What We’re Learning Every Step of the Energy Ladder
Over the last decade, Acumen has invested roughly $20 million in 18 social enterprises in East Africa, India and Pakistan to build the largest portfolio of off-grid energy companies serving the poor. Working across every step of the energy ladder, these social enterprises have provided tens of millions with access to energy and helped them to save more than $1.7 billion in energy-related expenses while offsetting more than four million tons of CO2.
Our vision is to create an off-grid solar ecosystem that fills in the missing gaps in the value chain and accelerates energy access across the developing world, but we need to fully listen to those 1.3 billion people living without power to understand what life is like—and how to better serve them.
As Associate Director of Acumen’s Impact Team, I focus on our energy investments, looking to understand their impact and enable them to become more effective in serving their customers living off the grid or with inadequate or unreliable access. To strengthen the way Acumen measures impact, we are using standard impact metrics created for the energy sector. In the off-grid energy space, I led the development of these as Chair of the Global Off-Grid Lighting Association’s (GOGLA) Impact Working Group and, for improved cookstoves, we’re looking to the Global Alliance for Clean Cookstoves (GACC).
We spent the last year collecting impact data on companies across our portfolio using our Lean Data approach, which harnesses the power of technology to give voice to low-income customers and allows us to provide quality customer feedback to drive business decisions for our investees. Using Acumen’s method of collecting and measuring impact, combined with my role as the Chair of GOGLA’s Impact Working Group, we felt we were in a good position to develop our first Lean Data set of questions tailored specifically for our energy companies.
The GOGLA and GACC standardized metrics focus on change in spending on energy for households, in hours available for study for children, in time spent collecting fuel for cooking, and many more. The questions we’re creating will provide us with the opportunity to talk to our companies’ new customers and learn how they accessed energy before becoming customers, as well as understand their experience using the companies’ products and services. Spanning India, Pakistan and East Africa, the investees involved include BioLite, BURN, d.light, Devergy, Frontier Markets, Greenway Grameen Infra, Husk, Nizam Energy, Orb Energy and SolarNow.
From these surveys, our entrepreneurs will get real insight into their customers: who they are, how and where they utilize energy, how much energy they use, and what they spend on a weekly or monthly basis, among other valuable feedback. We will then follow up with the customers a few months after they purchased the product or service to find out how they’re using them and get their opinions on the experience, so we can calculate impact. Armed with this information, we will be able to understand our companies’ strengths and weaknesses and where different challenges and opportunities lie within the energy sector. As an organization, it will allow us to examine each of our investments, get a better grasp on each subsector and, most importantly, make sure the customers—and their needs—are always part of the conversation.
By early next year, we are hoping to have our first comprehensive evaluation of the impact of our entire energy portfolio aligned with the sector standard way of reporting. Our hope is that data we collect will enable better understanding of the energy sector and help to catalyze its growth and development, as well as strengthen and enhance the metrics. The more information we can provide, the better we can demonstrate to governments, donors, and investors the value of energy access in addressing the larger problems of poverty. We believe that opportunities to align and strengthen existing metrics and indicators provide opportunities for aggregation, comparison, benchmarking, and shared learning. We look forward to sharing rich, colorful insights and learning from this work over the coming months to help the sector develop and grow. You can keep updated by following me @Sunrise_Kat.