“Shakti Energy enables people at the BoP to run a business”

Bertil van Vugt
By on December 16, 2014

Access to electricity remains a big challenge in most parts of the developing world. In the South African city of Cape Town social entrepreneur Vijay Mitha saw the potential of pedal power generators and is setting up small business units that can be operated by people from the communities his company Shakti Energy is targeting. We contacted Vijay to learn more about his venture.

Vijay MithaPlease introduce Shakti Energy to us?

“Shakti Energy is a social enterprise providing energy solutions for people living in informal settlements and rural areas that do not have access to electricity and are reliant on using kerosene and candles for illumination.

Our aim is to establish micro-entrepreneurs to operate recharging stations to recharge LED powered lights and mobile phones using human pedal power via a pedal powered generator. This will enable people at the Base of the Pyramid to have a means to have a sustainable income and offer their communities a safer, more efficient and cheaper form of lighting and mobile phone recharging. We aim to empower local communities to help themselves and become self-sustaining.”

Why did the company start and what phase are you currently in?

“I started the company as I was deeply concerned when reading in the local newspaper that children had died in a shack fire due to a candle falling over at night. This is a regular occurrence all over South Africa and is most distressing. While the majority of us enjoy electricity and lighting from the convenience of a wall switch, many people living at the Base of the Pyramid are not as fortunate. These communities are reliant on using kerosene and candles for illumination and these are highly dangerous and environmentally unfriendly fuel sources.

We are currently busy implementing a pilot project in Cape Town, South Africa in a local off-grid community to demonstrate our solution which is provided by Nuru Energy, of using a pedal powered generator and LED lights that last for 20 hours at a time and can be recharged after 20 minutes of pedaling.

We are looking at setting up business units that are run by four entrepreneurs who will earn a sustainable income from providing a recharging service to their community who do not have electricity. We are focusing on renewable energy since this is something that I am passionate about – especially in South Africa and Africa, we have so many natural resources, we should be using it to benefit communities that are in dire need of solutions.

We are currently working in the Cape Town areas of Khayelitsha, Gugulethu, Sweet Home Farm, Malawi Camp and Philippi, interviewing potential entrepreneurs, performing site assessments and talking to the local people.”

What are your main achievements so far?

“We have taken part in various exhibitions to showcase the technology and solutions that we are able to offer people living at the Base of the Pyramid, such as the ‘Better Living Challenge’ held recently in Cape Town. We also recently won the Deloitte Challenge hosted by Stellenbosch University in the social entrepreneurship category. And we are a recognised World Design Capital Cape Town 2014 project and we were a finalist in the PWC Vision to Reality competition.

In terms of new markets, we are actively working with numerous NGO’s to take our work to other areas of South Africa where this type of solution is required, especially the Eastern Cape and KwaZulu Natal provinces.”

One of the customers of Shakti Energy.

One of the customers of Shakti Energy.

What are your main challenges of operating in the market where you are active? And how do you see the IBA community playing a role to support you?

“Our main challenge is finding good entrepreneurs in the local communities that we work in. The questions we ask are: Is the person well known and does the community trust him or her? Is the person entrepreneurial? Many times we find that people are interested, but they need to show a level of commitment to be involved in this type of enterprise. We are therefore working closely with community leaders to find the most suitable entrepreneurs moving forward.

As said earlier, we actively engage four people per micro-franchise – two women and two men. The women deal with sales, finance and end user education and support. The men operate the pedal powered generator and also provide support.

I see the IBA community acting in a supportive role to introduce us to potential funders as well as to introduce us to communities and entrepreneurs that would require our type of solution in other parts of Africa. We also look to learn from the experiences of others working at the Base of the Pyramid as well as providing input of our experience to assist others.”

What is the main lesson you can share with the IBA community about doing business with the Base of the Pyramid?

“The main lesson is that one has to be patient since things take time when working at the BoP. One has to persevere, and be able to adapt to changing circumstances. One must also be respectful of local cultures and customs and work within the existing structures of community leaders where these are present. Affordability is one of the major factors we’ve encountered, and your solution should provide a recurring income if possible since this is how we will empower local communities to become self sufficient.”

What are your plans for the future?

Our plan is to have over 400 entrepreneurs established all over South Africa and later into other regions in Africa. Our main focus is to make people in the BoP become self-sufficient and be able to generate their own income in a sustainable manner. We want our entrepreneurs to grow and become successful. We are looking forward to a day when a child in a remote village without electricity can use a tablet or mobile phone to browse the Internet which was recharged using human pedal power!”

Visit the venture profile of Shakti Energy.