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Problem:
A large number of villages in Lao PDR will not be connected to the main grid for many years to come. Small village grids fed by decentralized local energy sources are an option to be explored and developed to overcome this lack of energy supply.
In some places it is feasible to consider hydro-electric solutions. During the dry season, in most areas, stream flows are considerably reduced. Hence, a feasible small grid has to be boosted with solar energy or a diesel generator. (In the future, after the commercial viability of its use is proven, we are planning to substitute the diesel with biofuel made from Jatropha. At the moment our partner LIRE is researching about the effectiveness of the Jatropha-seed-oil.) In view of the government’s policy for decentralized energy production in remote areas, and in view of repeated requests by villages and district and provincial authorities, Sunlabob has looked into the possibilities of small hydro-power generation and the operation of village grids. With regard to the national grid, the village grids themselves may also act as “systems-fringe boosters”, with their generators remaining operational in order to ensure voltage at the outer reaches of the grid.
Concept of Private Public Partnership
Insular village grids with their low load factor and the required infrastructures at the village level are an unattractive investment for private investors.
Against this background an innovative operative set-up is tested. Thereby public investors (in this case a cooperation of the villagers of Nam Kha, Helvetas, ENTEC and SUNLABOB) pay for the fixed assets to build up the infrastructure, such as dams, intakes, channels, housings, grid and supporting structures. The private investor pays for the movable assets, i.e. turbines, generators, solar panels and controllers, batteries, etc., operated by a “Private Energy Provider” (PEP), in this case Sunlabob, which also trains and coaches the village energy committee to operate the village owned grid. Energy then is sold into the village grid, and the village committee sells it to the households and small rural enterprises.
So a split in ownership preserves flexibility for the energy provider as well as for its customers, and thereby allows win-win options for all concerned partners in any conceivable situation. Furthermore public investments into the fixed infrastructures can leverage private investments.
Why Nam Kha?
In order to test and demonstrate this concept a pilot project was set up. Out of the 40 potential locations, Nam Kha village in Phaxay District, Xieng Khouang Province, was given priority, where a derelict hydraulic turbine allowed us to utilize already-existing fixed infrastructures. The concept of refurbishing existing facilities offers the opportunity to keep starting investments low. The Hydro Plant in Nam Kha was constructed in 1994 by a Chinese company and also funded by a Chinese donor. It had been running until 2004, whence it stopped because of a burned out turbine. Nevertheless, this derelict small hydro installation could be refurbished with few costs for the infrastructures.
So Nam Kha village was selected as an appropriate demonstration place. Main criteria for the selection besides the fairly good condition of the fixed assets was the comparatively good access to the village, which is positioned close to the provincial capital, as well as the already available knowledge of electricity. We identified a high potential of the villagers to use energy productively, mainly based on their previous experience with electricity. Furthermore, the inhabitants of Nam Kha showed a high interest in getting access to electric power again.
Partners for pilot project
The successful implementation of the Nam Kha hybrid pilot project was possible due to a collaboration of the villagers of Nam Kha as the main beneficiary of the village grid, contributing and owning the fixed assets, SUNLABOB, granting the technical design, know how, as well as the operational and logistical competence as the private energy provider, ENTEC, serving as our private industrial partner by providing technical know how concerning small hydro power solutions and equipment and finally Helvetas, a NGO from Switzerland, providing the necessary funds to refurbish the fixed public infrastructures.
What was installed?
The hybrid system Nam Kha was built as a pilot scheme to demonstrate state-of-the-art technology for rural electrification. The system is fed by multiple sources. The annual production capacity of 175.200 KWh is provided by a 12,5 KW Hydro turbine, a 15 KW Diesel Generator, which enhances the overall availability, and a 1,84 KW solar array, allowing water to be saved, especially during the dry season.
A load management system optimizes the load balance between the different sources, and enables 24h operation all year round.
Progress
Throughout Lao PDR there are 63 small Hydro Power Plants. These plants are registered under the supervision of the Ministry of Energy. The available survey data has been provided to Sunlabob by the Ministry and was used for an overall assessment of all plants. This assessment was conducted mid 2005 in collaboration with ENTEC, our industrial partner for hydro solutions. The appraisal identified that 40 of those 63 systems are defect or not operational at all.
Nam Kha was selected as the first pilot village in August 2005. A survey team consisting of ENTEC and Sunlabob staff conducted a detailed survey on the reconstruction of the existing system.
After the positive survey results, various meetings with provincial and district authorities and representatives of the village took place. During those meetings the construction details and the contribution of each stakeholder for the rehabilitation of the system was agreed upon. Hence, the villagers have been involved during the entire decision-making and refurbishing process, so as to ensure that they support the project.
The rehabilitation of the hydro plant to be transformed into a hybrid village grid started in December 2005. The hydro turbine and the central control unit was provided and tested by ENTEC. The solar unit and the generator were installed by Sunlabob. Happy to participate in the betterment of their village, most of the inhabitants were involved in the build-up-process by supporting transportation and facility-installation. For example, solid waste had to be collected, canals had to be cleaned, and organic material, such as plants, had to be removed to guarantee a steady flow.
