in 2010. For the first half of 2011, the number
is 323 jobs.
Capacity building has been a priority, and it has included
training for staff and community representatives on
how to operate and manage MHPs and other RETs;
establishment of Rural Energy Service Centres; income
generating and environmental related activities; institutional development; book-keeping; and decentralised
planning. Priority is accorded to women, dalits,5 ethnic
groups, and the poorest of poor. So far, a total of 34 050
people, including 15 000 women, have received training.
Some 2 596 people have been trained on the technical
aspects of MHP operations.
SUPPLY CHAIN
Upstream Linkages
The turbines, penstock pipes, and accessories for the
MHPs are locally fabricated, and the electronic load
controller was locally assembled, but the generators are
imported. The REDP/RERL programme puts strong emphasis on local enterprise development, and especially
its contribution to community development. This is done
through the Enterprise Development Fund (EDF). Each
MHFG receives assistance to create an enterprise fund
to provide loans to needy villagers at convenient terms.
Downstream Benefits
All households equally contribute to, own and benefit
from local MHPs (electricity and revenue). Communities
have instituted mechanisms to help poor households
gain access to electricity:
»»Poor households unable to contribute cash or raise
collateral for a bank loan are allowed to contribute
in kind and labour;
»»Those unable to pay the electricity tariff in cash
are allowed to contribute through canal cleaning
and/or repairing.
5
Dalits is a word used to describe a group of people traditionally regarded as “untouchable”. Dalits consist of numerous castes from all over South
Asia and come from a variety of religions.
49
R e newa ble Energy Job s and A c c e s s
In RERL-supported communities, 100% of Dalit, Janajati
and ethnic/religious minorities are connected to energy
services. A quarter of all energy enterprises are owned
by these groups, and 41% of those enterprises are owned
by female entrepreneurs.
FINANCING
REDP/RERL provides grants in support of local energy projects. Project funds are channelled via a District
Energy Fund, which in turn channels funds to Community
Energy Funds. The Community Energy Funds are established by each MHFG and by Micro Hydro Co-operatives
to receive funds and to collect revenues from local
households and businesses that use energy from RERLsupported projects. RERL makes an initial contribution
of 10 000 Nepalese Rupees (USD 125) per kW (up to a
maximum of 250 000 Rupees, or USD 3 125) to each
MHFG for creating the enterprise fund. Priority is given
to poor households to obtain loans to carry out income
generating activities or create micro-enterprises.
Figure 3. Direct MHP Employment (1998-2011)*
[* =
first 6 months in 2011]
Community member operating an agro processing mill
in Nepal (UNDP/WB)
700
600
500
400
300
200
100
0
1998
2002
2006
2010
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
50
4.2.3. Improved Cookstoves Projects
4.2.3.1. GIZ FAFASO Project in Burkina Faso
FAFASO (“Foyers Améliorés au Faso” = improved
stoves in Burkina Faso) is a Deutsche Gesellschaft für
Internationale Zusammenarbeit - The Dutch-German
Energy Partnership Energising Development Project
(GIZ-EnDEV), supported by co-financing from the Dutch
Ministry of Foreign Affairs (DGIS) and the German
Ministry of International Co-operation (BMZ). It started
officially in 2005; on-the-ground activities commenced
in 2006. It will probably conclude at the end of 2012,
after which activities will continue in an autonomous
way. FAFASO covers all of Burkina Faso, with a focus
on the capital, Ouagadougou (2 million inhabitants),
the second-largest city (Bobo Dioulasso, with 500 000
inhabitants) and the south-western and eastern regions.
The project helps to disseminate ICS that save 35–80%
of wood or charcoal compared to the traditional threestone-fire. During the period 2006–2011, about 180 000
ICS were sold at market prices to households, institutions
and productive units.
Women making briquettes in Jude Kabanda’s business (GVEP)
Most of the stoves disseminated are mobile, metal
household stoves that are 35–45% more efficient in fuel
use. For poorer households, a mobile ceramic stove is
also available that saves 40% fuel. In addition, FAFASO
offers big mobile metal stoves for restaurants and school
canteens (saving around 60%) as well as mud stoves for
traditional beer brewing (saving about 80%).
The overall objective was to train ICS producers and help
them sell the stoves commercially, so that dissemination would continue even in the absence of subsidies,
or other dependence on external resources or technologies. A key objective of the project has been to promote
decentralised production located as close as possible to
potential markets. From 2006 to 2010, training sessions
were conducted in five towns with about 30 000-50 000
inhabitants each, as well as about 40 smaller towns with
5 000-10 000 inhabitants each. Training sought to impart
a range of skills including quality production, marketing
techniques, price design, budgeting and reinvestment,
and associative organisation. The project also entails
marketing (large-scale efforts via TV and radio; smallerscale through cooking demonstrations, sales events,
etc.); introduction of an ICS quality label and efforts to
strengthen the commercial supply chain.
Norah Mukasa cooking with an improved cookstove (GVEP)
51
R e newa ble Energy Job s and A c c e s s
JOBS AND TRAINING
Two thirds of the overall budget of USD 3.2 million (up
to late 2011) has gone into training and marketing efforts; the fixed costs for project personnel account for
one third. A typical training session involves an average
of 30 trainees. As of early 2012, FAFASO had trained a
total of 807 people, 313 metal smiths, 314 masons, and
180 potters. Initially, the numbers were quite low, but
expanded dramatically in 2009, when the project began
to train masons and potters, in addition to metal smiths
(see Figure 4).
families who are unlikely to employ apprentices. Except
for the potters who are organised in associations and
share revenues, stove producers work individually and
revenues stay strictly within family circles.
SUPPLY CHAIN
Upstream Linkages
The stoves disseminated by FAFASO were originally
developed by the government’s Institute of Research
of Applied Sciences and Technologies in the 1980s.
However, ICS production was virtually abandoned prior
to FAFASO’s launch because of the lack of a viable market at unsubsidised prices. FAFASO was thus confronted
with the need to establish new training for stove producers. The project also focused on marketing and public relations, deciding to create a distinctive logo for improved
stoves of good quality, and working to strengthen the
value of the commercial chain.
These numbers cannot be considered to constitute new
jobs. Rather, the individuals concerned are experienced
craftsmen. The training allows for higher qualifications
and an opportunity for a sustained role for themselves
in the market. As part of the training, all producers are
taught to calculate the prices for the stoves, putting them
in a better position in markets. Many of the metal smiths
and masons also employ apprentices (who are all men).
The stoves are produced domestically, in a decentralised
small-scale fashion. In general, the materials used are indigenous. Previously imported scrap metal is now locally
procured. However, this does not necessarily indicate
increased overall demand for metal scrap. Although
FAFASO has sought to strengthen the commercial chain
(bringing together producers and salesmen, installing
special shops at central places, etc.), the majority of
Most of the potters, however, are women whose main
occupation remains fieldwork and household duties.
The project allows them to acquire knowledge that helps
generate additional income (and cope with competition from plastic products). It must also be kept in mind
that pottery is caste-bound work dominated by certain
Figure 4. Number of FAFASO Trainees
350
300
250
200
150
100
50
0
2006
2007
Metal Smiths
2008
Masons
2009
2010
2011
Potters
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
52
sales are still made directly at producers’ workshops or
through close contacts. Nearly all efforts to create new
distribution models failed.
