Promoting Productive Use of Electricity in Displacement settings
Phase 2: PUE Unlocking Access to Finance for End Users (2024)
The ESDS project supported promoting Productive Use of Electricity (PUE) phase 1 activities in 2022, with positive results evidenced by an increased knowledge of available PUE appliances within the project implementation area. Against this background, the ESDS project carried out PUE phase 2 which went beyond sensitization to enhance the uptake of PUE appliances within Kakuma and Kalobeyei. The overall objective was to increase electricity consumption by households by households and businesses, while also ensuring energy efficiency.
The PUE awareness campaigns were implemented in partnership with SNVSNV with an aim to increase the daily electricity consumption by 1kWh/day for businesses (SMEs) and 200Wh/day for households (HH). The awareness measures involved three main activity areas i) sensitization and training of households and businesses on highly demanded PUE appliances, enabling market linkages, ii) unlocking access to financing for PUE vendors and end‐users, and lastly iii)) awareness on e‐waste management with a focus on solar equipment and accessories relevant to PUE.
This working paper presents the experiences and lessons learned from the implementation of promoting PUE phase 2 by focussing on unlocking access to financing for vendors and end-users workstream. It also provides specific recommendations necessary to enhance access to end user finance for PUE adoption in Kakuma Refugee Camp and Kalobeyei Integrated Settlement.
Key takeaways from desk review on existing financing products
- There's a scarcity of both primary and secondary data available specifically for financing PUE initiatives, contrasting with the largely available information on clean cooking and solar solutions funding. This highlights the underdevelopment of specified financing avenues for PUE initiatives, as well as the lack of documentation.
- Refugee initiatives heavily rely on support from donors, development organisations, and DFIs, including those focusing on energy market development. This dependency underscores the need for diverse and sustainable financing sources beyond traditional donor funding, where coordination between donor initiatives within refugee settings is key to prevent market distortion and ‘competition’ with other initiatives and opportunities.
- Despite opportunities, private sector involvement (financial institutions) in PUE initiatives remains constrained due to challenges like limited human capital, infrastructure deficiencies, and high investment risks. The lack of engagement beyond contractual agreements hampers the scalability and sustainability of projects, emphasising the need for innovative approaches to attract private funding.
- Supportive policies and frameworks at national and international levels are crucial in enabling refugees to access diverse financing products. Such policies create an enabling environment for financial institutions (and private financiers) to engage with refugee populations, fostering sustainable and inclusive development.
Recommendations
- Understand end-user funding needs and requirements to provide wholistic support to refugees and host communities.
- Develop tailored financial products for PUE adoption.
- Adopt a cross-sectoral approach to end-user financing.
- Provide appropriate financing mechanisms for Kakuma and Kalobeyei financial landscape.
- Advance the community-based financing mechanism as an avenue for end user access to finance.
- Blended Financing
- Leverage Emerging Financing Mechanisms
- Strengthen collaboration and partnerships with the private sector through local financial institutions.
Phase 1: PUE Awareness and Sensitization (2022)
GIZ, through the Energy Solutions for Displacement Settings (ESDS) project, seeks to address the lack of a sustainable energy supply in Kalobeyei integrated settlement (KIS) and Kalobeyei Town, Kenya, which hosts 3,500 host community members and 47,700 refugees respectively.
Increased energy access through the mini-grid systems presents the opportunity for the host community and refugee residents, businesses, and institutions in Kalobeyei to expand their electricity usage to livelihood and income generation activities; so-called ‘Productive Use of Electricity’ (PUE). In addition, the uptake of PUE appliances can contribute to the financial sustainability of mini-grids due to increased power consumption. To this end, the ESDS project designed and implemented a campaign aimed at ‘sensitizing households, businesses and social institutions on available opportunities and potential for income generation through PUE in Kalobeyei integrated settlement (KIS) and Kalobeyei town in Kenya.
