At 11:56 AM on April 25, 2015, a 7.8-magnitude earthquake rocked the Nepalese district of Gorkha, 80 kilometers northwest of the capital, Kathmandu, sending shocks through Nepal’s Central Region and Kathmandu Valley. Powerful tremors continued for weeks after, shutting down power, cell towers, roads and stalling badly needed relief services’ arrival to affected communities. The earthquake’s total death toll surpassed 8,000 and left millions homeless, according to estimates from the International Federation of Red Cross and Red Crescent Societies.
While relief organizations scrambled to amass and courier aid into Nepal, one organization had an advantage few others had: a foot on the ground and a ready network within the very communities impacted by the disaster. Empower Generation—an umbrella organization for Nepalese solar business owners and sales agents—immediately got to work orchestrating an effort to distribute more than 11,000 donated solar lamps, mobile chargers, and other supplies to the affected areas. The effort was led by a group of individuals not typically seen in such public, active leadership roles in Nepal: women.
Empower Generation is a U.S.- and Nepal-based organization whose mission is to harness affordable technologies to bring energy to underserved, off-grid Nepalese communities. Its focus on energy—and solar lighting specifically—also has a dual purpose: to leverage the provision of energy services to enhance women’s leadership and entrepreneurship in a society that offers women few opportunities.
Even without a natural disaster, there is an acute need for energy services in Nepal. Roughly 30 percent of the country’s 28 million people are not connected to the electricity grid, and those who are experience little time with power.
“The energy situation is terrible. The grid is so mismanaged and under-resourced that the power can be out 18 hours every day,” explains Anya Cherneff, Empower Generation’s founder and CEO. Sita Adhikari, co-founder with Cherneff, adds that power is usually available from midnight to early morning hours, when no one really needs it.
Those with means purchase back-up diesel generators. Those without—or who are completely disconnected from the grid—rely on kerosene, candles, firewood, and other forms of biomass for household energy. In the remote regions Empower Generation serves, families spend 25 to 30 percent of their income on energy, or about US$10 per month. Percentage-wise, this is on par with what the poorest 20 percent of the world spends on energy. In fact, the world’s poorest 20 percent pays $27 billion annually for rudimentary energy sources, which accounts for roughly 20 percent of the global lighting bill but less than one percent of the visible light emitted, according to data from Lawrence Berkeley National Labs.
Everybody suffers from these circumstances, but women are disproportionately affected. Women’s primary responsibility in Nepal is household care, and lack of energy access means many hours spent collecting wood, cooking over smoky fires and performing home chores and childcare by dim candle and kerosene lamp light.
What’s more, women in Nepal have limited opportunity to change their living situations. A woman’s status is usually determined by the economic and social standing of her father or husband. Many are expected to marry young—a third of Nepalese women between the age of 15 and 19 are married compared to only seven percent of their male counterparts, a 2011 U.N. study reports. As for economic independence, women are allowed to own property, but it is often in-name only.
These factors, coupled with the high rate of village and rural poverty in Nepal (as high as 45 percent in some areas), leaves women vulnerable to abuse, exploitation, and human trafficking—issues that Cherneff knows well. “I spent my early career working against human trafficking and prostitution for the Coalition Against Trafficking in Women and was a founding member of the the University of Denver’s Human Trafficking Center,” Cherneff explains. “The work we did was great, but it was never-ending. For every victim we helped, another one would take her place.”
After five years, Cherneff burned out. Instead, she began looking for solutions at the root of the problem and ultimately seized on one unique fact about low-income, low-resource countries like Nepal as the basis for Empower Generation: that women are responsible for household energy decisions. “Women collect, use and manage their household energy supplies. They therefore feel the most pain from energy poverty and stand to gain the most from the transition to clean alternatives” explains Cherneff.
