Solar-Powering Cambodia: Daniel Pacheco ’07
In the Bardian
Daniel Pacheco ’07 installs a temporary solar frame for a family whose house
sank in heavy rain.
Photo Courtesy of NRG Solutions
When Daniel Pacheco ’07 accepted a job through Engineers Without Borders (EWB) to work in Cambodia, he had no idea that he would end up launching his own sustainable energy company there. “I was interested in solar energy, so started out working on projects with local companies, but they were all very commercial,” he says. “My motivation is not just about making money, but bringing solar energy to villages. Cambodia is a beautiful country. Coming from New York City, it was shocking in a good way. Life can be relaxed without stress. People are generous and friendly. I felt safe, and realized there are lots of opportunities.”
The Venezuelan-born Pacheco, a Distinguished Scientist Scholar and graduate of Bard’s 4+2 engineering program, received a B.A. in economics with a focus on global economic development. He went on to Columbia University to earn his B.S. in mechanical engineering, specializing in renewable energies. Upon graduation, EWB—an international nonprofit organization that partners with developing communities to improve quality of life—offered him a job in Cambodia designing a green building for a school. After leaving that project, he stayed on in the country’s capital, Phnom Penh, for the next four years.
Pacheco’s vision was to distribute solar power systems and bring energy independence to communities throughout Cambodia. He began his venture as a sustainable energy initiative under an established nongovernmental organization (NGO). But once he saw the potential for solar energy, he launched his own company, NRG Solutions, which he started with a Cambodian colleague. “A lot of commercial businesses or NGOs sell or donate solar products to communities, then walk away,” he says. “After a few weeks or months, the products stop functioning, which is how solar gained a reputation for not working.”
Pacheco and his team decided to build trust in the technology and their services through fact-finding, education, and training. They visited every house that had a previously installed solar system, made sure everything worked, collected feedback, then followed up with phone calls. NRG Solutions rolled this procedure into its unique business plan: By focusing on building a network and distributing solar energy and related products to the village, Pacheco was able to help other entrepreneurs with business decisions and microfinancing (small loans and other services to low-income individuals who do not have access to banks), and to create a feedback loop. “We give them access to the technology and business vision, or we do it on consignment, so if the business doesn’t work, they don’t lose money,” he says.
Pacheco says that after getting some great feedback, NRG Solutions started installing systems for larger businesses—schools, hospitals, and community centers—with 10 percent of profits channeled back into microfinance. But Pacheco wants to stay small: “It’s tempting to expand in this field because it’s easier money; we saw other corporations going in this direction. But we were chosen by a business incubator sponsored by the World Bank to select promising small businesses and help them grow.” Pacheco’s aim for 2013 is to reach 2,000 residential solar systems. To assist him in this, he partnered with an Australian social enterprise company, Barefoot Power, which supplies solar products in developing countries, and the nonprofit organization Kiva, whose mission is to alleviate poverty by managing loans.
While Cambodia is a booming economy, the market for solar energy is tricky, says Pacheco, because 80 percent of the country, which doesn’t have access to the grid, depends on kerosene or car batteries for power. Gaining access to these customers presents a challenge. And while product satisfaction has been excellent, he’s taking the next steps slowly. He doesn’t advertise; his company’s buzz travels entirely by word of mouth. “They contact us, we don’t push. We are invited to come into a village and analyze whether it is worth installing solar or not.” On the second visit, Pacheco and his team bring products, offer training and workshops, talk about technology, products, and business opportunities, and leave samples. Two months later, they call for feedback. On the third visit they train entrepreneurs, set them up with a business vision, and teach them about accounting, customer follow-up, marketing, and how to create inventories.
Today, NRG Solutions consists of two project managers in charge of distribution; a French engineer dealing with solar systems; a business development and technical supervisor; and a volunteer from EWB–Australia, who helps with fund-raising. The World Bank assists with strategy and administration. Demand is burgeoning: NRG’s latest projects involve installing solar power in orphanages and clinics and in a school inside the Angkor Wat temple complex, the largest Hindu religious monument in the world. The group is also starting its own line of solar systems that can power TVs and fans.
Politically, Cambodia is still a complex place with much corruption. Pacheco says, “It’s very poor; a lot of money is concentrated with just a few people. We’re also dealing with the first generation to graduate from university since the days of the Khmer Rouge [the ruling Communist Party from 1975 to 1979 that orchestrated country-wide genocide], so the skill levels are low. But it’s actually one of the easiest countries to start a small business in—considering I’m someone with no money, no experience, and no contacts.”
Pacheco took Khmer language classes when he first arrived, but no longer has the time. “Many people speak English, especially in cities,” he says. “Once we get into the villages, not so much English is spoken, but I can get by.” He is out in the field two to three times a month, but is trying to remove himself from the process by hiring and training local technicians. “I see myself here for a few more years and then ideally transferring everything over to Cambodians,” he says. “But it’s hard to make plans. Things happen very quickly here in some ways, and very slowly in others. When you get here you think it’s so messed up, but after four years you realize how quickly everything is changing.”Read the fall 2013 issue of the Bardian: