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UOMA Market Map - FullVersion 1 PDF

UOMA is an organization focused on accelerating off-grid energy access in Uganda through research, coordination, and direct interventions. It runs a technical team supported by an advisory board representing government, private sector, and development partners. In 2019, UOMA is focusing on 5 initiatives: expanding access to local currency finance for solar operators; reaching unserved populations; expanding productive use technology; strengthening the enabling environment; and facilitating communication and coordination in the sector. Despite progress, about 30% of Uganda's population is forecast to remain without electricity access by 2030 based on current plans. Off-grid solutions like solar home systems and mini-grids will need to play a critical role in achieving universal access.

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0% found this document useful (0 votes)
147 views130 pages

UOMA Market Map - FullVersion 1 PDF

UOMA is an organization focused on accelerating off-grid energy access in Uganda through research, coordination, and direct interventions. It runs a technical team supported by an advisory board representing government, private sector, and development partners. In 2019, UOMA is focusing on 5 initiatives: expanding access to local currency finance for solar operators; reaching unserved populations; expanding productive use technology; strengthening the enabling environment; and facilitating communication and coordination in the sector. Despite progress, about 30% of Uganda's population is forecast to remain without electricity access by 2030 based on current plans. Off-grid solutions like solar home systems and mini-grids will need to play a critical role in achieving universal access.

Uploaded by

wasili mfungwe
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Market Map of off-grid energy in Uganda

Full version

2019 edition
Uganda Off Grid Energy Market Accelerator (UOMA) is a dedicated
and neutral intermediary, focused on scaling off-grid energy access

We accelerate the off-grid energy


market in Uganda through:
INDEPENDENT,
CREDIBLE, & • Research & Insights: providing
NEUTRAL data, analysis, and insights to
businesses, investors, development
partners, and policy-makers
• Coordination: coordinating
industry actors and resources to
increase efficiency; and
RESPONSIVE LOCAL TEAM
CAPACITY, w/ ACCESS TO • Direct Interventions: catalyzing
FOCUSED ON CROSSSECTOR interventions where necessary to
RESULTS STAKEHOLDERS reduce barriers to off-grid energy
access

In partnership with:

1
UOMA is run by technical team supported by a cross cutting
advisory board representing govt, private sector and dev partners
Core technical team

Dr. Frank Sebbowa


Senior Advisor
Former Head of ERA & UIA*

Nicole DeMarsh Crystal Mugimba


Associate Partner, OCA Project Leader, OCA
Coordinator Technical Lead

Reza Fazel Harry Masters


Snr. Project Leader, OCA Project Leader, OCA
Workstreams Manager Off-Grid Energy Specialist

Advisory Board

2 Note: ERA = Electricity Regulatory Authority; UIA = Uganda Investment Authority


For 2019, UOMA is focusing on 5 initiatives

Increase access to local currency debt finance for solar operators, bridging a
Expanding access to
critical working capital shortfall and currency mismatch and enabling operators
finance
to increase affordability of units

Reaching unserved Reduce barriers to better target unserved populations in Uganda, improving
populations access for some of the hardest to reach and most in need communities

Expanding productive Support industry to test and validate productive use technologies that can
use technology achieve economic benefits for off-grid Ugandans while growing energy demand

Strengthening the Support public sector to create effective policies and a conducive enabling
enabling environment environment to increase off-grid energy uptake in Uganda

Facilitating Enable more effective communication and coordination in the off-grid energy
communication & sector in Uganda, resulting in better resource allocation and accelerated
coordination progress in achieving universal access

3
Table of contents

Context……5

Solar home systems……11

Mini-grids……43

Productive use……63

Industry stakeholders……80

Click on link to jump to


section of interest

4
Context

5
Context

Despite recent progress, gap to universal energy access continues to


widen; electrification rates in UG lower than SSA average
SSA not keeping up with pop growth for access UG electrification rates lower than SSA average

Trends in population with no access, 2000-20161 % pop electricity access, 20162


Millions
700
600 Tanzania 40

500
400
300 Rwanda 42
200
100
SSA World
0 Uganda 21
average average
2000 2004 2008 2012 2016
East Asia & Pacific

South Asia Kenya 68

Latin America & Caribbean


0 20 40 60 80 100
Sub-Saharan Africa

6 Sources: 1. World Bank Data, 2017 2. IEA, World Energy Outlook, 2017 (latest available data), https://www.iea.org/media/sdg/WEO2018-Electricity-Database.xlsx
Context

~30% of population in forecast to remain unserved by grid at 2030;


off-grid essential to achieve 100% access
Access to electricity over time On-grid Off-grid
Percentage of Uganda population
100%
Access gap with planned
80% on-grid acceleration (30%)

60%

40%

20%

0%

Despite projected growth of off- and on-grid connections, 30% of UG population forecast to lack
electricity access at current trajectory; off-grid solutions critical to reach unserved populations
• Uganda population expected to grow at ~3% per year, expanding from ~8M households in 2018 to over
11M by 2030
• Given planned additional connections under the Free Connections policy and growing uptake of off-grid,
millions of connections forecast to come online, however ~3M households (~16M people) will remain
unserved in 2030 (~30%)
Off-grid solutions will have to play a critical role utilizing
technologies such as solar home systems and mini-grids
7 Sources: 1. Catalyst report 2. Off-grid Strategy concept paper 3. Uganda Bureau of Statistics, Uganda National Household Survey, 2016/2017
Context

Through consultations we were able to map relationships & off-grid


market initiatives

Interviews & research were tailored to understand objectives & how they interact with each
other

Private sector Government Development orgs Other stakeholders

• Understand • Understand • Review current • Build holistic view


available products, different sub- interventions, of facilitating
current market industry focus broader mandates, market actors &
share, growth areas, major preferred models their role in capital
plans, challenges initiatives and existing provisioning,
to scale and underway, plans / collaborations industry research,
strategic strategies, and & coordination
differences sensitivities

8
Context

Insights also include learnings from pilots run by UOMA in 2018


supporting operators to test various business models
Summary of pilots supported in 2018
Piloting solar milling
equipment with
farmers
Testing commercial
viability for solar Northern
pumps
Testing distribution
and pricing
innovations

Eastern

Raising consumer
Central awareness through
grassroot campaigns
Western

Scaling solar
Testing use cases to irrigation with
scale solar farmer groups
refrigeration Supporting solar ice-
making unit for
island fishing
communities
9 Source: UOMA, Annual Impact Report, 2018
Context

Market map seeks to provide a holistic and objective description of


the off-grid industry in Uganda and is comprised of 3 sections:

Solar Home Systems Productive use Mini-grids


(SHS)

Each section contains an overview and insights section:


• Overview: Provides a holistic view of the specific technology presenting actors & activities
• Insights: Presents data-driven industry analysis to provide dimension & context to the state of off-grid
development and further outlines the primary barriers to growth of today’s market, highlighting
opportunities for stakeholder support
Additionally, the Appendix contains a summary of stakeholders active in the Ugandan market

Click on specific link


to jump to section of
interest
10
Solar Home Systems Productive use Mini-grids
(SHS)

11
Solar home systems Overview Insights

Ecosystem commonly divided by pico lamps, small & large SHS

• 0.35W-6W • 10W-100W • > 100W


• Mostly for lighting • Mostly for lighting • Often for business use
home homes and small • Can include, solar
• Can include: lamps, businesses panels, battery,
USB phone charging, • Can include: solar charging points, radio,
and solar panels in panels, bulbs, lights, clippers, water
some cases regulator, charger, heating & pumping
wiring, battery, radio, systems, refrigerators,
televisions milling equipment, etc.