Empower Generation, which started in 2011, is a hybrid for-profit, non-profit organization based in San Francisco and Kathmandu and works in remote communities throughout Nepal. The non-profit division identifies, trains and supports rural women in selling clean energy products—mostly solar lamps—to their communities. Women that show exceptional skill in sales and dedication are supported with resources from Empower Generation to launch their own independent businesses. Empower Generation asks them to commit for five years, and in turn, the organization offers economics and business training, low-interest start-up loans, a line of credit to buy inventory, and help with marketing, branding and opening a bank account—a first for most of the women Empower Generation recruits.
“Our distribution network is made up of women spread across different districts in the country. Most of them have less than a tenth grade education. Most have never had a job before, let alone owned their own company,” Cheneff says.
These so-called “Solar CEOs” form the core of Empower Generation’s distribution network and pay a membership fee to remain part of it. Their inventory is provided by Empower Generation’s for-profit arm, which buys and imports clean energy products and acts as a wholesaler for the women entrepreneurs. The women then sell the products by recruiting their own sales agents and taking the products home-to-home, Avon-style, in their local communities and educating their neighbors about the benefits of clean energy.
Because women are responsible for household energy decisions, they stand to benefit most from the transition to clean sources.
To date, Empower Generation, with support from outside partners like Mercy Corps and DFiD, has helped launch 14 women-led businesses, run by 23 women. These micro-enterprises collectively employ 185 sales agents, who account for 63 percent of Empower Generation’s total lamp sales. The rest are sold by the Solar CEOs themselves. Empower Generation’s network sells an average of 110 solar lamps per month—up from 70 per month in 2015.
Empower Generation does not design or make any of the products it sells; rather, it is a distribution partner for solar lamp manufacturers, including d.light and Greenlight Planet, which were among the first to create products for the energy poor and have a developed name recognition in numerous countries across the Global South. The individual lamps Empower Generation sells cost between US$10 and $35 and range in size from small focus lights that produce 25 lumens for about four hours a day, to larger lanterns that can produce up to 110 lumens and last up to 16 hours, plus battery storage. More than 90 percent of Empower Generation’s customers can afford to buy these products without credit, and by off-setting the cost of kerosene, buyers recoup the cost of the lamp in about three to six months.
This year, the organization also started offering pay-as-you-go home lighting systems, manufactured by Omnivoltaic and Fosera. These systems require a roof-top solar panel, connected to a battery. On a full charge, the battery can power multiple lights, a small TV, a fan, a USB charging station for mobile phones and a tablet. Depending on the panel’s size and the weather, these larger systems provide four to eight hours of power per day. The starting price for a home system is just under $250, which can be repaid over three years with a monthly payment of $7, or about 750 rupees locally. This model works well for a customer base that earns too little to plan spending far in advance; most household purchases, including kersoene, are made on a daily basis, based on what the family can afford.
“Every time they pay us, we unlock another month of the system. If they don’t pay, we can lock the system so they cannot use it,” Cherneff explains.
Other organizations and social enterprises work under a similar model to Empower Generation, functioning as low-cost technology distributors rather than product designers. These include Technosol in Latin America, Solar Sister in rural East and West Africa, Pollinate Energy, Frontier Markets and Essmart in India, and many others. In all, about 100 companies globally are focused on selling solar lamps and solar-home systems to the world’s 1.2 billion people who lack modern energy services. They collectively sold 20 million starter products by 2015, according to a recent report by the World Bank and Bloomberg New Energy Finance. Another 24 million unbranded small, or “pico”, solar products have been sold through other retail outlets.
The yawning gap between 1.2 billion people and 44 million products sold highlights the untapped opportunity for solar technologies and distributors. In Nepal, Empower Generation estimates the demand from off-grid customers alone could be as high as 440 million solar products per year. Cherneff says that having reached 50,000 lamp sales, her organization is already fielding questions from potential investors and donors about market saturation, however.
“People ask whether we are concerned, but let me ask you, would you be happy with just one light bulb?” she says. “We are focused on moving up the energy ladder by offering our customers more than [single] lights with one USB port. The market for power is almost unquenchable.”
This is especially true in countries like Nepal where the challenges of running a business have deterred potential players from serving its communities. “Nepal is an extremely risky and tricky place to do business. It has taken us years to figure it out,” notes Cherneff.
