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UNFCCC Workshop on Innovative Options for Financing the Development and Transfer of Technologies 27-29 September 2004, Montreal, Canada African Rural Energy.

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Presentation on theme: "UNFCCC Workshop on Innovative Options for Financing the Development and Transfer of Technologies 27-29 September 2004, Montreal, Canada African Rural Energy."— Presentation transcript:

1 UNFCCC Workshop on Innovative Options for Financing the Development and Transfer of Technologies September 2004, Montreal, Canada African Rural Energy Enterprise Development: A New Approach to Public-Private Partnership Youba SOKONA Executive Secretary Sahara and Sahel Observatory (OSS) Boulevard de l’Environnement BP 31 – 1080 Tunis, Tunisia

2 Key Challenges for African Rural Energy Prospect Widening Access to Energy Services Massive Self Sustaining Scale-up Market Creation and/or Stimulation Within & Across Countries Combination of Good Practices, Instruments & Technological Options

3 Number of People Income Levels $1/day Rural Areas Urban Areas CBOsSMEsUtilities PoorWealthy Rural Energy Services Framework

4 The AREED Approach Focusing on the critical enablers: enterprise and entrepreneur Combining services and capital Bringing together resources from multiple sources Targeted, customized tools and activities Real time, working, evolving partnerships to plan, implement and improve Cross platform learning

5 The AREED Enterprise Centered Model The Basics InvestorsDonorsCharities Services Entrepreneurs Capital Their Customers Public Purpose Specialty Organizations

6 Demonstrating that needed energy services can be delivered on a sustainable basis by small/mid sized local enterprise and multiple partnerships ENDA MFC KITE TaTEDO CEEEZ E+Co Africa E+Co NJ UNEP Paris UCCEE Risoe UN Foundation Others Countries Senegal Mali Ghana Tanzania Zambia

7 UCCEE Multiple Partnerships 1. Finance 2. Program 3. Implementation4. Enterprise 5. Service Delivery

8 Finance partnerships: to bring together the “hard” and “soft” resources that must be blended to launch sustainable enterprises InvestorsDonorsCharities Services Entrepreneurs Capital Their Customers Public Purpose Specialty Organizations e.g., United Nations Foundation

9 Program Partnerships: to bring together the governance, specialty expertise and local presence required InvestorsDonorsCharities Services Entrepreneurs Capital Their Customers Public Purpose Specialty Organizations e.g., UNEP, E+Co, ENDA and KITE for AREED

10 Implementation Partnerships: to deliver the services and capital to entrepreneurs InvestorsDonorsCharities Services Entrepreneurs Capital Their Customers Public Purpose Specialty Organizations e.g., E+Co and ENDA in Senegal, KITE in Ghana, MFC in Mali, TaTEDO in Tanzania and CEEEZ in Zambia

11 Enterprise Partnerships: the creation and growth of sustainable businesses InvestorsDonorsCharities Services Entrepreneurs Capital Ther Customers Public Purpose Specialty Organizations e.g., Bagani, Ubwato, VEV, Anasset

12 Business: Charcoal production from sawmill waste AREED Support: $73,000 loan + Enterprise Development Support Investment Activity: - Construction of 15 argentine brick kilns - Development of marketing and distribution network Status: Construction of kilns completed. Production, distribution and sales of charcoal started Feb 2003 Using a waste product for fuel and a conversion process twice as efficient as traditional methods, KBPS is proving that a clean energy enterprise can both solve an environmental problem and be good business. KBPS, Zambia

13 VEV, Senegal Business: Servicing of wind-powered water pumps in rural Senegal. AREED Support: $17,000 loan + Enterprise Development Support Investment Activity: - Expanding inventory to shorten service times - Offering short-term credit to qualified clients Status: VEV has expanded its inventory and operations. Together, these services should help to ensure that most wind pumps in Senegal become - and remain - operational.

14 Business: Own and operate multi-functional platforms in the Kita area of Mali. Platforms powered on Jatropha oil, derived from Pourghere nuts. AREED Support: $14,500 loan + Enterprise Development Support Investment Activity: - Own and operate two platforms; eventually expand. First commercial business and investment in a multi-functional platform in Africa. Bagani, Mali

15 Business: LPG distribution AREED Support: $ 38,000 loan Enterprise Development Support Investment Activity: - Purchase plant & equipment - Increase sales Status: Bought new bulk LPG tank and installed car dispenser. Increase in sales and profit margins The upgrading of infrastructure increase the delivery and service levels and makes the product more accessible to the community, decreasing dependence on traditional fuels Anasset, Ghana

16 Service Delivery Partnerships: to deliver modern energy to the under-served…to create choices for services and income generation e.g., Village and its six farmer-customers

17 Enterprise Centered Model How Organizations Working Together Add Value InvestorsDonorsCharities Services Capital EntrepreneursTheir Customers Specialized Funds + Programs Public Purpose Specialty Organization Program Partners Implementation Partners Co-finance Government + Policies Independent Evaluators + Best Practices Dissemination

18 How Specialized Organizations Working Together Add Value AREED Ghana UN Foundation UNEP ServicesCapital Entrepreneurs e.g., Gladymanual Their Customers UNEPKITE

19 What’s New Here Partnership of value adding entities, driven by bottom line of service delivery and sustainable market presence –Small/Medium energy enterprise development –Local partner capacity building –Financial institution linkages –Policy linkages Targeting two levels sustainability –Enterprise –Enterprise developer

20 Donors, Grant- Makers and Contract Service Providers Social + Strategic Investors Local Financial Institutions + Specialized Funds Capital Seed and Growth Services Pre- and Post Investment Specialized Intermediaries Energy Enterprise Energy ServicesCustomers Enterprise-Centered Model – Value Chain

21 Solar Bakery Solar Crop Drying Efficient Lighting Solar Hot Water Solar Dryers Salt Drying PV SHS Investment Committee Initial Go-No Go Fuel Switching Coffee Husk Pelleting Butane Dist. Formal EDS Stage Entrepreneur Training Stage Financed Stage Concept Stage Biomass fuels Sawdust Briquetting Water Pumping AREED Deal Flow

22 Why is this important? Network of partnerships need to link together different levels presently disconnected Different levels of “go between” value adding services are needed: - Specialized public purpose intermediaries, - Local intermediary organizations - Local SMEs - Customers The point of REED is to leave behind the discussions of “projects”, move to the creation of “portfolios” and reach the point where we are discussing “systems” of capital, products and services that are self-supporting. The key to getting there are sets of VALUE-ADDING PARTNERSHIPS

23 Thank you and for more information


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