This Issue

Lighting the Way

green-economy
Lighting-the-Way

By Barbra Murray

Entrepreneur Ajaita Shah brings sustainable energy to low-income households in India.

 

Ajaita Shah is dedicated to her work. She’s practically apologetic about taking one day off a week, Sunday, despite the necessity of downtime for humans. “I love what I do, I’m obsessed with what I do,” she says. She is the founder of Frontier Markets, the India-based sales and distribution company providing product solutions to facilitate the end of indoor pollution and related deaths. She is also president of the Frontier Innovations Foundation, Frontier Markets’ New York-based nonprofit arm that works primarily in India to help overcome obstacles to widespread clean-energy solutions through partnering with governments, businesses, and agencies around the world. And she’s only 30.

Ajaita

Her main pursuit at the moment is bringing light, literally and figuratively, to poor households in rural areas across India in the form of solar energy. Clean energy in India is not exactly an issue that is sweeping the global green community at present, so to say that Shah’s pursuit—bringing solar power to poor households in underserved areas of the country—is a progressive endeavor would be an understatement.

The U.S., home for this pioneering Indian American, is certainly a trailblazing country but solar-powered homes haven’t precisely caught on like wildfire, and most definitely not in low-income neighborhoods. Shah, however, sees solar energy as a potentially life-transforming form of power in India’s poverty-stricken communities, and is working through Frontier Markets and the Frontier Innovations Foundation to facilitate that change. Currently, it’s her life’s work, and while some may see a solar-powered rural India as a lofty notion, Shah views it as a practical pursuit.

For the poorest of the poor in India, those in bottom-of-the-pyramids (BOP) markets, solar energy is not just about cost savings and certainly not only about the environment. It’s about a basic necessity: electrical power. It’s an essential utility that, while so ubiquitous in the U.S. as to be considered an absolute necessity, if not a virtual right, is sorely limited and wholly unreliable in rural India. Shah knows; she’s spent the better part of the last six years on the ground level in rural India. “Having spent an enormous amount of time in blackouts, and actually seeing kerosene fires and seeing the damage that lack of electricity has on rural households, I believe if we’re going to be really addressing a challenge, it needs to be the energy challenge,” says Shah.

Community_India

Shah speaks to a community on the benefits of solar energy. Photo: Frontier Markets

Frontier Markets has been moving full-steam ahead toward achieving this ambitious endeavor of supplying Indian residences in BOP markets with solar energy, which would address not only cost and environmental concerns but, more importantly, it would provide low-income Indian residents with the electrical power that continues to elude them. Solar energy is the most practical route, she believes.

“If you look at the alternatives for rural India, there really aren’t that many,” Shah notes. “The [electrical] grid’s not coming to rural India anytime soon. People are using kerosene as their alternative, which is disastrous. And in terms of affordability they can’t keep affording to pay for battery-based solutions, which really only covers lighting, not power. And so it kind of keeps them in this level of a vicious cycle of unproductively.”

She goes on to point out that solar as a concept has existed in India for over 25 years, and she and her team questioned why, with the country’s ample amount of sunlight, solar energy has not made “the last mile.” The grids aren’t there, but the sun is. It was a moment of clarity; they realized, Shah says, “There’s a clear need, there’s a clear demand, there’s a clear solution.”

However, Shah found that a solution was just part of the issue. She had to convince solar-wary residents that solar energy really is a viable option for them. It was just one more challenge that Shah was determined to overcome. As she explains, “While the need is there, people either don’t have access to the solution; they don’t know about it; they’re very uneducated about it; or they’ve had very bad experiences with it.” Bad experiences, indeed. When the Indian government first tried bringing solar in from Iran, it was faced with poor-quality products and no technical assistance. The experience left citizens with little more than distrust of solar.

 

“I know that you’re spending 50 cents a month on kerosene today. If I can get you to spend 25 cents a month on solar, you will immediately see your return on investment … So you quickly see the value of what you’re putting your money in.”– Ajaita Shah

 

Wariness is one obstacle; money is another. So, as Shah notes, for these residents who have little, if any, funds to spare, the proof is in the pudding. Her pitch: “I know that you’re spending 50 cents a month on kerosene today. If I can get you to spend 25 cents a month on solar, you will immediately see your return on investment or at least I’ll show you your ROI within, at the latest, three to six months. So you quickly see the value of what you’re putting your money in.”

 

As for lack of access, the answer is building retail points, which Shah has been doing, supported by the Foundation. But it’s not just a business move. “We spend a lot of time building up the fact that incorporating special service is our biggest motto, and not necessarily pushing a product but really caring about the needs of the customer.” The benefit is twofold, as the very same residents Shah is trying to sell on solar are also being wooed with the potential for income. Frontier Markets is converting them into retail points, thereby allowing them the opportunity to earn money on the solar revolution.

These retail points take two different forms: new entrepreneurs and existing business owners. Those residents who are new to retail open shops branded by Frontier Markets. These new businessmen and women are trained about clean energy and the products offered, which range from cost-effective solar lanterns and torches to home-lighting systems to street lights. Business owners with their own retail destinations stock Frontier Markets products and are instructed in the selling of solar products as well.

The best-selling items at Frontier Markets entrepreneurs’ shops and local retail stores are solar lanterns and torches, which harkens back to the impetus for Frontier Markets: safe residential lighting.
And then there is the limited but growing number of service centers designated to provide customer service and execute repairs. Customer service is one of Frontier Markets’ biggest mottos, Shah says. “We’re not necessarily pushing a product, but really caring about the needs of the customer—so we really do a lot of brand-building and a lot of it is to build trust with the rural customer.”

On all fronts, progress is being made. “People are understanding the concept; they’re understanding why they can trust us, they’re starting to think it through in their own innovative ways as to why they need power and what they are actually going to use it for.”

Frontier Markets’ partnering is proving fruitful in its goal of spreading solar energy solutions in rural India. The Government of India is being very supportive of Frontier Markets’ efforts, and in general, solar energy has become a massive initiative for the country; it’s a new part of the government agenda. “They know that electrical grid systems will not be reaching their constituents anytime soon and there are a lot of other challenges so there’s a lot of support,” Shah says. “It’s also an industry that’s booming in India. You have hundreds and thousands of manufacturers now, focusing on the solar as part of the government’s agenda. So suddenly, economies of scale is in your favor when it comes to the price point of technology.”

There’s government advocacy, but Frontier Markets’ endeavors also benefit from the global push for alternative energy. The organization has found assistance from, to name a few, the World Bank, the Clinton Initiative, and the Asian Development Bank, all of which are investing in making reliable energy available in developing countries.
Shah has achieved so much. She has been recognized around the world for her efforts. Frontier Markets, since 2009 inception, has sold 10,000 solar solutions to date and made clean-energy retailers of 125 rural residents. And she’s not done yet.

“Our fundamental desire is to really start addressing some of the base challenges that rural households face through distribution,” Shah adds. “We really want to become one of the largest solar distributors and actually have retail points at every village level in India, but we want to be able to replicate this model in other countries because I believe that if you don’t have sustainable points of service, you’re not going to ever be able to address the rural household’s needs on a regular basis.”