Energy Supply Chain

The market development approach of RETs using productive uses as entry point would be useless without efforts to foster the growth of actors within the whole industry supply chain (as illustrated in the figure below) and facilitate interlinks among the actors. The various actors in the supply chain also have different need for finance.

Understanding the economic limitation of rural people, development of rural energy services must take into account other conditions to ensure sustainability, namely:

• adopt field-proven and most cost-efficient technological option;

• involve commercial suppliers with reliable after-sales warranties and service;

• be accompanied by the development of electricity-intensive rural businesses that will contribute to significant and sustainable electricity consumption;

• must be accompanied by the development of competitive market infrastructure by government or development agencies; and

• financing facilities to be made available to all key actors (developers, suppliers, producers, intermediaries and end users).

There are a number of requirements for sustainability of rural energy provision. Scaling of systems should be determined by the availability of demand (current and potential demand) in the immediate future. If an electricity-intensive business is available - a so called "anchor-users" - it is more likely that the energy service business is also able to cover recurrent costs and recover investment. Sufficient revenue to cover costs and reinvestment needs, along with market infrastructure to ensure quality and continued service delivery is key for sustainable market-based rural energy provisions.