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5 innovative models that expand solar energy in Nepal

The CleanStart programme in Nepal, implemented by the Alternative Energy Promotion Centre (AEPC) and United Nations Capital Development Fund (UNCDF ), has focused on growing access to clean energy finance by promoting innovations through partnerships.

It reached over 128,000 households and leveraged USD 23 million in investments. The success of this outreach relied on several partnership models. Here are 5 models implemented by UNCDF CleanStart and its partners:

Tri-party model

In this partnership model, a commercial bank (Nepal Investment Bank or NIBL) provided financing, a microfinance cooperative (Himchuli ) created the demand and a renewable energy provider (Suryodaya ) provided technology. This allowed for seamless energy access in remote areas of Kalikot district. The partnership enabled lending of Rs. 10 million and helped NIBL to cross lend to the cooperative, including for income generating activities.

Two-party model

In this model, a commercial bank (NMB Bank) partnered with a national level microfinance institution (Nirdhan Utthan Bank) to provide energy lending to Nirdhan's customer base. Through this partnership, about 30,000 of Nirdhan clients accessed energy loans. CleanStart and its partner (Winrock ) facilitated this matchmaking and provided capacity enhancement. Nirdhan was also able to leverage its energy loans to provide other loans and vice-versa.

Sales Agent Model

In this model, local financial institutions (small farmers' cooperatives) act as or help its members become sales agent for renewable energy service providers. These partnerships were facilitated by the Sana Kisan Bikas Bank for its member farmers' cooperatives. The model enabled increased lending and facilitated better after sales service.

Last Mile Distributor Model

The Sana Kisan Bikas Bank and Nirdhan Utthan Bank supported women to become entrepreneurs to provide final distribution service to customers. They worked with a partner service provider to provide this service. Ajummery Bikas Foundation, a private training service provider and wholesaler, trained 40 women to be agents of change.

One Stop Shop Model

In this partnership model, a financial institution (Jiwan Bikas Samaj or JBS) established a sister technology service provider company (Jiwan Bikas Urja) as a one-stop shop for renewable energy systems and services, including after sales services. This strengthened the post installation services to customers and also resulted in timely loan repayment. The partnership resulted in about Rs. 450 million disbursed as energy loans and 43,000 systems installed through microfinancing. JBS established its sister company, Jiwan Bikas Urja, with CleanStart support.

In addition to grant support, UNCDF CleanStart worked with its partners to provide mentoring assistance. This was crucial to the success of these models. Assistance included "match making", capacity building, and market research.

Feedback from energy financing clients show the immense benefits brought by access to clean energy. With these partnership models, more families and communities are able to use clean energy for basic and productive purposes. In a country where millions still lack access to electricity, new ways of doing business and partnerships are critical to help people access and use clean energy.

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