Going to Scale, The Case of Kenya - Panel Session Report Bonn 2013

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Overview

Panelists presented the cooking energy sector in Kenya and various business models in terms of products, production and marketing approaches. The challenges involved in promoting business by the various private sector players and the support they require from the public sector were also discussed.

►	Moderation: Sarah Butler-Sloss, Founder Director, Ashden
►	Introduction: Laura Clough, Technical Specialist, GVEP Kenya
►	Panelists: Anna Ingwe, Manager of Energising Development (EnDev) Kenya, GIZ Michael Kelly, Deputy Managing Director, World LPG Association Peter Odhengo, Office of the Deputy President, Kenya Peter Scott, Founder and Executive Director, BurnDesignLab
►	Rapporteur: Andrea Reikat, GIZ/EnDev

Introduction: Going to Scale - The Case of Kenya

• Introduction by Laura Clough, Technical Specialist, GVEP Kenya

General presentation of Kenya and its household energy situation (demographics, staple foods, cooking habits, fuel used in rural and urban areas, actors in the ICS sector)

Main points:

• In rural areas, wood is used at 88,2 % whereas it holds only for 10,3 % in urban areas
• Charcoal is only used for 7,7 % in rural areas whereas it stands for 30,2 % in towns
• Access to ICS is rather high, but quality is a problem
• 50-50 % of charcoal stoves are already “improved” (more or less), but only 4 % of the wood stoves
• Current challenges: increasing wood ICS in rural areas, LPG in urban ones

Presentation of Projects by Panelists

Anna Ingwe:

• Change of approaches between the 1980s and today: away from government driven approaches to business models based on the producers
• Quality is still a big issue EnDev is mainly acting in
  
• Awareness rising
• Teach commercialization to producers
• Create access to (micro-) finance

Peter Scott:

• Has worked in the last years in modernizing the manufacturing of stoves
• Concentrated on charcoal ICS as most people in towns are cooking with charcoal
• Raising up additional production capacities in Kenya until the end of the year (4 additional manufacturing units)
• Production in China is needed as intermediary solution until local production will come to scale
• Price of the stoves is not to high as it pays back within 6 months

Michael Kelly:

• ICS and LPG are not in opposition to each other but are complementary
• Challenges:
  • fight against fear (prejudices) for LPG
  • infrastructure (bring LPG to the people)
  • LPG in Kenya is still considerably low (in comparison even with other African countries)

Peter Odhengo:

• Government knows that energy is a driver of economic growth
• In addition it sees the danger of environment degradation by the present use of biomass fuel

Government role:

• Remove barriers
  
• Interest the private sector
  
• Set standards (bureau of standards)
  

How to encourage growth in the sector?

1. Question to Anna Ingwe: What do the small scale producers need to increase production?

• Small scale producers already have considerably high production figures
• No subsidies / no gifts (this kills the market mechanisms)
• Public sector must help: why sensitization against HIV was possible, but not for ICS?
• Standards

2. Question to Peter Scott: What challenges have you faced?

• Loans are too expensive
• To bring investors in (especially from outside Africa)
• Strengthening the distribution chain
• Expand sustainable fuel

3. Question to Michael Kelly: What has been the main challenge for LPG?

• Infrastructure (bring LPG to the people)
• This can go together with ICS distribution channels
• This needs public and private initiative
• National association of LPG actors to better communicate with government

4. Question to Peter Odhengo: What reactions do you have about the requests to government?

• Government is facilitator for all these requests
• But most states in Africa have budget deficits
• Private sector has to come up with concrete projects

Q&A Session

1. What about improved charcoal production?

• This is an option, but will be discussed in other panels
• Even in this, small scale entrepreneurship is to promote
  
  

2. Do stove types really meet users’ requirements?

• Constant feed-back is crucial and is integrated in all (serious) project’s approaches
  

3. When will Peter Scott come to Nepal?

• For the moment SSA is in the focus (fuel more expansive, stove production costs lower)

Moderator’s Wrap Up

• Not one single receipt for all circumstances
• Different approaches are needed
• Problems:
  • Finance
  • Infrastructure (distribution)
• Solution: collaboration of organizations + governments + GACC, however now there is more hope than ever before.