|Industry||Sustainable Energy Services and Solutions|
|Founder||Dr. Harish Hande, Mr. Neville Williams|
|Headquarters||Bangalore, Karnataka, India|
|Harish Hande, Managing Director|
||This article contains content that is written like an advertisement. (July 2011)|
The Solar Electric Light Company, India or SELCO India is a for-profit social enterprise based in Bangalore, India. The SELCO India has played an instrumental role in improving living standards of poor households in rural India especially in the state of Karnataka through solar energy based interventions and low smoke cook stoves. In recognition of the services towards reduction of the gap in access to energy, SELCO India has been awarded the prestigious Ashden Awards (also known as the Green Oscars) twice, in years 2005 and 2007. SELCO India was founded in 1995 by Dr.Harish Hande an alumnus of IIT Kharagpur with INR 15,000 funding from its co-founder Mr. Neville Williams. SELCO India has installed solar light systems in 125,000 houses and plans to aims to reach over 200,000 households by 2014.
Dr. Hande after graduating from IIT Kharagpur conceptualized SELCO India during his PhD on sustainable energy at the University of Massachusetts. During a field visit to the Dominican Republic, he was surprised to see the poor using solar lights. This prompted him to think if a similar model can be used for poor households in India too. After brief study on poverty and opportunities for solar intervention in Sri Lanka he returned to Massachusetts and met Mr. Neville Williams. Williams was the founder of SELF (Solar Electric Light Fund), a U.S.-based nonprofit organization facilitating rural electrification worldwide, and his interests were directly aligned with Hande’s work in his home state of Karnataka. In 1995, the two partnered to found SELCO as an energy services company focused on meeting the needs of people lacking adequate access to energy. Initially, SELF took a majority stake in the new company, with Williams as Chairman, while Hande retained a minority shareholding position and the role of Managing Director. When Hande established SELCO-India in Bangalore, he was looking to dispel three myths:
- Poor people cannot afford sustainable technologies;
- Poor people cannot maintain sustainable technologies;
- Social ventures cannot be run as commercial entities.
SELCO India eventually came into being in 1995 under the leadership of Hande and Neville Williams, president of Solar Electric Light Fund (SELF). Financial backing was received in December 1996 from Winrock International which released a conditional loan of $150,000 under the USAID Renewable Energy Commercialization project. This was however on a condition that SELCO INDIA created couple of solar service centers and install a minimum number of systems. SELCO started with a financial model in which each customer would pay 25% of the cost upfront as down payment and will further pay a monthly installment which is affordable and within the average monthly budget of a family in the region. Along with this, the SELCO INDIA also provided a year's guarantee to the warranty of the manufacturer along with free service for a year and a 90-day money back guarantee. The loan to Winrock was paid back by 2000. SELCO INDIA got good backing with E+Co initially investing US $107,500 to become SELCO India's first investor. The company has expanded into the United Kingdom, operating as a builder's merchants from 2006.
SELCO India has positioned itself firmly into the sustainable energy sector. To constantly explore opportunities and design products to serve the needs of the customer it has a dedicated innovation centre popularly known as "SELCO Labs" at Ujire, Karnataka. Selco offers products mainly in three segments - Solar PV, Solar Thermal, and Cook-Stoves.
- Solar lighting (CFL and LED)
- - Indoor Home Lighting System
- - Outdoor Home Lighting System
- - Solar Headlamp
- Solar inverter
In addition to the standardised product offerings, SELCO India also engages in customizing the offerings to suit specific needs of the customers. A few examples are solar powered sewing machine, headlamps for midwives, and portable lights for silk farmers. In addition to this SELCO India has also innovated the usage of its products by building entrepreneurial models around its offerings. One such successful model has been the solar battery entrepreneur. In this model SELCO India encourages budding entrepreneurs to buy its PV system and a number of rechargeable batteries. This entrepreneur can then charge these batteries using solar PV system and then rent out to street hawkers on daily basis.
SELCO also made a rigorous campaign to convince banks of the viability of solar electricity and requested them to provide loans to people interested to go for it. This is an critical achievement since many Regional Rural Banks (RRBs) initially refused loan because lighting by itself will not aid income generation activity(In the case of home lighting which improves only quality of life not income). SELCO INDIA has focussed on working with various financial institutions and micro finance institutions to come up with various financial products. These financial packages are crafted while keeping in mind the cash flow of its customers. The amount charged to consumers ranged from as little as 10 rupees per day to 350 rupees a month.
Solar energy service is decentralized in nature compared to centralized grid based electricity. Hence onus of maintenance will be upon the user. Hence reliability of service is also important factor given the customer profile and nascence nature of technology.Hence SELCO created a network of service centers to get confidence of customers. It is having 140 employees servicing the instruments in 21 energy service centers in Karnataka and Gujarat.
SELCO has so far installed solar systems in more than 125,000 homes. This is in spite of two-thirds of its customers surviving on less than $3–4 per day. Some of Selco's customers include poor daily-wage laborers and institutions like schools and seminaries. Everyone is charged the same rate for the solar panel; about $450 for a 40-watt system that can light many 7-watt bulbs for 4 hours between charges. Fewer than 10 percent of the company's customers default in their payment and about $20 million has been made available by lenders to finance this venture.
SELCO has also created other small entrepreneurs who use the solar panels to charge numerous small batteries which they then lend to street vendors for a nominal daily price. This has boosted their monthly incomes from Rs. 4500 to Rs. 13000. Other people who have benefited from SELCO's venture are the rose pickers in a village in Bangalore who earlier used to hold a lamp in one of their hands and pick roses from the other as part of their daily pre-dawn routine. SELCO has helped them in acquiring solar powered headlamps which the workers can now wear. With both hands now being free, the productivity of the workers has doubled resulting in a direct improvement in their income.
4) Winner of FT ArcelorMittal Boldness in Business awards in 2009 in Corporate Responsibility.
5) SELCO's products found place in "Design for the other 90%" exhibition from Cooper-Hewitt Museum.
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