4.2.4. Projects with a Mix of Technologies
4.2.4.1. GVEP The Developing Energy
Enterprises Project in East Africa
Downstream Benefits
The dissemination of ICS did not generate new downstream businesses as such. Users like beer brewers and
restaurant owners were already in business. However,
beer brewers and to a lesser degree restaurant owners
were able to realise higher returns due to savings in fuel
expenses, allowing them to send children to school, afford medical fees, etc. Also, housewives are now able to
engage in small professional activities (preparation of
cookies, roasting of maize, etc.) thanks to reduced fuel
expenses. Among households, fuel savings from ICS use
have also allowed improvements in diet.
FINANCING
The official minimum income in Burkina Faso is around
USD 70 per month. Based on official statistics, more
than half the population has incomes below this level. In
Burkina Faso’s towns, daily expenditures for fuel are about
USD 0.2, a little over USD 6 per month, close to 10% of the
minimum income. ICS can cut this expense by a third. The
following information provides a sense of how quickly fuel
savings help pay for the cost of improved stoves:
»»Metal household stoves (cost: USD 5.20; lifespan 2
years) offer daily fuel savings of USD 0.21, and are
amortised within a month;
»»Metal stoves for institutional / professional use USD
56; lifespan 1.5 to 3 years) offer fuel savings of USD
1 day.
»»Ceramic household stoves (USD 2.10; lifespan 1.5
years) offer daily fuel savings of USD 0.21, and
amortise within 10 days;
»»Mud stoves for beer brewing (USD 42) offer savings
of up to USD 28 per week, and are amortised in less
than 2 weeks.
The Developing Energy Enterprises Project East Africa
(DEEP EA) is a five-year initiative funded by the European
Union and the Dutch Government (DGIS). It was initiated in 2008 to provide support for the development
of a sustainable and widespread industry of micro- and
small-scale energy enterprises in Kenya, Uganda and
Tanzania. The project flows from the recognition that
small enterprises in East Africa face many challenges.
Entrepreneurs are often working in isolation from each
other, linkages to suppliers and financial institutions are
weak or non-existent, whilst consumer awareness and
limited purchasing power, present additional obstacles.
Entrepreneurs also often fail to reach their full potential
due to lack of certain skills.
However, small enterprises tend to use locally-available
resources more than larger ones. They tend to use more
labour and so strengthen local economic linkages. The
project assists the entrepreneurs with the identification
of viable energy market opportunities, technology options and service structures to generate revenue and
sustain business. DEEP EA also assists entrepreneurs
through training and mentoring to develop business
plans, access financing thereby enabling businesses to
survive and grow:
»»Entrepreneurs are taught how to keep basic records
for their business, including expenditure, sales, and
profit figures. This has helped the entrepreneurs set
aside money for savings and reinvestments;
»»The programme offers an International loan
guarantee fund, enabling entrepreneurs to access
loans. GVEP is working with several financial
institutions in East Africa to achieve this;
»»The programme assists entrepreneurs in linking to
A 2009 impact study conducted by GIZ indicated that at
least half the metal stove producers in the two biggest
cities reported higher incomes. Circumstantial information suggests that these findings may well be on the
conservative side, as living conditions of producers have
visibly improved. For a household metal stove, one fifth
of the sales price is usually marked as earnings for the
producer, thus typically CFA6 500 (about USD 0.75) out
of a stove’s price of CFA 2 500 (USD 3.75).
6
53
CFA: Franc de la Communauté Financière Africaine (West African Franc)
R e newa ble Energy Job s and A c c e s s
new markets. Group networking and information
sharing sessions bring entrepreneurs, customers,
suppliers and other stakeholders together.
Entrepreneurs are able to promote their products
to customers and learn about new products from
suppliers.
Challenges remain in that entrepreneurs do not always
pay sufficient attention to product standards and quality, assuming that short-lived products will translate into
greater sales. They often lack appropriate marketing skills
(with regard to recognising market segments and the
need for product customisation). They maintain a strong
belief that grant support for their businesses is needed.
JOBS AND TRAINING
By the end of 2011, there were 819 entrepreneurs that
had received DEEP EA support in Kenya, Uganda and
Tanzania. Most of the entrepreneurs are involved in ICS,
solar technologies and briquette-making (see Figure 5).
ICS and solar have received the bulk of donor funding
over the years. In Kenya, ICS ventures are most prevalent
(59.4% of all DEEP EA businesses); in Tanzania, solar
technologies (51.3%) and in Uganda, briquettes (40.5%).
Altogether, females represent 42% of all entrepreneurs,
they are mostly involved in ICS and briquette-making,
but only marginally in solar, battery-charging and biogas
ventures. Female entrepreneurs are more involved in
RETs that do not need a high level of capital or mobility.
Employment in the DEEP EA enterprises has fluctuated
through the course of the programme. From a baseline
assessment that showed an average of 1.6 employees
per enterprise, the most recent year’s data indicate an
average of 2.2 employee per enterprise. ICS liner and
briquette production are the more labour intensive
processes. ICS liner production involves preparing
the raw materials, mixing, moulding and firing. Solar
phone-charging, on the other hand, requires relatively
little labour. The total number of employees in the three
countries has thus risen from 878 to 1 803 by the end of
2011 (see Figure 6). Although the Kenyan numbers have
fluctuated, on average there has been strong growth.
Enterprises engaged in briquette and ICS liner production have experienced some fluctuations in employment
over time, corresponding to highs and lows in orders,
seasonal variations and other factors. Among ICS producers, Ugandan enterprises have slightly higher than
average numbers of employees compared with Tanzania
and Kenya. The difference may be due to the availability
of locally skilled labour, wage differentials, or differences
in markets for the type of products. Casual employment
plays an important role in these cases. It affords entrepreneurs flexibility (with regard to salary levels, taxes and
other dues, etc.). Often, family members are employed
by entrepreneurs.
Figure 5. Share of Renewable Energy Technologies, by DEEP EA Businesses
Solar
27
ICS
44
Briquettes
19
Biogas
3
Battery
Charging
Others
4
3
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
54
Figure 6. Total Employees, by Country (2010-2011)
900
Uganda
800
Number of Jobs
700
Average
600
Tanzania
500
Kenya
400
300
200
100
0
Baseline
Oct - Dec ’10
Jan - Mar ’11
SUPPLY CHAIN
Upstream Linkages
Enterprises that make use of locally sourced materials
may be more sustainable than those that depend on
suppliers that are based far away. For example the positive uptake of briquettes in Uganda is encouraged by the
relatively low cost of accessing charcoal dust which is
often wasted. Similarly, cookstove technology production is produced and sold in all three countries using local
resources.
Dissemination of RETs in isolated areas with poor road
networks can be a big challenge. Transportation of
products represents additional costs and entrepreneurs’
knowledge of new products may be limited. DEEP EA
focuses on a value chain approach to each technology
and works with stakeholders along the supply chain. The
strengthening of supply chains in this manner can help
increase an enterprise’s chance of survival.
Downstream Benefits
ICS - Kenya: A complex local value chain means that
employment generation spans the whole process from
the supply of raw materials to production and sales to
end users. The GVEP case study profiles one case—Janet
Atieno, a member of Keyo Pottery Enterprises in western
Kenya—whose business has grown with the help of GVEP
training. Atieno now employs between two to six casual
55
R e newa ble Energy Job s and A c c e s s
Apr - Jun ’11
Jul - Sep ’11
Oct - Dec ’11
employees, up from just one. Employees are paid on a
piece basis (earning USD 6.25 per day for making 150
liners). Atieno sources the clay and sand for making her
liners from local businesses that also benefit from the
group’s activities.
Briquettes - Uganda: The supply chain for briquettes is
principally local. With DEEP EA’s help, one entrepreneur,
Jude Kabanda and his sister Amelia Nabagala, expanded
sales more than 13-fold since 2008. The acquisition of
several briquette machines helped improve the quality
and types of briquettes, and sales were further increased,
to about USD 144 per month, with the help of a loan to
improve the packaging and branding of the briquettes.