For starters, any for-profit enterprise in Nepal that trades finished goods has to be 100 percent Nepalese owned. The policy is meant to protect the local economy from foreign exploitation, but it nevertheless presents difficulty for social entrepreneurs wanting to sell products in the country, because strong local partners can be hard to find.
Empower Generation was fortunate in this regard. Its for-profit wholesale business in Kathmandu is owned by Adhikari, who was the organization’s first independent entrepreneur. Cherneff and Chloe Chapman, director of operations, describe her as invaluable to helping Empower Generation reach its current scale and understand its customer base.
Logistically, the challenges are more acute and often unpredictable. The products Empower Generation sells are manufactured outside the country. Because Nepal is landlocked, the only import routes are by ground from India or China, or by air. India is the stronger of the two border partners, but Nepal’s political relationship with India is contentious at times, and recently, Empower Generation experienced how disruptive diplomatic disputes can be to business.
“We rely on travel through India to get the goods we sell. Late last year, India closed the border, and all of our products got stuck at the border,” explains Chapman, who is based in Kathmandu. “That’s an external problem that I can’t fix, but it’s so painful.”
Oil imports from India also slowed to a trickle during the border closure, which disrupted the alternate import option: air travel. Because planes taking off from Nepal could not refuel, air traffic slowed, and at some points stopped altogether. This affected one of Empower Generation’s shipments.
“Planes couldn’t refuel in Nepal so they had to use their cargo space to carry fuel,” Chapman says. Empower Generation’s solar lamps and other goods were off-loaded to clear additional room in the cargo hold. A shipment that would normally take two weeks to arrive by air took 45 days by water and land.
The impacts of these issues reverberate quickly through an organization like Empower Generation, which runs on extremely tight finances. While the border with India was closed, the inflation rate and transportation costs in the country skyrocketed, driving up the cost of all goods. Empower Generation increased its staff wages by $50 per month to compensate, while its revenues remained flat.
Skeptics might question whether affordable product distributors can succeed with for-profit models in such complicated, nascent markets like Nepal. Empower Generation’s for-profit arm, for example, is earning steady revenues from sales, but it is not yet profitable. It leans heavily on its non-profit division for essential functions like training. SunFarmer, a solar company that focuses on institutional installations for schools and health facilities, operates in Nepal under a similar hybrid-model.
The Empower Generation team counters that it is not a matter of whether an organization like theirs can be profitable, but when. People everywhere pay for energy, the team says, and for off-grid households, those expenses become profits for candle and kerosene vendors—sometimes exceptional profits: globally, rural customers pay anywhere from 29 to 170 percent more for kerosene than their urban counterparts.
The challenge then, for solar providers, is to prove that their less familiar products deserve a place in the market against the current mainstays. Distribution-focused organizations like Empower Generation have a role to play by vetting and selecting technologies that are most likely to be adopted by their target communities. “We don’t promote one technology over another—we are technology agnostic. We sell products that are available and will work in our communities,” explains Chapman.
For example, for its solar home systems, Empower Generation is currently weighing whether to choose between Omnivoltaic and Fosera products, or to sell both products on an on-going basis. Each has the same approximate energy capacity and battery technology, but their packages are constructed differently. The solar home systems are sold as 3- to 10-amp-hour units with 10- or 20-watt solar panels that can power four or five lights. Customers sign up for two- to three-year contracts and have the option of adding accessories, such as a universal laptop adapter, a multi-port USB charger, television, or fan. Also, both manufacturers export their systems as a set of individual components, which is attractive to Empower Generation because the parts qualify for a tax rebate from Nepal. Rather than paying 50 percent tax on the imports, the organization only has to pay two percent for the solar equipment. And both systems are integrated with a simple punch code, pay-as-you-go technology that allows Empower Generation to switch the customers’ systems on and off based on receipt of payment.
“What we are really evaluating is how well the systems function, how much power they provide and which ones our entrepreneurs and customers prefer,” Cherneff explains. “We also pay attention to how willing the manufacturers are to work with us on branding, marketing, and supply chain support.”
