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Supporting System for Microfinance in the Green Sector

Hi, everyone! Hope everything is going well for you.

This is my first time publishing my blog, not on Thursday. As there were so many things last week, I couldn't post this on Thursday.


In this post, I want to continue what I wrote last week: https://www.su-re.co/post/what-is-microfinance-in-the-green-sector.


Also, I want to continue the result of the badminton matches that I watched XD.

After finishing Sudirman Cup, there was Thomas and Uber Cup, then all athletes and committees just finished Denmark Open 2021. I watched some matches in those tournaments. The next tournament will be French Open, and BWF (Badminton World Federation) will have three tournaments in Bali, Indonesia (November-December 2021). Do I need to go to Bali to watch those tournaments? :p


As you know, the Indonesian team won Thomas Cup after 19 years! This made Indonesia the number one country that won Thomas Cup (14 times). However, the achievements in the Uber Cup are different as there is much homework for the women sectors. In this post, let me highlight one of the matches: Indonesia vs Denmark in the Thomas Cup semifinal. This tournament was held in Aarhus, Denmark, so Denmark had advantages as the host. Many supporters came to the stadium. How about Indonesia?

I remember that the commentators said this: "Indonesian supporters are around the world. In every tournament, they will come to the stadium. If you watch the tournament in Istora Senayan, Indonesia, you will find a huge supporter who will be there".




That match was that Indonesia won the match and went to the final with a 3-1. What I found was Denmark supporters are so supportive. Despite their team being lost, they gave a standing ovation, and Denmark athletes said good luck to the Indonesian team. What I want to say is, a good supporting system can help us to achieve any targets. You do not everyone will support you. What you need is the best supporting system from some people who knows you well.


The Indonesian Team won Thomas Cup in Aarhus, Denmark.



The same thing happens in the green sector. We can't expect that every element in this sector will support the implementation. What we need to help this sector improves is the best supporting system that can enable the environment. Microfinance is one of those. How to implement microfinance in the green sector will also need a supporting system. I took a PV system course when I studied in my master program at RMIT University. I had an assignment to assess the economic values of the PV installation at a household level.



Solar Choice Price Index in Australia as of January 2021


At that time, I compare all elements in the payback calculation. Some factors were important in this calculation:

  1. Electricity Price

Electricity will depend on the market. Compared to Indonesia, where one state-owned company (National Electricity Company) sets the price, and the government gives a subsidy, we can choose which provider we will use in Australia. Each provider will try their best to offer an interesting package and benefits for the customer. In Indonesia, the household watt capacity is around 900-3500 VA, so the electronic devices will be modified to have low watts. It will be different in subtropical countries when they need the heating system. The electronic devices will have 2000-5000 Watts for the heating system. So, there is no limitation on electricity use. However, the expensive electricity price will make the consumers implement the energy efficiency system.


2. Discount and Rebate

As there are some targets for the electricity provider to provide renewable energy options and people's awareness to shift the daily life to the green sector, the providers will give an interesting option to the renewable energy package, including discount and rebate. This will depend on the providers and regions. Some providers can give a big discount and rebate that will result in a shorter payback period.


3. Subsidy

In Indonesia, the subsidy is given to the electricity price where the electricity system still depends on fossil fuel. In some countries, including Australia, subsidies are given when installing renewable energy (although Australia still depends on coal).


4. Material cost

In Australia, the provider will give price options, including the descriptions of material, maintenance, transmission, and service costs. Then, we can calculate and compare with our own research. The material cost will depend on supply and demand. As the demand for PV installation in Australia is increasing, many solar companies are established in this country. In Indonesia, all materials are still imported, and there is no subsidy in the import cost. That makes the solar price is still expensive.




As you can see in the figure above, the payback period can be 3-5 years. Those payback periods were calculated by considering the electricity price, discount and rebate, subsidy, and material cost. The payback periods in Darwin and Hobart are higher as less population living in these regions. That will affect the infrastructure and service costs.


Those factors will contribute to the microfinance system in the green sector. The microfinance system will be implemented well if those factors support the system.


I will continue in my next post. Thank you for reading :)

My question for this post is, do you have an additional factor to be considered in the payback period calculation or microfinance system?

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