May 10

The Unspoken Risks and Side-Effects of the PAYGO Model in Africa

By Harald Schützeichel

The sale of off-grid solar systems using end-customer credits has become a widespread standard today under the overall term pay-as-you-go (PAYGO).

Even though the off-grid solar market in Sub Saharan Africa has received a considerable boost as a result and the instrument has often proven to be effective, it is also associated with risks and side effects that have caused and continue to cause not inconsiderable problems for many companies and end customers.

Based on 17 years of experience with the PAYGO model in Africa, I would like to point out some of the risks and side effects of this business model.

Photo courtesy of Russell Watkins/DFID.

Source: ESI Africa (link opens in a new window)

Energy, Technology
off-grid energy, renewable energy