Determining “what is available" and "what works” does not always go hand-in-hand in Nepal, but the one clear line Empower Generation has drawn is choosing branded versus “generic” solar products. Generic products now comprise more than 50 percent of total pico solar product sales globally, but the organization chooses to sell only branded items that meet the standards of Lighting Global, an institution that offers quality control assurance and standardization for off-grid solar products. Empower Generation’s rationale is that its organization is at the center of creating a new market in Nepal, and quality—and the perception of quality—are crucial to its success.
This is also where Empower Generation’s focus on building women entrepreneurs has a double impact. Because women are responsible for household energy decisions, women also have the potential to foster energy-related behavior change. Lack of awareness, technical knowledge and trust in new technologies are big barriers to the adoption of renewable energy products among the global poor. Families are often hesitant to switch from kerosene and candles to unfamiliar products with higher upfront price tags.
“Introducing a new technology always requires much customer education and awareness creation,” writes SEED program manager Amelie Heuer in a recent case study on Solar Sister—a Uganda-based solar organization with a similar model to Empower Generation. “[Focusing] on woman-to-woman sales is the best way of introducing new technology in rural households where women are the primary users and managers of household energy. Rooted in their communities, they become trusted energy advisors and focal points for quality customer care.”
Cherneff, of course, agrees. "Anyone who wants to sell renewable energy should be able to sell renewable energy,” she says. Indeed, both women and men serve as sales agents for Empower Generation. “But women telling their stories to other women is the most effective marketing tactic we have,” she adds.
Breadth and depth
Empower Generation hopes to increase its network of women-led businesses from 14 to 20 this year. It is also in the early stages of exploring a launch in its second market: Myanmar. Myanmar is nearly twice the size of Nepal with an electrification rate of only 23 percent. Empower Generation estimates that the country is a $1.1 billion market for solar products annually.
To expand, the organization needs capital to build its network and business support services. It is actively fundraising with the hope of securing $300,000 in grants and donations for its non-profit and $1.5 million in investment capital for the for-profit by the end of the year.
Cherneff admits that she has hesitated over the organization’s expansion plans to a new country, because she feels there is deeper impact to be made among the communities it serves in Nepal. For example, Empower Generation has started vetting and selling new technologies, including clean cookstoves and water filters, to help its Solar CEOs grow their businesses while fulfilling other community needs. But Cherneff says that as Empower Generation’s CEO, she faces pressure from potential funders and investors to prove that the organization can achieve scalable impact while heading towards profitability. That means reporting bigger impact numbers: jobs created, lamps sold, people reached, energy dollars saved, and carbon emissions offset.
“People ask whether we’re concerned about market saturation, but would you be happy with just one light bulb?”
“We are seeing incredible impact with our program in [people’s] lives, but this doesn’t always seem to match up with the volume-based demand and focus on fast returns from impact investors,” says Cherneff.
Empower Generation reports both its financials and impact in its annual report, which included 139 jobs created, 39,000 lamps sold, nearly 200,000 people reached, $1.45 million energy dollars saved and 8,017 tons of carbon dioxide displaced in 2015. But Cherneff sees this numbers-driven approach to impact as highly subjective, because metrics vary from organization to organization, report to report.
It also ignores subtler but meaningful examples of impact, she says. For instance, one of Empower Generation’s entrepreneurs—34-year-old Basanti Chaudhary—recently decided to go back to school to complete her secondary education. Chaudhary was among the 50 percent of girls in the rural Kailali District in Far Western Nepal who receive early education but do not advance or fail to pass their high school matriculation exams. Chaudhary dropped out of school after she failed the exam. She decided to give the exam another run, however, two years after joining Empower Generation and building a small enterprise that supports her entire family. Two other Solar CEOs made the same decision.
“For them, being successful in one aspect of their lives gave them the confidence to aim for success in others,” Cherneff says.
While it is far too early to call this a trend, Cherneff says she hopes it will start to have a domino effect on other women and girls. “Increasing [women’s] social capital, increases their social value. And it starts by having women provide a critical service that everyone needs.”