Financing and inclusivity of renewables in East Africa

March 21, 2018

Day two

On day one at the Sustainable Energy Forum for East Africa (In Kigali, Rwanda) there was a lot of chat about challenges facing the energy sector including of course, the money. On day two, the programme got deep into the status of financing and scaling up investments into sustainable energy in East Africa.  United Nations Industrial Development Organisation (UNIDO) presented findings of a soon-to-be-released baseline report that found that in East Africa, while renewable energy financing had been increasing over the past few years, the amount has been trending downwards since 2016. Finance to clean cooking remains very low, so does finance to decentralized energy options. For decentralized, it is at about two per cent in Kenya and Tanzania; and this is a higher average than other East African countries.

When it came to scaling, it was a tale of two realities. While private sector project developers lamented the lack of financing for their projects, financiers countered with the fact that ”there just isn’t much for them to invest in.” Without enough bankable projects, the domestic financing will not be attracted to the renewable sector sector. Overall, what came out is that there is a need to link the supply and demand appropriately. There are many projects but developers need capacity building for the projects to be able to attract investments, of which there is also a huge supply. The importance of making minigrids sustainable was also a key element of the conversation about scaling up – with subsidies starting to be phased out, those in the sector must figure out how to make them viable through figuring out productive uses of energy.

Secondly on the discussion of scaling up financing, I thought there was one large gap. Apart from the Equity Foundation in Kenya, everyone else in the financing sessions was discussing scale where small-scale is a minimum of $500, 000 worth of funding. Medium-scale was up to $10m. But – and especially when thinking about being inclusive – we also need to think about those who need funding on a far smaller scale. If the largest funders are not doing it, then we as a sector risk doing what we want to prevent; leaving people behind in the energy transition.

Leaving no one behind

One of the things that I have noticed when it comes to gender is that people automatically assume it means women. For instance, this was (and will be) the only topic featuring a panel that will have more than two women in a group of six or seven. This was also the only session where the contributions from the floor came largely from women participants. Sustainable Energy Solutions presented research undertaken on behalf of East Africa Centre for Renewable Energy and Energy Efficiency (EACREEE) that highlighted not only the East African populations lacking access to clean cooking and electricity, but also the populations who are living with disabilities (18M), internally displaced (2M) and those who are refugees (another 2M). All these populations have different needs, and understanding their different needs will lead us to energy solutions that work for everyone, not just the “average”.  Understanding this is crucial for a just transition and getting data on the make-up of our population is a great first step that EACREEE has taken as they work to increase energy access in East Africa.

Beyond this, it was also heartening that while this session was not as full as the preceding one, the governments of all the East African countries present were well-represented, and they submitted valuable input for EACREEE to act upon moving forward. Other participants also relished the chance to share views on the energy situation in their country with the regional body. At this rate, we will we will soon be able to move past the rhetoric that gender equals women or that inclusivity equals women. We will be able to move beyond this to come up with energy access solutions that work for youth, for the geographically marginalized, for the very poor and for women. For all rather than for some.