Larger solar-home systems


(component based)

Smaller solar-home systems


(multi-light point)

Pico lamps
Increasing in size (kW)

12
Solar home systems Overview Insights

Supplier landscape wide-ranging & divided, with prices varying


across the size of the SHS and many payment options available
Unit cost
USD
1,000 <10W 11-50W 50-100W >100W
900
800
700
600
500
400
300
200
100
0

Market typically divided in 3 categories, based on branding & services level:


• Off-brand generics: Ultra-low cost, generally sold by individual components, offer similar specs to brand-
name products, but often mislabeled, w/short life-span
• Branded retail: Brand-name, reputable systems sold via retail or through distributors, aftersales service
limited to distributors. Usually purchased with upfront cash or on credit from partners
• Branded service level: Brand-name, reputable systems sold directly through own channels and provide
aftersales services. Able to provide credit to customers, many utilizing PAYG model with 6—36 months
repayment period
Source: UOMA research and interviews, http://www.fenixintl.com/uganda, http://www.m-kopa.com/products, https://www.SolarNow.eu/solar-solutions,
13 http://www.greenlightplanet.com/shop, http://power4all.org/products, https://www.lightingglobal.org/products
Solar home systems Overview Insights

Several businesses are exploring different distribution models to


reach last mile
Some like Brightlife-FINCA
Orgs like Barefoot partnership leverage larger
Power partner with distribution networks of
development orgs to sell microfinance & provide
low cost products closer consumer financing
Financial
to displacement camps
institutions

Refugee
Small retailers Manufacturers/importers
camps
like Sunshine solar
Operators such as Solar distribute products
Sister recruit women as Operators through retail kiosks
agents to sell to their prominent in villages
networks & small groups
Women Farmer
groups groups
Models like One Acre
Charity based Fund leverage their
orgs farmer cooperatives to
offer energy products on
Social enterprises like
credit
EnVenture recruit & train
grassroots organizations
to reach the last mile

14
Solar home systems Overview Insights

Majority of sales in Uganda coming from PAYG operators; highest


branch density in Central & Western regions
SHS market driven by credit sales with most operator branches in higher-density regions

Operator Units sold Branches/Distribution points in UG Price of


in UG1 lowest cost
system

Total North East West Central


220,000 89 9 24 26 30 $189
SHS distribution
120,000 21 10 6 4 1 $274 branches are located
predominantly in
25,000 34 4 6 13 11 $480 higher-density areas,
with fewer service
15,000 242 4 5 7 8 $70
centers in Northern
12,150 15 2 2 3 8 $100 region

10,000 16 - - 12 4 $300
6,000 8 3 2 1 2 $131
Estimate represents
Rest of Market leverages agents across network, not enough data
~10,4003 multilight point SHS;
market on spread
GOGLA reports >1.5M
Total ~420,000 207 32 45 66 64 systems sold in UG to date
including pico
Sources:
1. UOMA interviews & consultations, supplemented by: http://www.fenixintl.com/uganda, http://www.m-kopa.com/products/ ,https://www.SolarNow.eu/solar-solutions/
2. Brightlife leverages the FINCA Uganda branch network but has an active agent at 8 of these branches
3. UOMA estimate of > Tier 2 products sold across the country by other distributors and small retailers
15
Solar home systems Overview Insights

This section aggregates research & insights from pilots and reports
covering UOMA initiatives

Access to finance Unserved populations Enabling environment

To design programs or set up


To reach meaningful scale, To foster a conducive
distribution points for the
activating local capital for business & regulatory
unserved, there is an
operators is necessary. We environment, there is need to
overarching need to clearly
believe Ugandan financial assess impact of current
define these groups,
institutions are at a crucial policies & standards, identify
understand their preferences
stage where centralized gaps and advocate for
and challenges, then
support & coordination suitable policies that could
determine pathways, and
could significantly advance increase uptake &
associated costs, to reach
access to local capital participation of stakeholders
them

16
Solar home systems Overview Insights 1 Access to finance

OGS sector has experienced rapid growth in investment, additional


investment largely required to finance PAYG working capital needs
Significant increase in financing of OGS sector ~$2.5Bn required to close financing gap
Investment in OGS sector Debt Grants Forecasted financing need
USD Millions Equity USD Millions
300 284M 3% 5,000 4,450M
36% 4,000 3,575M External
200 financing
3,000
required
2,000
100 61% 875M Capital
21M 1,000
committed
0 0
2012 2017 Financing split
(2017)

• Investment in sector has grown significantly,


• Top OGS affiliated companies will require ~$4.4Bn
doubling from 2012 to 2016
from 2017-2022; with ~$1.9Bn in place, $2.5Bn will
• Annual investment in 2017 reached ~$284M with need to be raised from external sources
~$922M cumulative funding raised since 2012
• Large proportion of investment required will be in
• Investment comprises of grants, commercial debt form of debt to finance consumer receivables &
& equity, as well as concessionary loans; debt inventory
financing increasingly dominant, making up ~61%
• Equity and grants still relevant to spur innovation of
of investment in 2017
business models to reach hard-to-serve consumers

17 Sources: 1. Lighting Global & Dalberg: Off-Grid Solar Market Trends Report 2018
Solar home systems Overview Insights 1 Access to finance

Despite large investment, financing still not adequate to meet


needs of SHS businesses at different stages of growth
Finance need by SHS business size

Have raised 1st Lack access to


Debt round of capital affordable local debt
Can access grants but unable to
but lack proven close multiple Increasing access
Equity business models & rounds across financing
traction to attain types
equity & debt
Grants

Early stage businesses Mid sized businesses Large businesses

Internal capacity building, Aggressive marketing, Expansion to new markets


Needs & product piloting, strategy, creating consumer & geographies, develop
activities consumer & market awareness, working capital unique customer centric
analysis for PAYG models products
Typical Seed funding, grants, early PE funds, impact Commercial debt, PE,
capital stage debt / equity, angel investment, development syndicated debt
amount & investment finance, lines of credit $5-$10M+
sources $10,000-$1M $1M-$5M

.
18 Sources: 1. UOMA analysis 2. Acumen: Accelerating Energy Access, The Role of Patient Capital
Solar home systems Overview Insights 1 Access to finance

Local SHS operators struggle to access capital across financing


instruments due to external and internal challenges
Internal External
1 Operators don’t have proven business 4 Lack of available & comparable industry data
models for SHS & lack traction to inform financing deals
• Early stage businesses have insufficient • Financiers lack comparable and validated
traction of revenues, cashflows & service data to benchmark the industry and
delivery required by investors understand business models
• Continuously changing business models • Lack of verified performance data delays
makes it difficult for investors to assess financing & prolongs due diligence
future performance process

2 Businesses lack internal capacity to manage 5 Limited finance industry capacity & sector
operations & obtain investor buy-in knowledge to assess SHS businesses
• Limited technical expertise to articulate • Investors have low understanding of
and implement growth strategies market players, products & trends
• Inefficient company systems & processes • Financiers like local banks lack personnel
for credit management particularly allocated to reviewing off-grid
businesses

3 Lack of collateral as a pre-requisite to access 6 Lack of standard performance indicators to


financing especially from local banks guide due diligence process
• Majority of businesses still too small to • Investors lack standardized indicators to
have sufficient collateral required by guide assessment of businesses &
financiers to access commercial capital evaluation of financing risk

19 Sources: UOMA interviews with local financial institutions & SHS operators
Solar home systems Overview Insights 1 Access to finance

