You are here: The desire for entertainment and connectivity is driving solar energy demand among Tanzania’s rural households

27/10/2017

Households in rural Tanzania who are aspiring to own or have access to entertainment appliances such as computers and tablets could be driving-up demand for solar systems, a new study by Solaris Offgrid reveals.

Solaris Offgrid designs and manufactures Pay-As-You-Go (PAYG) systems solutions to foster affordable and sustainable energy access in off-grid areas. They run their own last-mile operations through the field partner Solaris Tanzania which has made considerable efforts in research and development in the country since 2014. They recently examined the energy needs in rural areas of northern Tanzania which could be satisfied within the range of a 200 watt peak DC (direct current) installation.

The study assessed the needs of over 300 customers and prospects on their interest in a list of products and services that could be powered by solar energy. The desire to access computer tablets, the internet and television came top on their customers’ wish list. Some of the appliances are already offered to the customers as part of a Solar Home Systems (SHS) PAYG package, while some would be completely new.

Multimedia is consistently ranked as the most interesting service to our customers, overcoming offers of more ‘practical’ products such as irons or refrigerators.

- the study, Beyond Lighting: Evaluating the needs of rural communities (in Lake Zone, Tanzania), shows.

This result is the same even when we controlled for gender and income levels.

The interviewees depicted clear interest in multimedia such as music, video and photos. Having considered multimedia as the pinnacle of their customers’ priority list, they then explored exactly which services were of most interest. The biggest gap between interest and access was for the internet, with customers currently showing very limited levels of access compared to video, which registered the highest interest given its average access levels.

These needs can be met by a few different products, but tablets cover them all and are very appealing, with 90% interested in leasing one.

- the study finds.

Equally, 50% would consider buying instead of leasing the tablets. The report further states that about 10% of Solaris Tanzania customers buy their Solar Home Systems in cash and so the fact that 50% would be keen to buy a tablet outright shows very strong interest in the appliance. Given such interest, Solaris Tanzania has considered factoring their customers’ demand for such appliances in the SHS package going forward.

It was clear to us that we should begin offering tablets as an optional accessory to our Solar Home Systems, which are provided on a PAYG model.

- says Dave Henry, author of the report and Head of Business Intelligence at Solaris Offgrid.

Besides powering computers and tablets, interviewees cited the need to power other appliances for both domestic and productive uses such as hair cutting tools, refrigerators, irons, soldering irons and irrigation systems. This evolving trend, where energy usage among rural households has gradually moved beyond lighting and heating, is poised to further deepen the demand or adoption of Solar Home Systems. It also suggests that these technologies are increasingly becoming affordable, with the convenience in flexible payment options such as PAYG sticking out as a major driver.

In the next few months, Solaris Offgrid will work in collaboration with Microsoft to maximise the impact of offering greater access to multimedia and internet to households in rural Tanzania. The partnership followed Solaris Offgrid’s shortlisting as a beneficiary of The Microsoft Affordable Access Initiative grant in June this year. Comprising of funding, computer services and empowerment, the support will include coupling of internet and tablet access services to the current energy access offers available in Tanzania’s off-grid hamlets. The scope of the work will also include expanding content and computer science programmes with the addition of 1,000 content-rich tablets for roughly 7,000 users in Tanzania. These will be provided on a PAYG basis, alongside a SHS that will be providing the energy needed to power such devices.

As well as providing the desired multimedia access, these tablets will be loaded with educational content, providing an extra level of impact. We'll also be exploring different models for internet access

- he says.

While a number of customers may be interested in having their own internet-connected dongles and internet plans, this won't be suitable for all, says Dave:

We work with local entrepreneurs, and we’ll use these connections to develop ‘internet cafes’, where a single entrepreneur can provide Wi-Fi for people to come and use. In this way, we can broaden the internet access provided by the tablets.

In the past couple of years, Energy 4 Impact has supported entities such as Solaris Offgrid and other SMEs operating in the off-grid energy space with advisory services to be able to expand and make their products and services affordable to more people in rural areas. More recently, Energy 4 Impact supported Solaris Offgrid in its fundraising efforts by offering advisory on the financial model, a transactional opinion on the firm’s valuation, and the review of term sheets.