Rural solar electrification leveraging a confluence of factors!

 Couple of years ago I was trying to come up with a small framework I can use to analyze & understand anything that comes my way, be it world policy, family issues, work projects, politics or anything else. Eventually settled on two simple questions:

1. Is the picture being presented complete? (This is to help us get past arguments that focus too much on small slivers of data and/or anecdotal evidence.)

2. Whatever solution being proposed, will it scale? (This is to ensure that we are not beguiled by very nice-sounding solutions that cost too much or too complicated to implement and so won't work when scaled up.)

You can find the full post titled Simple Questions here. 

There can always be exceptions. Perhaps in some situations it is impossible to get the full picture OR scaling is not that important OR we need to do small scale solutions now and focus on big scale solutions later, etc. But asking these two questions should help us cut through clutter on any domain we are interested in learning about. 

Many articles, substack posts, papers I have been reading recently, with these two framework questions in mind, seems to point to solar power evolving into a comprehensive solution for power delivery in many remote parts of the world. As you may know, if we can somehow harvest all the energy that reaches planet earth from sun for one hour, it is adequate to cover all our power needs for a whole year! Though this is not practical, it goes to show that there is enough energy available if we can make use of it efficiently. This means the solution will scale if needed. This is getting demonstrated in parts of Africa really well!

- Solar panel costs (measured as $/watt) have plummeted more than 99% over the past 50 years. In other words, if you'd have spent $10,000 in 1975 to buy panels to power a home, panels providing same amount of power cost much less than $100 now! 

- Pay as you go models that allow people who are not wealthy to get solar power, paying monthly installments. After 5, 6 years, they do get full ownership.

- Mpesa (in Kenya) and other money exchange models that work via feature phones and SMS text messages, make it easy for customers in remote locations to make payments. 

- Solar panels installed in remote locations now come with microchips embedded that allows the service provider to turn off the service remotely if the monthly payments are not coming in, obviating the need for a truck roll. If payment resumes, service can be turned on again easily and remotely. 

- Mobile phone adoption skyrocketed in India couple of decades ago, since there was huge void that required filling as landlines were not easy to get and didn't work well. Similarly, solar adoption is taking off in Africa since "building power plants & running wires to individual homes miles and miles away" model wasn't working for decades, leaving a big void. 

- Western companies trying to buy green credits and even PE (Private Equity) companies trying to turn a profit, are investing in this area now, reducing the costs further!

Model seems to be replicable in most parts of the world and so can scale. This understanding appears correct since I see writeups explaining how renewable energy creation costs are now equal to or even below traditional power production and so are starting to compete on cost, powerful big countries like China, India as well as smaller countries around the world are leveraging these trends to implement solar projects in massive scales, and so on. China's manufacturing prowess cratering panel costs alone is a significant contribution towards green energy adoption around the world! 

I did read an odd article in the Financial Express. It discussed how the Pakistani power grid is not supplying power reliably, that is pushing anyone who can afford to buy solar panels to switch to solar for their electricity needs. This leaves only the poor who couldn't afford on the grid. They don't pay their dues properly that puts the grid in death spiral! While this is sad, even that article talked about customers buying panels fully first. Instead, if this "pay as you go" model gets implemented in Pakistan, it will work even for the poor. It may play the death knell for their power grid but will at least provide reliable power to everyone. Hopefully the resulting improvement in the economy, will eventually help the grid as well. 

Just to be clear, the overall share of power generation using solar is still too small compared to the role of fossil fuels as seen in this chart below. You can visit the https://ourworldindata.org/ site that has a lot of interesting data that is easy to explore in many domains, including this one. Still, it is good to see this uptick at least in the rural electrification projects, particularly since this model will scale. 

If you'd like to read a more detailed analysis, check-out this link and this one. 

Book Review: Poverty, by America by Matthew Desmond

For the past few months, I have been working on my next book titled "Oil & Water - How energy shapes societies, countries and the world" that is expected to come out early next year. It starts with my personal stories from the years I was working as an offshore oil platform maintenance engineer in the late 80's and then discusses global energy policies, geopolitics including Russia weaponizing natural gas export, fracking, nuclear fusion and so on. Though these widely different topics may make me sound like a boring policy wonk, I have tried my best to keep the flow interesting, short, and crisp. Since there is always more to discuss, I have setup a companion website for the print edition at https://oilwaterbook.blogspot.com where I intend to post additional/updated links, videos and other reference material for interested readers. Though the site is WIP, check out the short audio intros I have posted there in multiple languages. These were generated using Notebook LM. I was tickled to be able to do this for free and have posted 15 min long audio intros in English, Chinese, Spanish, Korean, Tamil, Hindi, Kannada and so on. Each version is unique and is NOT a translation though there are overlaps. Try out the languages you like and let me know if there are errors or anything goofy that I should correct.  

