Not surprisingly, when new technologies are developed, they are usually built for developed markets. Then – when it launches in emerging markets – and modified slightly, if at all.
Most people assume that new technologies work well without considering structural differences between developed and emerging markets, such as differences in infrastructure, operating environment, and culture. This is understandable as developed economies typically offer the largest market opportunities with deep pockets for new technologies. These deep pockets justify the significant R&D budgets driving new technologies built for the same deep pockets, so it’s all very circular.
Developed economy companies also have the level of sales, integration, service and technology expertise developed for adopting new technologies. The situation is different in emerging markets.
I have witnessed this dynamic firsthand in the energy access market, where 2.2 billion people and hundreds of millions in developing business, clinical and school markets lack affordable, reliable energy. The modern power grid was invented over a hundred years ago and implemented effectively in most developed markets, but ineffectively in emerging markets – apart from the vast structural differences.
Next came distributed renewable energy (DREs) for emerging markets, such as diesel generators, inverters, batteries and solar panels. These backup systems were designed for developed markets to complement a developed market network. They are not built for markets that lack the primary power source of a reliable grid. They also fail the 2.2 billion without affordable, reliable energy.
Further flaws are evident in the cost structure, just as it makes no sense to drive a Ferrari on most African or Latin American roads, so there is no need to fit in an all-singing, all-dancing renewable energy system that only delivers power sporadically. The goal should be to provide predictable and reliable power at an affordable price. Why meet the latest regulatory standards from Brussels when the engineers in Bulawayo only get costs and no benefits from it?
Over the past decade, ZOLA Electric and other pioneers in the Energy Access market have been replicating how energy is delivered in emerging markets. We have discarded legacy technology designed for developed markets and designed a decentralized technology platform specifically for areas that require flexibility, integration, modularity and intelligence – to deliver reliable and affordable power.
Delivering community-level electrification in over ten countries on four continents has taught me that attempts to standardize regulation and technology by copying and pasting from other jurisdictions will fail. Almost 40% of the world has failed at this for over a century. Every market is unique and deserves unique, flexible solutions. This flexibility must extend to energy sources in order to avoid problems such as energy security in Europe, where its availability is in the hands of a hostile power.
It is relatively easy to adopt a more practical and realistic approach that also saves scarce financial resources. It does not require engineers, officials and operators to be dazzled with a shiny new kit, rather calculating the minimum of what is required exactly, how it must grow or adapt over its lifetime and how best to conserve it.