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Developing Energy Enterprises in East Africa: Success for rural entrepreneurs

14/10/2008

Mama Rahel Shigella greeted us enthusiastically with a traditional song and dance as we approached her small home in rural Mwanza, Tanzania. Deemed a ‘successful woman ‘entrepreneur’ in the area, Mama Shigella was the only one of 30 trainees who succeeded in converting her new-found skills into a business that produces and sells improved cookstoves to local customers.

On our arrival, she led us into her back garden, where she produced the improved stoves and showed us her ‘business’ which included basic record keeping, different types of stoves, and her innovative solution of marketing by creating a special shiny coat for the stoves using dyes from local tree barks. Innovation, resourcefulness and willingness to learn are some of the traits that Mama Shigella possesses.

Despite all these, rural entrepreneurs like Mama Shigella are not making enough profits for this to become a fully fledged ‘business’. The enterprise is basic, and one can soon see that there are just as many challenges as opportunities for scaling up operations.

The GVEP International co-ordinated initiative ‘Developing Energy Enterprises Project East Africa’ (DEEP EA) will work with entrepreneurs like Mama Shigella in peri urban and rural areas of Kenya, Uganda and Tanzania to upscale their ‘businesses’ through individual mentoring, linking to markets and expertise training.

At the same time, new entrepreneurs interested in initiating energy enterprises will be identified, and support through training and mentoring will be provided by DEEP EA team members to help create a chain of suppliers and sellers of energy products and services.

The DEEP EA team will also work towards creating a ‘double edged’ supply chain. On one hand, rural producers such as Mama Shigella will be able to cater to the urban markets and on the other, suppliers from urban areas will be able to effectively trade energy products and services to rural areas (for example solar home systems).

In Mwanza, the team will work with supplier companies such as the Ashden Awardee, Zara Solar, to reach a wide customer base in the Lake Zone by designing a plan to support their deal flow. Zara Solar will in return provide technical training on solar to some of the DEEP EA enterprises. Also, within the region, community based organisations like CARITAS will provide the crucial linkages needed to reach communities through partnership with the DEEP EA team.

The action also expects to train at least 300 business mentors all of whom will provide support in mentoring the energy entrepreneurs.

The enterprise approach is coupled innovatively with consumer awareness raising and capacity building actions. With a team of 21 full time staff and 6 part time staff members from 7 organisations including GVEP International, the action will be carried on until 2013.

The DEEP EA team is learning simultaneously from each other and from experiences in the field, and is widely recognising that introducing an ‘enterprise’ based solution to energy access in rural areas is breaking new ground.

Many energy initiatives in East Africa have been ‘grant oriented’ and often we get asked ‘what are we going to receive from the project’? We are faced with the challenge of turning this around to achieve genuine partnerships on the ground with a high level of commitment from entrepreneurs and communities alike.

One of the key outputs we aim to achieve this year is a thorough understanding of small and micro, rural and peri urban energy enterprises and the additionality we can provide to strengthen their development and get energy products and services directly to the populations.

Focusing on the enterprise approach has already revealed positive results on the ground. The level of interest in local areas is high. It is my hope that we will build a model that will provide long lasting solutions, and that many more rural consumers will be able to adequately access quality energy products and services.

Primarily we are focused on building up skills and awareness, and once the energy entrepreneur(s) are well groomed, we expect that linkages to financing will be made by the entire team, including GVEP International.

The DEEP EA action would not be possible without the support of the European Commission and core funding support to GVEP International from the UK’s Department of International Development (DFID). Country level implementations are carried out by 6 partner organisations in addition to GVEP International: Practical Action Eastern Africa, ITPower Eastern Africa, Emerging Market Economics Africa Ltd, Aga Khan Foundations Coastal Rural Support Project, East Africa Energy Technology and Development Group (Uganda and Tanzania) and the Gender and Energy Research and Training.

We will share the lessons we learn and will post our results on the GVEP International website. So, do log on and provide us your inputs and if you want to be part of this initiative, feel free to drop us a line.

Further information please contact Kavita Rai