Battle for the solar market

 Solar wars heat up following German firm’s arrival into Kenya market.

 

THE STAGE is set for a major battle in the solar sector following the March entry into the Kenyan market of Mobisol, a provider of smart solar home solutions from Germany. By installing a free solar unit at a house in Juja, Kiambu County, about 50km from Kenya’s capital, Nairobi, Mobisol has ignited a price war that is bound to shake the market for sometime to come.

The solar unit - comprising a 120 watt solar lighting system and Mobisol-branded 32-inch flat screen TV - was installed at the one-bedroomed house of John Kimani Wanjiru, who became the company’s first customer in Kenya.

To witness the event were various high- profile guests, including Kiambu County deputy governor Gerald Gakuha Githinji, a member of the parliamentary committee on energy James Rege, Germany’s envoy to Kenya Jutta Frasch, and the director for renewable energy at the ministry of energy and petroleum, Isaac Kiva.

Kenya becomes the third East African country targeted by Mobisol, after the firm unveiled its products in Rwanda and Tanzania. 

Speaking during the pilot installation cer­emony, Mobisol’s CEO Thomas Gottschalk said that the Mobisol solar unit sizes are by “far the only credible substitute to grid elec­trification.

“We believe that ‘big is beautiful’ - our systems are designed to power entire house­holds and even businesses, with a variety of highly efficient DC appliances. Many of our customers in Tanzania and Rwanda not only run 32-inch flat screen TVs with their system, but also power haircutters and hair- straighteners simultaneously, while enter­taining their barbershop customers with music stereos,” continued Gottschalk.

Gottschalk noted that the company had realised a significant gap in the number of Kenyans connected to the national grid, especially in areas outside urban centres.

“More than 70 per cent of Kenya’s popu­lation does not have access to electricity. While solar solutions are increasingly gaining popularity for low-income individ­uals, the local market does not really carry large solar solutions, strong enough to power large TVs, music stereo systems, or even fridges,” he pointed out, adding: “Looking at the fact that our systems are 10 times bigger than those of similar providers on the market, much more powerful, but just as affordable, encourages us to provide our solutions also to Kenyans.”

Mobisol’s entry into the market, together with its branded solar-powered TVs came just a few weeks after local home solar solu­tions provider, M-Kopa Solar, launched its solar-powered TV sets for its existing users and new clients.

This has led consumers to believe that the local and regional home solar solutions market is set to experience previously unseen competition once Mobisol makes its products commercially available.

Mobisol is funded by the German Development Bank and has set its eyes on the region’s low-income households, most of whom are unable to apply for and get con­nected to the national power grid, mainly due to the high fees involved.

Many people are thought to need such home solar energy solutions and are looking forward to them as alternative to grid power, as confirmed by John Kimani Wanjiru, the beneficiary of Mobisol’s pilot installation in Kenya.

“I applied unsuccessfully for a grid con­nection a long time ago,” he said. “Within just one hour, Mobisol brought not only elec­tricity to our house, but also a new lifestyle. Now, my family and I can watch our favourite shows and news on our big flat screen TV, have multiple lights running during the night and even make money by selling excess electricity.”

Wanjiru said that he expects this additional income will allow him to buy more solar appliances from Mobisol, ranging from branded haircutters, straighteners and music stereo systems, to super efficient flat screen TVs, available in 19-inch up to 32-inch sizes, and DC powered cooking stoves.

Mobisol’s lighting systems are available in three sizes - 80 watt, 120 watt and 200 watt.

Until last month, Kenya’s home solar energy solutions market was synonymous with M-Kopa Solar, which has Safaricom Foundation among its funding partners.

M-Kopa Solar was launched in Nairobi, in October 2012. Since its launch, it has con­nected more than 280,000 homes in Kenya, Tanzania and Uganda to solar power.

M-Kopa Solar (whose name has been coined from ‘m’ for mobile and ‘kopa’, Swahili for ‘borrow’) has a similar aim to Mobisol, which is to provide affordable solar products for modest households, which can then own them flexibly via an installment plan.

M-Kopa users acquire solar units after paying an agreed deposit, then make daily instalments of $0.50 (Kshs50) via Safaricom’s M-Pesa mobile money platform. After 12 months of payments, customers then own the solar systems. The embedded GSM sensors in each solar system allow M- Kopa staff to monitor real-time performance of each unit and regulate usage based on payments.

Mobisol does not rely on one mobile payment platform and has indicated during the pilot ceremony that it would offer clients multiple payment platforms - whether M- Pesa, Airtel Money, Orange Money or Equitel.

For now, M-Kopa Solar has majority of people using its solar energy systems but holding this market share may prove difficult once Mobisol’s products hit the market from July. Consumers will also need to be per­suaded which product offers better value - whether in terns of quality, pricing or cus­tomer support.

 

 

 

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