Some of the vulnerable communities in rural Kenya are now able to buy their own solar-powered energy systems and efficient low-carbon cookstoves. This is thanks to the subsidies provided by Rafode Limited.
The Kenyan microfinance organization based in Kisumu is working with rural low-income earners to expand their access to clean energy, through microfinance and strengthened energy value chains. The company also has other branches in 10 counties where it offers access to necessary financial savings and credit services that facilitate the acquisition of new technologies.
“Offering financial products that enable low-income earners to purchase clean, low-carbon alternatives to kerosene, firewood and other conventional fuels is perhaps the best way microfinance can be mobilized to combat climate change. We have a loan product (Green Energy Loan) that helps rural clients to access affordable renewable energy products on credit,” says Antony Mayodi, Rafode Ltd founder.
The company sources both solar home systems and efficient cookstoves such as the Jikokoa cookstove from the manufacturers then offer the products on credit to its customers. The customers are organized in groups hence co-guarantee each other within the group.
Antony explains that the company decided to venture into this market due to lack of access to electricity and clean energy solutions by the vulnerable communities. He also adds that Rafode Ltd identified this gap after understanding the energy needs of the target population.
“We realized that many potential customers without access to electricity have trouble mobilizing sufficient capital to buy solar and fuel products. Our aim, therefore, is to ensure that we carefully select enough products, adapt existing designs to serve our clients better and involve target communities,” he says.
In Kenya, most communities in rural areas that do not have an electricity connection usually have to walk long distances to have their mobiles charged. Rafode Ltd, therefore, is making work easier for their rural clients by ensuring they get the most desirable features of solar systems.
The solar systems which include lamps and chargers play a significant role in the economic empowerment of the communities they work with. The lanterns have helped their clients do businesses at night and the clients can charge their phones, thus fully utilizing the online payment platforms.
With the demand for clean energy growing too quickly worldwide, it is estimated that renewable energy will make up almost half of the power generation growth in Sub-Saharan Africa by 2040 according to IEA. The report also notes that two-thirds of the region’s population lacks access to electricity hence the steamed growth.
Rafode Ltd, therefore, believes that with stepped up financing from public and private sectors, the company will accelerate this transformation and meet the high market demand.
“Solar lanterns are becoming increasingly more desirable. While kerosene prices are on the rise, costs of solar lamps are dropping, and quality is improving. The challenge resides in reaching the dispersed, untapped market and bringing the devices directly into the hands of people who need them most. Partnering with other organizations will make it easier for us to overcome various market constraints and make the adoption faster,” adds Antony.
The company is glad to have partnered with Kenya Climate Ventures (KCV) to harness its efficiencies. “Through our partnership with KCV, we look forward to addressing energy poverty by increasing access to small-scale clean energy solutions at the household level,” he says. KCV is not only helping Rafode Ltd actualize their dreams financially, but also provides them with advisory services, and technical support.