However, there are innovative financing strategies currently


available to increase lending to SHS operators
Financing strategy

Concessional • Operators are given loans with more favorable payment terms compared to
lending commercial loans; concessional loans offer lower interest rates, longer payment tenors
& grace periods that reduce default risk for investors and cost of capital for operators

• Local financial institutions are offered guarantees from dev’t organizations to cover
Guarantees portion of losses in case of default from operators; usually structured according to
level of risk exposure with guarantors heavily involved in due diligence

• PAYG companies are financed based on underlying receivables without recourse on


Off balance
the balance sheet; operators would need to improve their credit assessment
sheet financing
capabilities to attract more commercial financing through off balance sheet

• Financial incentives are usually disbursed to operators upon delivery of specific


Results based
outputs that will in turn increase availability of credit and transfer risk to operators to
financing
deliver on key milestones

• Emergence of SIV’s like Microfinance Investment Vehicles (MIV’s) that originally


Special Purpose offered wholesale debt to MFI’s are potential sources of funding to enable scale of
Vehicles (SPV) PAYG model

Sources: 1. Lighting Global & Dalberg: Off-Grid Solar Market Trends Report 2018 2. SNV: Innovative Finance for Renewable Energy Solutions 3. The World Bank & Climate Investment
20 Funds: Options for Developing Financing Instruments Using Public Funds
Solar home systems Overview Insights 1 Access to finance

OGS sector has also seen greater prevalence of local currency


financing through partnerships to increase affordability of capital
Examples Outcomes

Syndicated asset • SolarNow received $6M syndicated asset • Enhances focus on expansion of PAYG
financing financing arranged by SunFunder designed to to reach over 25,000 clients and tackle
facilities finance customer receivables; each financier unserved market
provided $2M

Local & multi • M-KOPA solar secured US$55M local currency • Presents a more cost-effective way to
currency debt debt equivalent, led by Stanbic Bank for PAYG fund last mile distribution while
facilities solar installations for 1 million households. delivering sustainable returns to
lenders

• UECCC* funded by World Bank extended an • Reduces skepticism of financial


Working capital $8.5M line of credit to PFIs as working capital institution to lend to solar operators
facilities loans to solar providers. PFI’s include: Centenary
Bank, Barclays Bank, Finance Trust Bank,
Stanbic Bank and Post Bank

Investors are more inclined to offer debt financing to large companies, leaving smaller businesses to
struggle for more expensive debt:
• Since 2012, capital deployed has largely been allocated to already established businesses; over 80% of
capital financed was attributed to ~10 market leading companies
Sources: 1. “SunFunder closes $2m multi-currency debt facility in Mozambique with MFX Solutions for SolarWorks!,” SunFunder, https://sunfunder.com/news/solarworksdebtfacility
2. “SunFunder leads $6m syndicated receivables financing facility for SolarNow - SolarNow Uganda,” SolarNow Uganda, https://www.solarnow.eu/sunfunder-leads-6m-syndicated-
receivables-financing-facility-solarnow 3. “Breaking records in financing off grid,” M-KOPA Solar, http://www.m-kopa.com/breaking-records-in-financing-off-grid/
21 * UECCC = Uganda Energy Credit Capitalization Company is a government institution established to facilitate investment in the renewable energy sector
Solar home systems Overview Insights 1 Access to finance

Consultations with local banks in East Africa revealed 4 key risk


drivers that limit lending to SHS businesses
• Banks struggle to find pipeline of businesses suitable for available ticket sizes & that match
1. Enterprise traction requirements; those with sufficient traction require larger loans
risk • Misalignment of bank off-grid lending efforts and overall credit strategy influences design &
performance of loan products; high transaction costs of financing also limits deals closed

• Limited number of bank personnel focused on off-grid lending; lack technical expertise to
2. Operational understand SHS trends, business models and evaluate investment risks
risk • Typical bank processes & systems are not synced to technology used by SHS businesses and
cannot capture relevant data to assess performance e.g. links to mobile money data

• Bank interpretation of reporting standards like IFRS 7* leads to more stringent collateral
3. Legal & requirements for SHS businesses to account for unsecured loans
regulatory risk • Single lender limit of USD 2M in Uganda hinders financing offered to larger SHS businesses;
also limits large international banks with local presence

• Due to high perceived risk of lending, banks offer small loans, with short tenors & high
4. Investment interest rates that are expensive for operators in comparison with social impact investors
risk • Majority of businesses are at growth stage and have high defaulting potential due to low
sales & evolving business models; uncertainty of credit worthiness limits bank financing

Sources: 1. UOMA analysis supplemented with consultations from local banks *IFRS 7 requires entities to provide disclosures in their financial statements that enable users to evaluate
22 the significance of financial instruments, the nature and extent of risks arising from them and how entities manage those risks
Solar home systems Overview Insights 1 Access to finance

To increase lending, banks need to build in-house capacity, develop


new products, business pipeline and stakeholder partnerships

• Conduct consistent training for bank credit teams to increase knowledge of


Build in-house off-grid sector
capacity
• Refine current bank systems to align with industry KPI’s

• Partner with intermediaries to build pipeline; long run, opportunity exists to


Develop business offer pre-investment support to businesses
pipeline
• Participate in sector events to identify & build relationships with potential
businesses

• Review & assess current product design to better align with bank strategy
Design new products
• Onboard external capacity to support suitable product development

• Partner with dev’t organizations to access financing facilities to boost liquidity


Partner with key
stakeholders • Engage external financiers like DFI’s to obtain guarantees that hedge
investment risk

23 Sources: 1. UOMA analysis supplemented with consultations from local banks


Solar home systems Overview Insights 2 Unserved populations

In order to reach unserved it is critical to address themes on


affordability, access & awareness

Affordability Access Awareness

Important to understand Important to think through Important to understand


how to reach the poor & what models are what is framing consumer’s
insecure non-poor: commercially viable & understanding of solar and
• Some cannot fully afford effective: purchase of energy:
current products or WTP • Sparse population & • A number can afford but
lower than products poor infrastructure has do not trust or have
available made it costly to set up skewed perception of
• Some earn seasonal branch networks to serve value & benefits
income and will require entire region
innovative finance
structures to serve
• Live below poverty line
cannot afford the
products available

24 Sources: UOMA analysis


Solar home systems Overview Insights 2 Unserved populations

Affordability: In order to develop strategies to serve, our framework


examines affordability as key theme for segmentation
What influences consumer decision
to purchase and consistently pay
for SHS?

