CONTEXT

Remittance inflows to Tajikistan account for as much as 52 per cent of gross domestic product (GDP) or USD 4 billion. In Kyrgyzstan, remittances make up 31 per cent of GDP or USD 2.1 billion. Most of the migrant workers from Tajikistan and Kyrgyzstan reside in Russia, and both countries face significant energy challenges, as supply is unreliable – particularly in winter when rural households have as little as one hour of electricity per day.

Tapping into the USD 2.1 billion of remittances sent to Tajikistan and Kyrgyzstan each year from migrant workers residing in Russia can offer a sustainable and empowering way to overcome the challenge of energy poverty. Remittance receivers often take a short-term cost-saving approach to investments. In contrast, remittance workers generally have a strong interest in seeing their remittance payments used for investments that will have tangible and longer-term benefit.

ANALYSIS

The aim of this market assessment was to examine the feasibility of implementing a locally relevant and self-sustaining business model that enables migrant workers from Tajikistan and Kyrgyzstan, who live and work in Russia, to direct part of their remittance payments towards sustainable energy solutions for their communities and families at home.

To establish a commercially viable business model that facilitates low-income families’ access to renewable energy and promotes energy efficiency, a deep understanding of market needs and local conditions is vital. A market assessment has already paved the way for implementation and focus group discussions with Tajik and Kyrgyz emigrants working in Moscow (Russia). As well, remittance recipients at home highlighted the importance of remittances as well as the need for energy products to enhance economic opportunities, to facilitate education and to ensure the well-being of families.

OUTCOME

The market assessment allows BASE and its partners to move on to the project implementation and business plan development stage as it has illustrated the potential for replicating the approach piloted along the Haiti-USA and Bolivia-Spain corridors.