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Q&A with Charlie Dou, author of Micro-Hydro Power case study in China

Charlie Dou is an adjunct Professor and Research Associate, Alternative Energy Institute, West Texas A&M University, USA; CEO, Beijing Bergey Windpower Co. Ltd., served as International advisor for UNDP/GEF on renewable energy project in China, key Expert for EU, Consultant for the World Bank/GEF, etc. He is directly involved in many research and international projects sponsored by UNDP/GEF, the World Bank, China central government, and has published and/or edited 14 books and more than 40 papers/presentations, including “China Village Power Project development Guidebook” and the series books of “Capacity Building Strategy for the Rapid Commercialization of Renewable Energy in China” for UNDP. He received his Master’s Degree in Engineering Technology in the US, and Master’s Degree in Electric Engineering in China, and once worked on his doctoral degree on Industrial Engineering at Texas Tech University.

To download the Micro-Hydro Power case study from the GIM database, please click here.

What is the project’s basic value proposition and what makes its financial model sustainable?

The economic development is slow for these remote villages located in China’s western mountain regions and the life of these villagers is poor because of their inability to access electricity.  Extension of traditional utility power line is not viable, and not affordable for low-income residents.  Finding a technical and economically feasible solution is key for rural electrification in such areas.  Micro-hydro power is the least costly technology for power generation compared with other renewable energy technologies and traditional power plants. This case provides a successful example of local people relying on their own efforts to develop an electricity service without government and outside financial assistance and improve their life.

In developing countries, what are the main challenges for access to energy for the poor?

The main challenges for access to energy for the poor in developing countries is to develop a solution for a financially and technically sustainable power supply and affordable power service.

What main factors make this model successful that will allow it to be replicated elsewhere?

First, availability of resource and technology. Second, affordability of the solution (again, micro-hydro power generation is one of the least costly power generation technologies). Third, self-motivation (local residents wished to change their status). Fourth, clear ownership (the micro-hydro power system was developed and managed by the villagers themselves).

What would you say was critical about the actor ecosystem that enabled this business to be successful?

The villagers there have lacked power supply for generations. They wished to change this situation.  But the local utility company is not interested in expanding the service to such areas due to high investment and poor return (or even no return, since the losses from the power transmission may be even more than the power to be applied).  Micro-hydro power generation provides an affordable and environmentally friendly solution, since usually, for such a micro-hydro power generation, no civic construction is needed.  The water flow will not change significantly, which means little negative impact on local ecosystems compared with large hydro dams.