Ability to pay Willingness to pay

Awareness
Level of income Product pricing

Perception

Wealth levels Pricing structure


Value proposition

Changes in income Changes in pricing


Trust

Customers segmented based on their ambitions


Customers segmented based on how their
around energy, how much they understand or
purchasing power would be influenced by a
value solar, how adapted products are to their
change in income or price
needs and who they trust to make a purchase

25 Sources: UOMA analysis and research


Solar home systems Overview Insights 2 Unserved populations

Affordability: Leading operators sell to upper market, with lower


income populations unable to afford, left to buy low-quality units
Poverty line Typically on-grid
High

Unable to pay
at any price

Service level* Unable to afford


high quality /
Unit cost
service-level*
Cost limit of tech + Quality retail products
services
Currently served
by offering

Cost limit of Typically on-grid


tech

Low

Low Customer household income High

High cost to provide service means many households unable to afford,


left to buy cheap units or continue with traditional fuels
* Service-level defined as products offered by businesses able to provide servicing & warranties. These products are of higher quality and are more expensive than off-brand generics.
26 Sources: UOMA analysis
Solar home systems Overview Insights 2 Unserved populations

Distribution: Operators are increasingly focusing on distribution


models for women & refugees to achieve social and business impact
Social impact Business case

Opportunity exists to improve livelihoods Potential exists to boost revenues of SHS


of women businesses
• Majority of women are primary • Women are considered hidden
caretakers of households and have influencers and play a critical role in
Women limited time to participate in income making SHS purchase decisions
generating activities • Recent studies show that women can
• SHS access increases amount of time sell to twice as many households as
available for women to manage own compared to men due to their network
businesses and earn incomes effect

Opportunity exists to improve livelihoods Potential exists to fill energy gap in


of refugees refugee camps through PAYG SHS
• UG hosts ~1.4 million refugees, • Refugees provide an opportunity for
majority of whom use wood fuels & PAYG operators to test new markets &
Refugees kerosene to meet energy needs products
• There is a growing need to find better • Increasing energy access to refugees
ways for refugees to achieve self- enables outreach to new off-grid
sufficiency and serve as economic customers and hence growth in
engines in their host countries operator sales

27 Source: 1. Calvert Impact Capital., Just Good Investing, 2018, https://www.calvertimpactcapital.org/2018-impact-report


Solar home systems Overview Insights 2 Unserved populations

Women: Distribution of SHS to women has been limited by


perception of their ability to pay & make purchase decisions
Women are perceived as unable to purchase SHS However, innovative models are being explored

Sales agents don’t perceive women as final To reach more women, operators are exploring
decision makers for SHS innovative women-focused distribution models
• Since majority of men are breadwinners in • Targeting women-led activities like market days
homes, sales agents usually focus on selling to – Market days are used to demonstrate & sell
them as they can make the purchase decisions SHS products to women; also help operators
identify potential customers
Women are not deemed creditworthy since they • Including women as part of sales teams
struggle to afford SHS & access finance – Operators like Solar Sister, have women as
• Operators are hesitant to sell to women since as part of their sales teams to influence other
they rarely manage income generating activities women purchase SHS
• Women are also not considered creditworthy • Leveraging women influencers to inform purchase
because they struggle to access finance due to decisions
lack of collateral – Community women influencers are used
mobilize other women and speak positively
Operators don’t include women as part of their about the purchase of SHS
distribution strategies • Increasing awareness through informal
• Operators usually focused on meeting sales community-based women financial groups
targets and don’t consider women when – Operators partner with women financial
developing sales & distribution strategies groups to distribute & offer credit for SHS

28 Sources: UOMA analysis


Solar home systems Overview Insights 2 Unserved populations

Women: More efforts are required by SHS operators to consider


women when developing distribution strategies

Communicate importance of gender inclusion to adjust mindsets of sales &


distribution teams
Adjust mindsets of
sales personnel • Communicate impact created by increasing access of SHS to women as well
as their role in making purchase decisions and influencing communities

Train sales personnel on more effective techniques of distributing SHS to


women
Train distributors to
• Train distributors on how to tailor strategies to reach more women; for
reach out to women
example, include women-specific customer messaging during after sales
services

Incorporate women-focused sales approach as part of distribution strategy


Incorporate gender for SHS operators
focus in sales • Develop sales strategy that includes focus on reaching out to more women;
strategy recognize women as end consumers of SHS, assess and include their needs
in product design

29 Sources: 1. Shell Foundation, A business first approach to Gender Inclusion, 2018, https://shellfoundation.org/app/uploads/2018/10/A-business-first-approach.pdf
Solar home systems Overview Insights 2 Unserved populations

Refugees: SHS penetration & distribution to refugees in UG has been


limited thus far by several challenges

• Limited information exists Commercial • Refugees often receive hand-


Limited
about the demographics, approach limited outs from humanitarian
information about
population, incomes & business by hand-out organizations and might not
refugee camps
activity in camps culture adjust to commercial approach

Logistical
Impermanence of • Refugees are uncertain about • Refugee camps are located in
resettlement in countries of constraints to remote areas making it difficult
potential
origin hence don’t invest supply goods to to distribute & supply goods to
customers
heavily in energy products camps customers

• Operators are not certain about Low level of • Many don’t have phone access
Insufficient SHS demand in refugee camps and can’t access mobile
connectivity &
market in as much as the need is banking services to support
mobile banking
present PAYG models

Refugee ID’s not • Refugee ID’s are not accepted • Due to insufficient documents,
by some companies in UG Limited data on operators are unable to obtain
accepted by some
limiting registration for services refugees historical data on refugees to
companies
like mobile money, banking, etc. access their credit worthiness

Sources: 1. IFC, Kakuma as a Marketplace, 2018 2. USAID Power Africa, Implemented by Green Powered Technology, in partnership with Energy 4 Impact, De-Risking Pay As You Go
30 Solar Home Systems in Uganda Refugee Settlements Project
Solar home systems Overview Insights 2 Unserved populations

Refugees: Public private efforts like the Smart Communities Coalition


seek to increase connectivity, access to digital tools and energy
The Smart Communities Coalition (SCC) is a public private effort co-chaired by USAID Power Africa &
Mastercard to transform the operating model in refugee camps and settlements

SCC will mobilize & organize stakeholders according to their core strength to address fundamental pillars
of connectivity, digital tools & energy access

• Connectivity: A recent study found that mobile phone and internet access is as critical to refugees’
safety and security as food, shelter & water

• Digital tools: Implementing agencies increasingly rely upon digital technology to reach refugees and
locals; digital tools open up new education, training, livelihood and information opportunities

• Energy access: Power is not provided in settlements as a service, so refugees rely on poor quality,
expensive diesel generators; SHS using PAYG models offer opportunities to enable livelihoods

SCC objectives SCC ecosystem approach

• Increase efficiencies in camp management and • Identify market opportunities


service delivery • Establish cross-sectoral working groups
• Empower refugees to provide for themselves and • Enable exchange of expertise and ideas across the
their families working groups
• Equitably address the needs of host communities • Implement pilot projects via working groups
in/around targeted settlements • Track KPIs as part of M&E and learning

31 Sources: 1. Smart Communities Coalition (SCC), October 2018


Solar home systems Overview Insights 2 Unserved populations

Refugees: Recent study reveals findings on digital technology for


refugees; insights relevant for mobile-enabled PAYG SHS
MasterCard & Western Union conducted a study to understand digital technology infrastructure of
refugees; the study was based on 2 largest refugee settlements in Kenya – Kakuma & Kalobeyei
• From research conducted, a digital model was created to focus on mobile money, digital vouchers & card-
based solutions and key insights were observed

1 Camps comprised of three key income segments, which include impoverished new arrivals, intermediate
residents & economically active residents; economically active refugees more commercially viable for PAYG SHS

2 Refugees that have spent a long period in the camp have a higher likelihood of transitioning from impoverished
to more economically active making them able to afford SHS

Most refugees that contributed to market research had smart phones, bought from local merchants through
3 installment plans; phones were particularly used to communicate with networks and receive funds. Access to
mobile phones will support payment collection through mobile money

4 Refugees prefer withdrawing remittances and saving in cash or mobile money; majorly use remittances for
food, lighting, education and purchasing business assets like sewing machines

Financial aspirations and desires of those in Kakuma and Kalobeyei are no different than higher-income
5
segments despite their complex financial situation

Opportunity to leverage DFS in the camps to extend energy access

32 Sources: 1. MasterCard, Western Union. Using digital technology to create sustainable refugee economies
Solar home systems Overview Insights 2 Unserved populations

