IRENA encourages business-driven solutions to promote rural electrification

06 December 2011| Articles

On November 30th and December 1st, 2011, IRENA’s Policy Advice and Capacity Building Directorate hosted a two-day practitioners’ meeting at the prestigious Indian Institute of Management in Bangalore, India. Over 50 participants from more than 20 countries convened to explore how best to enable local renewable energy entrepreneurship.

The global market potential for providing energy services to consumers at the bottom of the pyramid accounts for over USD 430 billion. This figure can no longer be ignored. Many small and medium-sized businesses now specifically target this market and are proving to be successful in providing renewable energy solutions to areas previously cut off from electricity.

Workshop participants hailed from diverse backgrounds, including social enterprises (such as SELCO in India, Emprenda in Argentina, and Wilkin Solar in Ghana), development agencies, local financial institutions and government policy makers. The workshop provided a platform for an exchange of viewpoints on barriers hindering the deployment of renewable energy technologies in rural areas in developing countries. Discussions also revolved around innovative approaches, conducive policies and appropriate institutional frameworks for creating viable local renewable energy markets.

Participants highlighted that there still remains a long way to go.  In many countries small renewable energy businesses continue to compete with government subsidies for grid extension. Current grant-based support schemes do not encourage the development of sustainable markets. Other barriers pointed out by entrepreneurs include the scarcity of appropriate market data,   numerous bureaucratic hurdles to obtaining support, and the shortage of skills and capacity of rural populations. Attendees agreed that successful business models must be scaled up, while simultaneously considering the relevant resources and capacity needs along each stage of the value chain, the technology specific requirements for the development of markets as well as solutions provided by local governments and financial institutions. 

IRENA recognizes the potential of small and growing business driven solutions to tackle energy poverty. The workshop provided an important platform for information sharing between entrepreneurs, policy makers and other stakeholders. “It is important for us to listen to the practitioners’ point of view in order to convey their specific needs to IRENA member states”, says Rabia Ferroukhi, Senior Programme Officer – Policy Advice at IRENA. “The meeting identified a number of practical recommendations on how to overcome barriers through enabling policy frameworks, which can hopefully be replicated in other countries.”

A summary of the major findings of the workshop will be made available soon.

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For further information contact:
Rabia Ferroukhi, Senior Programme Officer – Policy Advice, IRENA