Joseph Fernandez, CEO and founder of SOLAGEO, joins us for the latest TEA Break. He talks about SOLAGEO’s work to empower small, local solar companies in low- and middle-income countries, and how the company ensures inclusive business practices that meet the needs of their customers.
‘TEA Breaks’ is a series where we chat to our experts on the TEA@SUNRISE project about Transforming Energy Access (TEA) and next-generation solar. Join us for 10-15 minutes with a cup of tea (or beverage of your choice) as we discuss the challenges and opportunities of renewable energy transitions.
Transcript:
Carol Maddock: Hi, I’m Carol and welcome back to TEA Breaks, which is a series where we talk to experts on the TEA@SUNRISE project about next-generation solar and driving innovation in transforming energy access.
So I’m delighted to welcome today Joseph Fernandez, who is the CEO and founder of SOLAGEO, a company that’s rethinking how sustainable and inclusive energy services are delivered through local businesses.
Q1: Can you tell me a bit about yourself and your company?
CM: So first of all Joe, and thank you very much for being here, and please – can you tell me a little bit about yourself and about your company?
Joseph Fernandez (JF): Sure. Well, thank you for inviting me to TEA@SUNRISE. It’s wonderful to be here. Yeah, my company is based in Hong Kong. That’s where I am at present. The company’s name is SOLAGEO. So ‘Sol’ for sun and ‘Geo’ for earth. So basically, we work in the off-grid solar sector. And what we really do is we seek to empower local enterprises in the clean energy and energy efficiency space throughout the developing world. So developing Asia, Africa, and Latin America, although we have a primary focus right now on the East Africa region.
So, it’s really leveraging, you know, being based in Hong Kong being next door to a lot of the manufacturing, a lot of the suppliers to the solar sector, if you will. In my case, I’ve been based in Hong Kong for more than 25 years. So I’ve spent a lot of time at factories all over China, and so we know our manufacturing, our production, our procurement and product development and everything like that very well. And we also know global supply chains.
So basically, the idea is just to leverage our strengths, our competencies, upstream in global value chains. And to support local businesses, like I said, throughout the developing world by providing them with access to products and all the supporting services they need for the products and their businesses so that they can focus then on their downstream activities and operations so they’re not getting spread too thin.
Q2: How do you ensure that the services and products that you supply will meet the needs of the customers and communities that you serve?
CM: So, on that note then, how do you ensure that the services and products that you supply will meet the needs of the customers and the communities that you serve?
JF: A very good question. So, when we started out – SOLAGEO has been in business for about 15 years – and we really spent the first two years just getting to know the markets and the customers and things like that. This was around 2010. A lot of companies were asking me for solar products. So solar was just emerging as sort of you know, this viable option. I mean, of course solar has been around, but in terms of consumer solar solutions and things like that. And so it was very obvious to me that the demand was there.
And what we focused on was really just input from the companies that we interacted with and tried to understand what their needs were from the very beginning. So, our strategy has been what I would call a pull strategy in getting input from the local companies rather than a push strategy, you know, where we come up with the products and just try to push the sales of those products to our customers. So, from the very beginning, we’ve had that pull strategy and try to learn and understand.
But then we identified a gap with something simple, like a DC LED TV. And so people had their phones, their lights. But there seemed to be something missing, and in all of mainland China there were no low-cost, high-quality, small size, energy efficient LED TVs. They were all big size, consumed a lot of power.
So we went about again, leveraging our sort of expertise in manufacturing and so forth, and identified manufacturers that had experience already with smaller size TVs, experience with export and so forth. But then we worked with them to help them to understand the needs. You know, what we were familiar with in terms of the situations in low-resource, lower income environments. And so we knew it had to be affordable, energy efficient, but still retain the high quality in those products. So we were able to get the very first solar-powered TV developed and launched in 2013.
And so our journey has continued since then, trying to listen and understand what the needs and gaps are. And then working, doing what we know in terms of manufacturing product development and so forth, and to present affordable but high quality solutions to the companies we work with.
CM: Brilliant. Thank you. So it does sound like you’re very responsive to your consumer needs in talking about this pull strategy.
Q3: Can you describe what inclusion looks like within your business model?
CM: So one of the things that we’ve sort of talked about is the access to energy is more than just electricity. And that’s someof the things that you’ve just been talking about – it’s about equity and opportunity. So can you describe what inclusion looks like within, perhaps, your business mode? And explain a little bit more about that?
