NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

By Yariv Cohen

Decentralised energy solutions, especially solar home systems, have become more standardised and accepted in the past decade and adoption of these products is now widespread worldwide. Many African countries’ electrification strategies encompass decentralised renewable energy as a critical component in achieving nationwide energy access, as it is now the most accessible, scalable, and affordable option.

Looking at the decentralized revolution, electricity is only one, albeit crucial, aspect, and Productive use of energy, PUE, is slowly but surely becoming a decentralized phenomenon. PUE has various definitions, and broadly includes activities that generate revenue, increase productivity, enhance diversity, and create economic value through improvements in quality of life through electricity for education, healthcare, internet access, and other social services. It is actually an old term used way before decentralized energy solutions became prominent.

With the solar sector becoming increasingly meaningful across Africa, several recent developments have led to increased interest and emphasis of sector stakeholders on researching and promoting PUE. First, the increasing number of people with access to high levels of electricity (Tier-2 and beyond, which means >20W, >4 hours a day, and >2 hours at night time) have increased emphasis on translating energy access into new opportunities for income generation and sustainable socio-economic development in rural communities. Another critical factor is the financial one, as Pay-As-You-GO (PAYGO) models and the growing availability of mobile-money services, alongside technological innovation and decreasing costs of solar panels, contribute to PUE products becoming affordable for low-income consumers.

Photo courtesy of Christopher Herwig.