ENREP team leader says ensuring post-sale assistance to poor households is the key to scaling up off-grid solar in rural communities.
● 1.5 million rural homes are without electricity access in Ethiopia
● Carbon credits and IDA finance are being used to scale up off-grid solar program
● Carbon revenues will pay for better warranty programs, maintenance; fund battery replacements
For the millions of people living in remote rural areas of Ethiopia who lack access to the power grid or cannot afford electricity, solar energy represents an important first step on the energy access ladder. Instead of relying on kerosene, candles, dry cell batteries and other fossil fuel-based sources of power, they can now turn to off-grid solar to light up their homes, watch television and charge mobile phones, thanks to an initiative of the Government of Ethiopia supported by the World Bank.
“For households at the base of the economic pyramid, off-grid solar can dramatically boost the quality of life,” says Yemenzwork Girefe, Director of the Export Credit Guarantee & Special Fund Administration at the Development Bank of Ethiopia (DBE). ”Energy access has a large impact on the well-being of society in general, women and children in particular, in countries like Ethiopia where access to electricity is low for the vast majority of the population.”
The Development Bank of Ethiopia (DBE) in partnership with the International Development Association (IDA), the World Bank’s fund for the poorest countries, is providing working capital loans to private sector household solar providers, as well as micro-finance to households for the purchase of solar lanterns and Solar Home Systems (SHS) through a $20 million credit line under the Electricity Network Reinforcement and Expansion Project (ENREP). Another $20 million line of credit was approved by the World Bank Board of Directors in May 2016 as part of $200 million in additional financing to ENREP.
This line of credit leverages the market-based approach of the Lighting Africa program and supports Lighting Global’s list of quality-verified lanterns and SHSs to ensure Ethiopians have access to the best off-grid renewable lighting and energy products available. So far, 800,000 off-grid products meeting Lighting Global’s Quality Standards have been imported and distributed by eight approved retailers, providing clean, safe lighting and modern energy services to more than three million Ethiopians.
But while demand for these new off-grid solar technologies is taking off, barriers to consumer confidence must still be overcome before the market can be expanded to make a real impact on energy access in the poorest communities. Here is where the Carbon Initiative for Development (Ci-Dev), a $125 million fund with a pipeline of 12 pilot projects in Africa, is stepping in.
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