SELCO (India)
Encyclopedia
The Solar Electric Light Company or SELCO India is a social venture based in Bangalore
, India
. The main goal of this venture is to provide reliable, affordable, and environmentally sustainable energy services to homes and businesses, especially in the rural areas. SELCO INDIA is an expert in the area of rural energy services like solar electricity and its achievements have resulted in the company winning the Ashden Awards
(also known as the Green Oscars) twice, once in 2005 and the other in 2007. SELCO was formed in the year 1995 by an entrepreneur named Harish Hande
who got the inspiration to start this company while studying energy engineering
at the University of Massachusetts Lowell
.. Harish Hande has an undergraduate degree in Energy Engineering from Indian Institute of Technology Kharagpur
.
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.
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.
Bangalore
Bengaluru , formerly called Bengaluru is the capital of the Indian state of Karnataka. Bangalore is nicknamed the Garden City and was once called a pensioner's paradise. Located on the Deccan Plateau in the south-eastern part of Karnataka, Bangalore is India's third most populous city and...
, India
India
India , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world...
. The main goal of this venture is to provide reliable, affordable, and environmentally sustainable energy services to homes and businesses, especially in the rural areas. SELCO INDIA is an expert in the area of rural energy services like solar electricity and its achievements have resulted in the company winning the Ashden Awards
Ashden Awards
The Ashden Awards for Sustainable Energy are annual awards given by a charity of the same name that is based in London. They reward local sustainable energy projects in the UK and developing countries that protect the environment, and improve quality of life....
(also known as the Green Oscars) twice, once in 2005 and the other in 2007. SELCO was formed in the year 1995 by an entrepreneur named Harish Hande
Harish Hande
Harish Hande is an Indian social entrepreneur, who founded Selco India, a solar electric light company in 1995, which over the years has lit up over 120,000 households, to emerge as India's leading solar technology firm...
who got the inspiration to start this company while studying energy engineering
Energy engineering
Energy engineering is a broad field of engineering dealing with energy efficiency, energy services, facility management, plant engineering, environmental compliance and alternative energy technologies. Domain of Energy Engineering expertise combines selective subjects from the fields Chemical,...
at the University of Massachusetts Lowell
University of Massachusetts Lowell
The University of Massachusetts Lowell is a public university in Lowell, Massachusetts, and part of the University of Massachusetts system...
.. Harish Hande has an undergraduate degree in Energy Engineering from Indian Institute of Technology Kharagpur
Indian Institute of Technology Kharagpur
The Indian Institute of Technology Kharagpur is an autonomous engineering, technology and management oriented institute of higher education established by the government of India in 1951...
.
Origin
The seeds of SELCO were laid in the year 1994 when Harish Hande decided to sell solar lighting systems. Having no financial backing, he traveled across different villages in coastal Karnataka holding demonstrations and trying to explain the villages about the benefits of solar electricity. Solar electricity being an unproven sector economically also was a serious drawback that Hande had to face while trying to start the company and thereafter promoting its economic viability. Moreover, it was difficult to sell solar power to the rural folk in the country because many could not afford to pay for it. But Hande came with an innovative strategy that focussed on a steady long-term relationship with the customers by building their trust and confidence. SELCO IndiaSolar power in India
India is densely populated and has high solar insolation, an ideal combination for using solar power in India. India is already a leader in wind power generation...
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
E+Co
E+Co is a non-governmental organization based in Bloomfield, NJ, that makes clean energy investments in developing countries. E+Co has 6 regional offices in Africa, Asia and Central America. The company's name is pronounced, "E and Co"....
initially investing US $107,500 to become SELCO India's first investor.
Strategy
SELCO INDIA had to come up with some innovative strategies to make this venture successful. SELCO employees went on a door-to-door campaign trying to understand the needs of their potential customers and explaining to them the benefits of few extra hours of light in the night like less fumes from gas lamps and extra study time for kids. 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 and also provide schemes to the borrowers to repay the loans. SELCO INDIA has focussed on working with various financial institutions and micro finance institutions to come up with various financial products for its clients. The amount charged to consumers ranged from as little as 10 rupees per day to 350 rupees a month.Achievements
SELCO has so far installed solar systems in more than 120,000 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
Rose
A rose is a woody perennial of the genus Rosa, within the family Rosaceae. There are over 100 species. They form a group of erect shrubs, and climbing or trailing plants, with stems that are often armed with sharp prickles. Flowers are large and showy, in colours ranging from white through yellows...
pickers in a village in Bangalore
Bangalore
Bengaluru , formerly called Bengaluru is the capital of the Indian state of Karnataka. Bangalore is nicknamed the Garden City and was once called a pensioner's paradise. Located on the Deccan Plateau in the south-eastern part of Karnataka, Bangalore is India's third most populous city and...
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.