I remember meeting with potential investors in 2006 to pitch our business plan for d.light. It was usually the first time they had ever heard that 1.3 billion people in the world did not have access to electricity. Eyebrows would rise in surprise when I explained that kerosene was the primary source of light for these off-grid families, but that technological advances in solar and LEDs had created a path for cleaner, safer, and more affordable light.
Some investors shrugged us off as naïve for trying to address such a massive problem in markets that were difficult to do business in. Others said our business was doomed to fail, and a charitable model was the only sensible approach. But a few brave investors bought into the vision and dared to jump into the unknown with us.
While there have been many ups and downs along the way, it gives me great joy to think about how much has changed. Investors are now savvy about our market, companies have achieved amazing scale, and a fledgling but entirely new industry has formed for off-grid renewable energy solutions. Most importantly, tens of millions of customers are now enjoying the benefits of solar lighting.
We can all say with confidence that the kerosene lantern’s days are numbered. It will soon be totally eradicated, only to survive in history museums.
I believe we are entering a new phase of maturity as an industry, moving from childhood into adolescence. There is heightened awareness of solar and more competition in our markets, which are good things because our customers benefit, the market grows, and the quality of life for off-grid families improves. However, there are also new challenges that we need to face and constructively work together to overcome.
I want to highlight three areas that I think are important for us to address together as an industry:
Now that there is a demand for solar lighting products, opportunistic manufacturers have jumped into the fray to produce products that look identical or very similar to quality branded products in the market, with false claims on specifications and even blatant misuse of logos and trademarks. By and large, these manufacturers are only out to maximize their short-term profits and cut all possible costs. Therefore, care is not taken in quality and the products rarely survive in the field for more than a few months. This destroys value for the industry, individual brands, and the reputation of solar. We’ve already seen the presence of counterfeits significantly slow down market growth in Kenya and Tanzania.
We are not the only industry to face an onslaught of knock-off products. But we are vulnerable because our industry is still nascent and companies do not have large budgets to fight counterfeit-producing companies. We need to work together as an industry to deter counterfeiters in every possible way so the market and industry can continue to grow.
2) Government Relations
In the early days, the off-grid energy sector wasn’t even a blip on the radar of any government. It’s a different story today. We now have the attention of the likes of President Obama and President Kenyatta, and large government actors are getting involved to see how they can help grow the industry. This is an amazing opportunity, but it is important that we are involved in the conversation, and—to the extent possible—speak in a unified voice as an industry on important topics ranging from tariffs to recycling and counterfeits. This is why Industry Opinions are such an important tool for GOGLA and one that we should take seriously.
3) IFC / Lighting Global
I will always be deeply grateful for everything the Lighting Global team has done for our industry. Russell Sturm and the team at the IFC and World Bank have led a highly innovative and dynamic group of individuals to be champions of our fledgling industry and our customers. I am sure business schools will be writing case studies about the amazing things they have done to catalyze our industry for years to come. I think we have often taken for granted their efforts to pave the way for our industry to take form. However, the reality is that we are not able to rely on their support for the long term. They had funding and a mandate to mobilize the industry.
By all measures, the industry has been catalyzed! And now it is our job to take it forward. We need to come together on important topics like quality certification and collection of market intelligence, and align on plans that are possible to implement, financially sustainable, and don’t rely on indefinite involvement and funding from partners like IFC.
I am excited to work with all of you to tackle these challenges head-on and to work together to move our industry to the next stage.