Without electricity, energy and lighting options are limited, and fuel woods currently dominate the energy balance – especially for cooking. And while there is a clear demand for off-grid solar solutions, the current availability of products meeting Lighting Global Quality Standards is inadequate.
Solar is cheaper, there aren’t power cuts and protects the environment. Market Analysis Respondent, Dec. 2015
Identifying the issues
Lighting Africa recognized a need to support the acceleration of access to quality-verified off grid lighting and energy products, and started conducting market research in Mali in 2013 to learn how to best do so. Our research revealed a series of impediments to growing the market that often go hand-in-hand: consumers lacked awareness of SPLs, availability was extremely limited – especially in rural areas, and the financing for the the up-front cost of a lantern was often not available.
Our findings indicated that capitalizing on the existing urban-to-rural distribution channels, as well as involving the diaspora, would increase penetration. We also recognized that working directly with the rural population would be key to increasing the footprint of SPLs across the country.
To implement these findings, we are poised to embark on a Results-Based-Financing (RBF) Mechanism in conjunction with the Malian agency for the Development of Household Energy and Rural Electrification (AMADER). The goal of this RBF scheme is to address constraints on the private sector delivery of modern energy services to the poor. This will be done by providing financial incentives both to overcome temporary market development risks, and to shift from low to high-quality products in the pico-solar PV distribution chain.
For lighting and mobile phone charging solar equipment has entered Mali in force – with solar now representing 40% of the energy sources for these uses. -Market Analysis on Picosolar products in Mani, SNV, December 2015.
Specifically, the incentives are intended to temporarily off-set the higher acquisition costs for quality-verified products, to support the set-up for repairs and replacements, to expand to new areas, to offset promotion and marketing costs, and to stimulate the market for quality-verified products. In practice, incentives will be used by companies to recover the investments made to be able to sell products meeting our Standards in Bamako and beyond. This project aims to stimulate the market through incentives provided on the first 100,000 products meeting Lighting Global Quality Standards sold.
Plans are also underway to replicate and build on the successful lantern library project undertaken in Senegal. This project, which is set to kick off in late 2016 will raise awareness among the local population by providing access to off-grid lamps through schools or socio-community organizations.