For several years now, the sale of solar home systems in developing countries has been booming through pay-as-you-go technology (PAYG).
This supports lending by the possibility to turn off the power when the installment is not paid. More and more providers with different techniques are emerging. PAYG technology is particularly popular in East Africa today.
Who invented pay-as-you-go?
The PAYG technology was invented in Morocco. The company Afrisol, founded by the German Jürgen Gehr, has been striving, since its inception, especially for those households which were not connected to the electricity network.
Jürgen Gehr soon realized that the high initial costs hindered the spread of off-grid solar energy. On the other hand, the households had monthly smaller amounts to pay their current energy needs. His solution: in the year 2000, he developed a solar home system, whose charger was automatically switched off when the customer did not pay. In addition, the charge controller had a data logger, which allowed to monitor and control the user behavior.
The solar home system from Afrisol, the so-called “SunBox” supplied 4 energy saving lamps (LEDs were not yet operational) and a TV with electricity.
Download here more technical information about the SunBox of AfriSol.
With his idea, however, Jürgen Gehr encountered a lot of skepticism: the provision of small loans to rural households by an installation company seemed to be too unusual. Especially for investors who could have helped the idea to breakthrough.
The further spread
In 2004, the Stiftung Solarenergie – Solar Energy Foundation implemented the SunBox from Afrisol with integrated PAYG technology for the first time in East Africa: in Ethiopia. In cooperation with its own installation company (SunTransfer), a network of 15 rural solar centers was set up in the following years, each with trained technicians for maintenance and service. On behalf of the Stiftung Solarenergie – Solar Energy Foundation, the solar technicians sold solar home systems by means of loans to Ethiopian households. By 2012, more than 10,000 solar home systems were thus sold and the PAYG technology was constantly being further developed.
It was the beginning of the PAYG boom in East Africa. Later, SunTransfer transferred the successful model to Kenya. Shortly afterwards, today’s leading PAYG companies emerged: Mobisol, Bboxx or M-Kopa. Their merit is to have made the sale by means of consumer loans also interesting for investors in Europe and the USA on a larger scale.