Solar pumps for commercial production in remote Lao villages

Transcription

1 Sunlabb Rural Energy Systems C.,Ltd P.O. Bx 9077 Vientiane / La PDR Tel: Fax: sunlabb@latel.cm Electricity where the sun shines Slar pumps fr cmmercial prductin in remte La villages Prpsal fr a Public Private Partnership fr explring and develping a cmmercially viable rental service fr slar pumps and related equipment. 1. Summary Sunlabb is a La cmpany perating in the slar markets. It has established rental services fr slar hme systems in La PDR. These rental mechanisms have been awarded the DM-prize f the Wrld Bank. Sunlabb nw intends t develp rental services fr prductive use f slar energy, beginning with slar pumping fr prducing cash-crps. Initial tests with pumps, slar arrays and drip-irrigatin equipment have shwn t be prmising, with high interest frm villagers and frm lcal authrities. First calculatins shw that slar pumps may becme cmpetitive with fuel perated pumps, if indeed they can be rented. Sunlabb nw intends t apply the successful prcedures with develping the slar hme rental systems t develping slar rented pumping systems. Fr this purpse a PPP is prpsed t DEG. The main activities ver a 30 mnth perid are prjected t be trainings and demnstratin/testinstallatins in 14 pilt villages spread thrughut La PDR, and prmtinal effrts. Thereby the technical aspects shall be fully explred, the servicing netwrk shall be trained, the mnitring shall assess the cmmercial success f farmers, f the village-based service prviders, f the agrnmic services prvided t client villages, and f Sunlabbs rental peratins. This shall lead t viable business plans based n tested data fr farmers, service prviders, and Sunlabb. These shall be attractive fr lcal and internatinal investrs. Thereby it is expected that cnsiderable impact will be achieved in jbcreatin and incme generatin in remte rural areas ff the grid in La PDR. The prmtinal effrts shall ensure that lcal authrities, the dnr cmmunity and ptential investrs knw abut the ptentials. Sunlabb has gd cntacts t suppliers f irrigatin equipment frm utside Las, and t the expertise fr using it. Hwever, the agrnmy f irrigated crps and their marketing is utside the sphere f immediate cmpetence f Sunlabb. It is fr this purpse that Sunlabb wants t enter int a business partnership with anther La cmpany that can prvide the agrnmic and marketing services t farmers. At present

2 such cmpanies hardly exist in La PDR. Therefre Sunlabb expects t be caching a grup f peple cmpetent in irrigatin-agrnmy and interested t establish a cmmercial venture, t develp their wn cmpany. Sunlabb will thereby act as a business supprt service t this cmpany in all business matters except the technical issues f agrnmy f micr irrigatin and cash-crp marketing. There is a risk implied in this, as it is nt sure that after 30 mnths such a cmpany actually will be standing n its wn cmmercial feet. Hwever Sunlabb is prepared t cver any shrtcmings and t cntinue t cach fr the business aspects until independent cmmercial peratins are pssible. Cmpetitin neutrality f this PPP will be ensured by making public the technical specificatins f the installed systems, the surces f material and expertise, the prcedures in the villages, and the develped curricula. Any villagers and service prviders can thereby access the relevant infrmatin if they want t launch themselves in a similar business. 2. Backgrund infrmatin Sunlabb is a La cmpany prviding energy services in remte rural areas where the electric grid des nt reach. It was funded in 2000 and is perated and wned by tw La prfessinals and ne German manager. The main utput s far has been in slar systems ranging frm small slar hme systems t large systems fr perating cmmunicatin antennas. Sunlabb is well knwn in Las fr its effrts t prvide cmmercially viable energy services in remte areas. Sunlabb is recgnized by gvernment agencies as being a part f the cuntries effrts t develp a market ecnmy. Over the last three years Sunlabb has explred and develped rental services fr slar energy. The reasn is the lw purchase capacity f La village husehlds. The challenge was t set up a fastreactin netwrk f service agents, and t rganize the cllectin f rents in a way that enhances discipline in payments. This has been achieved thrugh a set f pilt effrts rganized with PPPs. At present a functining and tested system is in place. This allws a much larger percentage f rural husehlds t affrd themselves slar lighting at cmmercially viable cnditins. In this rental service