Uptake of Off-grid Solar Products Strong But Stagnating: GOGLA

GOGLA report sourcing data from 84 companies, provides sales data for solar lanterns, multi-light systems and solar home systems (SHS) in 46 countries.

The Global Off-Grid Solar Market Semi-Annual report, says solar lanterns were the largest category among off-grid solar products sold in the second half (July-December) of year 2018, however it also pointed out that there are signs of stagnation in sales volumes of this segment.

The Global Off-Grid Lighting Association (GOGLA) further added that globally 3.9 million off-grid solar lighting products were sold by its member, which represents an installed stand-alone solar capacity of 32.39 MW. Out of this, 2.79 million solar lanterns were sold globally accounting for 71% of overall sales volume, along with 630,000 multi-light systems and 480,000 solar home systems (SHS). The SHS category registered a 77% increase on YoY basis.

PAYGo Model Works

The GOGLA report points out that 2.95 million were cash products with a value of around $99.4 million. Products sold via pay-as-you-go (PAYGo) recorded 30% increase compared to previous half of 2018, reflecting a volume of 950,000.

PAYGo products represented $164.78 million in value, representing an increase of 30% compared to H1/2018. “The value of such products has seen a 50% boost as well, driven by larger size of systems,” it reads. The growth in PAYGo segment is also largely due to the growing penetration of this segment which enables end-customers financing.

Solar lantern sales are stagnating
Solar lantern sales are stagnating

Stagnation in Solar Lantern segment

The report sees signs of stagnation in sales volumes of solar lanterns which could be attributed to price consciousness and at the same time bulk purchases for these products for short term use, for instance to be used for humanitarian crisis mitigation.

Gogla says, “This could be a sign that in mature markets companies are beginning to reach saturation points of entry-level systems, or that entry-level products are no longer lanterns bur rather systems that provide higher energy services such as multilight systems or SHS.”

Geographically, the East African region was the biggest market with 1.85 million off-grid solar lighting products sold, followed by 1.26 million products going to the South Asian markets.

Other takeaways:

Market Trends report shows that off-grid solar lighting devices are estimated to have reached between 17% – 20% of the global potential market. While impressive in itself, this leaves a large untapped market and great potential for further growth.

As of December 2018, 108 million people are currently living in a household with improved energy access through off-grid solar lighting products, of which 59.5 million people have Tier 1, and 4.9 million have Tier 2 energy services, as a result of off-grid system ownership increased from $3.5 billion to $4.2 billion.

The positive environmental impact has risen to 58.4 million metric tonnes of CO2e that has been avoided releasing into the atmosphere. That’s equal to taking 15 coal-fired power plants off-line for a year.

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