The remote village of Monomoni, Kenya, is too far from cities and too sparsely populated to be part of the national grid. Now, however, it’s possible for a family of cow herders or a small business to buy prepaid solar power through a mobile phone.
Powerhive, a startup that builds solar, mobile-connected microgrids–small utilities that are usually built to power around 200 homes–started testing their system in Monomoni in 2012, and began expanding to 100 more rural villages around the country last year, along with others in the rest of the underpowered world. The company raised $11 million in December, and just raised another $20 million to expand even more.
It’s one part of a quickly-growing industry that many believe may be the best way to bring electricity to the 1.3 billion people around the world who still don’t have it.
Having access to around-the-clock power can sometimes actually be cheaper than what the poorest people in the world spend on energy now–which is often more than people pay in the developed world. In rural Bangladesh, electricity costs an average of $2.30 a kilowatt hour; in Western Europe, it costs almost eight times less. In unelectrified parts of Kenya, keeping a handful of small electronics charged or a light burning is an ongoing, expensive job.
“In Kenya, people burn kerosene, and they’ll typically buy two to four batteries every two weeks to run a radio,” says Powerhive CEO Chris Hornor. “They’ll walk miles to charge a cell phone. They’re paying $6-7 a month on kerosene, candles, batteries and cell phone charging today in the places we work. We can deliver 24/7 A/C electricity, like you and I have in our house, for the same or less money. It’s just a much better deal for them.”
Microgrids are also cheaper than trying to install individual solar systems at every home or business. “If you have one shared system that’s larger, you have the ability for each individual customer to have more options,” he says. “If you can imagine if you’re at your house in California, and you wanted to plug in a a sewing machine and refrigerator and all this other stuff, if you wanted to have a solar system that would actually run all of that, that would be a pretty big system. And batteries on top of that would be really expensive.”
Other startups, like the Kenya-based M-KOPA, are focused on building home solar systems in remote areas, and letting customers pay for it slowly, in tiny increments. But by spreading power and cost over a couple of hundred homes, microgrid systems can be cheaper and a safer bet for investors, so the systems can scale more quickly. The microgrids also provide enough power that it’s possible to run bigger equipment; businesses can start to use more machinery and grow.
“The key for economic development is to create opportunities to make more money,” says Hornor. “That kind of goes without saying and is obvious, but that’s easier said than done when you’re talking about a place that is mainly farming and still has pretty low income.”
The microgrids are wired with Powerhive’s own technology, which allows it to remotely monitor everyone’s electricity use and discover any problems that need to be fixed. Once someone makes a payment on the pay-as-you-go system by mobile phone, they get power immediately. The system sends an SMS alert when someone’s balance is low.
The systems could work in communities around the world, including places that already have some electricity access, but can’t get it all the time. In parts of the Philippines, for example, that get around 2 to 3 hours of electricity access a day now, the company can offer solar power all day long.
Around the world, more than a billion people–mainly in rural areas–still lack access to electricity and even more only have spotty power. But thanks to a convergence of factors–cheap solar panels, cheaper batteries from the electric car industry, efficient appliances like LED lights, and the ubiquity of mobile phones to manage payment–solar microgrids like Powerhive’s could become common. Hornor thinks that the whole world will have access to reliable power within 10 or 20 years.
If the developing world built that power using traditional fossil fuel-powered grids, it would emit enough carbon to fry the planet, as David Roberts puts it. But it’s now possible for the poorest communities to leapfrog over some of the developed world’s most polluting technology and go directly from no electricity to clean electricity. Ultimately, that’s the company’s goal.
“To the extent that there are smart entrepreneurs or developers that are interested in being part of the fight against climate change, I think now’s the time to take the risk to start looking at alternative ways of creating business models or generating new types of systems,” Hornor says. “We need to bring it on.”