Enabling Access to Sustainable Energy

Project details

013 Developing and testing franchise package for promotion of low cost solar LED systems in Tanzania

Project partner

Umeme Jua Ltd, Tanzania

Project status

on-going

Project description

The market for small and medium size solar home systems has developed into a large market in Tanzania, where private sector players can earn a sustainable income. Umeme Jua, established in 2002, has been a leading private sector player in developing the market for solar products in Tanzania, developing a sustainable and growing cash market. Umeme Jua sold 7.000 panels last year and aims to sell 10.000 panels in 2008. Umeme Jua works with a network of about 65 dealers, who are contacted monthly by Umeme Jua’s account managers to resolve any pending issues. This year support to dealers will be expanded by employing two upcountry sales people, who will regularly visit the dealers. The upcountry sales people will work in close cooperation with the back office staff.

Umeme Jua aims to provide affordable and reliable access to electricity for rural households and SME’s. To further promote such access to solar products for improving the livelihoods of rural people, Umeme Jua sees the introduction of low cost solar lantern for rural households based on LED technology as a priority, combined with further capacity building of its dealers.

The project focuses on the promotion of LED based solar lanterns developed and produced in cooperation with Barefoot Power. Umeme Jua is working with Chinese manufacturing partners to develop a low cost solar lamp which will be available in large volumes in the 3rd quarter of 2008. Umeme Jua targets to order 120.000 units and sell the first 80,000 in the 4th quarter of 2008.

Umeme Jua will work together with its network of solar PV dealers who supply retailers, as well as with more general product distribution channels that remain to be identified (possibly in cooperation with National). For both channels the product presentation is to be developed as part of the pilot project

Kigoma region is selected for a pilot of 1000 solar lanterns, sold through 3 to 4 dealers each targeting around 20 retailers. Each dealer will receive training shortly before the introduction of the product and a second training when the product is introduced. The dealers will be supported on how to introduce the product in the market and how to promote the product to the shopkeepers in their network.

In the prospective next step, Umeme Jua will support its dealers throughout Tanzania to introduce this product.

Learning questions

The principle questions to be answered by the project are:

How to develop a quality low-cost package of biodigestors which will be competitive in Tanzanian household markets (value chain)?

The subquestions are:

Which tools and capacity building are needed to get the solar dealer network as well as the retailers to selling large volumes of low cost solar products to rural families?
How can these best be supported by Umeme Jua and by ETC MFS Energy Access programme?
How can the experiences in 2008 be used for further work in 2009 and 2010?
What is the size and feasibility of the market segment(s) that have been identified and what are their characteristics?
What is the customer satisfaction? What are the experiences of, and impacts on, the users (men and women) of the solar lantern?
What are the after sales requirements and how can the after-sales system be organised?
How can the experiences from the pilot phase be used for scaling up?