Because of that diversion, reading has taken a hit! To catch up, picked up Poverty, By America by Matthew Desmond. I have been hearing about it from friends and media. Very easy read, as it is a short book (less than 200 pages) written in simple language. The main argument is that USA, despite being a rich & industrially advanced country, still leaves many of its citizenry in poverty. It proceeds to discuss possible remedies. While I may be fiscally conservative, when it comes to social issues, I tend to be progressive/liberal. Thus, the book is preaching to the choir. The chapter titles of the book, such as How we undercut workers, How we force the poor to pay more, How we rely on welfare, clearly convey what is being discussed. 

Book starts with anecdotes of a 55-year-old father pulling double shifts and taking whatever pill that is available to stay awake at the end of his graveyard shift, only to realize that the back ally pill he took has all kinds of drugs mixed in that shows up in his toxicology report, making him ineligible to keep his children with him. He is certainly not a junkie but is betrayed by the system is the takeaway. Left with no choice, he is happy to keep at least one child with him, while agreeing to let his stepmother take care of his other child. Another lady named Crystal, abused when she was a child, shorn by biological parents, bouncing around foster homes, not able to understand why her social security support stopped when she turned 18 (as she is an adult now), becomes homeless. A roommate of the author named Kimbell, who steps on a nail in a run-down apartment, ignores medical treatment since he can't afford it as he didn't have health insurance, ends up losing one leg. In each one of these cases, you'd think there will be mechanisms in a rich country to help them, since these are all people working one or more jobs to survive, not drug addicts or lazy bums just hanging around. But in reality, they all get advice about how they need to pull themselves up by their bootstraps but often not much else. I know of such stories myself through volunteering work I do. Though things are far worse in many other parts of the world, point here is that US, a country that can potentially eliminate poverty and provide a good baseline quality of life to everyone, in reality doesn't. 

Author discusses how in many areas laws in place are anti-poor. For example, tipping your waiter 15 to 20% when you eat in restaurants is a common practice in the US. While we think we are giving this tip to the staff in appreciation of their good service, restaurant industry has managed to get laws passed that allows them to pay less than minimum wage to their staff as long as the tips make up the difference! For example, if I hire a maid at home, I have to pay a minimum of say $10 per hour. But a waitress getting a $3 tip can be paid just $7 by the restaurant owner. Thus, the tip is actually going to the restaurant owner and not the staff. Book discusses many other areas such as how US corporations prevent labor unions, townships prevent low cost homes being built in their neighborhood thinking it will pull down the real estate value when poor people move in, etc. 

Mitigation ideas suggested are, supporting corporations that pay a fair wage, allowing labor unions, supporting low-cost home building in your neighborhood (research shows that unless the implementation is horrendous, real estate values don't go down when low-cost homes are built in a high-income neighborhood) and so on. While I am in support of these ideas, I wasn't impressed much by this book. I was quite aware of these issues, and the solutions proposed aren't anything new. They are not even anything too precise that will quickly address the underlying issues but are highlevel ones that will take decades to show any meaningful impact. 

Personal stories and anecdotes are powerful in helping us form our opinions. But it is a double-edged sword and so anyone who has experiences that fall in the opposite end, will have a strong negative reaction to the discussed problems and proposed solutions. For example, I personally know of people (i.e. not big faceless corporations) who have one or two condominiums they rent out to get some investment income. These are not the heartless slumlords discussed in the book but friends of mine who are generous, kind, good at heart middle-class individuals. They have horror stories of tenants who are coached not to pay rent and ways of avoiding eviction that have been living rent-free for years with court cases on going. These friends are realizing that they are not cut out to be landlords and are trying to sell the property and place the proceeds in mutual funds. I can tell many labor union stories where the impossible demands by the unions have run the whole company aground. Book doesn't even acknowledge such things happen, focusing only on one side of the narrative. We certainly don't want to be swayed by one anecdote or the other and will be better off following my Simple Questions framework to get the full picture and correct solutions that will scale. 

If you are interested in this topic, this might be a quick easy read. Perhaps Ezra Klein's Abundance book (which I haven't read yet) that deals with this domain might be a more interesting read, providing lot more to chew on.