independent Sunlabb-trained small entrepreneurs wh have a franchise agreement with Sunlabb take care f the installatin and servicing f slar hme systems. The systems are rented ut by Sunlabb t a Village Energy Cmmittee designated by the village authrities and specifically trained by Sunlabb t then sub rent the systems further t the individual husehlds. Sunlabb has been awarded the prize f the Develpment Marketplace f the Wrld Bank fr this successful intrductin f cmmercially viable slar rental services fr individual husehlds. Prductive use f slar energy (i.e. beynd lighting) is the next step that needs t be accmplished. In the La setting, with its still largely rural ecnmy, slar pumping int micr irrigatin equipment fr prducing marketable cash-crps is expected t have by far the biggest ptential impact in terms f incme in pr villages and in terms f the benefiting number f villages. Initial calculatins by Sunlabb suggested, that slar pumping cmbined with cheap drip systems may be cheaper per irrigated plant than with cnventinal fuel-perated pumps. But this wuld nly wrk if the equipment can be rented. Because Sunlabb has functining lgistics in place fr rental services, Sunlabb decided t explre this. A successful rental service fr pumps will mean that villagers n lnger pay fr hardware that they have truble t understand and keep in gd wrking rder. They pay fr the service itself, which has a direct impact n their incme and livelihd. Furthermre renting the equipment allws them t be much mre flexible, smething that is highly appreciated by villagers. An initial first test was cnducted in Ban Srg village in rder t assess sme pssible equipment. This test has revealed that equipment suitable fr La cnditins is available and that there is a high interest amng villagers and lcal gvernment fficials in the pssibility f renting slar pumps. Hwever, it als became clear that the agrnmy f micr-irrigatin needs t be better understd, and the marketing f the prduced crps needs t be lked int. Varius technical challenges became clear as well such as the need fr cheaper water strage devices and the need t better assess the varius technical ptins Slar pumps fr cmmercial prductin in remte La villages, Prpsal fr a PPP between DEG and Sunlabb 2

3 fr water-distributin. Furthermre it became clear that villagers were interested in a wide range f wateruse ther than irrigating high-intensive gardens, ie. fr watering livestck, fr washing, and even fr drinking water. Overall, the practical experiences s far with this test suggest that the riginal assumptin is crrect, ie. there is a high prbability that slar pumps will have a big impact n the ecnmy f many villages that are away frm the electric grid. Furthermre the cntacts f Sunlabb with lcal gvernment authrities at district and prvincial levels and with the ministries are very supprtive f further pushing in this directin. Based n these results Sunlabb decided t further explre the requirements fr a successful rental service fr slar pumps. Fr this purpse Sunlabb is searching fr interested public and private partners wh will enter int a public-private-partnership with Sunlabb fr further explring and develping slar services fr pumping, ie. public develpment agencies, financial sectr peratrs, representatives frm the slar and irrigatin industries, human resurce develpers, etc. The aim is t arrive at tested peratinal and financial prcedures, based n which an investment prgram can be frmulated. The generated data shall allw t build viable business plans fr investments by investrs. This paper is a first prpsal t DEG fr a Public-Private-Partnership with Sunlabb n this preinvestment effrt. 3. Dmain fr this PPP The PPP shall be restricted t: the explratin and identificatin f the peratinal requirements and the technlgy fr viable rental services fr slar pumps, and the required related services (prductin advice, marketing advice, etc). the cllectin f the data required t build fundable business plans fr slar pumping fr the prducing farmers, fr the prvisin f the related services, and fr the rental service itself. 14 pilt villages in 7 prvinces in which this PPP shall be active. This shall allw assessing the prcedures acrss the wide range f cnditins prevailing in La PDR. The setting up f the cmmercial peratins f a La cmpany, independent frm Sunlabb, which will earn mney frm prviding micr-irrigatin technlgy and related advice t villages. 