SDG 7 – How to achieve a succesful energy transition in East Africa?

Given the impact of climate change and an increasing global population, it is becoming increasingly clear that sustainable transformation of global agriculture and food systems is necessary. Emissions from agricultural production are a major contributor to climate change. At the same time, the agriculture sector itself is being significantly affected by climate change, particularly across the Global South. And while drought and flooding are reducing harvests, soil fertility and biodiversity, more food than ever before needs to be produced to feed the growing global population and respond to changing diets, as the middle class grows and the consumption of animal products increases. The production of more food also means more water and energy are being channelled into agriculture – the distances between farm and fork are long, requiring a lot of direct and indirect energy. For sustainable transformation of agriculture and food systems, the use of energy therefore also needs to change. Away from fossil fuels toward affordable, cleaner energy.

Solar-powered solutions shine a light on a possible route toward food security

There are plenty of approaches that can be applied and technologies that can be used.

Farmers can use solar water pumps to irrigate their fields efficiently, replace diesel pumps and at the same time become more resilient to periods of drought. Solar cooling enables agricultural products to be kept for longer and reduces post-harvest losses, even if there is no mains electricity. Solar dryers, which optimise use of the direct heat from the sun, have the same advantages. Solar-powered mills help to process grain into flour, and enable processing to be carried out locally without the use of fossil fuels or mains electricity.

The technologies outlined above are already very well developed, are scalable in size, tried and tested, and are clean. But are they affordable? Especially for the many smallholder farmers who produce the majority of agricultural products across the Global South? For the global Water and Energy for Food (WE4F) programme, part of the international initiative of the same name, the private sector plays an essential role en route to ensuring access to affordable, reliable, sustainable and modern energy for all. Technologies must be aligned to the context in the particular country, in terms of technical specifications as well as financial feasibility. This can only be done by enterprises who know the local conditions and whose business models reflect the conditions on the ground.

One such enterprise is SokoFresh in Kenya. They have been working with solar-powered 20-foot cooling containers, which are sold, leased or used by SokoFresh themselves as a collection point for delivering larger quantities of produce to supermarkets. This and many other technologies are helping to increase food production, keep food fresh and increase food processing – using nothing but solar technology.  Funding for the private sector from the international WE4F initiative has so far enabled more than 96,000 tonnes of food to be processed and 780 million kWh of energy to be saved or replaced by renewables. A small step toward achieving SDG 7.

Innovative approaches to financing technology for smallholder farmers

Solar-powered systems have the major advantage of being practically free to operate, as there are no fuel costs for running the systems and the equipment is low-maintenance. Compared to fossil-fuelled alternatives, however, these technologies are often more expensive to purchase to start with, which can initially put off many potential buyers. So alongside the system itself, may enterprises also offer appropriate financing. After a down payment has been made, farmers can then pay the system off, e.g. a solar water pump, with flexible instalments. Repayment is made over several harvests under a Pay As You Grow arrangement. Other enterprises do not actually sell the technology involved, but provide it as a service. This is the case with cooling, for example. Smallholder farmers may store some of their harvest in a cold room, paying a certain price for this to the provider. This model is known as Cooling as a Service.

Technology gives women access to a male-dominated profession

The use of technology is advantageous for farmers. They can increase their yields with proper irrigation and reduce post-harvest losses with cooling or drying. In other areas, solar technologies enable a service to be provided and therefore to generate income, such as with solar mills for example. These improve access to a particularly male-dominated profession. Diesel-powered mills are dirty, loud and need a lot of maintenance, and thus are mostly operated by men Solar mills are the complete opposite, making them much more attractive for women.

Small and medium-sized enterprises (SMEs) engaged in the productive use of solar energy are therefore of crucial importance if these clean technologies are also to be affordable. However, the SMEs themselves often come up against challenges, of a financial or operational natural for example. The enterprises need good sources of finance so as to, in turn, support end users in financing their systems. The SMEs must also produce on a large scale in other to reduce unit costs and to make the system more affordable for end consumers. And yet the terms and conditions of loan facilities offered by banks are often unsuitable.  The enterprises are providing a good product but they still have to establish contact with potential buyers. Most smallholder farmers are located in rural areas, making them difficult to reach. Difficulties also arise from the rules and regulations in force, for example taxes on the systems offered or high import tariffs on required components. A lack of quality standards can also become an additional problem for SMEs.

Looking at the big picture, the issues of ‘affordable, clean energy’ and ‘agriculture and food systems’ are closely intertwined, with small and medium-sized enterprises positioning their products at this interface.

Global Water and Energy for Food (WE4F) programme supports energy partnerships in East Africa

The GIZ nexus project WE4F operates precisely in this area, focusing on funding local private-sector enterprises in East and West Africa and many activities to improve the framework conditions for the spread and use of solar-powered technologies. In Kenya, for example, WE4F together with the Kenyan Bankers Association (KBA) – the umbrella organisation for the banking sector in the country – has developed an e-Learning module. This will train bankers on the benefits and potential of solar energy in agriculture so they can make better decisions when they receive loan requests concerning solar technology. So far, these training modules have been completed more than 1,000 times.

In order to improve the framework conditions surrounding the productive use of solar energy, WE4F is working with GOGLA, the global association for the off-grid solar energy industry. In Kenya, Rwanda, Uganda and Ethiopia, the collaboration is supporting exchange between enterprises, users, agencies and ministries to produce action plans which aim to advise decision-makers on creating better framework conditions for solar technologies.