Prior to installation, Sunlabob trained a Village Energy Committee selected by the villagers and officially mandated by the Village Authorities. The committee received several training courses, starting in July 2006, on how to operate, manage, and finance the HVG. During the construction and installation, three Village Technicians were appointed in a participatory identification process with the villagers and the traditional village authorities. Together with other interested villagers they received training in technical maintenance and business related issues, which started in January 2006. The village technicians have been involved in all steps of the construction process and were trained in class rooms as well as on-site. Now they are operating as independent small entrepreneurs.
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Final technical configurations for all components were performed during January and March 2007 by Sunlabob technicians with the support of ENTEC consultants. These checkups were also used for the final training instructions to the village technicians.
The system was operational by the end of March and a testing phase was launched on April 1st. The system operated without any problems during this four week testing phase.
On April 27, 2007 the village hybrid grid was officially launched in a big opening ceremony with participants of local and national Lao officials, ambassadors and representatives of international banks, bilateral government organizations and NGOs.
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Achievements
Nam Kha is the very first hybrid village grid that has been installed and launched with a public-private interaction in Lao PDR, and probably worldwide. With the success of the pilot project in Nam Kha the concept of Private Public Partnership has proved to be feasible for rural electrification: Thanks to the coverage of the initial costs through the Public Partner, the running costs can be covered by the monthly payments of the villagers. With an average demand of 2,4 KWh per day the commercial viability is guaranteed.
The whole Nam Kha village, including 120 households, now has access to electricity with affordable conditions. The connected households use the electricity for lighting, which can be achieved at costs comparable to former expenditures, and half of the households run a TV or a radio by now.
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For example, Mr. Bialy: He works as a soldier and lives with his family of eleven people in Nam Kha. They have a big herd of 27 cows and water buffalos, and furthermore 2 pigs. With his income of 600 USD per year his family is quite wealthy relative to the other households in Nam Kha with an average yearly income of 300 USD. So, he was one of the first connected to the HVG. Before that his family used candles and gasoline to cover their energy demands. Now that they have electricity from the decentralized hybrid grid, they can switch the light on and off whenever they want to. In the evening hours his wife can use the light for cooking, and his kids for studying and doing their homework. Therefore, daytime hours can be spent much more flexibly. But for Mr. Bialy the increase of flexibility is not the only advantage of the electricity supply: electrical light causes less fumes and dirt than candles and gasoline and provides a clean alternative. The electrical illumination was not the only factor that influenced him to choose the hybrid grid connection. He is also now able to run a TV, CD-player or a radio for family entertainment and access to information, which, due to the limited spread of newspapers in remote areas, is not always easy to find. Although his children still spend a lot of time on studying, he must admit that they also love to watch TV, so that he sometimes has to interrupt their TV consumption and remind them to do their homework. Since they are connected, Mr. Bialy also owns, as do most of the villagers of Nam Kha, a mobile phone, which his family uses to call relatives and friends. In the future, Mr. Bialy would like to buy an electric oven and a refrigerator, but first of all he wants to invest in an electric rice mill, so they will not be able to buy the kitchen appliances until the middle of next year. His wife is especially looking forward to that.
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Typical DC systems do not allow the operation of most income-generating equipment. For this, AC is required, which the HVG provides. The Nam Kha facilities have an annual production capacity of 175.200 KWh. That still leaves a lot of room for expanding energy use.
Therefore, the 24-hour electricity system opens the door for productive use to generate additional income and empower villagers to develop self-indicated, besides improving individual living standards in each household. Small businesses like furniture production and welding shops have opened in Nam Kha. Moreover, food processing activities, running rice-mills, or water pumps for a more efficient agriculture production boost the income of the villagers by now, and the already existing entrepreneurs can facilitate their workflows and increase their earnings by running electrical appliances.
Even a karaoke venue and a small cinema have been established Nam Kha, and entertain the villagers now.
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The town hall in Nam Kha was also newly built up in 2005. It is used for town meetings, and moreover for road shows of the head of the district, where people from all villages around Nam Kha come together, to get information about the latest developments in the district.
The access to electricity and electric light enables the villagers to hold their meetings later in the evening, so more people, which otherwise had to work on the fields, can join the conferences. Although the town hall is most of the time used for official get-togethers, the villagers sometimes alter its function: Than they switch on the CD-Player and deploy the space for big celebrations.
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But even if SUNLABOB as Private Energy Provider offers the opportunity to fulfill any kind of energy demand in Nam Kha, the decision wherefore the energy should be used, belongs to our customers.
So the school of Nam Kha is not connected to the hybrid grid so far; according to Ms. Manicxanh, one of the local teachers, just because nobody feels responsible to pay for it. Anyway, she would really like to have electric light in the gloomy class room while she teaches reading, writing and calculating: “It would be better for the kids’ eyes!”
Sustainability
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Like many rural infrastructures, off-grid village electrification is notorious for its lack of sustainability. However with Nam Kha there is an example where private investors remain owners of their earning assets and therefore have a stake in maintaining the system to keep it operational. On the public side a trained village energy committee has a stake in ensuring efficient use of the public assets. The combination of these two stakeholders results in a sustainable strategy that is innovative and replicable.
A technical solution for combined village grids has been tested, finalized and documented. This adds to the available options for off grid solutions for different requirements and circumstances. It will be an important positive example for establishing affordable off grid solutions in other areas. Based on our experiences with the first hybrid grid in Nam Kha, we are right now in process to build up a regional hybrid grid, which will supply energy for four more villages.
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Programmes 