Four casual employees were added (earning USD 11-22
per month), and another five may be needed. Kabanda
has trained ten other briquette entrepreneurs. His employees have also started up other enterprises, including
a poultry business.
SPV - Tanzania: A third GVEP case study, of Tanzanian
solar technician and phone-charging entrepreneur
Joseph Robert, also indicates a growing business; he
is now offering solar technician services and sells solar
parts. Two people were hired, and a further one to two
others are casually employed when the need arises, given
the fluctuations in sales. Joseph earns about USD 175 per
month and pays his employees monthly USD 58 each.
Finding staff qualified in installation and maintenance of
solar systems is a challenge. The installed solar systems
have allowed new phone-charging businesses to be set
up in neighbouring villages, providing additional employment. The cumulative impact of the DEEP EA project is
estimated at more than 2 million beneficiaries. The vast
majority of these relate to stove production.
FINANCING
As mentioned earlier, GVEP has started to link some of
the entrepreneurs with whom it works to financial institutions through a loan guarantee programme, enabling
them to access loans. As of September 2011, GVEP was
working with six financial institutions across the three
countries. To date, five DEEP entrepreneurs have received
and repaid loans; 47 others are currently being financed.
In Uganda, ICS sold in Namigadde Mwamin’s shop help women reduce their energy expenses (GVEP)
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
56
5. Lessons Learnt
T
he following are lessons learnt from both the review of the literature and the analysis of the case
studies presented in this study. They relate to the
supply chain, employment, gender, quality and training
aspects.
5.1. Supply chain: Imports
and Domestic Sourcing
Upstream and downstream linkages, i.e., the extent to
which renewable energy enterprises are integrated into
the local economy via the supply chain (upstream linkages) and the downstream businesses that are made
possible by the provision of energy services (downstream
linkages), are important factors for employment creation.
The literature review and the case studies support the
conclusion that little manufacturing of RET equipment
takes place in developing countries (with the important
exception of China and the partial exception of India
and Brazil). Some assembly, however, is taking place in
developing countries.
For some RETs, such as household biogas plants and
ICS, non-manufacturing inputs like construction materials and feedstock are easily sourced domestically and
indeed even locally within rural areas.
Figure 7. Illustrative Suplly Chains for various Renewable Energy Techonologies in Developing Countries
Figure 7a. Illustrative Supply Chain for SPV Systems
Manufacture
of PV
Panels,
Components
Assembly
Distribution/
Retail Sales
Installation
Maintenance
& Services
Phonecharging, etc.
Figure 7b. Illustrative Supply Chain for Small / Micro Hydro
Manufacture
of Turbines,
other
Components
Construction
Materials
Construction
Construction
of Transmission
Lines to Grid
Operations
&
Maintenance
Figure 7c. Illustrative Supply Chain for Improved Cookstoves
Stove Design
Raw
Materials
(Metal / Clay)
Stove
Production
Distribution /
Sales
Home &
Restaurant
Use
Figure 7d. Illustrative Supply Chain for Biogas Plants
Plant Design
Inputs
(Bricks, Metal,
Piping, etc.)
Plant
Construction
Home Use of
Biogas
Note: Colour legend
Imported
Inputs
57
Imported
& Domestic
R e newa ble Energy Job s and A c c e s s
Domestic
Inputs
Downstream
Business
Effluent Use
in Agriculture
Power for
Local
Businesses
Renewable energy employment opportunities in most
developing countries are centred on wholesaling, retailing, installing, operating and repairing equipment, as
well as local “downstream” businesses which are made
possible by improved energy access. Figure 7 illustrates
schematically the parts of the supply chains for SPV,
small/micro-hydro, ICS, and biogas plants that are typically domestic or import-dependent.
recent price increases in the international scrap metal
market have negatively affected producers).
The case studies offer specific information about the mix
of domestic and imported inputs along the supply chains
for different RETs:
The case studies provide evidence that energy access—particularly access to electricity—can have a range
of positive “downstream” effects for rural economies,
enabling a range of micro-enterprises. Table 11 provides a
summary of supply chain and downstream effects for the
individual case studies. Small stand-alone PV modules
like SHS frequently help spawn cell-phone charging businesses, which in turn can have further positive spinoff effects for the communities. In several of the case studies,
income earned from battery or lantern charging has provided the capital needed for new micro-enterprises such
as restaurants, snack bars, bakeries, convenience stores,
barbers shops, tailors, guesthouses, village cinemas and
handicraft enterprises (knitting, sewing, carpentry, pottery). Detailed profiles of such downstream businesses
and longer-term assessments are needed to determine
how sustainable and successful they will be.
SPV. Most of the inputs for the profiled solar companies are imported. For instance, the solar companies in
Nicaragua and Tanzania derive their PV panels and components from Germany, the United States, China, India
and Japan. Interestingly, Solar Company B in Tanzania
also imports solar lanterns from another developing
country, Indonesia. Similar import patterns also characterise the inventory of solar products used in projects
run by REF - SolarNow and at the NICE International
Centres in Africa. However, some domestic assembly of
purchased components from different countries takes
place, for example, Sunlabob in Laos.
Hydropower. The various hydropower plants in the case
studies present a mixed picture, with certain inputs
sourced domestically, but large turbines and advanced
electronics are still imported. The turbine used by Hydro
Company A in Honduras was purchased from an unnamed international supplier. By contrast, the turbine
at the much smaller Hydro B plant in Guatemala was
purchased from a local (Italian-owned) company and
other electro-mechanical equipment with a value of USD
800 000 was also manufactured domestically. For both
hydropower plants, the materials needed for project/facility construction were procured from domestic sources,
and local labour was used to construct both plants. In
Nepal, the turbines, penstock pipes, and accessories for
MHPs were locally fabricated, the electronic load controller was locally assembled, but the generators were still
imported.
ICS. For ICS, supply chains are more typically domestic
in nature. This is especially true for clay stoves. However,
imports do play a role for metal stove producers, which
often rely on imported scrap-metal. This is the case for
the FAFASO project in Burkina Faso, for instance (where
Biogas. For biogas plants, the bulk of inputs—bricks or
other materials—are also likely to be sourced domestically, as is the labour to construct the digesters. The
case studies do not offer sufficient detail beyond these
general observations.
Similar benefits arise when renewable energy access
and availability of ICS make it possible for households to
save on conventional fuel expenses. In Burkina Faso, fuel
savings from ICS have allowed women entrepreneurs to
set up small food-service businesses (maize, cookies). In
Nepal, MHPs set up under the REDP/RERL project have
also provided support for a range of agriculture-related
businesses, including agro-processing mills, irrigation
pumps and poultry-farming.
5.2. Employment Characteristics
Most of the case studies profile a single commercial enterprise or donor-funded project, as discussed in section
4.2. The single largest companies in terms of employment
are Solar Company B in Nicaragua, with 98 permanent
employees and Hydro Company A in Honduras with 83
employees. Most of the case study enterprises are much
smaller. Some employ roughly a dozen or so people. Many
others are micro-enterprises with just a handful of permanent or casual employees, and in some cases there are no
employees at all beyond the entrepreneur him- or herself.
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
58
Table 11. Supply Chain Aspects of the Case Studies
Company or Project
(RET used)
Supply Chain
Downstream Effects
Solar
Solar A — Nicaragua
(Mostly SHS; also Solar
Thermal, Small Wind)
All PV panels and components
imported
Roof attachment structures built in
Managua
Local retailers and micro-franchises
(women organised in co-operatives)
Some PV owners set up small stores
(refrigerating grocery supplies)
Solar B — Nicaragua
(Mostly SHS; also Solar Water
Pumps and Water Heaters)
No local supply chain. Entire
inventory is imported.
