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The Pay-As-You-Go System and Affordable Clean Energy

The Pay-As-You-Go System That Makes Clean Energy AffordableTechnology company Angaza is offering a Pay-As-You-Go (PAYG) system to manufacturing and distribution companies to make clean energy devices accessible for the more than 1 billion people worldwide still off the grid.

In the 21st century, more than 1 billion people still burn kerosene at night, a light source that is outdated, hazardous to health and pollutes the environment.

Over the course of a year, a family can spend 20 percent of its income on kerosene, which equals the total cost of a solar light.

The problem is not the access to solar options, but the barrier of upfront costs.

With the San Francisco start-up, Angaza is spreading payments out over a period of time. Now, people who cannot afford the total cost of a solar light have the option to PAYG. By working directly with manufacturers and distributors, the business model removes extra costs by selling their technology to third party manufacturers at a fraction of the cost.

This is how the PAYG solar energy system works:

  1. Before distribution, Angaza embeds its firmware into the green energy devices to provide internal energy metering.
  2. After making a down payment between $1 and $5, the consumer receives a lantern, solar panel and mobile device for tracking from the distribution company.
  3. Depending on the down payment, the lantern will only stay on for the amount of time paid for by the consumers.
  4. Similar to a pre-paid mobile phone, the lantern will deactivate unless payment using the mobile wallet is made.
  5. Depending on the size of the product, the consumer can pay between $1 and $2 per week until the lantern is paid off, typically a two- to 12-month timeline.

Currently, Angaza is the only company that offers a PAYG system to provide affordable clean energy products to consumers. As of now, Angaza’s PAYG system will be distributed to Kenya, Tanzania, Uganda, Malawi, Zambia, South Africa, India and Pakistan.

According to the Global Off-Grid Lighting Association (GOGLA), the off-grid energy and appliance market is expected to be a $50 billion per year opportunity.

Alexandra Korman

Sources: Angaza, Tech Crunch
Photo: Flickr