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Nate Heller ’98 is providing solar energy to underserved families throughout West Africa.
By Doug Daniels
ate Heller is ordering food at the La Gondole restaurant in Dakar’s Point E neighborhood when I reach him by phone late one afternoon.
He’s returned to town after spending the day in some remote villages in West Africa, where his company, PEGAfrica, is transforming the way people power their homes in Côte d’Ivoire, Ghana and Senegal.
Throughout the region, it’s typical for families of four or five to live in one-room mud huts, relying on one flashlight or a couple of kerosene lamps to provide light for basic activities like cooking and reading. For the hundreds of millions of people in Africa who don’t have electricity, this requires regular trips into town, where they can purchase batteries, charge their cellphones and replenish their fuel supplies.
But Heller’s company, which he co-founded and of which he serves as COO, has developed an innovative way to make those trips and their related costs unnecessary by providing home solar kits purchased through a pay-as-you-go model.
“If you live in a village and don’t have electricity, you live in the dark a lot of the time,” Heller explains.
“To power your home and to power your needs costs a lot of money because you’re always buying batteries, always paying to charge your phone. And for the amount of money that you’re spending on those things over a five-year period, you could pay for a solar kit a couple of times over.”
Heller says the major obstacle to people buying solar kits is that usually the upfront costs are too high. While people can spend a small amount of money each week on batteries over a long period of time, gathering a couple of hundred dollars at once to buy a kit isn’t possible, and getting loans is especially difficult, since they have no real credit history or collateral.
“Normal credit institutions won’t work with these customers, so we knew we needed to find a different way to make this work and to guarantee people will pay back their loans,” says Heller.
“Our solar kit has a meter inside the battery, which can temporarily shut off power if payments aren’t made on time, which essentially turns the kit itself into collateral and allows our customers to build a credit history, then purchase larger kits and products from us, like televisions and other appliances.
“So it provides a path to financial inclusion.”
The key to being able to execute this financing model is the adoption of mobile money, which allows customers to instantly submit electronic payments directly from their phones, since most people don’t have traditional bank accounts. Mobile money has revolutionized financial access throughout Africa over the past decade, particularly for people in rural areas who can deposit cash at local, participating retailers and then maintain a digital account that can be used for purchases online and in brick and mortar stores that accept mobile payments.
Heller’s company has also created incentives for customers to pay on time, including add-on kits for other appliances and, most notably, free hospitalization insurance.
“We’ve teamed up with a microinsurance company to establish the program, and it’s something we’re really proud of,” Heller says. “If a customer is on time with their payments, then they’re automatically enrolled, so if they get sick or are injured, they get a payout for each night they spend in the hospital.”
A native of Washington, D.C., Heller’s interest in social impact work was sparked at an early age. He recalls a determination to serve in the Peace Corps as early as 14, though he didn’t set his sights on Africa until he came to Conn, where he majored in philosophy, became a CISLA scholar and developed fluency in French, which led to him studying abroad in Paris and later in Senegal.
“I broadly liked the idea of going to Africa but didn’t really know where, so I essentially Googled ‘philosophy, French and Africa,’ and Senegal popped up, which is how it began for me,” Heller remembers when describing the genesis of his CISLA summer in Dakar.
When the time arrived for him to receive his Peace Corps assignment, with his French language skills and previous experience in Senegal, it made perfect sense to return to francophone Africa. The experience proved pivotal for Heller and set him on a path toward learning new languages, including Wolof, which was spoken in his village in Senegal; then, in later years, he learned to speak Italian, Spanish and Portuguese.
After his Peace Corps service, Heller decided he wanted to pursue a career in international development, and he stayed in Africa for another couple of years working for a nongovernmental organization (NGO) before returning to the U.S. to attend the School of Advanced International Studies at Johns Hopkins.
Following that program, he did a two-year fellowship with the United Nations—an experience that made him realize the traditional international development system simply wasn’t making the type of impact he’d been hoping for.
Particularly frustrating to Heller was that nonprofits, despite being fueled by the best of intentions and sweeping idealism, often aren’t as effective as they can be, especially if an organization’s wealthy benefactors are motivated more by the idea of what they’re funding than by achieving tangible results. That’s when Heller began thinking about for-profit models.
“I was really excited by social enterprise and business models for making change,” he says. “I thought about what I believed had made the largest-scale impact in the areas I wanted to work in, and the two things that were apparent were microfinance and mobile phones. Both have done more to change people’s lives in Africa over the past 20 years than anything else, and they’re models that deliver a return on investment that enables organizations to operate on a scale that can reach far more people than a traditional NGO ever could,” he believes.
With a renewed focus on the niche he wanted to serve, Heller decided to go to business school, and after graduating from the Yale School of Management, he moved to Ghana in 2012 to work with his current business partner, who had started a company selling solar kits.
“What I love about what we do as a for-profit is that it’s far more empowering for the people we serve,” Heller says. “If people in these villages don’t like our products, they’ll stop buying them, and we’ll have to adapt or go out of business instead of being propped up by donors.”
The business took some time to grow and to overcome a variety of obstacles, from navigating the initial distrust of potential customers to expanding the use of mobile money to securing financing and viable partnerships with manufacturers of the equipment they provide. But after a few years of “wandering in the wilderness,” as Heller describes it, the company is doing well and continuing to grow and expand its offerings, thanks to a combination of grant funding for the social impact work they do and private financing.
Heller says he’s excited about the products they’ll be offering down the road, including refrigerator kits that will bring some significant change to the villages PEG works with. And just as mobile phones have changed the lives of so many, the growing popularity of television among PEG’s customers is something Heller thinks shouldn’t be dismissed as frivolous.
“I feel like the introduction of TVs into homes can be game-changing in some ways,” Heller argues.
Empirical data suggests that televisions help reduce the birth rate in the villages where Heller works, combating overpopulation.
But also, “when you live in a village of maybe 1,000 people, you have very little outside influence. Most people never really talk to anybody that comes from anywhere outside their little region. Having outside information suddenly coming in gives villagers the ability to see images of things that are unlike anything they’ve ever experienced.
“It opens up people’s minds, [populating] these minds with new ideas.”