Refugees: To increase SHS distribution to refugees, important to


assess roles of various stakeholders in tackling challenges
• Participate in piloting distribution models to refugee camps, since Uganda has an open
market policy that allows free movement of goods
• Recruit field agents that understand local context of camps & can train refugees on
PAYG SHS importance of SHS and appropriately incentivize sales
providers
• Set up stock shops near refugee camps to solve logistical challenges
• Offer wide range of pricing structures and flexible repayment terms to meet differing
abilities to pay

• Provide financing to SHS operators to de-risk initial credit systems offered to refugees,
given the uncertainty around their ability & willingness to pay as well as permanence
Humanitarian • Give operators local context on regulations and ensure they are aligned with
organizations humanitarian mandate
• Reduce free and low-quality solar systems being offered to refugees as they distort the
market and reduce willingness to pay

• Directly partner with SHS operators to use the MNO’s mobile services and networks as a
Mobile Network mode of payment for solar clients
Operators • Ensure mobile money access is within close proximity to refugee camps; for example,
(MNO’s) have mobile money agents close to the camps

33 Sources: 1. GSM Association, The case for pay-as-you-go solar home systems in Kakuma Refugee Camp, February 2019
Solar home systems Overview Insights 2 Unserved populations

Awareness: Important to understand factors that influence consumer


behavior in order to improve perceptions in the market
To influence consumer decision-making and increase solar uptake, effective communication is needed across 4
key areas:

Building awareness Changing mindsets Gaining credibility Influencing purchase

Consumer awareness Consumer education Value proposition Distribution & quality


What is solar? Why solar? How to select? Where to get quality?
Exposing consumers to Educating consumers on Helping consumers Communicating where &
basic understanding of benefits of using solar understand the different who can provide quality
off-grid solar products products products available & how approved products
offerings can be adapted
to their needs

Effective communication in this process should incorporate a concrete understanding of the target
audience:
• What cultures and norms influence purchase & ambitions around energy for this group?
• Who are the influencers and decision makers in the community?
• What value and benefits are most appealing to specific regions and groups?

34 Sources: 1. Soltherm Europe - Campaign Guidelines, van der Ree B., Mert W., 2003
Solar home systems Overview Insights 2 Unserved populations

Awareness: Based on pilots, operators leveraged existing community


groups & partnerships with mobilisers to create awareness
1 Consumer response and perception was greatly defined by community influencers
• From pilots conducted, consumer perception and interest in awareness campaigns and road shows was
shaped by the kind of influencers hosted; for example, LC’s, MP’s, community leaders, etc.

2 On ground coordination by operators and local mobilisers was more effective in creating awareness
• It was important to have operator teams work with local community mobilisers who could easily influence
their fellow members and offer context on when to hold awareness initiatives

3 More effective to conduct trainings and info sessions through already existing community groups
• Easier to reach and mobilize large numbers of potential consumers through existing groups of farmers,
women, savings, faith-based groups, etc.

4 Information communicated ought to resonate with consumer needs and community characteristics
• Necessary for operators to understand characteristics of consumers in targeted communities of outreach
and tailor messaging to suit these groups

5 Follow up group meetings and one-on-one after sales services were key in influencing purchase
• Initial awareness campaigns needed to be coupled with subsequent on ground group visits to offer after
sales services and influence purchase decisions; these built credibility & trust in operators

35 Source: UOMA pilots


Solar home systems Overview Insights 3 Enabling environment

Fiscal policy and product standards for SHS are a large focus in
creating a conducive enabling environment for off-grid acceleration

Fiscal policy Product quality & standards

Section looks at current tax regime & fiscal Section looks at standards regulating quality of
interventions in order to: SHS products on the market in order to:
• Assess impact of current tax regime and draw • Assess current standards on product quality,
comparisons with various tax scenarios identify existing gaps and recommend ways
• Consider other fiscal policy interventions like to implement solutions
subsidies and assess their impact on SHS uptake • Develop strategies that can build consumer
• Goal is to obtain flexible tax structure that trust in suppliers & increase credibility of
balances tax revenues & consumer uptake products on the market

36
Solar home systems Overview Insights 3 Enabling environment

Fiscal policies: UOMA conducted fiscal policy analysis that revealed


current tax regime as reasonably conducive for SHS growth
Fiscal policy analysis assessed five tax scenarios for SHS components & potential effects on uptake
• Currently, SHS operators are exposed to corporate income tax and product-based tax like Value Added Tax
(VAT) & import duties; analysis focused on VAT & import duty only
• Tax scenarios reviewed included:
– Current tax regime with exemption on solar generation components only
– All taxes removed
– Only VAT applied to both solar generation & transmission components
– Only import duties applied to both solar generation & transmission components
– All taxes applied

Findings from the analysis revealed that current regime is conducive for SHS growth
• Full VAT and import duty exemptions on solar products was not suitable due to difficulties in enforcement;
despite having the largest growth in connections, it also led to significant loss in gov’t tax revenue of >$18M
• Similarly, without any exemptions on solar products, government accrued tax revenue of ~15M but enabled
only 4% growth in connections
• Current tax regime with VAT and import duty exemptions only on solar generation accrued government tax
revenue of ~$18M and had a 10% growth in connections hence optimal and favorable for growth

While current tax regime is favorable for SHS growth, more efforts need
to be attributed to effective implementation

37 Source: UOMA, Fiscal Policy Analysis: An assessment of the tax and subsidy options to accelerate solar home systems in Uganda, 2018, Kampala Uganda
Solar home systems Overview Insights 3 Enabling environment

Fiscal policies: Implementation of fiscal policies largely limited by


inconsistent application of taxes across SHS components
Tax policies are inconsistently applied across SHS However, efforts are underway to tackle barriers

Lack of clarity on current tax policies & Industry stakeholders like Uganda Solar Energy
inconsistent application of tariffs across similar Association (USEA) plan to foster uniform
solar components application of taxes
• Operators report inconsistent taxes and • Currently developing a tax handbook with
exemptions being applied to similar product Uganda Revenue Authority (URA) to provide
components; for example: clarity on tax guidelines for market players
– Solar generation components like panels • Provides approval letters for several operators
& batteries are tax exempted when part to obtain exemptions when importing solar
of plug & play systems components
– However, in some cases, batteries are not – Operators will need to be registered
exempted especially when imported as members of USEA to obtain approval
stand-alone components letters

Inconsistent tax application also driven by lack


of trust between regulators & operators
• Tax regulators are hesitant to offer exemptions To ensure effective implementation, more
to some stand-alone components as they are efforts need to be directed to creating
not fully certain of operator’s intended use of awareness & clarity on tax policies
these products

38 Sources: 1. UOMA analysis supplemented by consultations with stakeholders


Solar home systems Overview Insights 3 Enabling environment

Fiscal policies: Analysis also examined ways to stimulate demand and


supply of solar home systems through subsidy options
1 Stimulating supply by supporting operators to reach unserved populations
• Operator incentives: Government agencies can incentivize operators to distribute to hard to reach
areas that are not commercially feasible through subsidy and other results based funding
• Working capital facilities: Financial institutions can provide working capital to operators to finance
inventory for products offered to consumers on flexible credit terms
Analysis recommended phasing supply stimulating interventions first before demand is increased

2 Stimulating demand by offering price subsidies to consumers to increase affordability


• Direct subsidies: Government can work directly with consumers to finance purchase of SHS products
at a lower price; this can be done through vouchers
• Partial subsidies: Government can incentivize operators to reduce prices by funding a proportion for
their costs that would have reflected in price
• Consumer financing: Financial institutions can offer affordable and flexible credit options to end
consumers to support purchase of SHS