Cell-phone charging
Small shops (“pulperias”)
Solar A — Tanzania
(PV systems and solar
appliances)
All equipment is imported
Mobile phone-charging; barber
shops; village cinemas; bars and
shops; guesthouses
Solar B — Tanzania (SHS)
Imported PV panels and solar lights
Mobile phone-charging; barber
shops; inns and bars
REF SolarNow —
Burkina Faso, Mali,
Senegal, Ghana, Ethiopia,
Tanzania, Uganda, Zambia,
Mozambique
(SHS and solar lanterns)
PV panels and charge controllers
imported
Batteries often manufactured
domestically
No specific information given
NICE International —
Gambia, Tanzania, Zambia
(Solar-powered ICT)
Solar and ICT equipment purchased
internationally
Domestic assembly of components
Local businesses include ISP,
technical installation, maintenance
and repair, products and services
Sunlabob — Laos
(Solar lanterns )
Components sourced locally, but
sophisticated items imported with
pre-assembly in Laos
Local micro-enterprise activities,
including stores, handicraft, mobile
phone-charging
Hydro A — Honduras
(Hydropower)
Turbines purchased from an
international supplier
Local construction materials
More reliable power supply allows
shopkeepers to open longer
Hydro B — Guatemala
(Hydropower)
Turbine and other electromechanical equipment
manufactured in
Guatemala.
Local construction materials
More reliable power supply allows
shopkeepers to open longer
REDP/RERL — Nepal
(Primarily MHPs, but also ICS,
Biogas, SHS)
Turbine, penstock pipes, accessories
locally fabricated
Electronic Load Controller locally
assembled
Generators imported
Local micro-enterprises:
agro-processing mills, irrigation
pumps, refrigeration
(medicines, etc.)
carpentry, battery-charging,
handicrafts, tailors, sewing, knitting,
poultry farming,
communications/computer centres
Small-scale production with local
materials, but scrap-metal supply for
metal stoves imported
Brewers and restaurant owners
Fuel savings permit ICS users to set
up new small businesses
(maize, cookies)
Mostly localised supply chains within
area of operation
Employees and customers of
micro-entrepreneurs started their
own small businesses
Hydro
Improved Cookstoves
FAFASO — Burkina Faso
(ICS)
All technologies
DEEP EA — Kenya, Uganda,
Tanzania
(ICS, Briquettes, Solar, Biogas,
etc.)
59
R e newa ble Energy Job s and A c c e s s
Labour Quality and Intensity
Among the case studies, cookstove enterprises on average create a higher number of local jobs than any of the
other renewable energy companies. ICS manufacturing requires numerous artisans and is labour intensive.
However, as the experience in Burkina Faso suggests,
switching from the production of more conventional
stoves to improved models does not necessarily mean
that new jobs are being created. While there is some evidence that local production of improved models requires
more labour than manufacturing of traditional stoves,
many of the individuals involved are already experienced
craftspeople. Where ICS training is provided, it offers
higher qualifications and an opportunity for a sustained
role for craftspeople in the market, and these are important factors in making employment more secure and
sustained.
The type of ICS makes a difference as well. In the case
of Burkina Faso, many of the metal smiths and masons
do employ apprentices and create temporary additional
employment. Among the makers of clay stoves, most of
the potters are women, whose main occupation remains
work in the field and household. Social structures and
traditions have an impact on employment: Pottery in
Burkina Faso is caste-bound work dominated by certain
families that are unlikely to employ apprentices.
Due to their greater labour-intensity, liner production
for ICS, briquette production and biogas digester installations, all require higher than average numbers of
employees compared to other RETs, as evident from
several case studies in East Africa. A rural solar phone
charging business can typically be run by as few as
one to two people. By contrast, for liner production it
may take several people to prepare the raw materials
and to do the mixing, moulding and firing. At a DEEP
EA-supported briquette-making enterprise in Uganda,
employment rose from two to six people following the
purchase of several briquette-making machines, which
were acquired to improve product quality and expand
the types of briquettes. With plans for the purchase of
a motorised briquette machine, another five permanent
employees are expected to be hired.
In addition to permanent jobs, a significant number of
temporary jobs are created among renewable energy
enterprises. Among a total of 166 enterprises in developing countries in which E+Co has invested, temporary jobs
account for 22 to 26% of all employment. By far most of
Ruth and Thomas lease solar lanterns in Tanzania (GVEP)
the temporary positions are found in hydropower; where
they actually account for as much as 70%, the only RET in
which temporary positions outnumber permanent ones.
The ratios are far lower or even negligible for other RETs
like biogas, biomass, and cookstoves.
Some work is temporary simply owing to the nature of the
activity, such as construction of a hydropower plant or a
biogas facility. But in other instances, the distinction is not
concerned with the type of work being performed, but
rather with formal and informal employment structures.
A number of East African cookstove, biogas, briquette,
and solar case studies feature micro-entrepreneurs who
hire labourers for a limited period of time or on a highly
flexible basis so that they can retain the control needed
to adjust to changing and often uncertain business conditions or to seasonal variations. Fluctuations in business
and employment are in some cases also due to the fact
that some entrepreneurs engage in part-time business
activities to supplement incomes from other livelihoods.
Another divergence from conventional employment
creation is found in two other case studies from Laos
and Nepal. In Laos, a village energy committee of three
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
60
to four people is responsible for overseeing operations
of communal solar charging stations. While committee
members receive a small income for their work, they
are not full-time employees. In Nepal, active community
participation and ownership of MHPs is a key ingredient,
with a Village Development Committee charged with
planning, implementation, operation and maintenance of
community energy systems.
Salaries
Salary information is relatively limited among the case
studies. However, cases contributed by E+Co offer some
insights (see Table 12), although information about management salaries is not available. E+Co offers the general
comment that the companies it invests in appear to be
paying competitive wages for their sectors and countries.
Because up to date and sector-specific salary information
for many developing countries is difficult to come by, Table
12 compares salary information with average GDP per
capita data for the countries concerned. This comparison
indicates that the salaries compare very well against the
general economic conditions of these countries.
Gender Aspects
Women derive some of the most important benefits
from improving energy access. In rural areas, the burden
of gathering fuelwood falls heavily on them, requiring
hours of back-breaking work each day. However, they
have established an important role in producing RETs
such as ICS.
In the majority of the cases presented in this report, female
employees are a distinct minority, especially in managerial and technical positions. This is quite apparent from
the E+Co companies, for which Table 13 shows total staff,
women employees and the female share of total staff.
For Hydro Company B in Guatemala and Solar Company
B in Tanzania, the female share is particularly low at 14%
Table 12. Monthly Salaries at Hydro and Solar Companies in Central America and Tanzania
Salaries (USD)
Technicians,
Sales Officers
Solar Company A, Nicaragua
Solar Company A, Tanzania
Operators,
Administrative and
Support Staff
200 - 350
150-200
GDP per Capita
(USD)
94
70-100
44
Solar Company B, Tanzania
100-150
50-70
44
Hydro Company A, Honduras
325-455
250-350
169
Hydro Company B, Guatemala
240-360
200-300
239
Note: E+Co offers a salary range for workers and administrative staff at the two Hydro companies. It estimates that technicians and sales officers’
salaries at Hydro Company A in Honduras are 25-30% higher than those of workers and administrative staff, and 15-20% higher in the case of Hydro
Company B in Guatemala. For simplicity’s sake, this table shows figures that result from applying a 30 and a 20% differential, respectively. For Solar
Company A in Nicaragua, a single range is given for non-management staff.
