Sunlabob Renewable Energy Ltd.

• Only 48% of people in Laos have access to the electricity grid.
• The average annual consumption per capita is 135 kWh, while the global average is 2,490 kWh.
• Laos is also one of the poorest countries in the world, and 74% of the population lives on less than $2 per day.
• The government has not been successful in delivering lighting to most rural communities and it is challenging developing systems that can offer lighting at a price people can afford.

• Poor off-grid communities in Laos and other developing countries

• For the past 10 years, Sunlabob has been working to offer sustainable off-grid lighting to poor rural Laotians at a price equivalent to the $4-6/month they currently pay for kerosene.
• To deliver off-grid power to poor villages , Sunlabob has designed an innovative  model in which villagers buy light as a service through community-owned lanterns which are charged every few days from a village-based solar station rented from Sunlabob and operated by a village franchisee.  Systems receive up-front subsidization but are designed to be sustainable in the long-term without further funding.
• Sunlabob also offers a range of other energy products and consulting services to other clients in Laos and around the world.

• Sale of lanterns
• Rental of charging systems
• Sale of recharges
• International consulting and product sales

In addition to its rural electrification system, Sunlabob offers a range of products such as solar PV systems, solar water heaters, lighting systems, water, wind and biogas power products, hybrid systems, e-transport, energy audits, and power conversion and backup systems. See here.

• 2000: Sunlabob founded
• 2006: Developed Solar Lantern Rental System concept
• 2009: Expanded model to Uganda and Afghanistan
• 2010: Establishment of Sunlabob International Pte Ltd (Singapore branch)
• 2011: Development of Sunlabob Pico Solar Lantern Rental System (Improved lanterns system)

• Sunlabob is now developing village grids powered by hybrid renewable energies and is researching solar pumping and biofuel power sources.
• Sunlabob is expanding its activities into more countries and further within Laos.

• Trained over 200 technicians
• Installed more than 7,500 solar systems in over 500 villages and locations in Laos, also expanding to Cambodia
• Developed affordable solar lantern rental system for Laos that has since expanded into Uganda and Afghanistan.
• Launched the non-profit Lao Institute for Renewable Energy (LIRE) in partnership with other organizations to research and test renewable energy technologies.

• Sunlabob has received a $4m loan investment from Triodos Bank and FMO Development Finance Company, and is currently seeking equity investments.

• Sunlabob experimented with a number of different distribution models before arriving at its current structure for delivery to small rural villages.
• Key from the start was the need for a village based franchisee from whom customers would buy or rent the energy products.
  • This both established customer trust since people associated the Sunlabob brand with someone from their community, and provided someone at village level who was responsible for and capable of maintaining systems over time.
• Sunlabob first tried selling 20-100W fixed solar home systems, but because many people could not afford to buy solar systems up-front, and credit was hard to come by, Sunlabob tried a rental scheme, with franchisees collecting a $4 monthly fee from customers and taking care of maintenance.
  • This proved too expensive for Sunlabob, as franchisees had to go to customers’ houses to collect unpaid rents and perform maintenance, and when customers tried to get out of paying, franchisees had very little leverage.
• Sunlabob’s current system creatively addresses these problems:
  • First, Sunlabob has shifted from fixed solar home systems to 1Watt portable LED lanterns.
    • These require less maintenance and customers have to go to the franchisee rather than the other way around.
  • Second, rather than making the systems self-sufficient electricity-wise, the lanterns need to be charged every 10 hours (3 days or so of use) at a central charging station.  Each station handles 50 lanterns.
    • This means that if customers don’t pay, their light gets cut off, incentivizing them to go to the franchisee rather than forcing the franchisee to track them down.
  • The central charging station is owned by Sunlabob and maintained by the franchisee and the lanterns are sold to a Village Energy Committee, which rents them to the villagers, so Sunlabob and the franchisee are only responsible for the central charging station.
• Sunlabob’s lanterns contain microchips which count the number of hours used, which not only allows them to cut off after 10 hours of use, but also let Sunlabob track the total number of hours used by all lanterns, which let them keep track of carbon saved.

• Customers can charge their lanterns at a price equivalent to the cost of kerosene, $4-6/month.
• The money is split between the franchisee technician, Sunlabob, and a village fund used for long-term maintenance.
• Sunlabob believes that while the ongoing cost of recharging is affordable to customers, the upfront cost of the lanterns is not, and that the initial sale of the lanterns should be subsidized by the government or donors, in a public private partnership where the public sector is responsible for initial investment and the private sector is responsible for ongoing service delivery.

• Sunlabob has received a $4m loan investment from Triodos Bank and FMO Development Finance Company.
• Sunlabob’s rural electrification program has required a great deal of experimentation, most of which has not been profitable.  As it has worked to develop a model that covers its costs, it has self-subsidized through its sale of other products and consulting services to higher-end customers.
• Sunlabob believes that it would be very difficult to make rural electrification for customers at the bottom of the pyramid sustainable without any philanthropic or public funds whatsoever, but believes that its private enterprise approach can make public funds go much farther and deliver much stronger results.

• Sunlabob’s rural installations are often initially financed by donors, but designed to be self-sustaining thereafter. Sunlabob believes that entities like the government and the World Bank are much better at offering initial capital and subsidies than at long term service delivery, because their salaried employees are less motivated than profit-based private franchisees.
• When Sunlabob was running its solar home system rental program, it received direct competition from the World Bank, which offered a rent-to-own system for $1/month (vs. Sunlabob’s $4).
  • However, in addition to being tax exempted and subsidized, the program kept rental costs low by using lower quality materials and leaving customers responsible for maintenance, and in the long run over 65% of systems broke down with no way for villagers to repair them or find parts.
• Laos has highly subsidized electrical tariffs in on-grid areas, which distorts the market and makes off-grid customers less willing to pay sustainable rates for power.

• Solar Water Heaters
• Solar Water Pumps
• Solar Water Purification Systems
• Grid Connected Solar Systems
• Decentralized Wastewater Systems
• Solar Home Systems
• Solar Cooling Systems
• Hybrid Village Grids
• Hydro Village Grids
• Solar Village Grids
• Wind Village Grids
• Backup Systems
• LED Lights & Streetlights

• Sunlabob website: http://www.sunlabob.com/
• Ashden Awards Profile
• Enterprise Challenge Fund case study
• Facebook Profile
• UNEP Press Release
• Alliance for Rural Electrification Interview
• UNEP Sasakawa prize profile
• UNEP Sasakawa Prize article