One of the Break-Out Sessions during the DCHI Annual Event on the 2nd of October 2018, focussed on new business models for the Humanitarian Sector. Traditionally, humanitarian organisations have often provided support through direct distribution of relief items, relying largely on financial support by donors to be able to purchase these items in the first place. Increasingly however, others ways of creating access to goods and services are being explored, sometimes even changing the business model by which the ‘humanitarians’ are operating themselves.
Large parts of the world’s population are exposed to high energy costs and unhealthy smoke at the household level as a result of their methods of energy consumption, both thermal (cooking, heating) and electric (lighting, mobile device charging, etc). Determined to increase their access to clean and affordable energy, Ruben Walker and his family set up African Clean Energy (ACE). Ruben explained how they made the conscious decision not to set this up as an NGO. From a belief that a basis in a profitable value proposition will lead to the most sustainable solution in the end, ACE operates as a business. At the moment, Ruben was proud to share, ACE has already sold 55.000 clean energy systems worldwide, and over 90% of their customers report significant savings on household expenses.
Peter Scheer of SEMiLLA Sanitation Hubs explained how in the model they envision as well, usage of the sanitation solution itself should yield such positive returns, that this should drive economic demand for and willingness to invest in the hubs, and thus in sanitation solutions for people affected by crisis. Turning wastewater into fertilizer, compost, and clean drinking- and irrigation-water, usage of the solution should create the revenue streams that allow for the investment to pay off. Peter is reaching out to NGO’s to support SEMiLLA in the coordination and exploitation of the hubs in humanitarian settings.
The important role development organisations can play in supporting private sector development, which in turn can create impact at scale regarding access to needs such as energy, was demonstrated through the experience of Martijn Veen of SNV. Their Results-Based Financing facility for solar market development in Tanzania both supported 1256 new jobs in this industry as well as created access to clean energy services to over 300.000 people in the period from 2014 to 2017. Martijn shared how also in case of humanitarian needs in long-term refugee settlements for example, market-based approaches might eventually have a bigger impact than donations of energy equipment.