Solar power reaches 100,000 in rural India.

A solar photovoltaics pilot project in India has transformed the lives of some 100,000 people living in poverty-stricken rural regions. The goal of the $1.5 million project, led by the United Nations Environment Programme (UNEP), is to facilitate household financing for solar home systems. Its success has inspired satellite programs in Algeria, China, Egypt, Ghana, Indonesia, and Mexico.

Approximately 45 percent of people in India are hooked up to a power grid and endure daily power failures. Those without grid access must often walk long distances to buy a few liters of expensive kerosene. In developing countries, the use of kerosene and other "dirty" fossil fuels for indoor lighting is responsible for 64 percent of deaths and 81 percent of lifelong disabilities from indoor pollution for children under the age of five. "Kerosene used by the poor for lighting is often unaffordable, unavailable, unsafe, and unhealthy, while the electricity power grid is unreliable," explains Timothy E. Wirth, president of the United Nations Foundation.

The largest barrier to solar power in developing countries has been the lack of financing in poor communities. UNEP's Solar Home Systems project aims to make solar affordable by encouraging banks to finance small loans (US$300 to $500) for a system that can power two to four low-watt compact fluorescent lamps and a direct-current fan. Two leading Indian banks, Canara Bank and Syndicate Bank, were the project's original partners, jointly supplying low-interest loans that could be repaid over five years through their 2,000 rural branches. A vendor qualification process resulted in five solar vendors offering a variety of competitive products that were eligible for financing.

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With the project, the number of financed solar home systems in the pilot region of Karnataka state in south India increased from 1,400 in 2003 to more than 18,000 today, providing power to approximately 100,000 people. The systems supply a few hours of continual power in homes or shops to run small appliances and provide improved reading light. According to the UN, "the lighting has been credited with better grades for schoolchildren, better productivity for cottage-based industries such as needlework artisans, and even better sales at fruit stands, where produce is no longer spoiled by fumes from kerosene lamps."