Key benefits Papua New Guinea will see from the wider program include increased access, with more than 194,000 people gaining access to clean, reliable electricity through grid densification and expansion. Around 232,000 people in remote areas will also benefit from off-grid renewable energy solutio Contact online >>
Key benefits Papua New Guinea will see from the wider program include increased access, with more than 194,000 people gaining access to clean, reliable electricity through grid densification and expansion. Around 232,000 people in remote areas will also benefit from off-grid renewable energy solutions such as micro-grids and solar home systems.
The Papua New Guinea National Energy Access Transformation Project (NEAT or the ''Project'') will be financed by the World Bank and implemented by the National Energy Authority (NEA) and PNG Power Limited (PPL). The project will support the GoPNG in achieving its energy access target through investments in on-grid electrification, sustainable
Papua New Guinea''s first plug-in electric vehicles (EVs) – two cargo vans and a passenger bus – have appeared on the streets of Port Moresby. Ruby Gamoga reports. Improved access to finance could the rapid development of solar power, according to Jon Pittar, Managing Director of solar provider, Solar Solutions PNG.
Through our innovative solar solutions, we are bridging the energy gap and empowering individuals, households, and businesses with solar energy, reaching all regions of Papua New Guinea.
Over the next four years SolaPayGo aim to supply 10,000 solar power kits throughout PNG. The knock-on effect of reliable energy means that the owners of those 10,000 kits will be able to improve their livelihoods and may well access formal financial services for the first time.
How Solar Pay-As-You-Go Energy Is Helping Papua New Guineans Access Financial Services
Knowledge Management and Communications Consultant
In Papua New Guinea (PNG) over 80% of the population don''t have access to grid electricity.
This means that people turn to expensive, unreliable and unsustainable energy sources for their everyday needs. Without access to electricity people can really suffer; children are unable to do their homework, business owners can only operate during daylight hours, and people have to spend longer completing household tasks. That''s why SDG 7 aims to ensure access to affordable, reliable and environmentally friendly energy for all.
SolaPayGo, an off-grid energy start-up which received funding from UNCDF''s Pacific Financial Inclusion Programme in August 2019, are tackling this problem by providing affordable and durable energy solutions. Since launching they have supplied 3,100 customers with pay-as-you-go, or PAYGO, solar power kits to light up homes and small businesses. The kits contain solar panels, lights, a mobile charging bank and a torch or radio.
These customers show the difference that a reliable source of electricity can make to people''s ability to make a living; one customer uses his power kit to increase chicken production, to light a snooker hall and to have longer opening hours for his store. But PAYGO solar energy not only enhances people''s ability to earn but also may lead them to access digital financial services for the first time.
Solar power kits give people access to clean energy in remote and rural areas which aren''t connected to the electricity grid. But these power kits are too expensive for many of these customers. By using a pay-as-you-go model SolaPayGo can lease kits to customers who pay towards ownership of the kit in installments which provides them with energy access at the same time. Once customers reach the end of the lease, if they have made payments throughout, they own the kit. Already more than half of the 3,100 of SolaPayGo''s customers have successfully paid off their kits and most of the remaining customers are still making regular payments.
What are the challenges?
PNG is one of the least densely populated countries in the world, with some 87% of people living in rural areas. It''s those rural people who most commonly don''t have a connection to the electricity grid and who are, therefore, SolaPayGo''s target customers. This is SolaPayGo''s main challenge; the customers who are most in need of their solution are the most difficult to reach.
Partnerships are key to overcoming this challenge. PFIP supported MiBank with the integration of a PAYGO solution with their mobile money account in 2017. SolaPayGo and MiBank have collaborated to offer loans to buy the kits which can then be paid off through MiBank''s mobile money account. Since then they have also brokered a partnership with BSP, who will offer top-up tokens for the kits through their mobile money platform.
How does PAYGO solar energy lead to financial inclusion?
PAYGO solar energy gives people a reason to begin and continue using digital financial services. As they need to continue making regular payments they become used to the mobile money platforms. SolaPayGo have also invested heavily in on-the-ground staff who conduct ''roadshows'', explaining both their products and the methods of paying for them in-person. This helps to onboard people who may otherwise have trouble engaging with digital financial services. Recent research by UNCDF indicated how important this might be; over half of survey respondents in PNG said that they didn''t know what a mobile money agent was, and some reported not engaging with mobile money and microinsurance as they did not understand it.