The promotion of PUE awareness was carried out by SNV on behalf of the ESDS project from July 2022 to December 2022. This report presents the state of PUE in Kalobeyei, the design and campaign activities and, lastly, identifies the recommendations for replication in displacement settings.
Promotion of PUE in Kalobeyei
Summary of PUE promotion activities carried out in Kalobeyei (July to December 2022)
| Project implementation phase | (Primary) target group | Focus PUE appliances |
| 1. Local community sensitisation: on the opportunities and benefits of using electricity for income generating purposes, PUE appliances available in the market and where to buy them.
|
Households and businesses with (expected) electricity access to the Renewvia mini-grids | Mini-grid compatible food preparation appliances (electric cookers, blenders, and toasters), sewing machines, and hair dressing equipment (including hair dryers and shavers). |
| Households and businesses without (expected) access to the existing mini-grids | PUE appliances with stand-alone solar systems including solar-powered fridges, freezers, water pumps, shaving kits, computer, and entertainment services (TVs, radios, and speakers). | |
| PUE appliance suppliers in Kalobeyei and Kakuma town and sub-camps | Mini-grid and stand-alone solar systems compatible PUE appliances | |
| 2. Targeted awareness raising & training for existing and new mini-grid customers: on use of electricity for (additional) income generating purposes.
|
Households and businesses connected to Renewvia mini-grids with basic electricity usage (lighting & charging) | Mini-grid compatible food preparation appliances, fridges, and entertainment systems |
| Households and businesses connected to Renewvia mini-grids with advanced electricity usage (entertainment, cooling, cooking, productive uses) | Mini-grid compatible hairdressing equipment, sewing machines, cooling (fridges and freezers) | |
| Saving groups | Mini-grid compatible appliances | |
| 3.Targeted training for institutions and businesses: on effective utilization, operation & maintenance of PUE appliances
Activities: Trainings |
Institutions: teaching staff of vocational training institutes.
Businesses: (aspiring) tailors and food and beverage services |
Food preparation: EPCs, microwave/ovens, blenders/juicers, air fryers, toasters/sandwich maker, water dispensers and fridges/freezers.
Service category: Electric sewing machines and iron box |
Key findings and lessons learnt
- The use of various channels and local languages is critical.
- There is need for further awareness on available energy sources.
- End user training on proper wiring and safe use of electrical appliances is important.
- PUE appliance vendors are willing to supply specific products on demand.
- Inclusion of VSLAs training as part of PUE promotion is critical.
- Unlock other financing services to support growth in PUE.
- Opportunity to increase PUE uptake through vendor knowledge on O&M.
Recommendations
- Conduct in-depth research prior to the design and implementation of PUE promotion activities to tailor them to the needs of the market segment and supply. The research should include:
- The socio-economic profile of target audiences
- A stakeholder analysis
- A PUE market analysis
- Mini-grid system capacity (constraints) and potential overloading concerns.
- Main communication channels, tools and messages
- Design and implement PUE promotion activities with a clear set of objectives, priority target group(s) and appliances, implementation partners, activities to be accomplished, and tools required using an iterative, ‘phased’ approach.
- Carefully identify, segment, and involve all relevant stakeholders along the value chain
- Choose focus PUE appliances based on:
- Electricity source(s) available to selected target group(s)
- Direct income generation potential (as opposed to complementary services such as fans and radio)
- Market availability and provision of proper after sales service
- Implement trainings on effective utilization, operation and maintenance of electrical appliance(s), and safe and appropriate use of electricity in close consultation with mini-grid operators, appliance vendors and technicians.
The Promoting Productive Use of Electricity in Displacement settings working paper can be downloaded here:
Partners
GIZ's Energy Solutions for Displacement Settings (ESDS) project cooperate with UNHCR to enhance the access to sustainable energy in displacement contexts, and the Energypedia page has been created to share learnings across various practitioners to spur the development of clean energy solutions.