4. Jint bjectives f this PPP This PPP shall prvide: Tested peratinal prcedures fr cmmercially viable renting f slar pumps. tested agrnmy fr prducing high-value ff-seasn crps with the installed equipment a useful partnership between Sunlabb and an agrnmic cmpany (wrking name Xa Ban ). The agrnmic cmpany will take care f explring the mst efficient use f the micr-irrigatin equipment (i.e. drip lines, etc) and train clients accrdingly. It will als train clients n marketing their crps. Suitable prcedures fr marketing the prduced cash crps, and indicatins n the level f returns that can be used by farmers t pay fr the equipment and services. Cheap and tested means fr string and/r distributing the pumped water. Effective criteria fr mnitring the ecnmic success f the client farmers and the status f the rented equipment. The data and any ther infrmatin required t build business plans fr farmers, service prviders, and fr the rental service. The business plans f farmers and service prviders shall be attractive t lcal financial institutins. The business plans f the rental service shall be attractive t investrs (lans r equity). Slar pumps fr cmmercial prductin in remte La villages, Prpsal fr a PPP between DEG and Sunlabb 3

4 5. Private reasns fr reaching the jint bjectives Farmers: Increased incme thrugh cash-crp prductin that wuld therwise be either impssible r t expensive. Husehlds: Clear drinking water in case f pumping frm bre wells. Sunlabb: Rental business Xa Ban (an agrnmic service cmpany with which Sunlabb will enter int a partnership): Business frm selling agrnmic advice and trainings t lcal service prviders and farmers, plus selling the drip-equipment. Sunlabb and Xa Ban will share the distributin netwrk f trained small entrepreneurs. Slar Service Agents: Business frm servicing the installed equipment. Other lcal service agents (village extensinists, village technicians, etc): Business frm prviding trainings, infrmatin, advice, etc. 6. Public reasns fr reaching the jint bjectives DEG: Incme generatin fr disadvantaged remte villages away frm the electric grid jb creatin in rural areas within the service netwrk With Xa Ban the emergence f a cmmercial prvider f advice n prductin and marketing t remte farmers prducing fr quality markets. envirnmental cncerns with fuel-driven pumps effects n lcal gd gvernance thrugh the village energy cmmittees Pssibilities fr fllw-up prjects fr sustainable use f natural resurces, value chains, micr credits, cmmercial service delivery in rural areas. The pssibility f drinking water when pumping frm clean bre wells. Here the general health aspects cme t play, alng with imprved nutritinal status f families due t kitchen gardening. Village, District, Prvincial authrities: Ecnmic develpment in the village, health (drinking water when pumping frm bre wells, and nutritin when kitchen gardening is made pssible). Gvernment f Las The establishment f market riented services in rural areas 7. Envisaged actrs and their rles/functins THE ENVISIONED SITUATION TO BE REACHED: In each pilt village a prducer grup perates a rented slar pump. The pump, the slar array, the initial distributin tank and tw primary lines are wned by Sunlabb and rented ut t the Village Energy Cmmittee (VEC). The secndary lines frm the tw primary lines up t the plants r ther uses f water is wned by individual farmers, including their individual water strage and distributin systems. The VEC perates the rented equipment and sells water t the individual users. The VEC then pays the rent f the equipment t Sunlabb. FIRST LEVEL SUPPORT FUNCTIONS Village Extensin Wrkers (VEW, fficially designated in the Village Extensin System f the Ministry f Agriculture) prvide cntacts, agrnmic advice, and marketing advice t prducing farmers. Usually this will be embedded services, i.e. the advice cmes alng with the irrigatin equipment. Prducing farmers pay them fr bth the equipment and the advice. Village Technicians (VT) trained by Sunlabb take care f primary technical servicing f the slar pump and the distributin system. They are paid by the Village Energy Cmmittee fr the rented parts, and by Slar pumps fr cmmercial prductin in remte La villages, Prpsal fr a PPP between DEG and Sunlabb 4

