Rural home in Nicaragua electrified by solar PV system provided by Tecnosol. Photo by Perry Goldstein
Marcos Mancini and I, Rebecca Martin, completed our summer internship at E+Co’s regional office in Latin America in San Jose, Costa Rica. We are graduate students at the Erb Institute at The University of Michigan pursuing a dual degree from the Business School and the School of Natural Resources. The projects we worked on were an assessment of the solar market in Central America and an analysis of microfinance institutions in Honduras and Panama.
For the solar market assessment, we were working with Tecnosol, one of E+Co’s portfolio companies that sells Photo Voltaic (PV) systems in Nicaragua, that wants to expand into other countries in Central America. We traveled with Walter Vargas, one of the investment Officers, to Managua to meet with the entrepreneur and inquire about his expansion plan. In order to learn about the solar market in different countries, we interviewed the largest solar PV companies in each market, government organizations and associations of renewable energy producers. We learned that PV companies target rural households that are not connected to the grid because PV systems make sense economically for them. Many times, the cost of a system is less than their monthly energy costs for kerosene, wood, candles and batteries. Poor households that are connected to the grid usually receive subsidized energy so their monthly electricity costs are very low and purchasing PV systems would be too expensive.
It was fascinating to learn how different the solar market is in each country. Panama and Costa Rica do not have as much growth potential because they already have high electrification rates. The other countries’ markets are based mostly off of government contracts focused on rural electrification. Frequently, the main issue in selling PV systems is that poor, rural households do not have the capital to purchase systems, which leads to the other project we worked on with microfinance institutions (MFIs). Nicaragua is the only country where solar PV financing is widespread amongst MFIs. We contacted several MFIs in Honduras and Panama to assess possibilities for partnerships between MFIs and PV companies in these countries.
We would like to thank everyone at the office, Wilhelm, Walter, Alex, Eu, Cynthia and Karla, for a great experience and Gina and Meredith in Bloomfield for the opportunity to work with a company that is truly making an environmental and social impact.
By Rebecca Martin
Dear Rebecca Martin:
I live in El Salvador and work on the electricity sector in Central America. I would like to know if you did any research of the solar market in El Salvador. In my country many people needs electricity and I would like to know if I can implement a Photo Voltaic systems in certian areas of my country and countribute to help many poor peoples without electricity.
Thanks for your kind response.