Harmen and Marcel van Heist and Evan Mertens - Rural Spark

Through a monthly subscription, rural Indian villagers rent a Rural Spark energy kit and become Local Energy Suppliers who generate, use and sell energy. By trading energy surpluses with other Local Energy Suppliers in the network, supply and demand are linked up.

Using tools that encourage local systems to emerge within the context, Rural Spark offers a network solution that will evolve along with the development of the context (as opposed to most temporary standalone solutions).

In 2020, Rural Spark will supply ten million households with sustainable and reliable energy.

Rural Spark develops decentralized energy networks through Local Energy Suppliers

“Just look around. The world population is surging ahead. New means of communication are increasing knowledge, which leads to greater demand. No one wants to be left behind. A higher living standard goes hand in hand with a greater energy need. Just in India, demand is expected to grow by 77% by 2030! Today’s centralized power networks can never meet that demand. Rural Spark is working on smartly distributed, decentralized energy networks in which surpluses and shortages are linked up. These networks are designed within the users’ actual context and evolve along with development of the village.”

How does Rural Spark do it? Harmen van Heist, Rural Spark’s co-founder and Director of Strategic Development explains: “We supply ‘energy kits’ that enable people to become an energy supplier at the village level. A kit consists of an energy source, the Rural Spark energy router, and various applications. It’s the perfect solution for villages not connected to the grid. People lease the equipment from Rural Spark through a monthly subscription. They generate, use and sell energy, and so become an energy entrepreneur. By working with Rural Spark, these entrepreneurs become part of a network of local energy suppliers. By trading energy surpluses through this network, both efficiency and income increase. Shared ownership also makes the system more reliable.”

Smartly distributed energy networks

Harmen van Heist founded Rural Spark with Evan Mertens and Marcel van Heist. “Evan is the technological brain behind Rural Spark, with a strong interest in efficient energy solutions”, explains Herman. “Evan developed a roadmap that facilitates the creation of smartly distributed energy networks, in which access to energy is democratized (like access to the internet). This inspired Marcel – a system developer by training and passion – to the point that he immediately departed for India to implement the idea in practice.” And with that, the division of responsibilities among the 3 owners is clear.

India

The choice fell on India “because there we can ‘leapfrog’ the existing systems”, says Harmen. “So not from A via B and C to D, but directly from A to Z! It’s comparable to the mobile phone network, which completely leapfrogged the system of landlines.”

Social challenges

“The spontaneous initiative was of course exciting”, Harmen recounts, “but of course it came with quite a few social challenges attached. The system really works only if the users go for it 100%. To achieve this, Marcel developed a unique design method, dubbed ‘Hidden Design’. This method is based on the rapid prototyping approach, which produces concrete things that users can put to very specific use and which they can modify according to need. This is the only way to generate a system from within the local context.

Thanks to this method, we achieved our first operational success. An entrepreneur was born in rural India: he shared the energy he generated with his fellow villagers. This was the very first concrete step towards the exchange of energy surpluses and deficits. Rural Spark emerged from this success. The only way for us to become a business was by building a sustainable energy network in this way.”

Sustainability

According to Harmen, a system like the one supplied by Rural Spark can only be successful if it is embraced by the people it serves.  “Building a smartly distributed network centered on users is almost more of a social than a technological challenge. There’s a lot we can do technically, but the system needs to be self-sustaining economically. Besides, we need to deal with a scarcity of (fossil) fuels. That’s why we work with renewable sources, as much as possible. So in our system, social, economic and environmental sustainability are all rolled into one.”

Revenue model

Harmen elaborates a bit more on the aspect of economic sustainability: “There is a revenue model at all levels. First of all for our users: they generate energy, but not just for themselves and their family. They also sell energy to their fellow villagers and thus become an ‘entrepreneur’. These ‘Local Energy Suppliers’ can provide energy to around 12 to 20 households. For these end-users it is also a worthwhile proposition, as the energy costs of a LED lamp are lower than that of a kerosene lamp, for example.  Additionally, there is a profit margin for our distribution partner, which is often a local party with access to rural areas in India. Finally, there’s a profit margin on the supplied service for Rural Spark as well. This enables us to scale up the network and to continue to add new functionalities.”

India and the Netherlands

Doing business in India is fascinating, says Harmen. “Some things happen ten times faster than you would have expected, while other things which you think are just a formality can take weeks. We try to adopt existing structures as much as we can, and besides that we try to be as pragmatic as we can in terms of procedures. “Working in India is something special. But it also means that we are operating slightly off the radar, so to speak. This carries the risk that we’ll be seen as just another solar energy outfit here in the Netherlands, while in fact we are offering long-term solutions. So we are working on our company image, and I think that people are increasingly recognizing that we offer a much wider network solution, which we implement using a special system-design method. This is borne out quite nicely by the fact that our method (Hidden Design, developed further by design studio Afdeling Buitengewone Zaken) was nominated for the Rotterdam Design Prize last year. And our partnership with GDF SUEZ was mentioned by Minister Ploumen as an example of a form of development cooperation for ‘civil society’.”

Looking ahead to 2020

Rural Spark is about to significantly scale up its operations. The first contracts are being drawn up to start reaching 10,000 ‘Local Energy Suppliers’ at the village level, starting April 2015. These suppliers will earn an income through the sale of energy to their fellow villagers. And that’s just the start of it, says Van Heist: “All these Local Energy Suppliers can trade their energy surpluses, resulting in a distributed energy network. In addition, we are working on two very interesting R&D programs that, when implemented, will make the network even smarter. By 2020 we hope to have some 700,000 Local Energy Suppliers in the network. This should provide some 10 million households with sustainable, reliable and clean energy.”

The worldwide market

“In ten years from now, we hope to be one of the major players in the field of smartly distributed energy networks in India. This should result in a standard that makes it easier for other initiatives to connect to the Rural Spark network. It is only through such subsidized networks that it will remain possible in India (but certainly also in Africa and in time even in the Netherlands and other western countries) to continue to meet the ever-increasing demand for energy. In the long run, it won’t be possible to meet this demand with (only) fossil fuels through centralized grids. Rural Spark has taken the first steps, and now we’re on the verge of scaling up in a serious way.”

For more information visit our website:

www.ruralspark.com