ONergy: Energy Access For BoP

onergy

Let there be light!! –Genesis 1:3

Even God, I bet, underestimated the task at hand. Even now, 1.2 billion people around the world live in dark. Most of this population resides in the developing and underdeveloped countries. India alone accounts for 25% of the total population without access to electricity.

50639724Poverty and lack of access to energy ensue a vicious cycle, one only augmenting the other. Access to energy not only affects the economic activity of a region, but it also inadvertently impacts its social development indicators. Lack of sufficient energy, particularly electricity, renders public infrastructure such as health centres and cold storage facilities dysfunctional. Socio-economic development of poor communities around the world is thus constrained by lack of access to energy.

It is with the resolve of breaking this cycle; ONergy was founded by the trio- Piyush Jaju, Vinay Jaju and Ekta Kothari. They started their journey in 2009, with the vision of providing access to clean energy to create a sustainable and equitable India. Since then, it has been active in the states of Jharkand, Odisha and West Bengal. It meets the varying energy needs of its communities by providing a suite of products- solar lanterns (0.5-10 Watt), home lighting systems (20-200 Watt), solar inverter systems (KW level), solar water heating systems and even solar micro-grids

In its regions of operation, ONergy is putting up a last mile distribution network by establishing renewable energy centres in rural areas. Equipped with a couple of technicians and sales representatives, each centre services a radius of around 100 km. These centres manage sales, provide quality technical assistance and regular maintenance of products to its customers. Such strong focus on quality customer service helps build both the much needed trust in solar products and company loyalty. They also train village level women entrepreneurs who act as extensions of the rural energy centre. These entrepreneurs aid in product distribution and provision of technical assistance to the end customers and get paid by the customers directly for each such service. Besides, ONergy also leverages the existing network of grassroots NGOs to generate awareness about their products and create demand in the region. This allows them to offset a part of its customer acquisition costs. These costs, often, substantially increase the operating expenditure of organisations serving at the bottom of the pyramid.

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Additionally, ONergy also helps arrange product finance for its customers. Most of its products are capital intensive with majority of their target customers unable to pay the entire amount upfront. Therefore, they have tied up with local financial institutions to provide credit to its customers. Currently they have a network of 20 such partners that provide product finance for their customers. Thus, ONergy is not just concentrating on pushing its products into the market but is making sure that those who need them the most are able to afford them and use them most effectively.

Such a carefully crafted business model has helped ONergy to reach out to about 2 lakh users via 10 rural energy centres. But those remarkable figures are just not enough for a company with a bold vision of creating a sustainable and equitable India through energy access. Over the last 5 years of its operations, they have trained over 2000 micro-entrepreneurs and its products will mitigate 700 tonnes of CO2 over a 10 year period. In addition each household saves anywhere between Rs 200-600 per month by switching from kerosene to ONergy’s clean energy products. This is the kind of multi-dimensional impact that ONergy has been able to create on the ground through its operations. A social investment score of $7.8 on every dollar spent and an impact score of 12.5 of 15 awarded by Impact Investment Exchange Asia (IIX) further testifies this fact.

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But in order to be able to achieve what they have, the ONergy team has had to overcome a lot of challenges. Access to product finance for its poor customers being one of the most critical roadblock of them all. High upfront costs of the solar products acts as a major deterrent for the cash starved customers. Reluctance of financial institutions to lend to those at the bottom of the pyramid does not help the cause either. Moreover, the delays and red-tape involved in getting the promised subsidy on solar products makes the matters worse for organizations operating in this space. In addition, companies such as ONergy which are exploring the micro-grid space face a unique problem. Besides putting up the renewable energy power plant, these companies also have to setup the entire local transmission & distribution infrastructure which not only raises the cost of such projects but is also cumbersome and time consuming.

Despite such challenges, the manner in which ONergy has been able to grow while truly maintaining the triple bottom line – people, profit and planet is truly commendable. It has been able to gather funding to the tune of Rs 3.5 crores from some of the best people in the business including CIIE IIM Ahemdabad and Swedish International Development Agency (SIDA). And, Sudipta Dawn, the General Manager for Operations at ONergy, is hopeful of rapidly scaling the organisation and reaching out to 1 million people by 2016 and further impacting 10 million lives by 2022. It is when companies like ONergy succeed in their mission only then there will be light in the darkest corners of our country.

Discover similar impactful social enterprises on www.impactpreneurs.com 

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