Market Development of PAYGO - Revision history

Johanna at 13:35, 16 June 2020

2020-06-16T13:35:51Z

Johanna: /* Further Information */

2018-09-19T14:45:29Z

‎Further Information

Johanna at 14:44, 19 September 2018

2018-09-19T14:44:20Z

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Johanna: /* Less Government structures */

2018-02-02T15:41:10Z

‎Less Government structures

Johanna: /* Further Information */

2018-02-02T15:39:22Z

‎Further Information

Johanna: /* Further Information */

2017-08-18T10:02:19Z

‎Further Information

Johanna at 13:01, 17 August 2017

2017-08-17T13:01:44Z

Johanna at 12:56, 17 August 2017

2017-08-17T12:56:32Z

Johanna at 12:55, 17 August 2017

2017-08-17T12:55:04Z

Johanna at 12:47, 17 August 2017

2017-08-17T12:47:35Z

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 *Insuring capacity building and retention among a network of sales and after-sales agents can be challenging and strongly impactful on profitability, as is arbitrage between payroll and commission-based staff.<ref>19.09.2018. Thibaut Lesueur, Co-Founder and Chief Marketing Officer at Solaris Offgrid: On the path to profitable solar Paygo distribution? https://www.sun-connect-news.org/articles/business/details/on-the-path-to-profitable-solar-paygo-distribution/</ref>
+<br/>
 = Market Outlook for PAYGO =
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 <br/>
 = Further Information<br/> =
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 *19.09.2018. Thibaut Lesueur, Co-Founder and Chief Marketing Officer at Solaris Offgrid: [https://www.sun-connect-news.org/articles/business/details/on-the-path-to-profitable-solar-paygo-distribution/ On the path to profitable solar Paygo distribution?]
 = References =
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 <references />
 [[Category:Financing_and_Funding]]

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 <br/>
 = Further Information<br/> =
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 *Winiecki, Jacob, and Kabir Kumar. ‘Access to Energy via Digital Finance: Overview of Models and Prospects for Innovation’. ''Consultative Group to Assist the Poor (CGAP), Washington, DC, USA'', '''2014'''. [http://www.fgda.org/dati/ContentManager/files/Documenti_microfinanza/Access-to-Energy-via-Digital-Finance.pdf Link].
 *2018 [https://sun-connect-news.org/fileadmin/DATEIEN/Dateien/New/2018_Off_Grid_Solar_Market_Trends_Report_Full.pdf Off-Grid Solar Market Trends Report (GOGLA)]
+*12.09.2018. Harald Schützeichel: [https://www.sun-connect-news.org/articles/business/details/why-africas-payg-bubble-heated-up-by-investors-will-burst/ Why Africa's PAYG bubble, heated up by investors, will burst]
-.09.2018. Harald Schützeichel: [https://www.sun-connect-news.org/articles/business/details/why-africas-payg-bubble-heated-up-by-investors-will-burst/ Why Africa's PAYG bubble, heated up by investors, will burst]
+*19.09.2018. Thibaut Lesueur, Co-Founder and Chief Marketing Officer at Solaris Offgrid: [https://www.sun-connect-news.org/articles/business/details/on-the-path-to-profitable-solar-paygo-distribution/ On the path to profitable solar Paygo distribution?]
 = References =

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 For years, PAYGO companies used to be vertical integrated, excluding financial intermediaries. This changes now, with synergistic partnerships that disaggregate the value chain (e.g. Companies like Angaza provide PAYGO hardware and portfolio management software to potential financiers). So far, MFI mostly stayed out of PAYGO. However, they are better equipped to finance PAYGO business models: they have more local currency and less foreign exchange risk. They also have an existing customer base and loan distribution network that they could use to sell PAYGO products (and other financial products). Specialisation might bring down costs along the value chain.<ref name="Daniel Waldron, ‘Solar Energy: A New Frontier for Microfinance’, CGAP, 17 April 2017, http://www.cgap.org/blog/solar-energy-new-frontier-microfinance.">Daniel Waldron, ‘Solar Energy: A New Frontier for Microfinance’, CGAP, 17 April 2017, http://www.cgap.org/blog/solar-energy-new-frontier-microfinance.</ref><br/>
 === Less Government structures<br/> ===
 PAYGO companies can perform a similar, critical role as public players used to in the past. For example, the government owned company Infrastructure Development Company Limited (IDCOL) in Bangladesh: with their one-stop-shop role, they managed successfully to channel financing for SHS.<ref name="Sanyal, Sanjoy, Ariel C. Pinchot, Jeffrey Prins, and Feli Visco. ‘Stimulating Pay-As-You-Go Energy Access in Kenya and Tanzania: The Role of Development Finance’. World Resources Institute, 2016. http://www.wri.org/sites/default/files/Stimulating_Pay-As-You-Go_Energy_Access_in_Kenya_and_Tanzania_The_Role_of_Development_Finance.pdf.">Sanyal, Sanjoy, Ariel C. Pinchot, Jeffrey Prins, and Feli Visco. ‘Stimulating Pay-As-You-Go Energy Access in Kenya and Tanzania: The Role of Development Finance’. World Resources Institute, 2016. http://www.wri.org/sites/default/files/Stimulating_Pay-As-You-Go_Energy_Access_in_Kenya_and_Tanzania_The_Role_of_Development_Finance.pdf.</ref> As PAYGO companies are able to occupy this one-stop-shop role, they might be able to increase the financing for SHS even further. If more private PAYGO companies take over such roles, the efficiency and effectiveness of the funding process will increase.<br/>
 == Hampering Factors of PAYGO market development<br/> ==

