Understanding Solar Distribution : Delivering Uganda’s Bright Future

Arun Abichandani, Elif Unlu, Mathangi Sivaramakrishnan and Arjun Kapoor are Team Uganda Solar. On a project for Haas Professors William Fuchs and Brett Green, our charter is to understand, analyze and offer recommendations on solar lamp distribution in Uganda. This project complements the Professors’  ongoing research projects in Uganda, mentioned in The Economist and Freakonomics among other publications.

Almost immediately after President Barack Obama’s historic visit to East Africa, we arrived in Uganda excited to meet solar manufacturers, distributors and NGOs. Our mission is to understand the distribution of solar lights and other goods to rural Uganda. In a country with limited infrastructure, the narrow and bumpy roads serve as the only link between Kampala and the smaller towns and villages across the country. Combined with the fact that more than 85% of the population lives off-grid, finding efficient and reliable solutions for solar lamp transport is a critical problem to solve if Ugandans are to have healthy, cheap and renewable lighting.

Barefoot Firefly Lamps

Better than kerosene and charges your phone too!

 One Game, Many Players
There is no shortage of manufacturers, distributors and organizations trying to increase solar adoption in peri-urban and rural Uganda. We met with several of them in our first few days, starting with our Berkeley Research Co-ordinator Vastinah who introduced us to the solar lamp experiments and their transport logistics. Barefoot Power, an Australian solar lamp manufacturer with a local office, was an eye opening visit. We got a first hand view of the products and how they are operated and repaired. Quizzing the country manager and her support staff, we learned the many challenges in getting lamps from their Kampala location to regional distributors and rural retailers.
Anne Kayiwa - barefoot

Meeting with Barefoot

Businesses with a social charter like Living Goods buy and transport high-impact products such as medication, solar lamps, stoves and contraceptives to local entrepreneurs and businesses, generating employment and providing access to life-improving technologies in rural Uganda. Their country director was an excellent resource for understanding the local distribution sector. BRAC is an NGO with probably the largest presence and distribution network in Uganda and were gracious enough to share their logistics and supply chain best practices in their interviews with us. UpEnergy is a well established distributor of efficient cooking stoves, now entering the solar lamp distribution business hoping to leverage their existing networks with micro-franchised entrepreneurs & NGOs.
Left : Taking stock; understanding UpEnergy's warehousing and logistics Right : Always be making deals; Our driver and guide, Herbert, seen with his new energy efficient stove from Up Energy. He will test it in his village to determine if he wants to be a micro-franchisee

Left – Taking stock: understanding UpEnergy’s warehousing and logistics
Right – Always be making deals: Our driver and guide, Herbert, seen with his new energy efficient stove from Up Energy. He will test it in his village to determine if he wants to be a micro-franchisee

Sipping Coke while understanding Century Bottling's distribution network

Sipping Coke while understanding Century Bottling’s distribution network

As part of our research back in Berkeley, we had identified a Coca Cola bottler (Century Bottling) and Unilever as companies whose superior reach would serve as an interesting model – both to compare existing solar distribution with as well as to creatively leverage for solar distribution. Fortunately for us, we could set up meetings with executives at both companies who were very interested in our work and very generous with their time and knowledge. Both discussions were extremely rich and impressed upon us the commitment, persistence and creativity required from multi-nationals who want to establish a local presence. We’re very excited to share our findings and ideas generated from these discussions.

 
Bright Future
Traveling in and around Kampala, listening to people’s stories and soaking it all in, we can see Uganda’s potential for growth. With the right public and private investments, Uganda can leverage its very young population and abundant fertile land to improve the lives of the millions in semi-urban and rural areas. Basics first though – lighting, energy, education and health. Market solutions are just as important as non-profit/charity work in enabling sustainable progress. That’s where we hope to do our small part, in understanding how solar lamp companies can profitably and reliably deliver their products.
Stay tuned for more updates, including one on our site visits to villages where research is being conducted and why this IBD trip is definitely Level 5 on the adventure scale.

