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KCV equity investments promises clean energy and a sustainable future

  • By KCV
  • April 28, 2021

As the world celebrated Earth Week this year, Kenya found itself at a pivotal moment in an effort to achieve its ambitious goal of reducing its net Carbon emissions by 30 percent by 2030. For too long, most of our rural communities have been disproportionately affected by energy poverty. A significant amount of a family’s budget is dedicated to basic utility bills, which are not sustainable. These communities also live and work with poor air quality, which exacerbates underlying health conditions.

Climate change is one of the foremost significant problems of our time. With it comes threats to food systems, water crisis, ecosystems and the livelihood of millions of people. As we make fundamental shifts in how we heat our homes, power our economy and electrify our transportation system, we must bring our vulnerable population along with us. The transition to a clean energy future presents a new opportunity to address the legacy of social injustice in our communities.

With this realization, Kenya Climate Ventures, an independent investment management company, has focused on investing in enterprises whose actions reduce the climatic impact that vulnerable communities face. One such enterprise is Vuma Biofuels.

With a mission to replace firewood as fuel for the industrial sector in Kenya, the company has some good news: large scale industries do not have to depend on carbon-intensive fuels and can eliminate energy poverty.

Vuma Biofuels, founded in 2017, produces clean biomass briquettes called VumaBriqs, from sugarcane waste. These VumaBriqs help to significantly reduce firewood dependency among large-scale industrial users like tea factories. The company’s VumaBriqs (bagasse briquettes) is a superior fuel source for industrial boilers and a far better alternative to wood fuel.

According to Victor Ndiege, KCV CEO, the primary focus of investing in the enterprise was to develop new programs in these communities to support sustainable livelihoods, in addition to providing clean energy. “To create an innovative, resilient and inclusive clean energy future, it is important to start by addressing inequities that have faced our communities. We are happy to walk this journey with Vuma as our dedication to accelerate clean energy adoption in the country and thus mitigating the impact of carbon emissions on climate change,” Ndiege said.

Vuma biofuels CEO, Ian Otula, says that the financial partnership with KCV has enabled the development of a high-performance firewood alternative for industries. Otula adds that the investment also will enable the enterprise to expand production to over 1,000 tonnes of unpolluted energy briquettes a month.

With this comes benefits for both the community and the environment. He says that besides an alternative source of clean energy, Vuma Biofuels has saved forests, created employment and reduced atmospheric carbon emissions.

Saving forests

It is with little question that firewood consumption is that the drive behind the rampant deforestation in Kenya and East Africa. Vuma Biofuels recognizes that creating alternatives to firewood, particularly for large-scale users, is a key part of the solution. Each ton of VumaBriqs is like 25 trees worth of wood fuel. Vuma Biofuels has an ambitious goal of saving two million trees in Kenya by 2022. Keeping these trees within the ground will reduce atmospheric CO2 levels and help combat global climate change.

Creating jobs

Vuma Biofuels says there are not many options for earning a viable income in rural Western Kenya. Basic subsistence farming predominates. The company is therefore helping to change that by creating additive and year-round jobs with training, benefits and a pathway for promotions. Vuma Biofuels has created over 100 jobs in their first two years and are promising hundreds more in future.

Reducing atmospheric carbon dioxide

Based on their projections for the industrial use of VumaBriqs in Kenya, 42,000 tons of CO2 will be absorbed by the trees saved in the next three years. That is like the Carbon emissions from 9,000 cars per annum or a person’s Carbon burden on over 11,000 commercial flights.

KCV promises that as it makes this paradigm shift in clean energy, it will continue to make investments to advance environmental justice, increase access to opportunities to promote sustainable livelihoods while progressing toward the country’s climate goals.