By: Iben Bjørgulf Antonsen

Today more than 100 million off-grid people have benefited from energy access through off-grid solar technologies. Until now it has not been clear how the decentralized, renewable energy sources have impacted the household economy and quality of life.

But in a new report from July 2018, Power Opportunity. The Economic Impact of Off-Grid Solar, by GOGLA, new knowledge occur. Evidence show that off-grid solar home systems (SHS) have a great impact on economic activity and opportunity. The report is based on data from 2,343 solar home system customers in Kenya, Mozambique, Rwanda, Tanzania and Uganda representing 45% of the global off-grid SHS market.

The typical purchaser of solar home system is a 37-year-old male, living in a rural area with a wife and three children - on average being 5,6 members in one household.

GOGLA, Power Opportunity. The Economic Impact of Off-Grid Solar

Overall, the study found that 58% of households undertake more economic activity due to their purchase of a solar home system. On average these new economic activities created an additional USD 35 per month. Customers combining two or more economic activities create on average 53 USD per month. The activities followed three main pathways; more time to work, income generating activities and getting a new job.

Additional working hours

Having a solar home system enabled 44% of households to spend more time at work. Among households where a member is able to spend more time at work, 2 out of 3 say they were able to do so because they can work longer hours after sunset. With a reliable source of light and charging at home, less time was spent on traveling to purchase kerosene, batteries or to charge their phone – and more time was spent on working.

A Solar Home System (SHS) is a technology that are made up of a solar PV panel, battery and LED lights, which provide light and power to a household or business. The size of a SHS can vary, as can the appliances they are sold with. SHS are often defined as 11 Wp (watt peak capacity) and larger, while systems between 3-10.99 Wp are referred to as ‘multi light and phone charging kits’. The three different systems sizes are 3-10 Wp, 11-20 Wp, and 50-99 Wp.

GOGLA, Power Opportunity. The Economic Impact of Off-Grid Solar

Establish new businesses

A total of 24% of the off-grid customers used the solar home system for an income generating activity and establish new businesses. The most common new businesses established are phone charging for a fee (34%). Hereafter followed using the SHS in a shop to power lights or appliances (20%). Of the three system sizes, customers that purchased the smaller ones (3-10.99 Wp) were most likely to undertake economic activity (66%).

Extra income with solar power

For 7% of the households the solar home system enabled them to get a new job, however the most beneficial way to increase income is to undertake more than one activity. Having light and power from an SHS in a pre-existing business appears to be the most rewarding with an average of over 2000 USD created over the expected product life.

- More time at work generates additional 25 USD per month
- Getting a new job generates additional 28 USD per month
- Starting a new business generates 26 USD per month

When living off-grid, all of the daily activities stops when the sun sets and darkness take over. Alternative lighting sources such as kerosene lanterns and tourches are not only expense, but pollutive. With a solar lamp or home system the normal day-to-day life can continue and with unlimited access to light and charging it is actually possible to work longer hours, create new businesses, ultimately increase income. Income, that is generated through a sustainable and environmentally friendly source of energy.