Pay-As-You-Go is increasingly being used as a mechanism for financing the purchase of small-scale RE technologies in West Africa, as well as facilitating payment for ongoing energy service by an energy producer or utility in ECOWAS developing countries. In Senegal, some pioneer projects have started offering consumers the ability to pre-pay for their energy, mitigating one of the main obstacles in providing solar technology to people from rural areas: their inability to meet stand-alone product costs, or to pay for service on an ongoing basis from either products or larger network-based solutions such as mini-grids.
Through the regional componentes of the IRENA & ECOWAS Renewable Energy Entrepeneurship Support Facility, pioneer experiences have set-up in Senegal to increase the access to electricity for the people in rural areas.
One project is Toba Solar Rama. Since 2015, this company has been implementing a PAYG solar project in Senegal. The company provides about 500 low-income rural families with lighting, mobile phones charger facility and solar TV. When the customers pay off their solar system, they become owner and the system is unlocked forever. The project plans to expand its activities in other regions in Senegal and neighbor areas, and it seeks to create PAYG Franchisees among Rural Entrepreneurs in order to provide energy service to 8000 customers in 2 years.
These promoters are facing some challenges that include:
- Training needs on franchising models
- Training needs for operations manager and agents
- How to properly analyze impact statistics and data for their portfolio
- How to track funders using different avenues and techniques
- Training needs on strategies and deliveries required to negotiate a loan (equity, debt, grants, etc)
Sosai Renewable Energies represents one more example in the ECOWAS region. It is a Registered Private Limited Liability Company operating in Nigeria since 2010, when the project was set-up to help facing Nigeria's energy poverty. Indeed. the country experiences a remarkable paradox: the abundance of energy resources and widespread energy poverty, situation in which 40% of the population has access to the country's grid electricity and 60% connected to the grid have about 70% power outage. Thanks to the activities carried out by the IRENA & ECOWAS RE Entrepeneurship Support Facility, the project gained the necessary knowledge and capacities to start installing Solar Kiosks to serve as Independent Electrical Contractors (IEC's) and being capable to install a set of mini grids.