Over the next four years SolaPayGo aim to supply 10,000 solar power kits throughout PNG. The knock-on effect of reliable energy means that the owners of those 10,000 kits will be able to improve their livelihoods and may well access formal financial services for the first time. By bringing Papua New Guineans clean power SolaPayGo hope to have an exponential impact on their lives; as Marge Tekwie, their Operations Manager, says "Light is an essential utility of any household or business; a necessity for families, communities, or individuals, wanting to improve their quality of life."
Papua New Guineans are embracing mobile pay-go, aka PAYG, solar, which is proving to be a potent, if small-scale, agent of change in terms of improving energy access, rural electrification, renewable energy use and sustainable development.
That''s changing fast, household by household and business by business. Sales of mobile pay-go solarkits have soared, rising 68% per year since 2012. Solar energy is now lighting some 60% of households in Papua New Guinea. That''s up from just 2% in 2012, according to the International Finance Corporation''s (IFC) recently released "Going the Distance: Off-Grid Lighting Market Dynamics in Papua New Guinea."
In a number of countries with high mobile penetration and low energy access, solar solutions with mobile charging sees a major uptake.
—highlighted Subrata Barman, who leads IFC''s Pacific Energy Advisory Program.
"This is because people need the energy to charge their mobiles, and there is also an attempt by mobile companies to launch initiatives for mobile charging. It is important to remember that the revenues of mobile companies are directly related to handsets being charged...The whole idea behind pay-as-you-go was to make it affordable. We realized people would not be able to pay for solar systems upfront. So, we broke down the payments, which in some cases are lower than what they would pay for flashlight batteries."
The potential for solar to replace fossil fuels in Papua New Guinea is high, according to Lighting Papua New Guinea, which has played a key, pivotal role in multilateral efforts to promote and foster solar and renewable energy investments and use in Papua New Guinea. Lighting Papua New Guinea is a branch of the World Bank Group''s Lighting Global program, which is working "to rapidly increase access to offer off-grid solar energy for the 1 billion people living without grid electricity worldwide." For its part, Lighting Papua New Guinea has been "creating markets for, and promoting the use of solar power across the island nation, more particularly in rural areas that lack grid access."
"With 300 days of sunshine in many parts of the country, there''s great potential to harness solar power for businesses and households," Lighting Papua New Guinea highlights. The program, supported by the governments of Australia and New Zealand, has helped bring so-called pico, mobile pay-go solar to some 1.6 million Papua New Guineans for the first time. All told as of August 2018, the program has provided mobile pay-go and off-grid solar power systems to one-fifth of Papua New Guinea''s population, "mainly in remote villages and rugged highlands, helping to boost small businesses and cut household costs."
Lighting Papua New Guinea has drawn on the experience it has gained in Africa and Asia to help 10 global and local companies in Papua New Guinea develop and grow the island nation''s local off-grid solar market. By and large, these are solar manufacturers and distributors from other emerging markets, according to program executives.
The program has helped global solar manufacturers enter the local market by providing business connections and market intelligence, as well as education for consumers and retailers on the value of using quality-verified solar products.
—Barman told Solar Magazine.
Lighting Papua New Guinea is no longer involved in the program, but according to its records, some 317,000 solar lighting products, lanterns and solar home systems that meet Lighting Global Quality standards were imported into Papua New Guinea between January 2014–June 2019, according to Barman.
Lighting Papua New Guinea started out by partnering with Origin Energy Australia subsidiary Origin Energy Papua New Guinea and investee client Bank South Pacific (BSP) to develop a pilot mobile pay-go solar project. "As part of the pilot, IFC advised on how to best adapt the BSP mobile banking platform to handle Origin PAYG payments. Our work here was simply to help establish the mobile money platform for payments to Origin Energy and provide early stage guidance. Since our initial engagement however, we have completed our advisory engagement, as our support was limited to development of the business plan and providing implementation support for the first 200 systems," Barman said in an interview.
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