5 the individual farmers fr the individually wned parts. (The functins f Village Technician and Village Extensin Wrker may be cmbined in the same persn). SECOND LEVEL SUPPORT FUNCTIONS The Sunlabb Service Agent (SA) franchised by Sunlabb takes care f secnd level servicing f the rented equipment, i.e. the pumps and the slar array and the primary distributin system. This service is paid fr by Sunlabb thrugh the rental returns. The earnings f these Service Agents are tied t the amunt f rents cming in frm their area. Such SAs already exist in areas where Sunlabb perates rental services fr slar hme systems. They are therefre available fr the whle range f slar applicatins, nt just fr slar pumping. Xa Ban prvides irrigatin equipment, agrnmic and marketing advice and caching t the Village Extensin Wrkers. The Village Extensin Wrkers pay fr the irrigatin equipment and sell it t farmers. The equipment always cmes with the embedded advice and caching services. Sunlabb will act as a business develpment service t this new cmpany called Xa Ban. The result will be anther La cmpany that prvides services in pr rural areas in La PDR n a cmmercial basis. The business f this cmpany will be independent f Sunlabb, but the businesses f the tw cmpanies have strng synergies, and a partnership is therefre aimed fr. THIRD LEVEL SUPPORT FUNCTIONS Sunlabb prvides training and caching t the franchised Service Agents t be capable f gd servicing f the rented equipment and thereby make a business. Enterprise Develpment Cmpany (EDC) is cntracted by Sunlabb t prvide business training and knw-hw t Xa Ban, t the Service Agents, the Village Extensin Wrkers, and Village Technicians. Several f the functins at village level may be taken up by the same persn, i.e. VT and VEW 8. Main activities during the PPP The time-frame fr the PPP is expected t be 30 mnths. During this time the fllwing activities are envisaged: Identificatin f suitable actrs, i.e. Xa Ban and villages. Sme cntacts have already been established with peple wh are interested t perate a Xa Ban. Identify their specific shrtcmings and training needs t take up the challenge. The pilt villages will be preferably selected frm amng villages already invlved in rental services fr slar hme systems, and wh have the water required water resurces. Initial feasability surveys in each ptential pilt village Negtiatins with lcal authrities, villages, etc Experience shws that rental services will be secured nly when lcal authrities understand and supprt the prcedures. Wrkshps 1. With Sunlabb Master Trainers fr the technical aspects (facilitated by hired cnsultants). With Xa Ban n the marketing aspects (facilitated by EDC) and use f drip-irrigatin (facilitated by hired cnsultants). With Master Trainers f bth Sunlabb and Xa Ban tgether n the whle system and its peratins. Curriculum develpment fr the trainings that Sunlabb MTs and Xa Ban will prvide t lcal service agents (i.e. SAs, VEWs, VTs, VECs) 2. With Sunlabb Service Agents n the basics f slar pumping, the technical specificatins, and the installatin f drip-systems. Curriculum develpment fr what they will train. 3. With Village Energy Cmmittees and Village Technicians n the varius types f systems and their peratins. Detailed planning tgether with all n what will happen in which village. Slar pumps fr cmmercial prductin in remte La villages, Prpsal fr a PPP between DEG and Sunlabb 5

6 Detailed planning (based n wrkshps) Based n the negtiatins, detailed plans will be set up fr each pilt-lcatin. The idea is t test varius appraches in varius areas and villages t understand the range f useful setups fr the whle system (water surces, pumping heads, vlumes f water, water strage ptins, cash crps, ethnic grups) Installatin f the equipment in the villages On-the-jb trainings During installatin and later during initial prductin. Sunlabb trains the Sunlabb Service Agents hw t crrectly install and service the systems. Sunlabb trains the Village Technicians hw t crrectly d the first level maintenance and cntrl f the systems. Sunlabb trains the Village Energy Cmmittees t manage the peratin f the rented equipment and selling f water. Xa Ban trains the Village Extensin Wrkers n installing and using the drip systems, n efficient use f water, and n prductin and marketing f crps. Village Extensin Wrkers and Village Technicians train farmers n perating their individual systems and n prductin and marketing f crps irrigated with the systems. Mnitring Useful criteria fr the ecnmic success f farmers and f the systems will be explred tgether with the villagers and the service agents. Effective indicatrs fr these criteria will be tested. Data-management sftware will be installed and tested at Sunlabb. This data is crucial fr evaluating the ecnmic viability in rder t then frmulate sund investment prpsals t investrs (the main bjective). Fr this reasn a mnitring expert will be hired fr this PPP. Prmtin Stakehlder wrkshp