Innovation

There are 3 main innovations in the story of the Mobiya Lantern designed by the Sustainable Development of Schneider Electric:

• First innovation: the product “Solar Mobiya Lantern”.

It is a solar lamp designed with solar panel: first you plug the lamp to the solar panel and it charges the battery which is inside the lamp. Once the battery is charged from solar energy, the lamp can light a house or a market place! It can also be used to charge a mobile phone. As Olivier Jacquet, head of Sustainable Development, explains, “We realized that in the poorest African countries, more than half of the population has access to mobile phones but they don't have access to the energy to charge them.” The first version of the lantern had no plug for the mobile phone and nobody bought it. This was the key feature to make a viable business model.

In poor rural areas, people have a hard time to get access to energy and when they have it they use fossil energies for lighting and heating. It is not good for their health, there is smoke in their house. With this solution they have clean energy and they can have light for 8 to 48 hours. It is also a very robust solution; it is waterproof and shock resistant.

• Second innovation: the business model.

Olivier highlights, “Our traditional way to sell our standard offer is not valid with this new targeted market.” Usually, Schneider Electric sells products to large companies specialized in distribution of electrical supplies. In rural African areas, the only shop is the gas station. "We need to understand the local habits to find the right business models," explains Olivier.

• Third innovation: organization

It is not usual to dedicate a separate business unit for social business and to accept a lower profitability.

Inspiration

When the Schneider Foundation was created in 1998, the aim was only philanthropic. However, they soon realized that there were always limits in what they can do if they only relied on donations. Six to seven years ago, they decided to create a profitable social business. The aim is to cover costs and make some modest profits.To optimize cost, R&D and continuous engineering are located in India. The business margin objective is much lower than in standard business units.

Six to seven years ago, with Mobiya project, it was the first time that Schneider Electric company specially designed a product targeting the poor population.

Overall impact

With Mobiya and the new offers that are coming, Schneider Electric provides a free and unlimited access to electricity. Access to electricity is an enabler for multiple vital usages including lighting, safety, health, and water.

Some examples of the impact on local populations:

* The solution called “Villaya Water” allows villagers to get fresh water from a well thanks to solar energy.

* The access to electricity is a first step to economic development. Olivier notes, “I saw it last week in a refugees’ camp in Jordania. Electricity creates business activity, shops get created…”

* The newest lamps are designed with a plug for a fan, a radio, a TV set…

* This year, the microgrid, financed and managed by the HCL foundation, has given access to reliable electricity to the village of Malhpur in India. For the first time in the lives of people of Malhpur, reliable electricity access has changed from being a distant uncertain dream to a reality. Load monitoring and metering has allowed HCL to optimize peak load consumption. A further 47-50 similar microgrids are due to be set up, electrifying a further 50,000 people in 63+ remote villages.

These rural households are seeing immediate benefits. Where energy typically cost 20% to 25% of their income, this has been reduced to 15% to 20% with electrification. As the project grows, new opportunities such as water pumping and rice milling are enhancing local economic activity, while reliable mobile phone charging and the connectivity that comes with it, together with LED lighting in homes and businesses, also bring opportunities. Electrification of schools and health centers for the first time is having an immeasurable impact on quality of life.

Business benefit

Global social business turnover for Schneider Electric is around 20 million euros.

100.000 Mobiya units are sold per year to local communities, direct users through new selling networks such as Non-Governmental Organizations (United Nations, UNHCR for refugees’ camps, Red Cross…).

For example, last year Red Cross bought 5.000 units to give to those affected by Hurricane IRMA.

It shows that this social business is profitable and can be scaled up to a large level. And thanks to this business, the company discovers new markets and new ways to sell, especially in poor rural areas.

Social and environmental benefit

For years, Schneider Electric has been a company that provides energy efficiency solutions, access to renewable energy, and access to sustainable energy. The CEO says that: “access to energy is a basic human right.”

Olivier adds "Access to energy is our core mission. It differentiates Schneider Electric to other big companies who invest in this kind of social actions just for the image. "

In the sustainable development department, the business is focused to a new market; half of the planet ! People that have no access to energy or people who have access to fossil energy which is not good nor for the health nor for the planet.

Committed to the 17 Sustainable Development Goals (SDGs) set by the United Nations, Schneider Electric is particularly invested in SDG 7 or ensuring access to sustainable energy for all as a prerequisite for child education, quality of life, and economic development. In 2009, Schneider Electric launched its Access to Energy program with the objective of supporting vocational electrical training, in partnership with local organisations. Since then, the program helped more than 190,000 people in more than 45 countries.

Olivier insists : We want to help the 1 billion human beings who have no access to energy to have access to electricity. We want to provide clean energy to the 3 billion human beings who use fossil energy.

This is the mission of our department. It is a very difficult market we must be innovative in our product but also in our business models.

To close the interview Olivier shared his dream: he would really like to find the keys to deploy this kind of business in an even larger scale. The 100.000 lanterns represent a drop of water regarding billions of people!

Building a new economic system where “planet” value is considered as well as financial value is also a personal mission for him.

Interview

Olivier Jacquet, Sustainable Development – Business Development