While interventions are helpful in increasing demand and supply of SHS products, they cannot fully serve
entire unserved population
• Interventions like working capital facilities will increase number of operators in the market and volume of
sales, but only serve consumers that can afford these products in commercially attractive areas
• Demand stimulating subsidies run the risk of slowing down sector growth and can only be implemented in
specific regions in the country

39 Source: UOMA, Fiscal Policy Analysis: An assessment of the tax and subsidy options to accelerate solar home systems in Uganda, 2018, Kampala Uganda
Solar home systems Overview Insights 3 Enabling environment

Fiscal policies: Analysis also examined ways to stimulate demand and


supply of solar home systems through subsidy options
Interventions are have most impact when phased; first stimulating supply then
• Interventions like working capital facilities will increase number of operators in the market and volume of
sales, but only serve consumers that can afford these products in commercially attractive areas
• Demand stimulating subsidies run the risk of distorting the market and should only be implemented in
specific regions of the country after commercial options have scaled

1 Stimulating supply by supporting operators to reach unserved populations

• Operator incentives: Government agencies can incentivize operators to distribute to hard to reach
areas that are not commercially feasible
• Working capital facilities: Financial institutions can provide working capital to operators to finance
inventory for products offered to consumers on flexible credit terms
2 Stimulating demand by offering price subsidies to consumers to increase affordability

• Direct subsidies: Government can work directly with consumers to finance purchase of SHS products
at a lower price; this can be done through vouchers
• Partial subsidies: Government can incentivize operators to reduce prices by funding a proportion for
their costs that would have reflected in price
• Consumer financing: Financial institutions can offer affordable and flexible credit options to end
consumers to support purchase of SHS

40 Source: UOMA, Fiscal Policy Analysis: An assessment of the tax and subsidy options to accelerate solar home systems in Uganda, 2018, Kampala Uganda
Solar home systems Overview Insights 3 Enabling environment

Fiscal policies: Important to address challenges limiting effective


implementation of fiscal policies

• Strengthen capacity of local tax authority by investing in larger customs


Strengthen capacity of local
personnel & screening technology to ensure effective implementation of
tax authority
policies for various components

• Develop handbook that clearly outlines guidelines to understand tax


Create clarity on current tax treatment for each SHS component
policies • Conduct convenings with operators & regulators to discuss
misinterpretation of tax policies and align on application across products

Review & implement • Pilot subsidy delivery models provided either to operators or directly to
efficient subsidy delivery consumers; also market package models for operators. For example, offer
models subsidies for a single supplier to sell systems in a specific area

• Train both operators & regulators on tax policies to ensure uniform


Train operators & regulators application of taxes across solar components; conduct follow-up trainings
on fiscal policies when policies are updated in order to build trust between operators &
regulators

41 Source: UOMA, Fiscal Policy Analysis: An assessment of the tax and subsidy options to accelerate solar home systems in Uganda, 2018, Kampala Uganda
Solar home systems Overview Insights 3 Enabling environment

Quality & standards: Regulation of product quality is limited by


inadequate standards, minimal capacity, equipment & awareness
Challenges Ongoing strategies
• Standards don’t cater for component- • UNBS currently working to include
Inadequate based and inadequate for plug & play quality standards for component-
quality for example, only 30 standards cover based systems
standards generation components and not as
whole kits

• UNBS doesn’t have sufficient • UNCDF & ERT III are in the process of
Limited
equipment to test quality of imported enabling UNBS purchase machinery to
equipment to
products and determine operator test product quality
test products
compliance of standards

• Lean inspection team unable to serve • UNBS is partnering with Pre-Export &
Limited team entire country; UNBS currently has 15 Verification of Conformity contractors
capacity personnel that work across all sectors to test product quality from country of
and regions in the country origin

• Operators, consumers and quality • REA will work with UNBS under ERT III
Lack of
regulators lack awareness of standards to promote quality assurance &
awareness on
guiding quality of various SHS awareness of solar products in rural
standards
components areas

42
Solar Home Systems Productive use Mini-grids
(SHS)

43
Mini-grids Overview Insights

Mini-grids forecasted to play a central role in electrification of UG

Forecast of cumulative mini-grid connections across 10 service territories in Uganda


‘000 Households
• Master Planning exercise for REA identified
70 mini-grid sites after grid expansion analysis was
completed
Thousands

60
• Sites were identified where:
50
– 50 or more households clustered (smaller
40 number where they may serve trading
30 centre)
20 – Clusters corresponding to grid expansion
but –ve NPV or cost per consumer
10 >$2000
- • The analysis also assumed consumption per
0 customer is inversely proportional to the
penetration level

• REA’s Master Plan forecasts that in the next 10 years, there will be opportunity to electrify up to 62,000
households across 10 service territories of Uganda through mini-grids
• Majority of sites noted in North, West, South Western, and Central service territories
• The business case highlighted in the Master Plan for electrification implies mini-grids will continue to play a
crucial role in the electrification of Uganda to achieve universal access

1
Mini-grids Overview Insights

To date, only 14 mini-grid projects installed in UG, however several


sites are currently up for tender

5kW PV mini-grid 25 sites currently being


installed by Remergy tendered by REA & GIZ
Energy in Kasese

22.5kW PV installed by
Two 13.5kW PV Krichner Solar in Luwero
developed through a
partnership between E4D
& REA in Kyenjojo District

6 sites to be tendered 1.6MW PV diesel hybrid


by REA/WWF installed by Kalangala
Infrastructure Services

Two 32 kW biomass
gasification projects
setup by Pamoja Energy Legend

Completed grids
230kW PV managed by
15 sites currently being Absolute Energy at Upcoming mini-grids
tendered by REA & GIZ Kitobo Island

Vast majority of UG projects are solar / battery hybrid grids, with some donors
considering mini-hydro pilots

45 Source: UOMA interviews & research supplemented by REA documents on mini-grid opportunities
Mini-grids Overview Insights

A number of mini-grids have been constructed due to support from


the private sector, Ugandan government & other financiers (1/4)
Mini-grid Capacity and technology Developers/Partners

• Tech: 32kW Biomass gasification Developer: Pamoja Energy Limited


Tiribogo • Current connections: 170 Partners: REA, Royal Institute of
gasification Technology Stockholm, & Renewable
Energy Business Incubator

• Tech: 32kW Biomass gasification Developer: Pamoja Energy Limited


• Current connections: 72 Partners: REA, Royal Institute of
Magara gasification
Technology Stockholm, & Renewable
Energy Business Incubator

• Tech: Hybrid gen. station 600 kW (Solar) & Developer: Kalangala Infrastructure
1.6MW (Diesel) Services
Bukuzindu solar-
Partners: InfraCo, Nedbank, USAID,
diesel plant • Current connections: 40 villages (~2500 hhs) DFID, UDC, and Emerging Africa
Infrastructure Fund.