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 This article depicts the market overview with quickly summarising the history and the current market stage of PAYGO. The Market Outlook section looks at the future of PAYGO. The predictions of scenarios for 2030 do not take PAYGO separately into account. Nonetheless, market size is likely to grow. Entry barriers will fall. The PAYGO value chain is in the process of being disaggregated: vertically integrated PAYGO companies get competition by partnerships of companies that each stick to their competence (including microfinance institutions). Hampering factors for PAYGO are the lack of data and the lack of reporting standards.
 = Further Information<br/> =
-*[[:Category:Financing_and_Funding|Financing and Funding]] Portal<br/>
+*[[:Category:Financing and Funding|Financing and Funding]] Portal<br/>
-*[[Pay-as-you-go_Approaches_(PAYGO)|PAYGO: Definition and How It Works]]
+*[[Pay-as-you-go Approaches (PAYGO)|PAYGO: Definition and How It Works]]
-*[[Fee-For-Service_or_Pay-As-You-Go_Concepts_for_Photovoltaic_Systems|Fee-For-Service or PAYGO for PV systems]] including information about the major PAYGO companies
+*[[Fee-For-Service or Pay-As-You-Go Concepts for Photovoltaic Systems|Fee-For-Service or PAYGO for PV systems]] including information about the major PAYGO companies
-*[[Advantages_and_Disadvantages_of_PAYGO_Approaches|Advantages and Disadvantages of PAYGO Approaches]]<br/>
+*[[Advantages and Disadvantages of PAYGO Approaches|Advantages and Disadvantages of PAYGO Approaches]]<br/>
-*[[PAYGO_Approaches:_Overhyped_or_Justified|PAYGO Approaches: Overhyped or Justified]]
+*[[PAYGO Approaches: Overhyped or Justified|PAYGO Approaches: Overhyped or Justified]]<br/>
 *A list of relevant PAYGO companies and an in-depth explanation about PAYGO approaches: Bennu Solar Ltd. ‘PAYG Solar. Information on PAYG Enabled Solar Solutions |Bennu Solar’, 2017. [http://bennu-solar.com/pay-as-you-go-enabled-solar-solutions/#.WYGhmFFLfIV Link].
 *Lepicard, François, et Al. ‘REACHING SCALE IN ACCESS TO ENERGY: Lessons from Best Practitioners’. Hystra, '''2017'''. [https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf].