JF: Sure. So obviously in mainland China, with all the manufacturers there, and you can find many of them on alibaba.com, for example, right. But basically what they’re interested in would be to get your order and then, if you’re willing and able to pay them for it, they’re glad to ship you whatever products you’ve ordered to wherever you may be. So, theirs is just they get it to the port and they ship it to you. That’s it. Ok.
But what we basically understood in the markets that we were serving – there was a need to be more inclusive, if you will, and empower the local companies. Because you basically did not have your big box retailers.
There were a lot of SMEs, small and medium sized companies, who were emerging into the off-grid solar space. But they, in addition to access to products, needed a lot more supporting resources. And what we wanted to do is to make sure that we’re not just shipping products to those companies, but helping them to get the products to the proverbial last mile, but also to help sustain those products.
What I came across in the travelling that I did before, with a lot of let’s say NGOs with good intentions, but worked on sort of development projects. But they delivered the goods, but then there was no ongoing supporting services and so forth. So we wanted to make sure that it was as inclusive as possible in order to ensure sustainable long-term access.
Q4: How do you manage capacity building and education?
CM: So that’s a critical thing that I think you’ve mentioned before as well. So not only the ongoing maintenance and sustainability, but also the need for capacity building, perhaps, such as education when you’re introducing new technologies. So if you wouldn’t mind explaining a little bit about how you manage that?
JF: Yeah. So maybe a relevant example would be in the clean cooking sector. Given our experience with solar but also energy efficient appliances, we began to work with electric cooking appliances about seven, eight years ago I guess. And in 2019 we introduced our electric pressure cooker and we won – we were a Global Leap Award winner in 2020 for a small EPC (electric pressure cooker).
And in post-covid, UMEME, which was the national electricity distribution company in Uganda, they had an open bid with support from MECS (Modern Energy Cooking Services) out of the UK. And they had an open bid for – electric pressure cooker suppliers could submit their bids. And were one of those companies, and fortunately we were the ones selected.
But then, when we looked at the Uganda market for electric cooking appliances, what we realised very quickly was that it’s a nascent market. So, consumers and local companies basically had very little exposure to electric cooking appliances. Basically, that was a classic situation where there was going to be a need to provide resources, the education and training resources. It was difficult for us to even find technicians who were going to be able to repair the products if there was going to be any need for after sales services.
We worked with MECS to develop our own Uganda cooking guide. So we worked, you know, looked at local dishes and included those with nice pictures of the food and everything like that, and instructions on how to use the electric pressure cooker to cook the local dishes. And that education and training we knew was going to be important, both for the end users, for them to get the maximum benefit and use of the products, but then also for the companies and organisations that we interacted with to distribute the products or provide the support services there.
So we ended up supplying product directly to UMEME. But we also worked with an organisation called CREEC, which had the most experience in testing electric cooking appliances. And because they had the in-house expertise, what we did was we extended resources to them about our products so that they could then share that information with end users.
So, the cooking guide was one example. But we also developed videos on how to repair the product. So we were at our EPC factory, and you know, taking videos with the help of the factory staff.
And CREEC, fortunately, because we highlighted the need for training resources, and with the help I believe of the UK Government, CREEC is now in the process of training over about 600 technicians throughout Uganda, right. And that will go on for the next several years there. So we’re fortunate to have been at the very beginning, if you will, of the electric cooking industry, to help that get off the ground, and hopefully that will continue to grow in the coming years.
Q5: What are the main challenges to transforming energy access in the regions you have worked in?
CM: So just basically, TEA@SUNRISE is aiming to use next-generation solar technologies to transform energy access. From your experience, what do you think are the main challenges to transforming energy access in the regions that you have worked?
JF: Well, it’s multi-fold, I think, when we talk about next-generation solar, and it’s a new technology. So it’s in some ways no different than electric cooking. It’s something new and different. People don’t have much insight into it.
But I think the potential with next-generation solar is perhaps the potential to localize production and distribution. So what you find, if you look at a lot of the Chinese manufacturers, they’re very good at making the solar panels everyone knows. But what they really want to focus on is the larger ones – very large size you know 550 watt and so forth – panels. Because let’s say, on a per watt basis, those are the most economical for them to manufacture and to ship, and to generate the profits from the production of those panels.
