Solar Energy: By Nature, For Nature

SELCO-India

1. No Poverty 7. Affordable and Clean Energy 8. Decent Work and Economic Growth 9. Industry, Innovation and Infrastructure 11. Sustainable Cities and Communities

Overview

SELCO started with a financial model in which each customer would pay 25% of the cost upfront as a down payment and will further pay an affordable monthly installment and within the average monthly budget of a family in the region.

"SELCO has a group of 400 strong people to run it. It includes 490 people in roles. It has also partnered with various NGOs to reach the targeted audience and use the data from NGOs to solve the dilemma of [the] rural poor. SELCO not only looks at implementation but majorly looks at innovation," says Mr. Amogh Mamadapur

There existed a myth that poor people cannot afford sustainable technologies. SELCO has installed over 450,000 solar solutions for the poor, which have been paid for using various financing methods designed by SELCO and its financial partners. It has demonstrated that social ventures can be run as commercial entities by growing many folds over the years while promoting solar power to the rural poor.

The uniqueness of SELCO is that it is already on the path of Sustainable Development Goals along with an ideology in mind – “People Planet’s Profit.” SELCO is not about the financial gains; it is about the commitment towards climate and society, meanwhile earning profit.

Authors

Saurav Tiwari

Saurav Tiwari

Avinash Mendon

Avinash Mendon

Nisarg Mehta

Nisarg Mehta

Abhimanyu Sharma

Abhimanyu Sharma

Kiran Sajeev

Kiran Sajeev

Anubhav Srivastava

Anubhav Srivastava

School

Goa Institute of Management

Goa Institute of Management

Professor

Divya Singhal

Divya Singhal

Innovation

SELCO’s interest lies in three types of Innovations: Product, Process, and Financial innovations.

All solutions given from SELCO are tailor-made, and the major target to sell such solutions to economically backward or financially challenged people from rural areas. SELCO also provides financial solutions to such groups of society by innovating the financial models at a fundamental level.

For Harish Hande, the co-founder of SELCO, affordable didn’t mean low cost, but suitable financing. He emphasized need-based technologies rather than fitting the problem to the solution. He then developed tailored made finance products partnering with small business owners and financing companies.

SDG 1 and SDG 7 - SELCO combines these two SDG by providing energy solutions to the people on the bottom of the pyramid. In a subtropical country like India, where sunlight is in abundance, but because of vast stretches of land spread throughout, the electricity grid did not reach the poor people in the country's rural side. SELCO uses this to develop innovative solutions for installing solar panels in the villages, which fulfills energy requirements at cheap prices.

SDG 11 - Sustainable cities and communities

Earlier, India's rural side used wood fire for their daily energy requirements, which produced a lot of carbon dioxide and other greenhouse emissions. This solution not only reduces the carbon footprints but also provides them with a long term clean energy at affordable prices.

Solar Energy: By Nature, For Nature

Inspiration

When we interacted with Mr. Amogh, he shared with us that "on a visit to the Dominican Republic, Harish Hande, co-founder of SELCO was shocked to see the poverty level along with lack of electricity. He observed that the poor’s, street vendors, vegetable sellers, and small shop owners spent approximately 15% of their income on kerosene lamps to get light. Although he saw the people were paying for solar electricity, which made him realize that solar energy is a viable option to meet energy demand." This was the major inspiration for innovation. Their innovation is to offer this at an affordable price.

Mr. Harish Hande graduated as an Engineer from IIT Kharagpur and did his Masters's in agriculture from MIT, Massachusetts. He also holds a degree of Ph.D. in agriculture subject from the Dominican Republic. He studied the agriculture sector's dilemma and energy sources, and then to contribute his knowledge to his motherland, he came back to India.

Overall impact

SELCO aces in delivering Last-Mile Sustainable Energy Solutions that Improve Quality of Life and Socio-Economic Development for the Poor. With this thought in mind, SELCO, founded in 1995 and expanded to 5 states, Karnataka, Maharashtra, Kerala, Tamil Nadu, and Bihar, delivers sustainable decentralized energy solutions for the poor.