Developing a Distributed Solar Energy Sector in Chile

Team Chile worked with the Universidad de Chile and Fundación Chile in Santiago. Our goal was to recommend policy and financing tools to spur the development of distributed, or behind-the-meter, solar energy generation in Chile.

This past Thursday, Team Chile sat in the audience of a large auditorium watching the Chilean presidential candidates debate the future of energy in their country. Broadcast live on CNN Chile and sponsored in part by one of our clients, Fundación Chile, the fierce debate stressed the critical nature of Chile’s current energy dilemma. Chile needs more energy to fuel its continued economic growth, but the high smog levels in Santiago, foreign dependence on fossil fuels, and rising price of energy are leading Chileans to look for clean, sustainable energy sources within the country.

Our team with Marcos Kulka, the CEO of Fundacion Chile and a Haas alum, at the presidential debate on energy.

Our team with Marcos Kulka, the CEO of Fundacion Chile and a Haas alum, at the presidential debate on energy.

Luckily, Chile boasts some of the best solar radiation in the world. Major investment in large-scale solar generation in northern Chile has begun through both international solar developers as well a local start-ups such as Solar Chile, which was co-founded by Haas alum Cristian Sjogren.

Dinner with Haas alum Cristian Sjogren and his co-founder Koichi Arimitsu, who co-founded Solar Chile.

Dinner with Haas alum Cristian Sjogren and his co-founder Koichi Arimitsu, who co-founded Solar Chile.

Despite the growing solar industry, distributed solar on rooftops or in small community installations is relatively unexplored in Chile. Our team examined the existing markets for distributed solar in California and Germany, and then spent three weeks in Chile testing our hypotheses around how those models for public policy and financing tools might be applied in Chile.

In our first two weeks in Chile, we interviewed a broad web of stakeholders, including government ministries, environmentalists, educators, solar customers, bankers, retailers, entrepreneurs, and policy experts in Santiago. We traveled outside the capital city to interview potential commercial customers from the wine industry, and visited the port city of Valparaiso to listen to consumer opinions.

We visited the port town of Valparaiso to talk with potential solar customers.

We visited the port town of Valparaiso to talk with potential solar customers.

We visited a vineyard in the Maipo Valley to talk about their small solar-thermal installation.

We visited a vineyard in the Maipo Valley to talk about the winery’s solar-thermal installation.

Not only did we hear about policy and financing needs, but we also heard about the need for education and capacity building to foster distributed solar in Chile. As a result, we developed recommendations for a multi-pronged approach to educating consumers, financiers, government, and solar installers. We explored what it would mean to establish policy, financing, and education to spur a more democratic, distributed energy future for Chile using solar energy.

Team Chile worked closely with the Energy and Climate Change team at Fundación Chile as we developed our recommendations and tailored our ideas to the Chilean context. Fundación Chile’s office overlooks the city from high in the hills, and on a clear morning you can see the nearby Andes mountains covered with a fresh coat of snow. The organization is part think-tank and policy organization, and part incubator for new industries in Chile. (It is well known for fostering the salmon industry in Chile, for example.) The dual nature of Fundación Chile’s work pushed our team to think about both the macro-scale policy structures needed to foster the distributed solar market, as well as community engagement and viable business models for service providers working from the ground up.

The offices of Fundacion Chile overlooked the city and out to the Andes mountains.

The offices of Fundacion Chile overlooked the city and out to the Andes mountains.

In our final week, Team Chile presented our recommendations spanning policy, financing, education, and business models to increase the rate of solar adoption and establish a new, competitive sector for the Chilean economy. For example, new financing models such as solar leasing can be applied in Chile to reduce the upfront costs of solar systems and bundle customers to reach scale for effective financing opportunities.

Solar panels provide lighting at the local bus stop.

Solar panels provide lighting at the local bus stop.

Chile has already taken many positive steps toward fostering the distributed solar market with early policies that establish a vision for renewable energy development. To help Chile capture more of the value from its distributed solar industry and support rapid market expansion, our findings support even stronger, large-scale initiatives.

