Pioneer & Expanding Green Energy for the Rural People:

Thank you for giving me the opportunity to address the MBA students   gathered before me.  
I am absolutely delighted to be here to talk to you about the two key challenges facing us in this century:  Energy and Climate Change.  It is my privilege to address the next generation who will be future leaders.  
Let me  talk about  Bangladesh and Grameen Shakti to illustrate what we can do to face climate change and pave the way for adopting Green Energy i.e. Sustainable Environment Friendly Renewable Energy Technologies.   

As you know, Grameen Shakti is one of the pioneering organizations to develop a sustainable market based model to take renewable energy technologies to the rural people on a mass scale. This is a tremendous achievement for an organization coming from a country which is one of most vulnerable countries to face the onslaught of climate change. 

Climate change is a reality and people around the world needs to change their energy practices fast. Rural people especially of Bangladesh and billions of rural people around the world would be worst hit by this crisis.

Energy scarcity is one of the main reasons for poverty and accompanied environmental hazards. Poor people are forced to live in primitive conditions and harm the environment through destructive energy practices because they have no access to modern energy.

There is need to recognize that their energy needs can be served and environment protected through viable business model as Grameen Shakti has demonstrated for expanding renewable energy technologies.

At this moment we need a lot of Grameen Shakti around the world – bold organizations which will come up with innovative but practical ideas to protect the disadvantaged people around the world from climate change and energy poverty.

Why did we come up with the idea of Grameen Shakti?

I have been working with and for the  rural people since my student days. While as an Economics Student at Chittagong University, I worked with Professor Yunus in Jobra Action Research Project which eventually became the Grameen Bank. I am one of the core-builders of Grameen Bank. Over the years,  I have come to respect the inherent resilience and creativity of the rural people. I realized that rural people are forced to live in primitive conditions with limited opportunity,   cut off from the modern world because they have no access to efficient energy. There would no meaningful rural development unless this energy issue is addressed - while more than 80% of the rural people continued to live in darkness accompanied by kerosene fumes.

Grameen Shakti was created in 1996 to take renewable energy technologies to the rural people so that they would get the opportunity to change their lives and have development without damaging the environment. 

We were one of the first organizations to realize that we could not increase the carbon foot print in order to take development to the rural people. On the other hand, we should wean the rural people away from the energy practices which damage the environment.  We realized that in order to succeed we had to make renewable energy technologies a part of rural life.  We had to develop a program which touched at least three bottom lines   of sustainability:  social, economical and environmental.    

That is why, right from the start, Grameen Shakti sought solutions that empower women, the disadvantaged, create jobs, facilitate rural development and especially protect the environment.   

We develop programs which facilitate rural communities to own and use renewable energy technologies to become eventual partners to bring and expand renewable energy technologies to their communities.

An Innovative Business Model for the Rural People
 

crisis - this technology will not reach its full potential, neither will the economic and social problems of the world be solved.

The greatest achievement of Grameen Shakti is that it has developed a sustainable business model to serve the needs of the rural people. 

Village electrification was considered the domain of government programs, development aid, and industry efforts. Many of them left a legacy of inefficiency and squandered subsidies. Grameen Shakti in contrast demonstrated how a market-based approach could flourish in underdeveloped areas and solve social problems. The art of doing business in rural areas – i.e. meeting the energy needs of the billions of farmers who live without grid electricity – was   an uncharted terrain and a huge challenge.  That is where Grameen Shakti broke new ground and demonstrated that village energy needs can be served through a viable business.         

Grameen Shakti currently has one of the largest and fastest growing Solar PV technology programs in the world.  It has installed more than   239,000 Solar Home Systems (SHS)   with over 8,000 systems installed per month.  This success did not come in a single day.

Bangladesh is rich in sunshine that is why our first initiative was to popularize Solar Home System.  By owning a SHS, a rural family can enjoy bright lights, televisions, radios and power their mobiles phones .The upfront cost is high, but once this is paid off , there are no additional costs and one can escape from kerosene fumes. 

The main challenge was to convince the rural people that Solar PV technology was a workable solution to their energy problem.  High up front cost had to be reduced – no rural family would be expected to spend their hard earned money on an unknown technology.

Grameen Shakti came up with an innovative solution.  It used micro-credit to reduce down payment and offered free after sales service for nearly three years to attract rural clients.   GS developed rural based    efficient, socially motivated engineers who were ready to go door to door to convince the rural people about solar PV technology.   Now GS has more than 5000 staffs most of them engineers working from over 700 rural offices spread all over Bangladesh.   GS Engineers are known as Social Engineers because of their special rapport with the rural people.    

phones, watch TV and especially increase their  business activities with solar,  while incurring the same expenditure as kerosene.  