• Tech: 5kW Solar PV Developer : Remergy Energy A/S


Kayanja Solar • Current connections: ~70hhs Partners: WWF, Access 2 Innovation
microgrid & Joint Energy and Environment
Project

46
Mini-grids Overview Insights

A number of mini-grids have been constructed due to support from


the private sector, Ugandan government & other financiers (2/4)
Mini-grid Capacity and technology Developers/Partners

• Tech: 1kW Solar PV Developer: Centre for Research in


Kiboga solar mini- • Current connections: 11 Energy and Energy Conservation
grid Partners: National Council for Science
and Technology

• Tech: 64kW Hydro


Developer: Bwindi Community
Bwindi community • Current connections: 42 Hospital
microgrid
Partners: GIZ EnDev

• Tech: 300kW & 60 kW hydroelectric & diesel


generator of 80kva Developer: Kisiizi Power Ltd
Kisiizi Hydropower Partners: Kisiizi Hospital, Church of
• Current connections: 710 Uganda

• Tech: 13kW Solar PV


Developer : Energy for Development
Kyamagaruru solar • Current connections: 68 Partners: REA, University of
plant
Southampton

47
Mini-grids Overview Insights

A number of mini-grids have been constructed due to support from


the private sector, Ugandan government & other financiers (3/4)
Mini-grid Capacity and technology Developers/Partners

• Tech: 13kW Solar PV station


Developer : Energy for Development
Kanyegaramire • Current connections: 74 Partners: REA, University of
solar plant
Southampton

• Tech: 5kW Hydro


Developer: Eco-Garden Ltd
Eco-Garden micro- • Current connections: 16 Partners: Renewable Energy Business
hydropower plant
Incubator (REBI)

• Tech: 5kW Hydro Developer: Rwenzori Mountaineering


Partners: Private Sector Foundation
RMS Pico • Current connections: 3 Uganda (PSFU), Centre for Research in
Hydropower
Energy and Energy Conservation
(CREEC)

• Tech: 230kW Solar PV Developer: Absolute Energy Africa


• Current connections: 541 Limited
Kitobo Solar Plant
Partners: REA, EEP Africa, Shell
Foundation, FinAfrica

48
Mini-grids Overview Insights

A number of mini-grids have been constructed due to support from


the private sector, Ugandan government & other financiers (4/4)
Mini-grid Capacity and technology Developers/Partners

• Tech: 9000kW Hydro


Kabalega • Current connections: 203 Developer : Hydromax
hydropower plant Partners: REA

• Tech: 22kW Solar PV


Kichner solar • Current connections: 60 Developer: Kichner solar
minigrid Partners: REA, GIZ

49
Mini-grids Overview Insights

There a number of up-coming mini-grids that are set to increase


energy generation and access (1/2)
Developer/Tender Capacity and technology Partners

• (53) solar mini-grids total of 600kW in Buvuma


Bakulu Power district REA
• Potential to reach ~8000 people Energy for Impact

• Estimated capacity of 100kW Solar PV


• Located in Kalangala District with potential REA
Absolute Energy
impact of 5400 people

• Biomass plant
Pamoja Energy • Capacity of 50kW in Kamwenge District REA
Africa Ltd

• Capacity of 30kW to 80kW


• 15 villages in Rakai & Isingiro & 25 villages in REA
TBD
Lamwo District GIZ, Pro Mini-grids project

50
Mini-grids Overview Insights

There a number of up-coming mini-grids that are set to increase


energy generation and access (2/2)
Developer/Tender Capacity and technology Partners

• (10) decentralized mini-grids on Lake Victoria


AfDB and REA REA

• (10) mini hydro projects Emerging Africa Infrastructure Fund,


ORIO Infrastructure • Capacity of 50 to 500 kW FMO (Dutch development Bank)
Fund UECCC

• 20MW biomass project in Gulu, Northern


Uganda
Mandulis Energy KfW, AfDB and Power Africa

• (3) Solar PV arrays in Kyenjojo Uganda


• Expected to serve 1000 households REA
Tiger Power
The Belgium government

51
Mini-grids Overview Insights

Setting up mini-grids in Uganda has several steps involving


government licensing and community outreach
Site ID / Sales & Metering &
Grid setup Generation After sales
assessment distribution payment
Govt & private Different permits Mini-grids Developers Operators use IT Operators offer
sector identify & licenses generate partner with REA systems to maintenance &
mini-grid sites processed from: electricity from: for last mile effectively technical
Government • Electricity • Solar panels distribution manage smart assistance to
Regulatory metering customers
• Identify • Diesel • With exception
potential sites Authority of few, most • Systems • Operators have
generators
& run them via • National mini-grid receive & technical staff
public tender • Biogas developers effectively track that respond to
Environment
partner with customer customer
Private sector Management • Hydro power
REA to provide payments queries
Authority generators
• Identify & distribution • Also provide
develop sites • District and • Hybrids of subsidy maintenance as
within local various
needed
regulatory community generating
framework of leaders technologies
licensing

52 Source: UOMA interviews


Mini-grids Overview Insights

Site ID: Mini-grid sites are identified by government and private


sector operators; approved through tender or non-solicited bids
Government identified sites Private sector identified sites

• Sites are identified during master planning process • Sites are identified by private developers or
or service territory concessions allotted by community
government • Private operator has site surveyed, initial feasibility
• Tenders are awarded through a competitive studies conducted, and confirmation received
selection process for sites or concessions from REA before setting up or developing the
• Setup process is considerably shorter as upfront mini-grid
surveys & feasibility studies have already been
conducted by government
• Regulated tariffs in parity with central grid • Tariffs should cover all costs of the mini-grid
costs hence government subsidizes project to plus a margin; sites are likely applied in areas
ensure viability with higher willingness to pay

Mini-grids in Uganda are mainly identified by public sector but managed by private developers:
• Government-led projects result in several benefits for mini-grid developments:
– Clear planning in different territories to ensure economies of scale & reduced operational expenses
– De-risked projects with added predictability on when grid is likely to be extended
– More affordable utility for end-users through subsidies on distribution & connection

53
Mini-grids Overview Insights

Grid setup: Need to process licenses & permits to operate, and


leverage local partnerships for procurement
Several steps involved in receiving clearance Mini-grid setup begins after ERA clearance

1 Identify proposed project in line with rural After necessary regulatory requirements are met,
electrification master plan; project must be less than developers begin setting up the mini-grid
2MW & located more than 1km from the grid to • Mini-grid developers start constructing
qualify for an exemption necessary infrastructure required to run the grid
• Components are assembled at mini-grid sites;
2
Develop project feasibility study including detailed majority of developers usually import these
social economic assessment and environmental components
project brief • Local partnerships are instrumental in procuring
components, processing them through customs
3 and finding a construction company to develop
the infrastructure
Obtain clearance of project brief from NEMA

• For generation projects less than 2MW, the


4 developer must apply to ERA for an
Submit developed documents to ERA for exemption from the requirement to obtain a
consideration license
• For those sited on land held in trust by the
government, the developer is required to
5 obtain a license or concession from the Land
ERA then processes and confirms the application. This
involves advertising, holding a public hearing and Commission
detailed assessment of tariff proposal

54 Source: UOMA interviews & research supplemented by ERA documents on license processing procedure
Mini-grids Overview Insights

Generation: Solar & hydro dominate generation technologies of


mini-grids in Uganda; trend is encouraged by reduced costs
Solar & hydro powered mini-grids prevalent Reducing costs encourage use of solar assets
Generation mix for minigrids in UG Cost of C-Si solar modules across the world1
Mini-grids $/W
7 3
6
5 2

4
1
3
2 0
1 2010 2011 2012 2013 2014 2015 2016 2017

0 • Uganda has solar irradiation levels of up to


Hybrid Biomass Hydropower Solar PV 2000kWh per m2 which makes solar power
relatively easy to generate
• Solar PV & hydropower are most common • Introduction of new & more efficient technologies
generation technologies used to setup mini-grids; has led to reducing cots and contributed to the
recently biomass tech has also been used dominance of solar generating technologies
• Several hybrid generation technologies also exist
• However, the challenge to have a good storage
for example, solar diesel, hydropower diesel, etc.
system for energy collected during the day still
prevails
Source: UOMA interviews & research supplemented by GIZ documentation on mini-grids in Uganda
55 1. Lighting Global & Dalberg: Off-Grid Solar Market Trends Report 2018
Mini-grids Overview Insights