But in the countries, what you find is that the needs are going to vary. It’s not just for 500 plus solar panels. So for a street-light they might have a need for a 50 watt panel, for you know, other applications, other size panels.
And so, perhaps with next-generation solar, there could be that opportunity to, based really on what these local needs are and the requirements for different applications locally, to be able to better customise the PV modules based on what those local needs are. And of course, to the extent you can localise production and so forth then so much the better.
Q6: What’s missing from the conversation at TEA@SUNRISE?
CM: So what we were talking about – for businesses, researchers, entrepreneurs, funders in this TEA@SUNRISE arena. Is there one particular thing that we’re not talking about enough, do you think? Is there something that we’re missing somewhere in the scheme of things, from your perspective?
JF: So you know, I mean, I’m based in Hong Kong. So obviously, I’m looking at things from the vantage point here, if you will, right. And we know that the solar sector is global, you know, and there are a few things.
So one is, if we look at next-generation solar and the deployment of that and scaling up of that – in what ways can one effectively leverage the strength of Chinese manufacturing with strengths in local markets? And being able to figure that out effectively where you’re – ok yes, you’re leveraging lower cost manufacturing at scale, let’s say, as long as you ensure the quality requirements are there and things like that. But how can you localise what can be done out of mainland China as much as possible, right?
And then the other thing is that when you look at – what SOLAGEO in particular has found – is that a lot of the solar manufacturers they’re of course shipping, as I said, the commodity supplies, the solar panels, the batteries, and so forth. And locally a lot of companies then are, you know, installing solar mini grids, and whatever the case may be.
But people forget about – ok, well what are you going to do with the solar electricity that you’re generating, right? And so we sort of found our niche is meeting – well filling the gap – for those energy services, as I would call them right. So from the very beginning, we say ok, if you’ve got solar, how can you make best use of that solar energy and deliver the solar energy services at the lowest cost, most economically, most cost effectively.
So with electric cooking, which I touched about, you know it fills a gap for solar mini grid developers, because they might be setting up a mini grid in a rural community connecting households to the mini grid. But the energy consumption is very, very low, and you find this throughout the developing world. So LED lights and phone charging doesn’t consume enough energy. And so the investors or the developers are not able to get the return on their upfront investment on their capital investment and so forth. So you have to figure out a way to effectively increase the energy consumption as well.
So you can talk about next-generation solar. But you have to make sure that’s not just the technology solution that you’re delivering. But you have to just connect all the dots. And how can you then – so if you’re delivering a better solar energy solution, but you still have to work on ensuring the consumption of that solar energy.
CM: Ok, that’s brilliant, So being able to raise awareness about the opportunities that exist as well.
Q7: What’s next for SOLAGEO?
CM: So in closing then, what’s next for SOLAGEO? Are there any technologies, markets, or partnerships that you’re particularly excited about?
JF: Yes. So you know, looking at next-generation solar, so one of the other network members is a Kenyan company called LixGlo Ventures. And we recently collaborated with LixGlo Ventures to submit a grant application where we’re looking at the deployment of next-generation solar on to rooftops of small businesses in peri-urban areas outside of Nairobi, for example.
And what you find is that in those communities, the grid electricity may be less stable. So there are several hours a day where they’re using diesel generators as the backup. And so what we’re looking at is with the benefit of next-generation solar, it might be more viable to install the solar and integrate into the rooftops. And if we can do that, then we’re providing those energy services, displacing diesel and so forth.
So again, we are a business. So it’s a matter of finding those market gaps and, you know, making use now of next-generation solar to fill those market gaps.
CM: That’s brilliant, thank you very much. It’s been really interesting talking to you. And I really am going to be keen to watch progress and keep in touch, because I do see you’re a member of our network. And it’s really, well hopefully – and in fact maybe you’d like to say something a little bit about that? Because I’ve noticed that you’re attending the meetings, I mean, have you found them quite valuable?
JF: Yeah, well I think, you know if we’re talking about next-generation solar. So it’s just like that – you may have your thoughts and ideas, but it’s good to see what other people are working on as well, and to get insights from them as well. And so either to reaffirm what you were thinking, or to provide you with new insights or new ways, and generate new ideas. So I’m very much an ideas person, a sort of visionary type of thinker. So it’s always helpful to listen to other thoughts and ideas and that helps to stimulate my own creative juices, if you will.