The predominant model in the off-grid solar (OGS) sector is that of non-interoperable systems – brand-specific connectors combined with proprietary digital protocols. For pay-as-you-go (PAYGo) consumers, this means they must purchase their solar home system kits (SHS Kits) and appliances from the same company. They are unable to use an appliance with another company’s SHS, or vice versa. For cash sale customers, this means limited flexibility and choice of appliances, and a high risk of buying an appliance that is not compatible with their SHS Kits.
The Off-Grid Solar Market Trends Report 2020 identified interoperability as a game-changer. Interoperability entails products, services and information systems being able to work well together, reduced product development and manufacturing costs, and enabling greater competition and supply chain efficiency. Although it is categorised as a ‘small win’, interoperability underpins many of the other game-changers, including specialisation and partnerships. Experience from other electronics and consumer goods industries shows that greater standardisation and interoperability can drive market growth (see Case Study on smart home systems below).
” Greater product interoperability could be a game-changer for the OGS market. It would enable business model innovation and specialisation, and enhance consumer flexibility and choice.” Russell Sturm, IFC
However, the off-grid solar sector is a unique beast – the energy and power limits of the technology, combined with the PAYGo business model and the early stage of the market, mean that an interoperable ecosystem also presents challenges and risks to consumers, and to the companies providing OGS goods and services to them. The opportunities and risks depend to some extent on whether you are a vertically-integrated company or a supply-chain specialist (e.g. a ‘PAYGo 2.0’ company).
Most PAYGo players sell VeraSol quality-verified (QV) products that meet IEC standards, but a large market also exists for non-quality-verified (non-QV) and non-branded SHS Kits and a wide range of appliances (including TVs, fans, radios, hair razors, etc).2 Some manufacturers sell nonQV appliances such as hair razors or radios on the open market. Finding compatible non-QV products and ensuring they work well can be a challenge, given the range of connectors on the market, the unknown electrical characteristics, and uncertain quality and safety. Non-QV SHS Kits and appliances can have a negative impact on the market, undercutting QV products on price, while poor quality and sometimes dangerous goods fail to deliver customer value and damage trust in the technology.
This White Paper explores the opportunities and challenges provided by universal connector and PAYGo standards for 12V SHS Kits and appliances. It draws together work on the Connect Initiative (formerly the Interoperability Initiative) by the GOGLA Technology Working Group3 and its members, supplemented by research and interviews with stakeholders in the OGS industry.
The aims of this White Paper are to:
- Raise awareness and spark debate in the OGS industry about the Connect Initiative;
- Articulate in detail the benefits and risks of interoperability for consumers, companies, and the industry;
- Prompt wider discussion on what the Connect Initiative will mean for companies’ strategies, operations, and customer relationships; and
- Get your feedback on the Connect Initiative and how we can work together to achieve its aims.
1 This non-quality-verified market is predominantly ‘basic’ technology, i.e. is sold in cash (without PAYGo Activation) and has no digital communications for device control (also known as ‘dumb’).
2 The Compatibility and Interoperability Technology Roadmap (efficiencyforaccess.org), published in September 2019, identified the universal connector and firmware standards; this formed the basis for the Connect Initiative.