Nearly 400 million Indians, mostly those living in rural communities, lack access to grid power. For many of them, simply charging a cell phone requires a long trip to a town with a recharging kiosk, and their homes are dimly lit by sooty kerosene-fueled lamps.

To change that, Nikhil Jaisinghani and Brian Shaad cofounded Mera Gao Power. Taking advantage of the falling cost of solar panels and LEDs, the company aims to build and operate low-cost solar-powered microgrids that can provide clean light and charge phones. Microgrids distribute electricity in a limited area from a relatively small generation point. While alternative solutions, such as individual solar-powered lanterns, can also provide light and charge phones, the advantage of a microgrid is that the installation cost can be spread across a village. The system can also use more efficient, larger-scale generation and storage systems, lowering operational costs.

Mera Gao's first commercial microgrid was deployed last summer, and eight more villages have been added since; there are plans to expand to another 40 villages this year with the help of a $300,000 grant from the U.S. Agency for International Development. The company has also encouraged others to enter the Indian market for off-grid renewable energy, which the World Resources Institute, a think tank based in Washington, DC, estimates at $2 billion per year.

For a cost of $2,500, a hundred households, in groups of up to 15, can be wired up to two generation hubs, each consisting of a set of solar panels and a battery pack. The grid uses 24-volt DC power throughout, which permits the use of aluminum wiring rather than the more expensive copper wiring required for higher-voltage AC distribution systems. The village is carefully mapped before installation to ensure the most efficient arrangement of distribution lines. (Circuit breakers will trip if a freeloader tries to tap in.) "This mapping and design is our biggest innovation," Jaisinghani says.

Each household gets 0.2 amps for seven hours a night—enough to power two LED lights and a mobile-phone charging point—for a prepaid monthly fee of 100 rupees ($2); kerosene and phone charging generally cost 100 to 150 rupees a month.

Jaisinghani says Mera Gao's microgrid is not a replacement for grid power, but it's what people want and can pay for right now. Currently the technology supports only lighting and phone charging, but the company is exploring ideas such as community entertainment centers where the costs of television, radio, cooling fans, and information services are spread across a group of homes rather than being paid by a single user.