In the coming years, Fundación Chile and Universidad de Chile together will lead policy and public-sector initiatives to unlock demand and capital in Chile for distributed solar. In addition, Fundación Chile will undoubtedly incubate a solar provider for the Chilean market. As Chile turns to national elections in the fall, its foremost experts on policy and energy at Fundacion Chile and Universidad de Chile will have the opportunity to push for new ideas. We hope that our recommendations can help inform new developments in the nascent distributed solar sector, making Chile a regional leader in solar energy.

Our last day at the Fundacion Chile offices in Santiago

Our last day at the Fundacion Chile offices in Santiago

New Kids on the Eastern Bloc

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Author: Allan Riska
Team: Georgia
Project: Develop marketing strategies to attract foreign investment

Our cab driver finally showed up to the airport at 1am, about an hour after our flight from London had landed. Alper, Rahul, Pulak and me were piled in the back seat to make room for the luggage. Ripping through the Georgian night at 120km/hour, the capital city of Tbilisi drew closer. Revealed was the cheerfully illuminated landscape of the it’s exposed rock faces, castles and cathedrals, inviting visitors to change their perceptions of the former Soviet state.   

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“An egg-white omelet, sir?” Don’t mind if I do. The five-star breakfast would be key to fueling our days that were  scrambled with government interviews, a dash of research and a pinch of mind mapping. To tackle the work, we generally split up into teams of two so that we could interview the most people, in order to get the widest perspective of the issues. The work hours were also and adjustment to make, 10am to 7pm, which stretched out our interviews time slots. AC was rarely present in the government buildings, so thankfully we were able to do most of our diverging and converging from the comfort of our hotel.

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Our moment of shock came when we showed up to meet Vera Kobalia, the Minister(ess?) of Economy and Sustainable Development. We thought it would be a casual half-hour interview, but it turned into a surreal moment when we ended up doing TV interviews and having the press film our meeting. Another unexpected moment was when we came back from dinner at 11pm only to find approximately 50 tanks in the street, practicing for Georgia’s 20th Independence Anniversary celebration.  Alper was definitely surprised by the girl who really wanted an autograph from a Turkish Diplomat…

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Throughout the process we established common themes that Georgia needed to focus on; transparency, transportation, fast business, and clean energy. The growth that Georgia has seen has been remarkable. One electrifying fact is that through liberalizing policies, Georgia has gone from experiencing rolling blackouts to being a net exporter of energy in only seven years, mostly while developing clean, hydro-power resources. For reasons like this that that we feel Georgia will be in a great geographic and political position to attract more FDI. Our client was receptive to our final presentation, where we converged on the final marketing execution strategies. It would be great to see new ads based on our work!
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Food & Wine
We ate at traditional Georgian restaurants, such as Breadhouse and Maspindzelo.The fare is quite heavy, and consists of fresh meats, breads and veggies. The Kinkali (dumplings) were particularly delicious, especially when paired with Georgian wines. I highly recommend the unique “semi-sweet reds”, of which many bottles will be making a stow-away trip in my luggage. Wine production originated in Georgia, and it shows. There was also and excellent Italian restaurant and Thai restaurant in the area, as chefs from the US and Europe return to the area. I had a special affinity for restaurants run by M Group, as the prices were perfect given the high quality, location and service.

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Side Trips
It wasn’t all work.  We did take time to enjoy Tbilisi and the surrounding areas. We were lucky enough that our assignment required us to enjoy the tourist aspects, and we did so with great admiration for the natural beauty of the area. First, we took a side-trip to towns east of Tbilisi, where the cave cities sit near the border of Azerbaijan.  The monastery on the opposite side of the hill provides a breathtaking view of the natural landscape. Next we were off to Batumi, an area described as the “Miami of Georgia,” on the coast of the Black Sea. We missed the analogy because the summer rush hasn’t yet begun there, but were shown a fun time by our hosts nonetheless. Any rush not found in the city is available during the five hour car ride from Tbilisi where our cab driver was driving in the wrong lane at 120km/hr, passing other vehicles through mountain passes. Aside from that minor brush with death, we were impressed by the hospitality of those in the government and the service industry – an area we are pushing for re-branding campaigns. 
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If you’re in the Eastern Block, take a trip to visit. You won’t be disappointed.