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Ignite broke affordability records: "affordability should be the sector’s number one priority"

Published in the PV Magazine


Ignite Power's offering, launched in early 2020, reportedly broke affordability records after it enabled families living in remote Rwandan villages to purchase solar home systems for less than US$1 (Rwf 860) each per month.


Gil Karie, head of marketing at Ignite told PV-magazine that since launching the program, the company has been able to provide more than 10,000 households in remote communities with clean and sustainable power for the first time. Using a very conservative estimate of five per household, that means impacting over 50,000 people since the launch of the program.


“We believe affordability should be the sector’s number one priority, as the cost of the systems is still the number one problem for millions of poor families throughout the sub-Saharan Africa region,” she said, adding, “Every ten cents reduced from the price enables thousands of families to own a system; with the Affordability Plan allowing tens of thousands of families in the country to enjoy home electricity for the first time. It will not only create great social environmental impact, but also lead Rwanda into a more sustainable and prosperous future.”


To date, Karie said the program is available in four districts in the Southern Province of the country: Ruhango, Nyanza, Huye and Nyamagabe. Further expansion into additional districts is expected in the near future.


Explaining how the Affordability Plan is impacting on businesses and livelihoods in Rwanda, Gil said, “Having power access is recognized globally as a basic infrastructure need that contributes drastically to financial development. With solar home systems, businesses can expand their offerings (with solar-based fridges and TVs, for example) and keep open after dark. In homes, having reliable electricity enables children to read and do homework after dark, while many women who have to deal with house chores during the day, can now learn, read and even work after dark.”


Double boost


The Extreme Affordability Plan has twice been given a boost in 2020. In July, Ignite Power entered a fundraising and collaboration with the Development Bank of Rwanda (BRD), the World Bank, and the Swedish International Development Agency (SIDA), to expand its operations in the country. Then in October, it signed a new strategic collaboration agreement with Tele 10 Group, which will make the solar-based TV market accessible for millions of customers.


Under the collaboration with Tele 10 Group, Ignite aims to target businesses in off-grid, underserved areas, providing businesses with an A-Z solution that includes designed-for-solar TV, solar panels, and full access to Tele 10’s broadcasts and content.


An exciting aspect of the project is the fact it enables customers in off-grid areas in Rwanda to enjoy access to satellite TV for the first time. The system and services will also be available in all of Ignite’s markets throughout Africa, through additional partnerships.


Concerning the Tele 10 Group deal, Arthur Houston, managing director of Ignite Power, said, “Seeing the impact of designed-for-solar solutions on our customers' lives, we work constantly to expand our offerings, and to provide customers everywhere with sustainable, tangible, and affordable solutions. This new offering will bring the company’s activities to hotels, restaurants and cafes located in off-grid areas throughout the country. We are proud to collaborate with a market leader as Tele 10 Group, which shares our vision to connect people everywhere.”


Lacking


The importance of the plan cannot be overemphasized for a country regarded as an African development success story. Rwanda has registered an average economic growth rate of more than 7% per year since 2000. Between 2010 and 2011, Rwanda’s GDP reached a record 8.2% and the poverty rate dropped by 57% with over a million Rwandans pulled out of poverty.


But while this growth has been maintained, the country’s overall development is largely impeded by a lack of electricity. A World Energy Outlook 2014 report revealed that only 17% of Rwanda’s 10 million people had access to grid electricity in 2014, with a 5% electrification rate in rural areas.


Rwanda needs adequate electricity to power its economic growth. The vast majority of the population already has access to mobile phones, while banking transactions are facilitated through mobile services and urban transport is facilitated by car and motorcycle services controlled via mobile applications. All these require electricity.


Furthermore, the “One laptop per child” initiative launched in June 2008, and which saw over 600,000 laptops distributed to school pupils, faced the challenge of a lack of electricity coverage, especially in rural areas for charging the laptops. Thus Rwanda, like most Africa countries, had to resort to renewable energy to solve its power needs.



Affordability challenges


In 2013, U.K.-based Azuri Technologies, which provides pay-as-you-go solar PV home lighting products to customers in off-grid areas of sub-Saharan Africa, entered the Rwandan market with support from the United States Agency for International Development (USAID), with the objective of increasing access to affordable electricity through solar.


Azuri introduced a product called Indigo Duo, where customers pay an upfront installation fee of RWF 6,600 (around US$8.80), with the rest of the payments being made in regular 28-day installments of RWF 3,500 (around US$4.70).


However, a 2016 research report by Simon Collings and Anicet Munyehirwe, titled ‘Pay-as-you-go solar PV in Rwanda: evidence of benefits to users and issues of affordability’ and published in Field Actions Science Reports, revealed affordability challenges for many households in the country, as many Rwandans cannot afford even the low rates charged by Azuri.


This means that, despite the number of people without access to electricity in the country dropping drastically in recent years, thanks mainly to solar energy, more than five million Rwandans still lack access to electricity in their homes.


This is the challenge Ignite Power is trying to address through its Affordability Plan. Since it commenced operations in Rwanda in 2016, Ignite Power has connected hundreds of thousands of people to power while creating thousands of jobs and reportedly breaking affordability records in Africa.


The company previously lowered prices from $15 to $6 for a basic solar home system. The latest Affordability Plan that brings solar to homes for less than $1 is believed to be the cheapest so far in Africa.

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