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 This article depicts the market overview with quickly summarising the history and the current market stage of PAYGO. The Market Outlook section looks at the future of PAYGO. The predictions of scenarios for 2030 do not take PAYGO separately into account. Nonetheless, market size is likely to grow. Entry barriers will fall. The PAYGO value chain is in the process of being disaggregated: vertically integrated PAYGO companies get competition by partnerships of companies that each stick to their competence (including microfinance institutions). Hampering factors for PAYGO are the lack of data and the lack of reporting standards.
 = Further Information<br/> =
-*[[:Category:Financing_and_Funding|Category:Financing and Funding]] Portal
+*[[:Category:Financing_and_Funding|Financing and Funding]] Portal<br/>
 *[[Pay-as-you-go_Approaches_(PAYGO)|PAYGO: Definition and How It Works]]
-*[[Fee-For-Service_or_Pay-As-You-Go_Concepts_for_Photovoltaic_Systems|Fee-For-Service_or_Pay-As-You-Go_Concepts_for_Photovoltaic_Systems]] including information about the major PAYGO companies
+*[[Fee-For-Service_or_Pay-As-You-Go_Concepts_for_Photovoltaic_Systems|Fee-For-Service or PAYGO for PV systems]] including information about the major PAYGO companies
-*Advantages and Disadvantages of PAYGO Approaches
+*[[Advantages_and_Disadvantages_of_PAYGO_Approaches|Advantages and Disadvantages of PAYGO Approaches]]<br/>
-*PAYGO Approaches: Overhyped or Justified
+*[[PAYGO_Approaches:_Overhyped_or_Justified|PAYGO Approaches: Overhyped or Justified]]
 *A list of relevant PAYGO companies and an in-depth explanation about PAYGO approaches: Bennu Solar Ltd. ‘PAYG Solar. Information on PAYG Enabled Solar Solutions |Bennu Solar’, 2017. [http://bennu-solar.com/pay-as-you-go-enabled-solar-solutions/#.WYGhmFFLfIV Link].
 *Lepicard, François, et Al. ‘REACHING SCALE IN ACCESS TO ENERGY: Lessons from Best Practitioners’. Hystra, '''2017'''. [https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf].
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 *Lighting Global ('''2015'''): Alstone, Peter Michael. ''Connections beyond the Margins of the Power Grid Information Technology and the Evolution of Off-Grid Solar Electricity in the Developing World''. University of California, Berkeley, 2015. [http://search.proquest.com/openview/0a39e3cd025b0300cc030729278ccf1d/1?pq-origsite=gscholar&cbl=18750&diss=y Link].
 *Winiecki, Jacob, and Kabir Kumar. ‘Access to Energy via Digital Finance: Overview of Models and Prospects for Innovation’. ''Consultative Group to Assist the Poor (CGAP), Washington, DC, USA'', '''2014'''. [http://www.fgda.org/dati/ContentManager/files/Documenti_microfinanza/Access-to-Energy-via-Digital-Finance.pdf Link].
 = References =