Source: E+Co, 2011; World Bank (2012), Databank (GDP per capita data are for 2010).
Table 13. Share of Female Staff at Hydro and Solar Companies in Central America and Tanzania
Employees
Total
Solar Company A, Nicaragua
Solar Company A, Tanzania
a
Women
Share of
Females (%)
13
4
31
14
4
29
Solar Company B, Tanzania
9
1
11
Hydro Company A, Honduras
83
15
24
Hydro Company B, Guatemala
14
2
14
b
a
The Company also employs 15 external sales representatives, but no gender breakdown is available. b The company also has 20 technical contractors and 2 drivers on call; no gender breakdown is available.
Source: E+Co, (2011).
61
R e newa ble Energy Job s and A c c e s s
and 11%. At the Guatemalan hydro company, women are
found only among the administrative/support staff; at its
Honduran counterpart, 20% of maintenance workers, as
well as all support staff are female. Solar Company A in
Nicaragua has the highest share (31%) of female staff out
of all the E+Co portfolio companies listed here. It has also
created micro-franchises for female-run co-operatives
that distribute solar products and trains women on SPVbased products such as lanterns. In Tanzania, the support
staffs at Solar Company A, as well as two of the three
sales officers are women.
Women play more prominent roles in case study enterprises in Nepal and in East Africa. In Nepal, in communities
supported by REDP, 41% of all energy-based enterprises
are owned by women entrepreneurs. Among the 800
renewable energy entrepreneurs in Kenya, Tanzania, and
Uganda who receive support through the DEEP EA project, females account for 42%. Figure 8 illustrates where
women entrepreneurs are primarily active. They own 62%
of briquette-making and 51% of cookstove-producing enterprises. These typically do not require much mobility or
a high level of capital. But women play only a marginal role
in solar technologies (20%), battery-charging (10%), and
biogas ventures (3%). As noted earlier, among cookstove
producers in Burkina Faso gender is essentially separated
according to the different materials used. Metal smiths
and masons are typically men, but potters are principally
women.
5.3. Skills and Training
An important point that emerges is that small-scale RET
is on the whole well adapted to the rural context. The
bulk of the skills and training that are required can be
developed locally. This is of great importance because
there is limited need for foreign know-how and expertise.
In most renewable energy enterprises, only a limited
number of people need to have advanced or specialised
technical skills such as engineering. The majority of
jobs have less-demanding skill profiles and the training
needed can therefore in many cases be imparted in a
relatively short length of time.
Figure 8. Female Entrepreneurs in Kenya, Tanzania, and Uganda Case Studies, by Renewable Energy Technology
(as of late 2011)
Solar
Battery
Charging
47
3
ICS
196
Briquettes
104
Biogas
1
Others
18
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
62
In many cases, training can be done on-site or on-thejob. This is especially true for many micro-enterprises
and particularly those that rely on casual labour in addition to the regular employees. Experience from the case
studies suggests that business skills such as accounting
and record-keeping, price design, inventory, quality assurance, etc., are often as critical to the success of rural
energy enterprises as the technical aspects. (see Box 2
on Standards and Quality Assurance).
In contrast, for RETs that are sold individually to households such as SHS, solar lanterns and ICS, marketing
skills (including awareness campaigns, product demos,
etc.) are critical, but so are after-sales services. Solar enterprises in particular depend strongly on the abilities of
retail staff and franchise owners. Solar training is carried
out on marketing and product demos, competent aftersales services, and other similar skills. Marketing plays
an equally critical role for ICS and briquette producers,
though the model of dissemination used—commercial
markets or locally by word-of-mouth and reputation—
makes a key difference.
A different form of training is important among the
NICE International Centres in Africa, Sunlabob in Laos,
and REDP/RERL-supported MHPs in Nepal. The NICE
Centres offer ICT skills training for local youth—a clearcut example where energy access offers new career
and employment perspectives in remote rural areas.
Sunlabob’s village solar-charging stations entail a more
communal form of instructions to ensure that all members of a village’s energy committee receive proper
training in how to operate the charging station and solar
lanterns. Similarly, in Nepal, technical capacity-building
has been carried out in a more communal form, to ensure
that beneficiaries of local hydro plants understand how
these micro-systems work.
A final aspect of training efforts that emerges from
the case studies is that cross-mentoring among local
entrepreneurs can play an important role in the success of enterprises. This is the case, for instance, among
entrepreneurs that are being supported by the DEEP
EA project in East Africa. In Uganda, for example, more
experienced briquette-making entrepreneurs mentor
others and local entrepreneurs have been encouraged to
attend networking sessions.
5.4. Improving Primary Data
As mentioned in Section 3, renewable energy development has been regarded as a key area of greening
economies, with the notion of “green jobs” gaining
increased interest. Yet, relatively little is known about the
employment implications of providing energy access in
rural areas of the developing world. This gap in knowledge exists even though the links between social and
economic development and modern sustainable sources
Box 2
Standards and Quality Assurance
Establishing and enforcing appropriate quality standards for the use of renewable energy equipment
and components is an important undertaking, especially in countries which do not manufacture RET
equipment and thus depend on imports. Frequent
malfunctioning or breakdown of RET equipment
can overburden supply chains in remote rural
areas, which even under normal conditions face
a challenging task in providing adequate maintenance services and spare parts. Well-functioning
and reliable RETs help reinforce among prospective
rural customers the sense that renewable energy is
a workable and attractive alternative to traditional
forms of energy. This is ultimately critical for sustaining
renewable energy jobs in rural areas.
63
R e newa ble Energy Job s and A c c e s s
The experience of different countries suggests that
designing and enforcing quality standards for RET
equipment is a critical element. This necessitates
building competent national-level administrative
structures, but also relates to skill-building and technical expertise among importers, distributors and
retailers of RET equipment, as well as establishing a
domestic capacity to adapt RETs to specific local
needs. Governments are principally responsible
for putting such standards and quality assurance
measures in place, but capacities vary across
the developing world and some countries could
benefit from targeted capacity-building efforts.
Table 14. Jobs, Skills and Training at Enterprises included in the Case Studies
Enterprise — Country (RET)
Jobs
Skills / Training
Solar
Solar A — Nicaragua
(Mostly SHS; also Solar
Thermal, Small Wind)
13 permanent jobs (9 men, 4
women) in Managua
Plus 15 Sales Personnel at 4 branch
offices
»»Professional training for PV
Solar B — Nicaragua
(Mostly SHS; also Solar Water
Pumps and Water Heaters)
98 permanent jobs
Plus 12-15 jobs through expansion of
activities.
»»Technical and branch staff
Solar A — Tanzania
(PV systems and solar
appliances)
4 Managers, 3 Technicians, 4
Admin./Support, 3 Sales Officers
20 Technical Contractors, 2 Drivers
on call
»»No information available
Solar B — Tanzania
(SHS)
1 Manager, 2 Technicians/
Shopkeepers, 1 Support, 5 Sales
Officers
»»Owner has MA in Economics
»»No further information
REF SolarNow —
Burkina Faso, Mali,
Senegal, Ghana, Ethiopia,
Tanzania, Uganda, Zambia,
Mozambique
(SHS and solar lanterns)
200 retailers in 9 countries
About 200 technician jobs created
through retailer expansion
NICE International —
Gambia, Tanzania, Zambia
(Solar-powered ICT)
Operated by local Entrepreneurs.
Currently 7 Centres, growing to 50 by
2014.
