By Richard Stubbe, BloombergNEF. This article first appeared on the Bloomberg Terminal.
The number of people in the world living without electricity access has dropped below 1 billion, according to BloombergNEF, and that will be cut by more than half by 2030 if all the nations that have set targets for electrification meet them.
Grid extensions are the primary way to boost electricity access, BNEF reported in its Frontier Power Market Outlook in March, but they aren’t the only way.
The Boston-based startup OffGridBoxbuilds what the company name implies: boxes that work off the grid. Specifically, the boxes are 6-foot cubes with solar panels mounted on top. The box uses the energy from the solar panels to charge batteries, offer Wi-Fi access, and power a water purifier. OffGridBox has installed 38 boxes in 10 countries, said Kathryn Chelminski, strategic partnerships lead for the company, with a goal of deploying 500 boxes by 2024.
OGB is running a pilot project in Rwanda, where more than 30% of the 11 million people had no electricity in 2017, according to BNEF. Off-grid systems are a key component of the nation’s strategy to reach its goal of proving more access to power.
Chelminski answered questions from BNEF by phone and email in October:
Q: One of the world’s questions is: How can we get electricity to the last billion people? It seems like you have a solution to that.
A: That’s the problem — 1 billion without access to electricity and 2 billion without access to safe water, and there are public health issues surrounding both of those. OffGridBox is a really exciting technology that, with the right scale, could help solve those issues. Our technology provides solar power, battery storage and clean water, all in a 6- by 6- by 6-foot container that can be deployed easily all over the world. Its easy setup makes it accessible to all corners of the globe.
Q: Where did this idea come from?
A: Emiliano Cecchini and Davide Bonsignore, the co-founders, had been working on each of the separate parts — the solar, the battery, the water filtration. They won a tender with Oxfam in 2015, and they were providing this off-grid solution to kindergartens in South Africa. In the process of deploying this project, they realized they should put this all together in one shipping container and assemble it before deploying it to the site. Doing it that way was faster and easier than sending the pieces separately and then trying to build. That led to the creation of OffGridBox in 2016.
Q: How many boxes are out there?
A: There are 38 in 10 countries. We just secured funding for 57 boxes to add on to the Rwanda pilot.
Q: How does a community acquire a box?
A: Obviously, you can buy the box upfront, and people have done that in the wake of disasters like Hurricane Maria. But for most communities, we use a pay-as-you-go model that pays the $25,000 cost of the box through a revenue-sharing agreement. Community members make a down payment for their kit, which includes a power bank, two lights, jerry cans and a phone adapter, and then for each charge they pay 18 cents, which is a fraction of what they’re normally paying for electricity. Those payments then go to pay back the upfront investment. We have, then, a box that serves 400 families and some small shops.
Q: The boxes are $25,000 each? For a First World country, these are small numbers. At that price, a philanthropist could step in and change the world.
A: Absolutely. That price includes assembly, customs clearance and training. We do the manufacturing and assembly in Italy, and then ship it, and then we send a small team to train an all-female staff of entrepreneurs to run the box. There’s obviously huge potential, and we’ve had a great response in Rwanda, where our pilot continues to grow and find investors.
We also just deployed a project in Tanzania that also uses the pay-as-you-go model. Google selected our technology for a pilot project in the Democratic Republic of the Congo. These test pilots are showing the box’s capability in different contexts around the world, and we’re excited about it.
Q: It sounds like your plan is designed to create some pride of ownership in the communities where the boxes go.
A: Yes, and the boxes are also customizable to the needs of the local community. You can add Wi-Fi or desalination. Families benefit, and we’ve found that small shops that sell chewing gum or soda are very interested because the box can provide them with some refrigeration, perhaps to power an ice machine to keep seafood cold. That really expands the reach of the box in the community.
These two video clips provide another look at the OGB with the perspective from our local female implementers/OGB managers: The first is from the Not Impossible Award, and the second shows an interview with Joyce, who with her daughter manages one of our boxes in Rwanda. They lost family members during the genocide and they lived on the edge of their village. Now, with the income from working for OGB they can afford better housing, and Joyce has used her earnings as an investment to also become a mobile money agent in her village.
Q: How did you reach your current model of incorporating such a high level of community involvement?
A: Since we train women from the community to manage the boxes, they show potential customers the benefits of the service, rather than an outsider from a foreign company. We found this approach builds trust of the new technology and services with the local community.
The local recipient communities for the pilots are chosen using a combination of commercial viability (to ensure sustainability) and need for water and power. We also use survey data that was developed together with MIT D-Lab.
Q: What’s the capacity of the water purifier?
A: It’s 8,000 liters per day, and the PV is 3.8 kilowatts of solar. The water comes from the local community. People bring containers of water to be put through the purification system. So far, we have purified water from reservoirs, lakes, swamps, rainwater and other sources, but with reverse osmosis we can also remove heavy metals, hydrocarbons and salt. The second prototype of the desalination technology will be available in the first quarter of 2020.
Q: What else can it do?
A: We’ve recently added the OffGridBox app, which can tell us when the filter needs to be changed and give us other information about the machine. That’s been valuable so far.
Q: What have been the biggest challenges, physically?
A: Part of it is the complex nature of putting the technology in these environments. We’re creating relationships with distributors around the world, and we rely on them. With our small team, we can’t possibly respond to the needs everywhere in the world. We need our distributors to get the boxes through customs, for instance, and on to the ultimate destination. Trying to deploy boxes during Hurricane Maria was especially challenging, but our local people helped expedite that process.
Q: What’s your message to investors?
A: We offer an Impact Package, in which an individual OffGridBox is purchased or donated to a community/school/NGO as part of a corporate social responsibility or development project, and a local implementer is trained to run the business and keep a share of the revenue. OffGridBox provides supervision throughout the project life. We have a profitable business model and technology proven through our pilots, and we are currently raising convertible notes and then Series A later in 2020 to support continued R&D and market development efforts. The goal is to move 500 boxes around the world by 2024. We calculate that could affect 2.5 million people.
Q: How much has the technology of the boxes changed?
A: We now use a range of storage technologies, in part to solve some of the shipping issues. The water filtration system has been improved. We’re adding on Wi-Fi. Desalination is an evolving technology.
Q: Are governments coming to you and asking how to acquire boxes?
A: It’s been a mix of both. In Rwanda, we are collaborating with one of the ministries. In other places, we do public-private partnerships.
Q: It sounds like the big bottleneck is capital investment.
A: Yes. I’ve worked in the renewable energy industry. I think a lot of investors are wanting to prove that they can have a direct impact, and OffGridBox is an amazing technology that can help solve some of those problems. It’s great to be working for a company that can put all that into a 6- by 6- by 6-foot container.