Private sector: Who is funding energy access?
Energy access industry is moving towards commercialisation. Things are happening at their own pace. BNEF’s off-grid and mini-grid outlook identified for example $223 Million worth of funds willing to boost pay-as-you-go solar companies.
The August Company has been looking at “which are the corporates with sizable budgets for energy access programmes”. Overall, we have identified 3 approaches that companies take: The companies do the electrification work themselves, companies invest in local companies to contract the work, or companies donate to international organisations focused on addressing the issue.
The findings are quite interesting because the following list shows that new players are finding their ways into the off-grid energy industry. Google, Tesla and even Ikea : The list of MNCs with potential interest in energy access spams across few industries.
1. Samsung
Programme:. In 2015, Samsung invested $40 million into rural electrifcation and $45 million into renewable energy projects in Honduras. Most of these funds were invested into companies and organisations specialising in electrification, rather than a dedicated Samsung subsidiary.
2. Schneider Electric
Programme: "Light it Up"
Schneider Electric's Light it Up programme, aimed at reducing the use of kerosene stoves for heating and lighting has a budget of 14 million euros (15 million USD). Most of this funding went to the distribution of solar lamps. While the Light it up programme is focused on the Asia Pacific region, Schneider Electric has programmes in 12 countries, including Myanmar, Mongolia, Vietnam, Philippines.
3. Caterpillar Incorporated
Programme: A microgrid initiative
The first project initiated by Caterpillar was a $20 million investment deal in Indonesia. The company provided pre-engineered systems as a standard kit, which can be customized based on the need for energy (ranging from 5 kW to 100 mW). The company partnered with Powerhive (a rural electrification startup) and First Solar (a solar energy company) to make design and distribution of the devices possible.
4. Ikea
Programme: Brighter Lives for Refugees campaign
Ikea lacks a dedicated programme, it has focused on raising donations to international organisations such as the UN High Commissioner for Refugees, to which it donated $20 million in 2016.
5. Google
Programme: Google Access
Google Access, which was previously formed under the name Google ‘Access and Energy’ focuses mainly on improving internet access around the world. Because of the nature of the subsidiary, it is unclear what the budget is, but Google has invested in large-scale infrastructural projects such as the $700 million Lake Turkana Wind Power Project in Kenya. Additionally, in 2013, Google invested $12 million into the South African 'Jasper Power Project' and since 2007 Google has committed more than $1 billion in renewable energy projects.
6. Microsoft
Programme: Microsoft Affordable Access Initiative
Like Google Access, Microsoft's programme is focused mostly on improving access the internet, rather than just electrification. The main mechanism of the programme is the Microsoft Affordable Access Initiative Grant Fund, with funds organisations such as African Renewable Energy Distributor (ARED) in Rwanda and Ekovolt in Nigeria. There is currently no budget data publicly available regarding the programme.
7. Tesla
Programme: Off Grid Electric
Off Grid Electric was acquired by Tesla through the recent Solar City merger. The programme aims to deploy solar panels (generally small 25-watt modules) to households not connected to the grid, which is very common in rural Africa, which is then linked to a 60 watt-hour battery. Off Grid Electric has a budget of approximately $70 million.
Let us know if there is a programme or company we should add to the list.