The Next Step in Spreading the Reach of Solar Power: Pay-As-You-Go Solar Systems

On April 18, 2024, the Alberta government announced the RRO would be renamed to the Rate of Last Resort (RoLR). The proposed change was done to provide more clarity to electricity consumers and encourage them to explore other retail energy options. The RoLR will be set at a fixed rate every two years rather than month-to-month as was the case for the RRO. The RoLR came into effect on January 1, 2025. We have updated certain sections of this article with the term RoLR. To learn more about the RoLR, check out our in-depth article.

---

Solar systems aren’t cheap, especially in North America, where the typical household consumes much more energy than those in less-developed nations. But smaller-scale systems that can meet the much more modest needs of poor and remote households that don’t have reliable access to electricity are still far beyond the financial reach of those who need them most. For instance, in Sub-Saharan Africa, homes and businesses depend upon lighting and energy produced from kerosene fuel. However, burning kerosene has serious health impacts, and can be costly. Kerosene-based energy can cost up to US$8 per KWh, which is higher than the RRO* of 10.974¢ per kWh being paid by residents of Calgary as of December 2024.

But a UK-based company is working on putting solar power within the reach of some of the world’s poorest people.

Homes and businesses in Sub-Saharan Africa are seriously hampered by an unavoidable problem: night-time. Residential access to energy grids is scarce in many areas, and those that are connected to a grid suffer from frequent rolling blackouts. As a result, the onset of night means that homes and businesses must either cease activity during dark hours or burn costly and toxic kerosene fuel. However, a company called Azuri Technologies is taking advantage of a rather curious contradiction in the infrastructure that currently exists in Sub-Saharan Africa: while reliable electricity is rare, Internet-enabled mobile phones are extremely common. Azuri has leveraged this contradiction by developing a solar system called PayGo, and is partnering with energy company Oasis African Resources to distribute the systems. The PayGo solar system is powered by a small solar panel that can generate a few watts of energy. This provides enough electricity to power the system’s four LED lights for 8 hours per night and also powers a mobile phone charger, flashlight, and radio. But it’s the payment system that is particularly interesting. Users pay a $10 deposit upon installation of the system. Then every week, system owners use a prepaid card or their cell phones to pay a weekly fee of between $2.50 and $3.50. The system will provide power for 8 hours every night for a week, and will then automatically disable itself. The user restarts it by paying the next week’s fee. When users first receive their units, they are trained how to use the systems effectively and have access to phone and in-person support if any problems occur. After making payments for 12 to 18 months that amount to a total of between $130 and $180, the system is completely paid off, and Azuri unlocks the unit. From that point on, users own their systems and don’t have to make any further payments. The installment payment plan–which would be impractical if it weren’t for the region’s existing cell networks–keeps the price of the system low enough for just about all of the area’s inhabitants to afford. But more importantly, the weekly cost is less than what those households pay every week for the kerosene they rely upon for lighting and power. So even during the payment period, those households are saving a large amount of money. This year, the company will distribute the PayGo system to 100,000 households throughout Central Ghana. Next year, Azuri Technologies will roll out larger units that can power TVs, and systems that are designed specifically for use in small businesses. Azuri isn’t the only company looking to put power within the reach of those who need it most. Another company, Nariobi-based M-KOPA Solar, has sold more than 250,000 pay-as-you-go solar systems to homeowners in Kenya, Uganda, and Tanzania over the last three years. Similar companies are popping up throughout Africa, some of them started by small-scale native entrepreneurs. Some are offering solar-powered charging kiosks for phones, and solar-powered Wi-Fi hotspots. And governments throughout the continent have been becoming increasingly eager to enable these companies to thrive. For instance, Tanzania has exempted solar products from its Value Added Tax, helping to keep the cost of such products low. It seems likely that the heart of Africa will be shining bright in the night within the next few years, as such companies work to make their products ever more accessible and common.

(Image from Azuri Technologies)