GS was proactive in involving the local community.  Local teachers and elected leaders helped GS to explain the benefits of renewable energy technologies especially SHS to the rural people. GS trained and employed locals as GS certified technicians. Local employment was created and users dealt with technicians whom they knew and trusted.  GS trained users and especially the women of the households to take care of their systems. This helped GS to provide repair and maintenance services at reduced costs, helping it to further scale up its program.  The installed systems were in good condition, creating good will and reducing GS’s overhead costs.
  
Increased sales meant decreased overhead costs which helped GS to provide further credit options to the rural people.  Local production of solar accessories further reduced cost.  GS reached economies of scale and break-even in 2002.    

We started our Biogas Program in 2005 and Improved Cooking Stove Program in 2006.  Both of these programs are thriving.  GS has installed more than 7000 biogas plants with around 300 plants constructed per month. Around 30 of these plants are producing electricity. This is a huge achievement for Bangladesh and GS because the majority of biogas plants previously constructed under government initiative failed creating huge distrust among rural customers. We have been able to overcome this to create an expanding market for biogas plants. We have been successful because we successfully linked biogas technology with income generation especially with the livestock and agriculture business. We were able to create huge demand among poultry owners, farmers and rural households. We successfully demonstrated that   Biogas technology is very appropriate for the rural people   because it converts  cow dung  or  poultry wastes into  gas  for cooking, lighting and electricity generation. It also  provides  slurry  which is  a very good  organic fertilizer.

Our newest program is to promote tree plantation, nursery development among the rural people. We have already planted about 2500 herbal, fruit and forest trees and also nearly 3500 Jtropha trees in Rangamati District. We have also planted more than 2000 trees around client homes. We plan to develop a seed bank, provide training to rural clients who want to set up nurseries or similar ventures. We are also organizing organic fertilizer demonstration plots. 

Light, Energy and Income from Renewable Energy Technologies

More than two million rural people have benefited from our programs.  Rural people are forced to live in primitive conditions because of the twin curses of economic and energy poverty. These two complement each other to downgrade rural people reinforcing inequalities and social injustice.  Women and children are the worst victims.  Our  programs  have  rescued thousands of rural   families  from this  vicious cycle  giving them  light, hope,  income, so  that they can move  forward to realize their full potential.        

Thousands of our happy and satisfied clients are our greatest promoters and Shakti is becoming a household name in rural Bangladesh. In many rural areas, Shakti stands for Solar and Renewable. This is our success story.

Hundreds of villages have been rejuvenated by Solar Home Systems

New  businesses have sprung  up- mobile  shops,  community  TV  centers,   electronic  repair  shops . Business  hours  have  been  extended -  shops,  bakeries,  saw mills  stay open late at night.It is  as if  sleepy, dark villages  have  woken up to new life – a  life  of  activity,growth ,which  is    healthy  and  clean. Approximately 100,000 tones CO2 per year is being replaced by the installed systems. Especially the lives of women and the low income households have changed dramatically. Low income shops keepers in hundreds of village markets are earning more because of solar light. Micro-utility model is allowing a group of people to share a single Solar Home System, bringing down costs and maximizing benefits. This model has become very popular in market places.  Small Solar Home Systems of 10 and 20 watts is helping to replace kerosene or candles in low income households.  Owners of 20 Wp SHS used about 7.5 liters / month of kerosene save Tk. 400 month at the current subsidized price of Tk. 50 per liter.  Most rural people install 50 watt systems which  can save about Tk.  800 -1000 energy cost monthly , replacing kerosene/diesel.

Rural women can now run home based poultry or handicraft business after dusk under solar light.  They no longer have to finish their household activities under dim light, or clean soot from ceiling or walls.  They are also protected from in-door air pollution and kerosene fumes.

The use of SHS brings significant social benefits. Families can listen to music and with larger SHS watch television.  Domestic chores and studying can be carried out more easily for longer and more safely in the evenings with PV lighting.  Many clinics use SHS to provide lighting during check-ups or operations. GS has also started installing solar run refrigerators in many rural clinics. The availability of PV power for phone chargers has made it possible for people in rural areas to use mobile phones. This increases business opportunities and also allows people maintain contact with family members throughout Bangladesh and abroad. In many cases rural offices have started to use solar powered computers with internet access.

Rural schools are also installing Solar Home systems to power computers ,   televisions  and bright light for evening study.  Grameen Shakti has installed Solar Home Systems in 11 rural schools under its Energy For School Program.

In areas which were struck by cyclone Sidr in 2007, PV was a lifeline.  After the cyclone hit, the only homes with light were those with PV.  Through PV charged mobile phones, people learned about the approach of the cyclone and were able to call for help. Most PV systems survived the impact of the cyclone and demand for PV has increased substantially in the area which was hit.

