Market Assessment Study: Financing Sustainable Energy through Remittance Flows in Haiti and the Dominican Republic

Commissioned by the Multilateral Investment Fund and carried out by Arc Finance with the Basel Agency for Sustainable Energy, this study asks whether remittance flows can finance household clean energy. The method is qualitative: twelve focus groups of up to twelve participants each, six with remitters in the New York area, split between Haitian and Dominican origin, and six with recipients, three in Haiti at Ganthier, Mirebalais and Hinche and three in the Dominican Republic at Santo Domingo East, Bani and Bonao. Sessions ran in English, Spanish, French and Creole. The authors are explicit that the work has no statistical value and was designed to surface reasoning.

The finding that frames the rest is that remittances already function as energy finance: remitters reported that about 25 percent of what they send goes to paying energy and electricity bills, and recipients confirmed it. Interest in clean energy products was strong on both sides, and among Haitian remitters partly because participants doubted their government would deliver electricity any time soon. Preferences among products were price-sensitive and practical. The combined radio, flashlight and cell-phone charger at USD 35 and lanterns at USD 27 ranked highest because they were cheap, portable and less exposed to theft; the USD 500 solar home lighting kit came next but drew complaints that it only delivered lighting and would not run a refrigerator, fan or television, along with theft concerns that prompted discussion of grilles, weighting and cementing panels in place. Solar and wood-burning stoves at USD 190 and USD 40 followed.

Seven business models were tested, and on these the two groups diverged. Remitters preferred buying the product in New York provided the vendor delivered it directly to the family, on the grounds that this avoided shipping, customs and liability and guaranteed the money was not diverted. Recipients preferred simply receiving cash and buying locally themselves, arguing that relatives abroad would not actually follow through, would misjudge local needs, and that local purchase avoided shipping and customs and preserved a warranty with a familiar vendor. Savings-account and loan models were unattractive to both: most participants lack bank accounts, saving is not habitual, paperwork and account ownership raised control concerns, and loans were seen as expensive and collateral-hungry. Underlying the whole exercise is the control motive the study set out to test, with a documented tension between senders wanting to direct the use of their money and recipients resisting exactly that.