SELCO has busted this myth that poor people can’t afford the luxury of sustainable technologies. With it’s up to mark financial research and cash flow analysis, SELCO installed 450,000 solar projects, resolving the poor's survival challenges.

SELCO provided employment by hiring the rural locals from the poor locality to maintain the solar system in an area. It has increased trust and responsibility, which is crucial when it boils down to untapped minor communities or backward localities.

SELCO has a pure interest in earning moderate profits and investing the same back to the firm to grow and touch the largest market possible. It views energy access as an underlying base for the progress of health, livelihood, education, and society's overall welfare. At SELCO, the poor are looked as partners, innovators, which gives the poor the tag of dignity, increasing the indulgence and dedication to contribute by being part of this company.

The mission of the organization is to help society with equivalent financial stability. SELCO has carefully structured its investment with investing in non-profit organizations where the motive is “impact first.”

Business benefit

SELCO implemented a transition from “Solar Lighting to Solar Livelihood.” The company got deeper into society, looking towards the urban and rural poor class. SELCO began to set up innovation labs, where it partnered with various organizations to convert their innovative ideas into a physically consumable shape. SELCO evolved with creating innovations and kept a major preference for delivering those innovations to the targeted mass.

SELCO not only looks at implementation but majorly looks at innovation. SELCO did setup various R & D labs in different parts of the country, partnering with NGO(s) and other such organizations. SELCO uses the data and designs from such labs and delivers sustainable solutions to market at very affordable rates.

Instead of fitting the problem to the solution, by attempting to lower the quality and cost of solar products, SELCO creatively ensures that the poor can purchase their products at market prices. The mantra was affordability rather than low prices and efficiency by adequate financing. By sustainable initiatives, they have motivated the bottom of the social pyramid, and solar energy has been used to democratize society. To maintain the solar system, SELCO has hired mostly minor community and locals from the poor rural locality, which has increased the awareness, trust, and support among the locals. SELCO has already installed 450,000 solar projects, thereby having a scalable model with flexible cash flow and favorable financials.

Social and environmental benefit

The primary target of SELCO is innovation. It always looks forward to challenging the status quo. E.g., if a person is disabled, how he/she will run the sewing machine, how the roti-making machine could be made affordable to rural people etc.

"The company got deeper in the society looking towards the urban and rural poor class. SELCO began to set up innovation labs, where it partnered with various organizations to put their innovative ideas to convert those ideas into physically consumable shape," says Mr. Amogh.

SELCO has played an instrumental role in improving poor households' living standards in rural India, especially in the state of Karnataka, through solar energy-based interventions and low smoke cookstoves. SELCO has been awarded the prestigious Ashden Awards (also known as the Green Oscars) twice in 2005 and 2007. The e-shala (e-school), a project of the Selco Foundation, provides education for children in rural areas, mainly in areas where power supply doesn't exist, by using a solar-powered power storage device, LED projector, and tablet loaded with content. It is making sustainable goods and suitable financing available to uplifting the poor. It makes sustainable technologies and non-renewal energy available to the poorest community of society, with a mission only to earn modest profits and invest the same back into the business to expand and touch the maximum possible market.

At SELCO, energy access is seen as the fundamental basis for developing society's health, livelihoods, education, and general welfare.

Interview

Amogh Mamadapur, PR Head

Photo of interviewee

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SELCO-India

SELCO-India

Bengaluru, Karnataka, IN

Business Website: https://www.selco-india.com/

Year Founded: 1995

Number of Employees: 501 to 1000

SELCO Foundation is an open-source, not-for-profit organization that engages in field-based R&D and ecosystem building to deploy clean energy solutions that alleviate poverty in tribal, rural, and urban poor areas. The organization works closely with practitioners in the social sector, energy entrepreneurs, and partners from various developmental sectors.