Biogas Technology is paving the way for a Greener and Healthier Bangladesh. Biogas plants is restoring soil fertility, reducing dependence on chemical fertilizers and at the same time promoting agro live stock business, paving the way for SME development through lowering the cost of energy and electricity.

A   rural family   with few livestock can have light,   cooking gas and organic fertilizer by owning a biogas plant.  Their expenditures for fire wood, kerosene and chemical fertilizers are reduced. For example a rural family can save all the cost of wood (over Tk. 400-1000/ month) and may also be able to sell part of slurry as organic fertilizer which is a very good organic fertilizer.

Poultry owners with biogas plants can get rid of poultry wastes meet their energy needs and sell the extra gas or slurry to others.  Low income rural households or small food venders can buy biogas from these large biogas plant owners.  For instance, the owners of a 2000 bird poultry farm bought a 9m3 biogas plant costing Tk. 39,000 through a Tk. 10, 000 deposit and monthly payments of Tk.  1300 for two years.  The biogas supplies the owners with cooking fuel and also an electric generator for three hours per day. In addition, biogas is sold to ten neighboring families giving an income of Tk. 3900 per month which is three times the monthly payments.   The owners of this farm also estimated that their improved vegetable production from the slurry increased their income by TK. 7000 per month with reduced fertilizer costs too.

Biogas plants are reducing energy costs for livestock businesses and providing them with income generating opportunities.  Farmers are also getting slurry at lower cost than chemical fertilizers. This way, biogas technology is boosting livestock and agro businesses which in turn would provide people with meat, milk and vegetables at lower cost Biogas technology helps to increase   food security for Bangladesh when food prices around the world are increasing.

In future Grameen Shakti is considering the feasibility of bottling biogas which would extend the opportunities for sale beyond the neighbors of a biogas plant.  This means the possibility of powering small machines and even small vehicles and the creation of true green economy through SME development. Many large poultry based biogas plants are already producing electricity to power computers,   small machines such pumps.

Improved Cooking Stoves are helping to protect women and children from in-door air pollution, which is a major killer in developing countries.  The improved stoves reduce wood use by about 50% saving time and money and especially over dependence on biomass.  Many rural families are beginning to realize that cow dung stick they are using fuel can be used as organic fertilizer nearly all smoke is removed from the kitchen and cooking is much cooler and cleaner. Users of improved stoves reduce their monthly consumption from about 40 kg / month to 20 kg/ month which saves about Tk. 100 per month if wood is purchased. Thus the cost of the stove is repaid within about six months. The payback is even faster for commercial stoves.

Women users are very happy with their improved stoves. Many have promised to marry off their daughters to homes with Improved Stoves.  House rent is going up where neighbors have improved stoves. This shows that a social revolution is coming in Bangladesh and GS would be able to keep its promise of more than 50% of rural homes with Improved Stoves. 

Tapping into power of the Women and the Youth

Grameen Shakti can be called an organization for the young.  It recruits, trains and deploys young graduates to the rural areas. These young engineers are in the front soldiers of Grameen Shakti, helping to take renewable energy technologies to every corner of Bangladesh.

Grameen Shakti also taps into power of the local youth. Local young people are trained to be local technicians. These technicians help to market, install and repair, maintain renewable energy technologies for Grameen Shakti.  They are helping GS to decentralize its activities, transfer technology to the rural areas and especially build rapport with the rural people.

One of the most innovative programs initiated by GS is Grameen Technology Center Program. Around 43 Grameen Technology Centers (GTC) has been set up in the rural areas to train young women to become solar technicians.   Around 2000 women technicians trained by the GTCS are successfully operating at the field level: some are assembling solar accessories; others are marketing installing, repairing, maintaining Solar Home Systems.  Many of these young women have also learned how to construct Improved Cooking Stoves. With the help of these young women, GS is carrying out 80% of  accessories repairing and assembly at the rural level.  This mean huge reduction in time and cost as every solar part   does not need to go the head office for repair.

GS is planning by 2015, to deploy 100, 000 local youths especially women who will install Solar Home Systems and construct biogas plants and ICS on contractual basis for GS.  They will be able to earn around US$ 100 per month, providing local employment and reducing migration of the young people to cities.  GS will provide further training and seed capital to transform many of these youth into local entrepreneurs who will create jobs for others. In this way of full–fledged RET ENTREPRENEURS would be created in the rural areas. 

Lessons for   Asia:  

Asia faces challenges of ensuring food security, energy security and brings development to the millions of its people without damaging the environment. Asia has countries like India and China which large percentage of rural population,  huge energy needs.  There is Vietnam, Cambodia, Laos, and Philippines etc which face similar socio-economic challenges as Bangladesh.

