Pandemic Pulls Down Sales of Off-Grid Solar Products in India
Movement restrictions during the lockdown played a vital role in driving down the numbers
Sales of off-grid solar products in India fell by 50% in the first half of 2020 compared to the second half of 2019. The sales were also down 59% compared to the first half of 2019, said the latest report published by the Global Off-grid Lighting Association (GOGLA). Nearly 391,000 units of off-grid solar solutions were sold between January and June 2020.
The largest decrease was reported in the portable lantern systems, while multi-light systems saw an increase of 36% in volumes compared to the second half of 2019.
The Global Off-Grid Solar Market Report, which is published every six months by GOGLA and the World Bank Group’s Lighting Global program, documents the sales and impact of off-grid solar lighting products sold by GOGLA and Lighting Global affiliates.
According to the report, the ongoing COVID-19 pandemic’s economic effect has been substantial, and microfinance institutions (MFIs) who are the main distribution channel for off-grid solar products have been hit hard.
The report pointed out that between January and June 2020, the total recorded number of solar appliance sales in India stood at 7,000, consisting entirely of fans. Sales of appliances decreased by 82% compared to the second half of 2019 and 55% compared to the first half of last year.
Regarding sales of off-grid solar lighting projects, the report noted that sales of off-grid solar lighting products in South Asia totaled 495,000 units between January to June 2020. It was the lowest volume recorder since the regional reporting began in 2015.
The sale of portable lanterns reached 343,000 units, accounting for 69% of the region’s solar appliances sale. Also, around 66,000 solar home systems were sold in South Asia, a 35% increase compared to the second half of 2019.
The report noted that the total recorded number of solar appliances sales in the South Asian region reached 233,000 units, an increase of 68% compared to the second half of 2019.
South Asia remained the largest regional market for solar fans, with 232,000 units sold between January and June 2020. The volumes show an increase of 110% when compared to the second half of 2019. The sale of solar water pumps in south Asia dropped to 667 units due to a lack of bulk procurement in the cash segment under programs such as KUSUM in India. Only 13% of solar water pumps were reported to be sold together with a power system in South Asia.
On the global front, the report noted that 3.03 million off-grid solar lighting products were sold in the first half of 2020, out of which 2.03 million were sold as cash products and one million were sold using pay-as-you-go (PAYGo).
Between January and June 2020, the affiliates of GOGLA reported 477,000 solar appliances sold globally. Fans represented 52% of the sales with 248,000 units, closely followed by TVs with 221,000 units (46% of the global total). Refrigeration units and solar water pumps represented 1% each of the global sales of appliances, with 4,400 and 3,400 units, respectively.
Off-grid and energy-efficient refrigeration units experienced a relatively low decrease compared to the second half of 2019, with only an 18% drop in sales. Between January and June 2020, 4,400 units were sold globally.
Solar water pumps experienced the largest relative decrease among all appliance types, recording an 87% reduction of sales volumes and 3,400 units sold.
The report noted that throughout the supply chain from manufacturing to last-mile distribution, companies in the off-grid solar sector are experiencing varying degrees of vulnerability and disruption due to the COVID-19 pandemic. One of the main drivers of decreased sales is the physical restrictions on mobility for both sales agents and customers due to government lockdown measures.
In February this year, according to a report published by GOGLA, nearly 94% of the households surveyed reported an improvement in their quality of life after buying a solar home system. The published report stated that Indian households with a solar home system reported significant improvements to their quality of life.
Earlier, GOGLA had reported that sales of off-grid solar products in India fell by 20% in the first half of 2019 compared with the second half of 2018.
The latest report highlighted that continued growth in 2020 was expected to boost clean energy jobs and enable the sector to power millions of new homes and businesses. However, like many other sectors, COVID-19 has led to a slowdown in progress and threatens its ability to reach and sustain the 13% year-on-year growth rate needed to meet the sustainable development goal of affordable, reliable, sustainable, and modern energy for all.