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Mobile phone payments revolutionise energy access in Kenya

by Futures Centre, Jun 30
2 minutes read

A Nairobi-based company is offering affordable energy to rural off-grid communities by enabling customers to pre-pay for power with their mobile phones.

SteamaCo

SteamaCo installs hardware that facilitates remote owners’ monitoring of solar microgrids via cloud-based software. Customers then buy electricity through a pay-as-you-go service using their mobile phones, and all data is sent by SMS so there is no need for internet access, meaning that energy can be bought in the most rural or remote areas. SteamaCo uses M-Pesa a hugely popular mobile phone money platform, through which around 25% of Kenya’s GDP flows. According to the World Bank, 68% of Kenyans have no access to grid power, while around 95% are mobile phone users. “As soon as the payment is made, power comes on and the only thing one needs to do is flip the switch and enjoy the electricity,” said SteamaCo co-founder Sam Duby: “No contracts, together with pre-payments for small units of airtime, revolutionized access to mobile telephone services in Africa. We believe the same will be true for energy services.”

Customers typically pay a connection fee of around US$10 and then US$2-4 per kWh of energy used. Although this is high compared to per-unit of grid electricity, it is comparable to costs of pay-as-you-go solar-home-systems and cheaper than kerosene. Furthermore, some remote areas cannot access the national grid and the connection is around US$700, far more than many can afford.
SteamaCo is now supporting 30 grids (26 in Kenya and four in Tanzania, Benin and Nepal) that provide a total of 120kW of power to 1,000 homes and small businesses and it plans to expand further in Kenya and beyond. It recently won the prestigious Ashden International Gold Award and Business Innovation Award.

Image: Micro-grids bring electricity to rural Kenya

Image credit: SteamaCo

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