Difference between revisions of "Local Production: Conditions and Success Factors"

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<span lang="EN-GB" style="font-size: 10pt; font-family: 'arial','sans-serif'">Source: Outcome of a discussion during the GTZ mini-hydro power working group meeting in Nairobi, May 2009.</span>  
 
<span lang="EN-GB" style="font-size: 10pt; font-family: 'arial','sans-serif'">Source: Outcome of a discussion during the GTZ mini-hydro power working group meeting in Nairobi, May 2009.</span>  
  
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<span lang="EN-GB" style="font-size: 14pt; font-family: 'arial','sans-serif'">'''Examples'''</span>&nbsp;  
 
<span lang="EN-GB" style="font-size: 14pt; font-family: 'arial','sans-serif'">'''Examples'''</span>&nbsp;  
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*[[Example: Wind power plants and components|<u>Example</u>: '''Wind power '''plants and components]]  
 
*[[Example: Wind power plants and components|<u>Example</u>: '''Wind power '''plants and components]]  
 
*[[Local manufacturing of solar systems|<u>Example</u>: Local manufacturing of&nbsp;'''solar systems''']]  
 
*[[Local manufacturing of solar systems|<u>Example</u>: Local manufacturing of&nbsp;'''solar systems''']]  
*[http://www.energypedia.info/index.php/Production_of_Woodfuel_Stoves#Production_systems_and_quality_management Local Production Systems of Wood Stoves]
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*[[Production_of_Woodfuel_Stoves#Production_systems_and_quality_management|Local Production Systems of Wood Stoves]]
  
 
[[Category:Hydro]] [[Category:Solar]] [[Category:Wind]]
 
[[Category:Hydro]] [[Category:Solar]] [[Category:Wind]]

Revision as of 07:07, 12 August 2011

In contrast to imports, local manufacturing of energy products can constitute a reasonable cost-efficient alternative that supports local value creation.

Key factors for successful local production / manufacturing

1)    Relevant market: The demand of the relevant market should match the minimum size of one production unit. If a specific niche is big enough, the probability of success is higher. In Indonesia the niche was turbines for mini- and micro-hydro power, which has a high national demand and is not the core business of incumbents like Voith Hydro, Ossberger etc.

2)    Time factor: Establishing local production of hydro power components takes time (5-10 years). This is the biggest obstacle for projects which are only funded by EnDev and do not have a longer sectoral mandate like a focal area.

3)    Cluster: The production site / firm should be located within an industrial cluster, where it is easier to get qualified suppliers, employees etc. Multi-product firms are in a better position because they can compensate low demand with other product lines and transfer relevant knowledge to new technologies.

4)    No grants to the manufacturers. Better use (soft) loans or even better create trust for long-term investments like the German Feed-in Law did.

 

Source: Outcome of a discussion during the GTZ mini-hydro power working group meeting in Nairobi, May 2009.


Examples