Thanks to a REEEP project, cash-poor Pacific island villagers who often have no access to banking systems are able to trade cassava, dalo, bananas and other crops as payments for an LED solar lighting system to replace kerosene lanterns. This also leads to a considerable savings in fuel costs: in the Solomon Islands, kerosene will cost a typical household the equivalent of about €0.63 per day, while the value of the crops traded for solar LED amounts to less than half that, at €0.28 per day.
This SOPAC (Pacific Islands Applied Geoscience Commission) implemented initiative to establish Pacific Micro Energy Service Companies (PMESCOs) in the Solomon Islands and Kiribati has already had its share of media attention. And now with leveraged funding, the model is scaling up.
After the close of the successful pilot project, REEEP Southeast Asia Pacific organised an event alongside the Pacific Energy Ministerial Meeting (PEMM) in Tonga in April 2009, entitled “Successful Microfinance Models for Clean Energy Projects in the Pacific.” The well-attended gathering discussed how to make rural electrification a viable option for Pacific Island Countries through a microcredit facility. REEEP presented two successful projects; the PMESCO experience and a kerosene replacement project in Papua New Guinea and Vanuatu implemented by Barefoot Power; and opened the discussion for potential investors (Asia Development Bank, World Bank, the EU and private investors) to consider up-scaling them.
As a result of the work that SOPAC undertook over the 18-month life of the project, together with the local solar entrepreneur in the Solomon Islands, Willies Electrical, Willies was able to leverage further funding from the Solomon Islands’ government and the World Bank and scale up this kerosene replacement model to an additional 600 households, an 18-fold increase on the original project’s 35 households. Beyond this, Willies has another 1400 households who are interested in the LED systems, pending further financing.
“This is an exemplary instance of how small and targeted REEEP interventions pave the way for follow-up initiatives, resulting in large impact. It is also a testament to REEEP’s robust structure and its presence in the region through a Regional Secretariat which gives opportunity to work with regional agencies and develop possibilities for scaling up. For our donors, this demonstrates that funding that is channelled through REEEP is money well invested,” said Marianne Osterkorn, the organisation’s Director General.
