Worldbank: Lessons to learn from Bangladesh

Since its inception in 2003, Bangladesh’s solar home system program has installed about three million electrification systems in rural households, two-thirds of them in the last three years. the program is the most dynamic off-grid electrification program in the world, benefitting more than 15 million people.
Some aspects of the Bangladeshi SHS program may be unique to Bangladesh and difficult to replicate in other countries. But Bangladesh’s experience also conveys many lessons that are applicable to any off-grid electrification initiative. Among those lessons: 

  • The presence of a competent and passionate local champion with a strong capacity to promote and manage an off-grid elecrification program
  • Technical and financing solutions that match the target population’s ability to pay 
  • The quality of the solar home system and consumers’ awareness of its availability 
  • The patience to allow the program to evolve over time to reflect new technologies and market trends.

An ownership model based on microfinance proved most successful.
The SHS ownership program has been successful primarily because it has provided technical and financing solutions to users that matched their needs.

  • Financing: The program has made systems affordable through a combination of consumer credit and (declining) subsidies. The idea was to bring monthly expenditures as close as possible to existing household spending on kerosene and dry cells. Subsidies were initially required to bring the overall costs of the systems down, but they have been gradually phased out.

  • Technical features: From the start, the SHS program emphasized quality assurance in order to build consumer confidence in solar home systems, which were not yet widespread in rural areas. When the program started, batteries were the only component produced in Bangladesh. Today, all components (including solar panels on a limited scale) are produced locally.

Scalability is more important than scale. 
The Bangladesh SHS program, the largest off-grid electrification program ever supported by the World Bank, began as a modest pilot aimed at reaching 50,000 connections over a five-year period. This experience shows that it is less important to aim at developing a “a large-scale program” than to focus on developing scalable solutions. The approach was developed in several phases, as detailed in box 2. The SHS program was scalable because its design leveraged Bangladesh’s strengths while effectively addressing the identified barriers and allowing for careful and timely adjustments to insights gained during implementation. 

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