Tech Award Nomination for Tecnosol

Tech Award Nomination for Tecnosol

Over 50% of Nicaragua's population does not have power. This is a contributor to the high level of poverty in Nicaragua. In rural areas, lack of electric light, refrigeration, water purification, and farming systems suppress economic development and stifle commerce. A for-profit provider of decentralized energy solutions, Tecnosol is a Nicaraguan company, which consults, sells, installs, and provides post sales service to rural communities. Tecnosol's business model is aligned with the target of achieving full and productive employment and decent work for all, in support of the Millennium Goal of eradicating extreme poverty and hunger. The company partners with local microfinance institutions to allow rural businesses to make periodic payments toward ownership of sustainable energy sources. The combination of existing, small-scale power generation technology and partnered microfinance synergistically drive economic development in areas that would otherwise see little growth opportunity. With an innovative application of technology, finance, and an effective product and service mix, Tecnosol meets the criteria for nomination to the Tech Awards.

Tecnosol's target market is the rural population of developing countries. While the company has expanded from Nicaragua into El Salvador, the majority of its business is done with the rural poor of its country of origin. In 2005, 48.3% of Nicaragua's population lived in poverty. While poverty decreased by 2% overall in the country, it increased by 2.5% in rural areas. This can be broadly explained by access to means of making an income, and consuming goods and services. Rural areas in rocky terrain are widely inaccessible and thereby have limited access to trade and utility services. Specializing in highly rural, off the grid locations, some accessible only by horseback, it is Tecnosol's mission to "bring solutions, hope and improved well-being to its customers."

Tecnosol pursues this mission by engaging the population of rural communities, determining needs, and providing solutions. Purchases are made possible through local microfinance institutions. This is advantageous to consumers and entrepreneurs alike. For example, a butcher could purchase a solar powered refrigeration system on credit. Before his purchase, he may have only cut enough meat for one day, discarding what was leftover. His refrigeration system allows him to forecast sales and refrigerate quantities for future sale. The cost of potentially wasted inventory can be appropriated toward paying off his refrigeration system. In this manner, he increases his sales volume and pays off his investment through increased efficiency. Jose Feliciano Angulo, a butcher in Rama says, "I used to cut only as much meat as I could sell in one day. Now I can keep a stock of cut meat in the freezer. I used to throw away $100 worth of meat a week. I pay $150 a month for the loan."

Tecnosol has sold over 40,000 Solar Home Systems since the company was founded in 1998. Solar Home Systems (SHS) are made up of a photovoltaic solar module, a battery, a charge controller, wiring, and fixtures. These can be deployed for use in homes, business, and health clinics. Solar Home Systems can generate enough electricity for lighting, refrigeration, water purification, and even electric fencing for livestock. While Tecnosol is not the developer of the technology, its value proposition is in its ability to find its customer, solve the customer's problem, and turn the customer into an evangelist. The services mix and broad range of customers set Tecnosol apart from other systems integrators. The company "supplies, designs, and provides training, installation, technical support, consultation, and implementation of products and projects in renewable energy." Its customer base ranges from individual workers, farmers, and households to NGOs and government agencies. Its ability to provide financing for larger installations in remote regions has grown over time. Working with large-scale programs to extend its reach, the company lists three landmark developments on its website. In 2003, with funding from the NI-0069 BID project, Tecnosol installed 1,422 photovoltaic systems in 32 remote communities.