at the beginning, with all types f ptentially interested and invlved actrs, t explain t all what the effrt will be, and get sme feedback and cmmitment. Expsure visits t the pilt sites fr decisin makers cntemplating the use f slar pumps: Neighbring villages, authrities frm neighbring districts and prvinces, representatives f varius gvernment agencies, representatives f varius dnr agencies and prjects/prgrams, ptential future investrs. Prmtin campaign at trade fairs, i.e. That Luang at natinal level, and prvincial events. Media features (TV, radi, press. Presentatins at natinal and internatinal meetings / cnferences Evaluatin Stakehlder wrkshp twards the end f the effrt, with all types f invlved r interested actrs. The questins t be answered in the evaluatin wrkshp will be: With the develped rental prcedures, is slar pumping cmmercially viable in typical lcatins? Which rental prcedures fit which type f lcatin? Are the peratinal partnerships viable, i.e. between Sunlabb and Xa Ban, between Xa Ban and VEW/VTs, between SAs and VTs. What needs t be imprved, and hw? Can business plans be cnstructed based n tested data, i.e. fr irrigating farmers, fr the VTs/VEWs, fr Xa Ban, fr the rental fund f Sunlabb? What needs t be dne t make these business plans attractive fr lcal financial institutins and/r fr investrs frm utside Las (scial investment funds, investments by dnr agencies, etc.). Evaluatin Reprt Admin and management Slar pumps fr cmmercial prductin in remte La villages, Prpsal fr a PPP between DEG and Sunlabb 6

7 Overall management will be dne by Sunlabb. Sunlabb will als make its cmmercial experience available t Xa Ban and train and cach this partner-cmpany t be successful in its cmmercial peratins. 9. Cmpetitin neutrality The fllwing results f the effrt will be made publicly available in rder t ensure that cmpetitin with Sunlabb by any ther agency is pssible: Technical descriptins f the installed systems, with surces f materials and expertise The curricula fr farmers, Village Extensin Wrkers, Village Technicians, Village Energy Cmmittees A descriptin f prcedures frm initial cntact in a village t fully perating successful rental system in that village. 10. Risks Sunlabb at present has internatinal cntacts t prven prviders f tested drip-irrigatin equipment fr cnditins prevalent in Las. First tests with such equipment prmise high usefulness fr pr remte farmers. Technically this is nt a prblem. Sunlabb can als easily imprt and distribute the equipment thrugh its wn netwrk. Hwever, the agrnmy f prducing drip-irrigated crps (and/r alternative uses f pumped water) and the marketing f such crps is utside the sphere f cmpetence f Sunlabb. It is fr this purpse that Sunlabb is scuting fr a partner fr this venture. The wrking title fr this partner at present is Xa Ban. Xa Ban is yet t be identified definitely. The idea that agricultural services can be prvided cmmercially is fairly new in the La cntext. But with an innvatin such as cheap drip-irrigatin and slar pumping, and ptential ther uses f newly available water at the husehld level, it lks prmising that the idea f cmmercial services can be intrduced. Xa Ban is therefre expected t be grup f prfessinals wh want t perate a cmmercial enterprise with drip-irrigatin and the assciated services in agrnmy and marketing. The peple in Xa Ban will need t: be cmpetent in the agrnmy f irrigated cash-crps have a business utlk, i.e. want t perate this venture as an wn cmmercial enterprise have their wn netwrk f cntacts in villages already have experience in marketing cash-crps r interested in acquiring the cmpetence t market themselves r cach villagers t market. Sunlabb will be training and caching Xa Ban n the entrepreneurial aspects f perating their business. The risk is that due t pssible setbacks with persnnel, by the end f the PPP Xa Ban is nt yet an existing cmmercial entity with which Sunlabb can enter int a business partnership. In this case Sunlabb will have t temprarily safeguard the agrnmic side f the venture with hired peple. Hwever, care will be taken right frm the beginning t launch Xa Ban n a cmmercial fting, and aim all supprt frm Sunlabb twards reaching at a cmmercially independent entity Xa Ban with which Sunlabb can jin in a business partnership. Training and caching fr this prcess will be ensured thrugh hiring the Enterprise Develpment Cmpany, with which Sunlabb has several years f successful experience. Slar pumps fr cmmercial prductin in remte La villages, Prpsal fr a PPP between DEG and Sunlabb 7