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Sliding prices of components such as LEDs, batteries, and photovoltaic chips are prompting off-grid solar power product manufacturers in directing investments and funds towards enhancement of technology, efficiency, and durability of their offerings, states TMR in a recent report.

In the fragmented off-grid solar lighting market, featuring few large-scale vendors such as Koninklijke Philips N.V., OSRAM GmbH, Total S.A., and SunnyMoney, and several small- and medium-sized players, pricing of products is a major determinant of success.

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Government initiatives in the form of tax abatements and tax-free loans are encouraging vendors to introduce highly cost competitive products; technology innovations and patented technologies are also being introduced at a rapid pace in the market and companies are launching products that can suit the diverse needs of consumers. Recently, in March 2015, market leader Koninklijke Philips N.V. launched the Philips LifeLight, which is a range of zero-energy solar powered LED lighting solutions. The product range comprises two sophisticated pendant lights and a USB port for charging mobile phones that is connected to a solar panel. The lights in the product have demonstrated 10 times longer lasting light as compared to candles and kerosene lamps. Total S.A. launched an adaptable 48 volt solar house kit in January, 2016, whose capacity can be extended with the addition of solar panels and batteries.

Low Electrification Rates to Work in Favor of Off-grid Solar Power

Reliable access to electricity is one of the most prominent challenges for millions of households in countries across Latin America, Africa, and Asia Pacific, making them directly dependent on off-grid power sources. Most of these households reside in rural areas and come from low to moderate income groups. The cost-effective and reliable off-grid solar power technology makes for a fitting power supply option for this demographics, prompting companies to make non-traditional regions a key part of their growth strategy.

As for many other solar power technologies, the market for off-grid solar lighting has witnessed increased traction owing to the rising affordability of off-grid solar lighting products. Products such as solar lanterns and solar batteries have witnessed increased demand in remote parts of developing and under-developed parts of the globe that are not connected to conventional grids.

The rising consumer base of mobile devices such as smartphones and tablets in Asia Pacific and Africa has also augured well for the market. Increasingly reliable and innovative products such as the solar batteries capable of recharging mobile devices are becoming highly popular among the remotely located and mostly underserved demographics in these regions. The high consumer-base of mobile devices is also expected to have a major impact on the demand for off-grid multi-functional solar power systems.

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Off-grid Solar Lighting Products to Completely Replace Kerosene

The increased prices of kerosene is also a major reason why the consumer is shifting from the biologically and environmentally hazardous fuel to off-grid solar lighting products. As of 2013, nearly 18% of the world’s population was directly dependent on fuels like kerosene for lighting purposes.

The overall financial gains of this shift are also enormous, prompting government bodies in making major contributions towards raising consumer awareness on this front. “Households with no electricity spend over US$30 bn every year on kerosene for lighting purposes. On the other hand, the cost of providing solar lighting products for an equivalent amount of light and power can be as less as US$2.7 bn. This can encourage household savings of about 10%-15% annually. The drastic cut down on costs for lighting can have a major impact on the overall development of emerging economies,” says a TMR analyst.