AFD in Latin America and the Caribbean

kingo

Guatemala | The lights of Kingo

14/06/2017

In Guatemala, one inhabitant in ten does not have access to the national power grid. For nearly four years now, a Guatemalan start-up has been offering them the Kingo kit , an innovative solution to produce off-grid and low-cost solar electricity. Over 15,000 households are already equipped…


Millions of people are still without electricity in Central America. They use candles, kerosene or a generator for lighting… While these makeshift solutions are in widespread use, an innovation is gaining ground at the heart of the most remote areas in Guatemala: Kingo , a smart box which can be installed in about twenty minutes and supplies electricity by simply connecting it to a solar panel.

 

© Sarah Caroline Müller

 

This off-grid production “Is the fastest and cheapest way of developing access to electricity for rural communities who are not hooked up to the national grid”, points out Juan Fermin Rodriguez, CEO and co-founder of Kingo Energy , a company set up in 2013 in which Proparco, AFD’s private sector financing arm , became a shareholder in 2016.


Pay-as-you-go!

The financial argument really strikes home in a country where half of the 15 million inhabitants are living below the poverty line – with an even higher proportion in the Maya communities, who live in remote regions.

It is also in two of the poorest departments, Alta Verapaz and Petén, where the coverage rates of the power grid were the lowest, that Kingo started its deployment. “In under two years, we have equipped over 15,000 households”, adds Juan Fermin, “This has improved living conditions for families and safety in their homes, but it has also reduced the time spent on domestic activities and made it easier for children to study.” KIngo is currently the only alternative solution to the conventional power grid on offer in Guatemala.

How does Kingo work? A solar collector is installed on the roof of the house in return for the signing of a contract with no time commitment and the payment of time units with a prepaid card, a bit like mobile phone recharges. Once the client has entered the codes on the card, access to electricity is unblocked.

This pay-as-you-go system does not require the client to purchase equipment or pay for the system to be installed. It offers several advantages: it is cheaper, brighter, less dangerous and less polluting than kerosene lamps or candles.

Kingo also does not require any cultural adaptation by users: the recharge cards can be bought in small grocery stores, or directly from representatives from the company. In the future, it will be possible to pay the fee by mobile phone… and Kingo is planning to equip 2 million Guatemalans by 2020.

 

“Everyone wants light”

Clients currently have a choice between two options:

  • the Kingo 15 kit, which supplies three lightbulbs (five hours of lighting a day) and can recharge a mobile phone for a daily fee of 6 quetzals (70 euro cents) or 110 quetzals a month (13 euros),
  • or Kingo 100, which supplies enough power to light the main room of the house for five hours, recharge three mobile phones, and supply two electrical appliances.

Elena moved to the Caserio El Limon village in Petén province two years ago and the arrival of Kingo has changed her life. “I used to have to get up earlier, at between 4 and 5 in the morning, and prepare the meals for the day by candlelight. I can now organize myself differently, get up later, spend more time with my family and, most of all, my children can study for an hour every day. We are now fifteen families using electricity. Everyone wants light!”  Elena can now light her home for over five hours a day, recharge her mobile phone, organize the children’s homework and make her home safe, while paying 25% less.

 

© Sarah Caroline Müller 
 


We have the right approach
 
Kingo’s expansion has been made possible thanks to fundraising from several investors, including FMO, the Dutch development finance institution , and Proparco, but also thanks to the 80% reduction in the cost of solar systems since 2008.

For Juan Fermin, it is, however, essential for Kingo to meet its commitments, while being profitable: “I firmly believe that we have the right approach and that we can be both profitable and serve the public good. What matters to us is for our equipment to be more and more efficient so that we can provide more services to our users.”

But the young company’s market does not stop at the borders of Petén. Following a fundraising of USD 13.5m, including USD 4m of loans, the company aims to raise a further USD 8m. This would allow it to launch regional operations, in Honduras and Nicaragua, in Mexico and Colombia.

However, ten years after the launch of the first off-grid solutions, no economic model has yet managed to dominate the market. Could the Kingo solution make the difference? “It is our duty to implement our project regardless of the financial risk in order to close poverty gaps", points out Juan Fermin . "This is why we need financial partners like Proparco to support us.”

 

© Sarah Caroline Müller

 

►  Find out more on Kingo's official website

 

  Watch the video by Proparco 
 

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