The Organization of Rural Elecrification

Authors: Georg Heinemann, Christian von Hirschhausen

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Innovative financing and delivery models in combination with decentralised energy systems have significantly improved the electrification of rural regions in recent years. In Bangladesh, more than four million Solar Home Systems (SHS) have been installed with the help of a top-down government-financing programme (“the IDCOL-approach”). In East Africa, the figure is 1.5 million households. In this case, the private sector was instrumental to drive a bottom-up “market-based” electrification. Solar companies have developed their own pay-as-you-go financing models to provide SHS to rural customers (“the PAYGO-approach”). Using case studies of organizational models, this research compares and evaluates both approaches on the basis of institutional organizational model theory. The aim is to develop an understanding about both models as well as identify and compare key performance indicators of both approaches.