»»Business skills (franchise
Sunlabob — Laos
(Solar lanterns )
Per village: 1 Entrepreneur, 3-4
Village Energy Committee Members,
1 or more Technicians
»»Training for Entrepreneur and
Hydro A — Honduras
(Hydropower)
4 Managers, 7 Technicians, 62
Workers/Labourers, 10 Admin./
Support
»»Employs already-trained
Hydro B — Guatemala
(Hydropower)
1 Manager, 3 Engineers, 10
Operators, Admin./Support
»»Employs already-trained
REDP/RERL — Nepal
(Primarily MHPs, but also ICS,
Biogas, SHS)
Direct employment:
1.4 million person-days or 3 852 fulltime equivalent jobs (at 2 persons
per MHP)
»»To date, 3 000 persons
Trained 285 Metal Smiths, 264
Masons, 180 Potters
»»Quality control
»»Marketing, sales
»»Price design
»»Financial advice
885 Entrepreneurs
(44% in ICS; 27% in solar; 19% in
briquettes; 10% other)
»»Record keeping
»»Product-standard awareness
»»Marketing skills
Technicians, Salesmen
»»Women from co-ops
trained on PV lanterns and
other solar products
trained in Managua laboratory
»»Managerial staff trained
in operations control
available
Training for retailers, incl.:
»»After-sales advice,
Marketing campaigns
and product demos
model)ICT skills for youth
village Energy Committee
Hydro
Engineers. Specialised
Contractors hired for
specific tasks
Engineers. Other Staff
trained by the Engineers
trained on technical aspects
of micro-hydro systems
Improved Cookstoves
FAFASO — Burkina Faso
(ICS)
All technologies
DEEP EA — Kenya, Uganda,
Tanzania
(ICS, Briquettes, Solar, Biogas,
etc.)
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
64
of energy are well recognised. As far as data requirement
the following efforts should be supported:
Tracking Employment - There is a need for better and
more systematic efforts to track rural renewable energy
employment in developing countries. At present, there
are somewhat disconnected snapshots of employment—
typically focused on a particular RET or on a particular
community or project. There are very few available time
series that would allow a solid understanding of how
renewable energy employment is evolving in different
countries, and there is little information about qualitative
aspects of employment. Better reporting concerns not
just absolute job numbers, but also employment factors
per unit of capacity for each RET, and better insights
into the RET employment potential at different scales.
Other dimensions that deserve closer scrutiny include
the impacts of seasonal changes, as well as a better
differentiation of data between permanent/temporary
employment.
Expanding Case Studies - Case studies like those examined in Section 4 of this report reveal important insights,
particularly with regard to downstream economic opportunities that macro-level studies do not offer. But they
need to be extended in two ways. One, the connection
between particular local micro-conditions and the broader situation in a given country needs more attention. How
representative is the local case study, both in terms of
success and problems encountered? How do local enterprises and projects interact with national policy, and is
there a positive dynamic? Second, local case studies need
to be extended temporally, so as to allow an evaluation of
longer-term developments and impacts. lt will be important to develop a set of common metrics across different case studies, so that findings become more broadly
comparable. Additional case studies are desirable so as
to ensure a robust set of examples for each RET and for
different regions of the developing world.
Exchange of Lessons-Learnt - Many renewable energy
micro-enterprises in rural areas are struggling to succeed. As case studies presented in this report underscore, access to financing, reliability of equipment and
service, entrepreneurial/managerial capacities and the
availability of adequately skilled employees are key factors influencing whether enterprises succeed and thus
whether rural renewable energy employment can not
only be sustained but also expanded.
Beneficiary of solar home system in Tanzania (GVEP)
65
R e newa ble Energy Job s and A c c e s s
Re n ewa b l e E n e rg y Jo b s a n d Ac c ess
66
6. Conclusions
R
enewable energy technologies in the context of energy access have proven to be reliable and with the appropriate business model affordable for poor households. They can support the UN goal of reaching full energy access
by 2030 and have the potential to create almost 4 million direct jobs in the off-grid electricity sector alone.
Successful initiatives have some elements in common, including building qualified skills, setting quality standards for
equipment and providing financial support to entrepreneurs. Therefore, in designing and implementing policies to
increase sustainable jobs when introducing Renewable Energy Technologies for access, policy makers may want to
consider the following aspects:
Job Creation
Renewable energy jobs in rural areas of the developing world can be created across all segments of the industry’s
value chain, although there is greater potential for job creation during the distributing, selling, installing, operating,
and servicing stages than the manufacturing stage. Some assembly is also taking place in developing countries, particularly for household biogas plants and improved cookstoves, where non-manufacturing inputs such as construction
materials and feedstock can be easily domestically sourced (in particular for clay stoves).
It is also essential to consider that some renewable energy technologies are more labour-intensive than others. For
example, the manufacturing of clay cookstoves involves liner production, a process which requires several people to
prepare the raw materials and mix, mould and fire the clay. At the other end of the spectrum, a solar phone-charging
business or a micro-hydro plant can typically be run by 1-2 people. It must be underlined that employment is generated
not only across the renewable energy technology value chain, but even in a variety of other “downstream” microbusinesses, such as mobile phone charging businesses, battery or lantern charging, food-service businesses, barber
shops and tailors, guesthouses, agriculture-related businesses, and internet cafes.
In addition, employment in various renewable energy technology enterprises fluctuates considerably for a variety of
reasons, including seasonal changes, local business cycles, and the supplemental nature of some businesses. In fact,
a number of temporary jobs are created among rural renewable energy enterprises due to the nature of the activity,
i.e., the construction of hydropower plants or biogas facilities. Another important distinction concerns formal and
informal employment. Micro-entrepreneurs may hire labourers contingent on the need to adjust to changing and often
uncertain business conditions.
Improving Skills
Small-scale renewable energy technologies are generally well adapted to the rural context, considering that highly
advanced skills are not necessary. Furthermore, the bulk of skills and training can be developed locally, meaning a
limited need for foreign know-how and expertise. In many cases, training can be done on-site or on-the-job.
Nevertheless, greater efforts need to be made to map skills for different renewable energy technologies in order
to gain a clearer picture of existing strengths and weaknesses of vocational policies in local areas. Creating strong
vocational policies, setting up rural training centers as needed, and encouraging private sector companies to build
apprenticeship programs can all help to strengthen the skills base.
67
R e newa ble Energy Job s and A c c e s s
Experience from the case studies in this report suggests that business skills such as accounting and record-keeping,
price design, inventory, quality assurance, etc., are often as critical to the success of rural renewable energy enterprises
as the technical aspects. Additionally, proper marketing skills, with a strong view toward consumer awareness-building,
are critical, as are the skills to ensure adequate after-sales services to build consumer trust that Renewable Energy
Technologies are reliable alternatives to conventional forms of energy.
Gender
Women derive some of the most important benefits from improving energy access. In rural areas, the burden of
gathering fuelwood falls heavily on them, requiring hours of difficult work each day. Renewable Energy Technologies,
especially if combined with energetically efficient cookstoves, can reduce or eliminate this burden.
Within the renewable energy technologies sector in rural areas, gender roles are not in balance. In most renewable
energy enterprises, female employees are a minority, particularly in managerial and technical positions. Their role is
critical in producing renewable energy technologies such as improved cookstoves. But it is far less so in solar and
biogas ventures due to various limitations, including mobility, capital requirements, and the perception that technology is better served by men –all of which preclude a larger role for females in many rural settings. Social structures
and traditions have an impact: some female entrepreneurs are limited in their activities by the need to remain in the
household or help in the field. Policy makers may want to consider the gender specific aspects of various renewable
energy technologies.
