Small and medium-sized energy enterprises are often best placed to adopt and tailor solutions to a local context. They understand the pitfalls, and have a deeper understanding of what their community’s needs might be – not just when it comes to energy but also in terms of financing options. And they are potentially better trusted by communities to have their interests at heart. These three schemes were recognised by the prestigious Ashden Awards for their transformative potential.
Hydro to healthcare in Indonesia
IBEKA develops community-managed hydro schemes, bringing the benefits of electricity for the first time to off-grid areas, and enabling grid-connected communities to earn an income from selling into the grid. IBEKA works in partnership with communities, successfully helping them develop the skills to manage and maintain off-grid hydro schemes long term. Maintenance and spare parts are sourced from near the community so that as much expertise as possible is localised and costs are kept low. Operators and construction workers are trained on the job, and training is provided to the whole community.
Surplus revenue from the sale of electricity goes into a fund that communities then decide how to prioritise. At IBEKA’s Cinta Mekar power plant, this fund was first used to enable all households to connect to the grid, as the poorest households had not been able to afford the connection fee of around $200. The next priorities
were to improve healthcare for pregnant women and young children, repair the village roads, pipe drinking water to all homes and provide low-interest loans for setting up small businesses.
IBEKA also lobbied to change the law so that the national supplier must buy electricity from small grid-connected hydro schemes. This has enabled new schemes to be built under community management and allows existing off-grid schemes to be connected retrospectively if the grid expands.
Solar for dairy in Costa Rica
In Costa Rica, an equally pioneering organisation is taking a different tack to boost the prosperity of the communities it services. The country has a thriving dairy sector, and much of its milk comes from family-owned farms. Itself a family-run business, Enertiva spotted an opportunity to help dairy farmers increase their incomes while at the same time reducing fossil fuel use. Enertiva developed specially designed solar water heaters that supply hot water for washing milking equipment and milk tanks, teaming up with the milk-purchasing co-operative Dos Pinos, which lends the farmers the money to buy them.
Farmers who previously used electricity or gas to heat water save around $1,400 per year, and can pay back their loan within one year. Spare hot water is used for mixing calf food and extra cleaning. Farmers who make their own cheese and don’t have to meet such strict milk standards benefit from producing better-quality products.
The basic business model of Enertiva is designing, selling and installing solar technology: the organisation only promotes solar systems that it can show to have a return on investment of less than seven years. To achieve this, it focuses on eliminating the barriers to making the technology cost-effective in a particular setting.
In this instance, Enertiva proposed a solar loan scheme, which the co-operative Dos Pinos took up as part of its environmental programme. The co-operative provides loans to its farmers to buy solar water heaters at an annual interest rate of 14%, and promotes the loan programme through its network of agricultural supply stores and advisors. Having covered about 10% of the dairy sector in Costa Rica, Enertiva has now started installations in Guatemala and Panama.
Hill farming energy in Wales
Farmers in South Wales are also embracing the innovation demonstrated by the winner of the 2015 Ashden Award for Community Energy, TGV Hydro. Wholly owned by community interest company (CIC) The Green Valleys, TGV Hydro has developed micro-hydro projects for private and community ownership, working closely with the local authority to create a model that could be replicated elsewhere. The renewable electricity generated is used on site, and any surplus is sold into the national grid, so farmers and communities can diversify their incomes.
For Welsh hill farmer Howell Williams, the hydro turbine powered by the stream on his land generates 15kW of electricity at peak times and earns him £10,000–15,000 a year. The scheme cost about £50,000 to construct, so within five years he’d recouped his initial outlay, and the annual revenue is reassuring at a time when making a living from farming is proving a struggle.
TGV Hydro’s work has made micro-hydro financially viable for a much wider range of potential sites in Wales by reducing costs and smoothing the path to gaining all of the required permissions and licences. The team estimates that its work is supporting at least 16 jobs in the local area, and profits are used by owner The Green Valleys CIC to fund its work, including mentoring community energy groups that are planning to build micro-hydro projects.
Chhavi Sharma is International Programme Manager and Mike Pepler is UK Awards Manager, Ashden. Ashden champions and supports sustainable energy leaders to encourage the growth of the sector and accelerate the transition to a low-carbon world. www.ashden.org
Ashden is a Futures Centre partner.