Refrigeration
The LONG COOL fridge has the ability to maintain storage temperatures without any power for up to four days. The fridges are supplied with a solar panel so they are in any case completely independent of any outside power source.
They also operate from mini grids where they can restore their temperature storage during off-peak hours.
No batteries are required. The battery free technology ensures the fridges have a significantly longer working life than standard fridges.
The LONG COOL fridges are environmentally friendly and only use natural R600a refrigerant.
Commercial Opportunities
The LONG COOL fridges create commercial opportunities for small business people. Small businesses can diversify and supply a wide range of perishable products. Supplying cold drinks significantly increases business footfall.
LONG COOL fridges enable households to buy cheaper in bulk. Commercial use of the fridges creates profits and enables savings. Time and money is saved by not having to travel to and from food markets. Additional free time is created which allows for further life enriching pursuits, greater education time and a more varied and healthier diet.
Pay As You Go
Another innovative feature of LONG COOL fridges is the Pay As You Go electronics. This enables owners to buy the fridge on a variable HP or lease basis.
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Owners pay what they can, when they can, to complete the purchase of the fridge.
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If no payments are made over a pre agreed time the fridge can be switched off remotely. It can also be switched back on remotely.
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In other countries where LONG COOL fridges are in use the Pay As You Go feature is a major attraction to owners who are not well off.
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If no payments are made over a long period the fridges can be repossessed.
Case Study: Peru
Most of the people in Peru who fall into the bottom 40% economic group do not own a fridge.
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The average family size in Peru is circa 5 people. So, to supply a fridge to each family in the bottom 40% economic bracket would mean supplying 13.6 / 5 or 2.68 million fridges.
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This would significantly reduce stunting and general ill health. It would cost approximately US$ 1.4 billion but would save a loss of GDP of US$ 30 billion.
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Mass supply of fridges would also significantly reduce the ongoing health cost of having to deal with endemic issues caused by stunting and the rapid spread of endemic diseases such as Dengue fever, Yellow fever, Hepatitis and Typhoid.
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Peru discards approximately 9 million tonnes of spoiled food due to lack of refrigeration. This in itself is a further significant economic loss because that food has had a cost to be created, grown and harvested. That is approximately one third of Peru’s annual food production.
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However, of far greater importance is the fact that Peru has always suffered disproportionately whenever there has been an outbreak of contagious disease. Stunting and poor general health is one factor but another is that people who do not own a fridge have to go out to buy food more frequently. They mix more frequently in crowded markets and that significantly increases the chance of disease transmission. In recent times that has resulted in Peru having by far the highest per capita rate of deaths from Covid in the world. Covid is only the most recent manifestation of this reality.
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Something as simple as owning a fridge significantly reduces the need to shop as frequently and so materially reduces disease spread.
Modus Operandi
The key to implementing a policy of mass fridge ownership is the financial structure which is offered with the fridge.
Although the initial purchase of the LONG COOL fridge is slightly more expensive than conventional fridges they have several advantages which results in them being considerably cheaper over the life of the fridge.
Included in the purchase price is a solar panel designed to provide power to the fridge. So no electricity has to be available or purchased.
Because of the long storage feature of the fridge there is no need for very expensive batteries. The fridge will operate on a very small amount of intermittent power supplied several days apart.
The average monthly wage in Peru is approximately US$370: so $16.25 per month for something as life changing as a fridge is affordable. Particularly as the “Pay As You Go” system allows owners to vary their payments both in frequency and amount depending on receipt of a variable income.
Nearly 40% of Peru’s population do not have a bank account. It is safe to assume that the majority of these people will also be in the bottom 40% of the economy. A lot of people do not have a bank account because they do not know how they work. Others do not have a bank account because their way of life does not require one. Yet more people do not have an account because they do not want to declare income which can then be taxable.
Citizens of Peru can earn more than $13,000 per annum before they are liable to pay any form of tax. The average wage equates to 12 * 370 = $4,440 per annum: well under the tax threshold. So having a bank account for most people in the bottom 40% economically will not result in paying tax. This needs to be publicised.
Not having a bank account disbars these people from many of the benefits of modern day living. They cannot secure credit. They can only make limited use of phone payment systems. They have to deal in and store cash: which increases the risk of being a victim of crime.
The people in the lower 40% economic bracket need to be made aware of the advantages of having a bank account. Commercial banks, working in conjunction with the government can do that.
Example of Fridge Purchase: Peru
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Purchase cost of fridge - US$ 650.00
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Interest cost of fridge over 5 years* - US$ 325.00
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Total purchase price of fridge - US$ 975.00
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Repayment per annum - US$ 195.00
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Average monthly repayments - US$ 16.25
*20% p/a on "pay As You Go" basis
Enabling Structure
Commercial banks will be happy to administer loans to purchasers of the fridges because they can make money from the interest charged and it also means they will expand their customer base. The banks are also capable of making the advertising investment to promote, in conjunction with the government, the advantages of having a bank account.
However, the majority of the customers from the bottom 40% of the economic population will be bad credit risks: some because they have never had bank accounts previously so have no track record, others because they have only intermittent earnings.
We believe that to roll out a program of mass fridge ownership to that sector of the Peruvian population which really needs them will require the government, or a similar large entity, to stand guarantor for the loans which the commercial banks will issue.
The government would only be liable for the capital element of defaulted loans: not the interest. The banks would have to accept losing their profit in a default but they would not be left with an absolute loss.
Summary
2.68 million LONG COOL fridges with solar panels, which render them independent of outside energy sources, would cost approximately US $ 1.34 Billion. Commercial banks would supply the lending. The government would only need to supply an underwriting guarantee in the event of default.
This is an investment in the long term development of Peru. It will lift many of the bottom 40% of the economy out of poverty caused by stunting and long term endemic illness.
The huge improvement in the economy of having these people able to contribute effectively to the economic life in the country is estimated at over US$ 30 billion over the five year normal life of a fridge. More than 20 times the cost of the fridges.
Peru will also benefit by not having to carry the ongoing cost of medical provision to people who have previously been rendered prone to illness.
The economic saving to poor families by not having to dump 9 million tonnes of wasted food per annum is also significant. That represents approximately one third of Peru’s annual food production. It would feed 11 million people for a year.
This is a policy which can be seen to be both practical and popular. It is very easy to identify who has been responsible for making this happen politically.
The policy would not need to immediately commit to all 2.68 million fridges. The policy could be rolled out in stages to see how well it works and to aid budgeting.