Standards and Quality Assurance
Establishing quality standards for the use of renewable energy materials, equipment and components, as well as
ensuring their successful enforcement are critical not only to the sustainable development of the renewable energy
industry in rural areas, but also to local job creation. These components also help reinforce among prospective rural
community customers the belief that renewable energy is a credible and suitable alternative to traditional forms of
energy. This necessitates building appropriate national-level administrative structures, but also relates to skill-building
and technical expertise among importers, distributors and retailers of renewable energy technologies equipment.
Governments are principally responsible for putting such standards and quality assurance measures in place.
Improving Primary Data
There is a palpable need for more comprehensive and systematic efforts to monitor rural renewable energy employment in developing countries. Additional case studies are desirable so as to ensure a robust set of examples for each
renewable energy technologies and for different regions of the developing world. They would be of great value to
give proper attention to the connection between particular local micro-conditions and the broader situation in a given
country, including national policy-making. Local case studies need to be extended temporally to assist in an evaluation
of developments and impacts over a longer period of time. Having time-series and qualitative aspects of employment
would also facilitate a broader understanding of the evolution of the employment sector in rural areas. This requires
drawing up common criteria, metrics, and reporting standards for rural case studies in order to make findings as
comparable as possible and to support long-term monitoring and assessments.
Re n ewa b l e E n e rg y Jo b s a n d A c c ess
68
Honduras
Guatemala
Nicaragua
Nicaragua
Expanding to:
El Salvador, Panama,
Honduras,
Guatemala
Tanzania
Tanzania
Hydro B
(Since 2009)
Solar A (N)
(Since 1999)
Solar B (N)
(Since 1999)
Solar A (T)
(Since 2002)
Solar B (T)
(Since 2006)
Country
Hydro A
(Since 2008)
Company or
Project
SHS
PV systems and
solar appliances
Mostly SHS
Solar Water Pumps
Water Heaters
Mostly SHS
Solar Thermal
Small Wind
Small Hydro
[upgraded to 1.1 MW
from smaller
capacity]
Hydro
[13.5 MW]
RET
Retail, installations and
maintenance
Direct sales (shops) to
households; marketing to
institutions
Sales, installations and
maintenance
(80% rural
installations, incl. health
centres and schools)
Promotions, sales,
installations,
distribution network and
battery collection
Promotions, sales,
installations service
(85% rural customers)
Power generation
sales through national grid.
Isolated small plants interconnected for
grid-access
Power generation
sales through
national grid
Type of Activity
Table A. Overview of Case Studies — Activities, Sales, Training, and Employment
69
Almost 300 sold
In 2010, 80 sold
> 1 000 systems installed
Installed > 50 000 PV
systems, serving 300 000
people
163 new HH with access to
water pumps
> 10 000 people served
From 2009 to June 2011:
2 217 SHS sold and
3 000 systems installed
15 000 people in region
with more reliable access
to power
11 000 people in region
with more reliable access
to power
1 200 gained access
Sales / Recipients1
Owner has MA in Economics
No training information
given
No information given
Technical and branch
staff trained in Managua
laboratory
Managerial staff trained in
operations control
Professional training for PV
technicians, salesmen
Women from co-ops
trained on PV lanterns and
other solar products
End-user training
Employs already-trained
engineers
Other staff trained by the
engineers
Employs already-trained
engineers
Specialised contractors
hired for specific tasks
Skills / Training
1 manager
2 technicians, shopkeepers
1 support
5 sales officers
4 managers
3 technicians
4 admin. / support
3 sales officers
20 technical contractors,
2 drivers on call
98 permanent jobs
Plus 12-15 jobs through
expansion of activities
In Managua:
13 permanent Staff
(9 men, 4 women)
Plus 15 sales personnel
at 4 branch offices
1 manager
3 engineers
10 operators, admin. /
support
96 construction
4 managers
7 technicians
62 workers/Labourers
10 admin./support
100 construction
Jobs
Solar
Tanzania:
Joseph Robert
Solar Lanterns
ICS
Biogas
Briquettes
Uganda: Friends of
Environment
Kenya
ICS
Kenya: Keyo
Pottery
Enterprises
SCODE
ICS
Briquettes
Solar
Biogas
Others (such as fireless
cookers and battery
charging)
Kenya
Uganda
Tanzania 2
DEEP EA
(2008-2012)
ICS
RET
Burkina Faso
Country
FAFASO
(2006-2012)
Company or
Project
Sales
Assembly and sales
Construction
Phone-charging, solar technician services, and solar parts
sales
Briquette production
Stove production
Assist entrepreneurs to
identify viable market and
revenue-generating opportunities, technical options
Networking among entrepreneurs, suppliers and
customers
Small-scale production
of stoves
Type of Activity
From Oct. 2009-Dec. 2011:
6 057 ICS, 92 fireless cookers, 91 biogas systems, 3
institutional cookstoves, 70
big and 416 small solar
lanterns
April 2010 to Dec 2011: 6
751 phone charging units
Sept - Dec 2011: 6 solar
installations
From June 2010 to Dec
2011: 2297 units (each
unit is 1 kg)
From April 2010 to Dec
2011: Total of 108 983
units sold
From April-Dec. 2011:
1.1 million
beneficiaries
180 000 stoves
Sales / Recipients1
Table A. Overview of Case Studies — Activities, Sales, Training, and Employment (continued)
70
Business trainings
Same as above
Employees expanded from
5 to 11; distributors from 8
to 25
Example of Joseph Robert:
Expanded to employ 2
persons, plus 2 occasional
labourers
Example of Jude Kabanda:
Expanded from 2 to 4
employees, more in future.
Employees starting other
businesses.
Grew from 6 to 17 member
potters over a number
of years
Example of Janet Atieno:
from 1 to average of 4
casual employees
Business training and
mentoring
Business and marketing
skills
Networking sessions
Mentoring of other entrepreneurs
885 entrepreneurs
[average jobs per enterprise
grew from a baseline of 1.6
to 2.4 by Sept. 2011]
44% in ICS; 27% in solar;
19% in briquettes; 10%
other]
Trained:
285 metal smiths
264 masons
180 potters
Jobs
Record keeping
Product-standard awareness
Marketing skills
Quality control
Marketing, sales
Price design
Financial advice
Skills / Training
1
Gambia,
Tanzania, Zambia
Laos
Nepal
NICE
International
(Since 2007)
Sunlabob
REDP/RERL
(Since 1996;
3 phases
to 2012)
Primarily MHP, but also
ICS, Biogas, SHS
Solar Lanterns
Solar-powered ICT
SHS and Solar
Lanterns
RET
Collaborative
programme with multiple
partners at community,
district, and national levels
Establishment of Rural
Energy Service Centres
Solar-charging stations (for
20-50 lanterns), operated
by village entrepreneurs
NICE Centres offer:
Battery charging
Access to Internet, TV
Business, banking advice
Income generation opportunities
Help with business start-ups
and expansions
Quality assurance (brands)
Support for retailers, distributors, technical personnel
Type of Activity
Population benefiting:
350 000 (52 788 HH)
No information given
NICE Centres provide
energy / ICT services for:
1 000 people in 1st year,
2 000 people in 2nd year,
3 000 people in 3rd year
By 2014: 100 000 served
> 57 000 SHS sold
36 000 lanterns sold
> 492 000 HH reached
Sales / Recipients1
Skills / Training
To date, 3 000 persons
trained on technical
aspects of micro-hydro
systems
Capacity of > 34 000
people has been developed
Training for entrepreneur
and village energy committee
Business skills
(franchise model)
ICT skills for youth
Training for retailers, incl.:
After-sales advice
Marketing campaigns and
product demos to improve
village distribution channels
Cumulative figures, unless a specific year is specified. 2 More detailed information for these three countries follows below.