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 == History ==
-PAYGO has its roots in Sub-Saharan Africa (in Kenya <ref name="Sanjoy Sanyal et al., ‘Stimulating Pay-As-You-Go Energy Access in Kenya and Tanzania: The Role of Development Finance’ (World Resources Institute, 2016), http://www.wri.org/sites/default/files/Stimulating_Pay-As-You-Go_Energy_Access_in_Kenya_and_Tanzania_The_Role_of_Development_Finance.pdf.">Sanjoy Sanyal et al., ‘Stimulating Pay-As-You-Go Energy Access in Kenya and Tanzania: The Role of Development Finance’ (World Resources Institute, 2016), http://www.wri.org/sites/default/files/Stimulating_Pay-As-You-Go_Energy_Access_in_Kenya_and_Tanzania_The_Role_of_Development_Finance.pdf.</ref>) with ambitious young start-ups received support from the Power Africa initiative.<ref name="Andrew Burger, ‘Off-Grid Solar Start-Ups Pierce the ¨Heart of Darkness¨’, Microgrid Media, 8 December 2016, http://microgridmedia.com/off-grid-solar-start-ups-pierce-%c2%a8heart-darkness%c2%a8/.">Andrew Burger, ‘Off-Grid Solar Start-Ups Pierce the ¨Heart of Darkness¨’, Microgrid Media, 8 December 2016, http://microgridmedia.com/off-grid-solar-start-ups-pierce-%c2%a8heart-darkness%c2%a8/.</ref><br/>
+PAYGO has its roots in Sub-Saharan Africa (in Kenya<ref name="Sanyal, Sanjoy, Ariel C. Pinchot, Jeffrey Prins, and Feli Visco. ‘Stimulating Pay-As-You-Go Energy Access in Kenya and Tanzania: The Role of Development Finance’. World Resources Institute, 2016. http://www.wri.org/sites/default/files/Stimulating_Pay-As-You-Go_Energy_Access_in_Kenya_and_Tanzania_The_Role_of_Development_Finance.pdf.">Sanyal, Sanjoy, Ariel C. Pinchot, Jeffrey Prins, and Feli Visco. ‘Stimulating Pay-As-You-Go Energy Access in Kenya and Tanzania: The Role of Development Finance’. World Resources Institute, 2016. http://www.wri.org/sites/default/files/Stimulating_Pay-As-You-Go_Energy_Access_in_Kenya_and_Tanzania_The_Role_of_Development_Finance.pdf.</ref>) with ambitious young start-ups received support from the Power Africa initiative.<ref name="Andrew Burger, ‘Off-Grid Solar Start-Ups Pierce the ¨Heart of Darkness¨’, Microgrid Media, 8 December 2016, http://microgridmedia.com/off-grid-solar-start-ups-pierce-%c2%a8heart-darkness%c2%a8/.">Andrew Burger, ‘Off-Grid Solar Start-Ups Pierce the ¨Heart of Darkness¨’, Microgrid Media, 8 December 2016, http://microgridmedia.com/off-grid-solar-start-ups-pierce-%c2%a8heart-darkness%c2%a8/.</ref>
 *2010: First PAYGO approaches are tested in Eastern Africa.<ref name="François Lepicard et al., ‘REACHING SCALE IN ACCESS TO ENERGY: Lessons from Best Practitioners’ (Hystra, 2017), https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf.">François Lepicard et al., ‘REACHING SCALE IN ACCESS TO ENERGY: Lessons from Best Practitioners’ (Hystra, 2017), https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf.</ref><br/>
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 Geographical spreading of PAYGO companies:<ref name="François Lepicard et al., ‘REACHING SCALE IN ACCESS TO ENERGY: Lessons from Best Practitioners’ (Hystra, 2017), https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf.">François Lepicard et al., ‘REACHING SCALE IN ACCESS TO ENERGY: Lessons from Best Practitioners’ (Hystra, 2017), https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf.</ref><br/>
 *African growth is highly concentrated in Kenya, Tanzania and Ethiopia, with 78% of sales in those three countries.<ref name="Andrew Scott and Charlie Miller, ‘Accelerating Access to Electricity in Africa with Off-Grid Solar - - Research Reports and Studies - 10230.Pdf’ (Overseas Development Institute, 2016), https://www.odi.org/sites/odi.org.uk/files/odi-assets/publications-opinion-files/10230.pdf.">Andrew Scott and Charlie Miller, ‘Accelerating Access to Electricity in Africa with Off-Grid Solar - - Research Reports and Studies - 10230.Pdf’ (Overseas Development Institute, 2016), https://www.odi.org/sites/odi.org.uk/files/odi-assets/publications-opinion-files/10230.pdf.</ref>
 *East Africa has seen the emergence of the first market leaders: (e.g. M-KOPA in Kenya, Fenix in Uganda, Mobisol in Tanzania)<br/>
 *Rapid expansion of those players towards West Africa, and new players started in the region (e.g. Baobab+ in Senegal).<br/>
@@ Line 87: / Line 87: @@
 '''Figure: Global PAYGO Companies: Sales volume and age of company. Including the average size of the SHS product offered. Lepicard, Hystra, 2017.'''<br/>
-[[File:GOGLA 2017 PAYGO companies and sales volume.PNG|center|700pxpx|PAYGO companies and sales volume]]Source: Lepicard et al. 2017<ref name="François Lepicard et al., ‘REACHING SCALE IN ACCESS TO ENERGY: Lessons from Best Practitioners’ (Hystra, 2017), https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf.">François Lepicard et al., ‘REACHING SCALE IN ACCESS TO ENERGY: Lessons from Best Practitioners’ (Hystra, 2017), https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf.</ref><br/>
+[[File:GOGLA 2017 PAYGO companies and sales volume.PNG|center|700px|PAYGO companies and sales volume|alt=PAYGO companies and sales volume]]Source: Lepicard et al. 2017<ref name="François Lepicard et al., ‘REACHING SCALE IN ACCESS TO ENERGY: Lessons from Best Practitioners’ (Hystra, 2017), https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf.">François Lepicard et al., ‘REACHING SCALE IN ACCESS TO ENERGY: Lessons from Best Practitioners’ (Hystra, 2017), https://www.gogla.org/sites/default/files/recource_docs/hystra_energy_report.pdf.</ref><br/>
 This is, however, only a small glance in time. The market changes dynamically: new players emerge, others disappear, and others change their approaches.<ref name="Andrew Scott and Charlie Miller, ‘Accelerating Access to Electricity in Africa with Off-Grid Solar - - Research Reports and Studies - 10230.Pdf’ (Overseas Development Institute, 2016), https://www.odi.org/sites/odi.org.uk/files/odi-assets/publications-opinion-files/10230.pdf.">Andrew Scott and Charlie Miller, ‘Accelerating Access to Electricity in Africa with Off-Grid Solar - - Research Reports and Studies - 10230.Pdf’ (Overseas Development Institute, 2016), https://www.odi.org/sites/odi.org.uk/files/odi-assets/publications-opinion-files/10230.pdf.</ref>