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Can technology create transformational change at the bottom of the pyramid?

Rebecca Fay | 19 November 2015 |

Reflecting on a tech-fueled week at the VERGE Conference in San Jose, Rebecca Fay reviews one particular session with a slightly different approach - exploring how technology can transform livelihoods for those at the bottom of the pyramid. Read more...

Can technology create transformational change at the bottom of the pyramid?

High tech solutions for energy efficiency, inventions to ease the last mile commute and the power of the Internet of Things (IOT); there were many fascinating sessions at the recent Green Biz VERGE Conference in San Jose, California, but one stood out for its focus on a more fundamental issue - basic access to energy and clean water for underserved communities in less developed countries.

Bringing together the technology expertise of one of the world’s largest companies, with two social entrepreneurs from Guatemala and India, Jonathan Shopley of Natural Capital Partners, led the discussion with Rob Bernard, Chief Environmental Strategist at Microsoft on how technology can help enable projects working with communities at the bottom of the pyramid to deliver greater scale and impact.

Born in Guatemala and educated in the US, Philip Wilson set up Ecofiltro to provide clean water to 1 million Guatemalan families by 2020. One in 20 children doesn’t reach the age of five in Guatemala because of disease from the lack of potable water, so the ceramic filters developed and sold by Ecofiltro are vital. So far Philip is about a quarter of the way to his target, but the business is beginning to scale and he’s confident of success.

“The poor cannot afford technologies, the poor cannot maintain technologies, and you can’t run a commercial venture while trying to meet a social objective.” The core mission of SELCO, a social enterprise set up in India by Harish Hande in 1994, is to destroy these three myths. The business delivers sustainable energy through solar technology to underserved rural communities and aims to electrify 387,000 households over the next 10 years, many of whom live on as little as $1-2 per day

Both projects are included in Microsoft’s portfolio of carbon projects which are funded through its carbon fee. The carbon fee is an innovative approach to using an internal price on carbon in order to encourage behaviour change and achieve carbon neutrality. Through the money raised Microsoft funds internal carbon reduction initiatives, renewable energy investments, and carbon projects around the world. The sale of carbon credits by SELCO and Ecofiltro provides a critical stream of capital to the projects, and the processes they follow to validate and verify the greenhouse gas emission reductions, makes them quite different from more philanthropic or government funded activities. With companies like Microsoft relying on projects like this to meet their carbon neutral commitments, that results-based finance approach is essential.

A social approach to achieve scale

Neither project wants to follow a philanthropic model; commercial success is a key part of their business and fundamental to enabling them to scale up, and deliver real long term sustainable development to the communities they serve. However, in one key respect, they differ from many commercial organisations: their approach is ‘open source’ and they are keen for other organisations to replicate what they’re doing anywhere and everywhere.

“We want everyone to come and learn because we’ve made many, many mistakes but I think we have a lot to share with other folks that are trying to solve water issues in their countries, so we’re an open model, the android of water, I guess,” says Philip.

In India, Harish knows that SELCO can’t achieve the scale of energy access required on its own, and that the approach cannot be ‘one size fits all’. “We cannot come with solutions and try to fit a problem to it,” he says. Scale is about duplication of processes, enabling decentralised energy solutions which are customised to specific village needs. And, essentially, creating a holistic solution which doesn’t just provide access to energy, and doesn’t just enable a family to own a sewing machine, but also considers where the market is for the shirts that will be made. The goal is to improve livelihoods and quality of life, by keeping that in focus, the entire value chain is developed and the results are sustainable over the long term.

What's the role of tech?

The income from Microsoft’s carbon fee has doubled in three years from $10 to $20 million. Some of that money is spent on carbon finance projects around the world and Rob Bernard wants to know how his support can do more than just introduce capital. “We’re almost at the point where pricing of IOT, cloud computation, ubiquity of access to data, can much more rapidly transform the way the bottom of the pyramid gets out from being at the bottom of the pyramid.”

The success of projects like Ecofiltro and SELCO is built on a deep understanding of local context and needs, the slow process of building cultural acceptance and behaviour change through word-of-mouth, and finding trusted local advisors. For them an immediate and fairly straightforward technology solution will be to use mobile phones and social media to deliver updates and share information with communities. But beyond that there is an opportunity for technology to create a ‘network of networks’ that will unlock problem solving at scale and enable a much faster delivery of solutions.

Rob posed the question: “How do you create the conditions to do pilots and then start to create the ecosystem?”

No-one had an immediate answer to that big question. But, as companies change their language and begin to think about delivering better outcomes for a much wider set of the population, Harish and Philip demonstrated that the first step must be to understand the local context in which projects like theirs exist. Then technology can start to create networks to improve information flow, gather data and identify trends. Through that it may be possible to enhance decision making so that transformational change can be delivered rapidly, not just delivering clean water and basic energy access – but propelling communities further up the ladder of development.