Increasing access to energy services in rural areas - REEEP ...

More documents

Recommendations

Info

SUSTAINABLE ENERGY REGULATION AND POLICYMAKING TRAINING MANUAL page 10.86 Women and children wait to have their maize ground by a diesel hammer mill. The shed is equipped with PV – powered lighting to allow grinding after dark. Source: Department of Energy, Zambia • Provide means for the ESCOs to expand their business through the purchasing of more PV systems to enhance their financial viability; • Strengthen the capacity of the ESCOs to operate independently in the Zambian solar market, particularly in the area of equipment purchases from PV suppliers. During phase III, the issues of capital repayment and ownership transfer were resolved through an agreement between Government and ESCOs governing the repayment of the start-up loans. The project further developed a framework for administering new credit to enable ESCOs to expand their operations and move closer to being self-sustaining with minimum government assistance. The new credit also provides for formation of new ESCOs who would also receive training in technical and managerial skills. 3. CONCLUSION • The project succeeded in setting up four ESCOs in the eastern province of Zambia. These companies have generated significant interest in PV systems for rural electrification in the area. Each ESCO has a long waiting list of households, businesses and institutions that are interested in becoming clients of the ESCOs. • It is evident from the Zambia PV-ESCOs pilot project that for the PV-ESCOs concept in rural areas to succeed, a special funding facility to provide sufficient start-up capital to ESCOs on favorable terms must be established. It is
MODULE 10: INCREASING ACCESS TO ENERGY SERVICES IN RURAL AREAS page 10.87 not viable for ESCOs to obtain such loans on standard commercial bank terms because of the high start-up capital required to procure PV systems. In addition the new ESCOs need to be equipped with both managerial and technical skills. This capacity would enable them manage their businesses profitably, be able to repay old loans and qualify for fresh loans to expand. In some cases, it might be necessary to introduce smart subsidies especially during the startup period. • The viability of ESCOs would greatly depend on the number of customers that they could enroll in order to reach economies of scale, service their start-up loans and remain profitable. As of March 2006, the ESCOs had not yet managed to attract enough customers to reach economies of scale or profitability to make them self-sustaining. This was due to lack of additional capital to procure more PV units to service those potential customers already on the waiting lists. • The experience gained from this project has provided valuable information on how the rural population can benefit from access to energy services and in the necessary framework required to ensure that the PV-ESCO concept is successful. • The ESCOs are gaining experience on how to manage a business profitably. ESCO clients are very happy with the energy service that they are receiving, and it is helping them to improve their lifestyles by allowing more working hours and providing business opportunities. • The next stage should be the extension of the PV-ESCOs concept to a nationalscale. This is possible provided a framework to fund new ESCOs and expand the existing ones to profitable levels is put in place. 4. REFERENCES Zambia National Energy Policy 1994 Proposed Zambia National Energy Policy 2005 Stockholm Environment Institute, “Private Energy Services in Rural Areas – Experiences from the Zambia PV ESCOs Project”, prepared for the Department of Energy, Ministry of Energy and Water Development, Government of the Republic of Zambia.
Page 1:
Module 10 Increasing access to ener
Page 4 and 5:
SUSTAINABLE ENERGY REGULATION AND P
Page 6 and 7:
Page 8 and 9:
Page 11 and 12:
MODULE 10: INCREASING ACCESS TO ENE
Page 13 and 14:
Page 15 and 16:
Page 17 and 18:
Page 19 and 20:
Page 21 and 22:
Page 23 and 24:
Page 25 and 26:
Page 27 and 28:
Page 29 and 30:
Page 31 and 32:
Page 33 and 34:
Page 35 and 36:
Page 37 and 38:
Page 39 and 40: MODULE 10: INCREASING ACCESS TO ENE
Page 49: MODULE 10: INCREASING ACCESS TO ENE
Page 52 and 53: SUSTAINABLE ENERGY REGULATION AND P
show all

Increasing access to energy services in rural areas - REEEP ...

Create successful ePaper yourself

Delete template?

Save as template?