At first glance, Bongadovan village in Baglung is unremarkable. A typical Himalayan village perched on a ledge of flat land next to a boulder-strewn river. But a closer look reveals something different-on almost every roof is a small solar panel generating electricity for the household beneath. These panels are high tech devices, originally developed to power satellites in space. Twenty years later they are on grass roofs in remote Nepali valleys. But they do not look inappropriate. The panels shining in the sun in this idyllic landscape is like a techno-environmentalist's vision of utopia.

But getting them here has taken innovative planning, arm-twisting, subsidies, and a lot of walking. Most importantly, the panels are there because these houses were lit terribly before, like most rural Nepali homes, with kerosene lamps. But light from a kerosene lamp is poor, smoky and expensive-bad for education, health and pocket.

Solar systems would be perfect in such situations, except they are expensive-at around $300 apiece, few in Bongadovan could afford to buy a system outright or even subscribe to a long-term repayment scheme. The Nepal government's Alternative Energy Promotion Centre (AEPC) provides a subsidy for a certain number of systems each year and the Agricultural Development Bank plans on giving loans for them, but neither scheme helps those with the greatest need. Demand for the subsidy far exceeds supply and the bank loan requires collateral. This creates a free-rider effect-only richer villagers apply for the loan and obtain the subsidy, which perhaps they don't even need. The rural poor must go without.

What Bongadovan needed was flexible credit, where repayments did not need to be in cash. This is where the non-profit Himalayan Light Foundation came in with its "HELP" program. Through HELP, the women of Bongadovan pay for their solar systems by knitting traditional bags. Twenty-four bags pay for their system and money from the sale of further bags goes back to the household. The AEPC still subsidises the systems, but now it goes to those who really need it.

In this way, the project organisers, HLF and the project funders-the Global Environment Facility Small Grants Programme of the UNDP-hope to get clean lighting into people's homes and also create a much-needed longer-term sustainable source of income.

All this requires is what in development-speak is called "local capacity building." Basically, committees, groups and financial arrangements need to be established so the community can take ownership of the project and its everyday management. This is quite a challenge in a place like Bongadovan with very low literacy rates and little experience of such things. But even some "capacity" opens the door to a range of other development activities-savings and credit groups, literacy programs, or, as in Bongadovan, a new toilet in the health post compound and a smokeless cook stove. The community debates the best use of the small grants available to them in lively group meetings.

But development theory is often a little different from development practice. The problem in Bongadovan is that each bag takes around 70 hours to make-which would be fine if the women had nothing else to do. But on average a rural Nepali woman has a 15-hour day of hard work. Every day. How to fit the knitting in?

Suggesting that the men could take on some of the household duties is an iffy matter. "But how will I get my dinner" laughed one knitter, "He will be drunk and beat me" said another. People also die, move home or get married. The bags must still be made. The eighty solar systems mean eighty bags a month, eighty sets of individual circumstances. Samir Newa, the project officer, reckons managing such a project is five percent administration and 95 percent motivational psychology.

The Maoist insurgents in the area also had to be placated. Seeing the panels, they came down from the surrounding hills and started asking questions. In Bongadovan the Maoists power is considerable-they have imposed bans on money lending and raksi. After talking to the locals and realising that no cash was changing hands, they allowed the project to continue.

But the project works and lighting has transformed the village. "Where there is the big light there is the happiness" as one grandmother told me. Children study in the dark mornings and at night. Women can in the evening do some of the detailed tasks they earlier had to finish in the day-sorting through rice and grain to pick out stones, sewing, spinning thread. A women's group regularly meets under a solar light in the health post compound learning to write Nepali. Gopal Pandey, the health post worker, says he see fewer people with bronchitis and pneumonia, and that the lighting has also discouraged the banned but still endemic drinking-now drinkers must find ever more dark corners to indulge.

But Gopal Pandey does see quite a bit of "knitter's finger"-people complaining of sore fingers as a result of all the knitting. Until there are many more Bongadovans there will be insufficient numbers in the manufacturing process to drag the panel price down, which will mean fewer bags to knit. HLF's chief advisor, Adam Friedensohn says, "HELP is the only program I know that intrinsically links renewable energy deployment with income generation. Many organisations are watching us closely and are excited about the possibilities for replication." If the project is a success and the model is replicated by other development agencies, system costs will surely come down. The knitters of Bongadovan are waiting.

Formerly an energy and environmental consultant with Oxford University's Environmental Change Institute, Dr Banks now travels and writes on environmental issues