Let us first analyze the challenges faced by Bangladesh.  It is a country which is 90% dependent on gas.  Though once thought only seven years ago that the country was floating on gas, no additional sites have been identified. The result has been recurrent power failure and no dependable energy source to fuel power plants. The demand for power will rise to 20,000 mw by 2020.  Bangladesh has to find alternatives as quickly as possible.  But, what are these alternatives?

According to Energy experts coal cost up to US$ 5 to US$ 6 cents per kilowatt hour,   nuclear power also costs same, while solar power 30 to 35 cents.    Therefore, many policy makers in Bangladesh advocating nuclear and coal power for Bangladesh.  However, there are failing to take into account inherent social and environment costs of depending on these sources.  How will Bangladesh with one of highest population density in the world deal with nuclear wastes?     Similarly, can Bangladesh really take the risk of displacing thousands of people, causing damage to its rivers,   lands and eco-system by going for open pit mining?  And all these sources nuclear or coal   are finite, they are not renewable.   Bangladesh has run out of gas and will run out of coal or uranium in the future

Where does Renewable Energy stand in this mix?  Energy experts acknowledge that solar energy can be one of the best solutions as it is renewable, Environment friendly, and very flexible to install.  However these same experts treat solar power as small power and nuclear and coal as the big power.  Success of  Grameen Shkati has made them realize that  solar power is  a feasible solution for the rural people   for meeting some of their needs ,  but they  still  fail to realize its full potential and consider  it as mainstream energy  .  In Bangladesh, biogas technology faces similar challenges

It took us more than 13 years, stating from 1996 to pass the renewable energy policy and it may take us few more years to see it implemented. Good news is that Government has agreed to source 5% of the total power demand by 2015 and 10 percent by 2020.   Grameen Shakti is planning to pilot test solar power and biogas technology in urban settings. It hopes to meet with the same success it did in the rural areas, thus demonstrating the feasibility of   renewable for Bangladesh.  This may help to pass feed –tariff laws in Bangladesh 

We have no alternatives but to go renewable. Renewable Energy Technologies can give us unlimited power without damaging the environment; it can help us to increase food production without damaging the environment. It can help us to turn our toxic urban wastes into energy.  It can help to bring development, jobs. Modern facilities to thousands of isolated rural villages.

I am sure that renewable enthusiastic and practitioner meet with similar challenges in his or her country.   What is the solution?  They can come up with practical, sustainable programs and implement this in small steps.  They can attract the attention of policy makers and other stake holders to scale up its program.  This is behind the success of Grameen Shakti.

Grameen Shakti   program has demonstrated the potential of renewable energy technology to play a crucial role in the social and economic development of the rural people. Grameen Shakti has generated employment, boosted business including creating new business opportunities. Women have found protection from indoor air pollution and new employment opportunities. Windows of opportunities have opened up for the rural through solar powered mobile phones and televisions.  Biogas technology has shown that economic development is possible while protecting and preserving the environment.  Improved Cook Stoves are helping to reduce deforestation and protect women’s health.

A synergy has been created between technology, economic, social development and environment to become forces of positive changes for the rural people of Bangladesh. 
A successful Business Model   should have the following elements:

Question is not whether Asia needs Renewable Energy Technology or not. Question is to how to develop successful business models which can help take Renewable Energy Technologies to the masses.   Goal is to make Renewable energy technologies as affordable as a mobile phone

Vision for the Future

The last two years have taught us many lessons.   We have suffered from spiraling fuel,   food and other raw material prices, followed by one of worst recessions faced by the modern world.

Our leaders, policy makers, economics and energy experts have failed us in many ways.   We need to change our mind set and create a totally different world.  We must realize and acknowledge

Who will take the lead in this regard?    The Future belongs to the youth.  The young people must come forward to claim their future. In Bangladesh we have set a goal to reach at least 75 million rural people with Solar Home Systems, including other renewable by 2015. We have a dream of providing all modern facilities to thousands of rural villages by 2015. They will use solar or biogas to get connected through Internet their children will study through distance learning, they will enjoy the facilities of telemedicine. Biogas plants will give them energy to run machineries, power vehicles at the same time boosting agro-livestock business. We are dreaming of a Cleaner, Greener and Healthier Bangladesh.

Our dream is to see a World, where every citizen of this earth has access to pollution free efficient energy so each of us can live with dignity and realize our full potential.We have a long way to go to fulfill this dream for Bangladesh and the World. We are still at the starting point where the full potential of renewable energy is yet to be realized.You can also dream big and aspire for the highest horizon. Maybe some of your dreams will come true. You may make a breakthrough, design new solutions and be a source of new inspirations.  I hope that the success of Grameen Shakti will inspire those who are present here to aim for greater heights, do something innovative, and creative for your country and the world.

Each of us has the ability to bring some positives forces in the world so that eventually we can create A Better Greener World