Burkina Faso, Mali,
Senegal, Ghana,
Ethiopia,
Tanzania, Uganda,
Zambia,
Mozambique
Country
REF – SolarNow
(Since 2007)
Company or
Project
Table A. Overview of Case Studies — Activities, Sales, Training, and Employment (continued)
71
Direct employment:
1.4 million person-days or 3
852 full-time equivalent jobs
(at 2 persons per MHP)
Per village:
1 entrepreneur
3-4 village energy
committee members
1 or more technicians
Operated by local
entrepreneurs.
Currently 7 Centres, growing
to 50 by 2014.
200 retailers in 9
countries
About 200 technician jobs
created through retailer
expansion
Jobs
Honduras
Guatemala
Nicaragua
Nicaragua Expanding to:
El Salvador, Panama,
Honduras, Guatemala
Tanzania
Hydro B
(Since 2009)
Solar A (N)
(Since 1999)
Solar B (N)
(Since 1999)
Solar A (T)
(Since 2002)
Country
Hydro A
(Since 2008)
Company or
Project
PV systems and
solar appliances
Mostly SHS
Solar Water Pumps
and Water Heaters
Mostly SHS
Solar Thermal
Small Wind
Small Hydro
[upgraded to 1.1 MW
from smaller capacity]
Hydro
[13.5 MW]
RET
Equipment imported from
manufacturers and distributors in USA
(80%), China, India and Germany
Local: training and installations
-related
No local supply chain. Entire inventory
is imported.
PV panels and components imported
from Germany, USA and Japan
Only roof attachment structures are
built locally, in Managua
Some panels produced locally from
broken panels
Turbine purchased from a local
(Italian-owned) company
Other electro-mechanical equipment
manufactured in Guatemala
(total value of USD 0.8 million)
Local construction materials
Pelton turbines from an international
supplier
Local construction materials
No further supply chain information
given
Supply Chain
Downstream Effects
Mobile phone-charging
Barber shops
Village cinemas
Bars and shops
Guesthouses
Cell-phone charging
Small shops (“pulperias”)
Local retailers and micro-franchises
(women in co-operatives)
PV owners set up small stores in
homes (refrigerating grocery supplies;
operations after dark)
More reliable power supply allows
shopkeepers and other businessess to
open longer: Restaurants, snack bars,
barber shops, tailors
More reliable power supply allows
shopkeepers and other businessess to
open longer: Restaurants, snack bars,
barber shops, tailors
Education benefit: Children can study
longer
Table B. Overview of Case Studies — Supply Chain, Downstream Effects, and Financing
72
Company debt financing from E+Co
for inventory
(2006, 2011)
Presently, company sells on cash
and contract basis
2012: micro-finance pilot planned
IADB and E+Co loans to Solar B, plus
donor/government subsidies and
micro-finance for end-users:
Nicaragua: PERZA (World Bank)
programme
El Salvador: FOMILENIO
programme
Panama: IADB/RENO
(USD 2.25 million)
Buyers finance out of pocket, plus
micro-finance options
Finances tend to improve (saving on
kerosene, candle, fuelwood expenses)
Project cost was USD 1.5 million
E+Co loan of USD 1.1 million
Project cost was USD 16.5 million
E+Co debt equity investment of USD
1.35 million
Carbon offset credits
Financing
Briquettes
Solar
Uganda
Tanzania
Kenya
ICS
Kenya: Keyo Pottery
Enterprises
SCODE
ICS
Briquettes
Solar
Biogas
Others
Kenya
Uganda
Tanzania 2
DEEP EA
(2008-2012)
Solar Lanterns
ICS
Biogas
ICS
Burkina Faso
FAFASO
(2006-2012)
RET
Mostly SHS
Solar Lanterns
Tanzania
Country
Solar B (T)
(Since 2006)
Company or
Project
SCODE has about 25 micro-distributors
of their products
Same as above
Localised supply chain
Complex domestic supply chain, from
raw materials to stove production to
sales
Various—depending on technology, but
most are localised supply chains within
area of operation. Since 2011, focusing
on specific supply chain models per
type of technology
ICS developed in-country in 1980s, but
abandoned
Scrap-metal supply for metal stoves
from abroad
Small-scale production with
local materials
Imported equipment:
PV panels: Europe and USA
Solar lights: Indonesia
Six large wholesalers in the capital
Supply Chain
Most customers are households. Positive health impacts (ICS) Children can
study longer (Solar)
Barbers shops and phone-charging
businesses
Example of Joseph Robert’s business:
A customer started a phone-charging
business
Loan guarantee from GVEP
No information given
Micro-loan secured with DEEP EA help
Linkages to financing for some group
members through networking sessions, or direct intervention by GVEP
No information given
Example of Jude Kabanda’s business:
Employees started up other businesses
(poultry, etc.)
Funding from EU and DGIS
(Netherlands)
GVEP loan guarantee fund (working
with 6 financial institutions
in the 3 countries)
Co-financing by DGIS (Netherlands)
and BMZ (Germany)
E+Co loan to company of USD 50 000
for inventory (2007)
Local financing unavailable
Sales to end-users on cash basis
(but only 10% of HH can afford SHS)
Financing
See below for details
Brewers and restaurant owners
Fuel savings permit women to set up
new small businesses (maize, cookies)
Mobile phone-charging
Barber shops
Inns and bars
Downstream Effects
Table B. Overview of Case Studies — Supply Chain, Downstream Effects, and Financing (continued)
73
Burkina Faso, Mali,
Senegal, Ghana, Ethiopia, Tanzania, Uganda,
Zambia, Mozambique
Gambia, Tanzania,
Zambia
Laos
Nepal
NICE International
(Since 2007)
Sunlabob
REDP/RERL
(Since 1996; 3
phases to 2012)
Country
REF – SolarNow
(Since 2007)
Company or
Project
Primarily MHP, but also
ICS, Biogas, SHS
Solar Lanterns
Solar-powered ICT
SHS and Solar
Lanterns
RET
Turbine, penstock pipes,
locally fabricated accessories
Locally assembled electronic load
controller
Generators imported
Components are sourced locally
More sophisticated items are imported,
but with pre-assembly in Laos
Revenues generated stay within villages
Solar and ICT equipment
purchased internationally
Domestic assembly of
components from different suppliers
PV panels and charge controllers
imported from China, USA, Europe
Batteries: often manufactured
domestically
Assembly and installation by local
technicians
Supply Chain
Local micro-enterprises like: agroprocessing mills, irrigation pumps, refrigeration (medicines, etc.) carpentry,
battery-charging, handicrafts, tailors,
sewing, knitting, poultry farming, communications/computer centres
Local micro-enterprise activities, including stores, handicraft, mobile phonecharging
Local businesses: ISP, technical installation, maintenance and repair, products
and services
No information given
Downstream Effects
Table B. Overview of Case Studies — Supply Chain, Downstream Effects, and Financing (continued)
74
Grants for Community Energy Funds
established by Micro Hydro Functional
Groups, and District Energy Funds
Fee-for-service concept:
SLRS—Solar Lantern Rental
System customers buy a service
rather than lanterns (regular, small
fees for a fully-charged lantern
System installation and hardware
initially sponsored by donors,
eliminating up-front costs
Franchise and lease agreement for
NICE Centres. Centres are financially
self-sustained, typically run a profit
within 3 years
Customers pay on a per-use basis
REF itself was initially funded through
Dutch lottery, foreign ministry, and
private donors
REF is involved in micro-finance
schemes; 2010: pilot with hire
purchase (Uganda)
Upfront cost still a big burden for
customers
Financing
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