Distribution: Last mile distribution for mini-grids is usually done in


partnership with government authorities or local community
Productive use
Number received subsidy from REA for last mile connection
Partnership with REA

Mini-grid
Many successful mini-grids have Businesses
partnered with government agencies like
REA for last mile distribution

Households

However, potential to leverage other strategies for distribution

Distribution to low-density areas can take up to 30-40% of total project costs; mini-grid developers reduce these
costs by:
• Setting productive use zones (usually commercial centers where all businesses can access electricity) E.g.
Pamoja Energy Ltd.'s agroprocessing hub in Kamwenge
• Setting up business hubs with all appliances (carpentry, milling and the like) and charging service fees
• Setting up battery charging stations for consumers who live too far from the grid (near common market
place/commercial center) E.g. Kisiizi Hospital Power Ltd.'s battery charging outlets

Samuel Booth et al, Productive use of energy in African micro-grids: Technical and business considerations(Location: National Renewable Energy Laboratory and Energy 4 Impact, August
56 2018), https://www.nrel.gov/docs/fy18osti/71663.pdf Opportunities and Challenges in the mini-grid sector in Africa: Lessons learned form the EEP portfolio, [, 38]
Mini-grids Overview Insights

Metering & collections: Mini-grid operators use integrated IT systems


for more efficient management
Integrated IT systems can cost 13% or more of
Smart total CAPEX for the project and are used to track
metering and monitor customer usage
• Used to consolidate consumer data, track
Demand Payment payments and usage for better billing (especially
manage tracking for PAYG systems)
ment

Most use smart meters to monitor and track power


consumption of customers
• Smart meters are used to monitor customer usage
and track data on power consumption
System
Usage monitor- – Some mini-grids provide scratch cards for
tracking ing customers to buy and load on their meters
Customer – Others use prepaid mobile systems where
data customers pay and receive units of electricity
mgmt. purchased
• Smart meters are used in collaboration with mobile
Both international and regional software providers money services to process and collect payments
offer systems that developers in Uganda can use to without having to pay directly at the mini-grid
track different functions of the mini-grid operator’s office

Source: Opportunities and Challenges in the mini-grid sector in Africa: Lessons learned form the EEP portfolio, [, 27] Pol Arranz-Piera, Benchmarking study of Solar PV mini-grids
57 investment costs(USA: The World Bank, Climate Investment Finds and Energy Sector Management Assistance Program, December 2017[,14]
Mini-grids Overview Insights

After-sales: Customer support varies across different types of


operators; key challenge is long distances between customers

Efficiency of after sales service


Type of mini-grid operator Response to customer queries
delivery

Private operator Often have dedicated team to Often have technical team
respond to customer queries dedicated to providing efficient
after-sales services

Community operator Often have team members Often lack technical skill required to
handling a variety of tasks including deliver efficient after-sales service
responding to customer queries

• Long distances between customers are a key challenge across all operators; mini-grid customers are often far
apart, making it difficult to efficiently provide good after sales services to all of them
• Mini-grid operators often lack technical skill required to deliver good quality services to customers

58 Source: UOMA interviews & research supplemented by GIZ documentation on mini-grids in Uganda
Mini-grids Overview Insights

Partnerships: To implement mini-grids, working with government


institutions, funding bodies, and local communities is vital
• Financial partners provide financing across the different stages which include;
feasibility studies, infrastructural development, operations, and distribution
Financial partners
• Nearly all projects start off with a grant, subsidy or other type of infrastructure
financing to reduce capital costs

• SACCOs provide loans to customers that enable them afford the initial setup
Local community • Operators partner with local community leaders to manage operations of the
partners mini-grid & accelerate buy in from local community members and businesses

• Uganda Rural Electrification Agency supports with infrastructure dev’t and last
mile consumer connection
Gov’t agencies
• Government electricity agency subsidizes price of mini-grid to customers, making
it more affordable to make a connection

• Technology partners support with operating the grid; they provide a platform
Technology used to collect payments, monitor different components of the grid and
partners consolidate data collected

Source: Opportunities and Challenges in the mini-grid sector in Africa: Lessons learned form the EEP portfolio Samuel Booth et al, Productive use of energy in African micro-grids:
59 Technical and business considerations
Mini-grids Overview Insights 1 Access to finance

Despite availability of capex financing, developers lack funds to


scale operations & serve hard to reach customers
Mini-grid developers have accessed concessionary
finance for setup and development
• Majority of the developers have accessed grant
financing; developers also use their equity to
finance initial stages of development Financing structures should promote
• Debt finance providers still skeptical to provide sustainability
investment due to unproven business models
• Subsidy allocation scenarios should ensure that
grants don’t exceed the level of investment
Financing mix for minigrids in UG
required for viability of grid extension projects
Mini-grids
within the foreseeable future
12 ~71 % of mini-grids
in UG have accessed • Grant allocations should also consider number
grant funding to of customers to be electrified, electricity
10
support initial demand and ability & willingness to pay
8 development • Financing should also be allocated to activities
that increase energy demand and community
6 awareness

0
Grant Equity Grant + Equity Debt

60 Source: UOMA interviews & research


Mini-grids Overview Insights 2 Unserved populations

Unserved populations: Households contribute largest proportion of


connections; mini-grids utilize <30% of installed capacity
Percentage of connections by mini-grid
120%
100% 10% 6% 10%
25% 13%
80% 40% 30% 30%
45% 50%
60% 65%
40% 90% 87% 94% 90%
75% 70% 70%
60% 55% 50%
20% 35%
0%

Households Businesses

Household customers make up the largest percentage of mini-grid connections


• Households account for largest proportion of connections to mini-grids and mostly use electricity for
lighting and phone charging; due to small loads utilized, mini-grids use less than 30% of installed
generation capacity
• Mini-grids utilizing more than 50% of installed capacity usually serve institutional buyers like hospitals and
other commercial customers

To maximize capacity, developers need to incorporate productive use in


feasibility and implementation phases

61 Source: UOMA interviews & research


Mini-grids Overview Insights 3 Enabling environment

Developers face additional challenges in setting tariffs, managing


operational costs, forex risk & obtaining skilled personnel
• Mini-grid developers still face a challenge in setting the right tariff that enables
Difficulty in setting the developer to recover costs of setup and be financially sustainable while
retail tariffs remaining affordable to the customers.

• Mini-grid developers incur high costs in operating (hiring a competent team,


High operation and monitoring the grid) and maintaining the grid that are often recovered over a
maintenance costs long time

• From developers, operators, community engagement leaders, local engineers &


Inadequate skill & project management staff, there is limited available skill & experience for
expertise development, operation & maintenance of the grid

UOMA is looking to support more research and pilot work with mini-grids this year. Do reach out if
interested in partnering

62 Source: Green Mini-Grids in Sub-Saharan Africa: Analysis of barriers to growth and the potential role of the African development bank in supporting the sector
Solar Home Systems Productive use Mini-grids
(SHS)

63
Productive Use Overview Insights

Cycle to increase energy demand requires investment in productive


use technology to increase incomes
According to GIZ, productive use can be defined as1: “Agricultural, commercial and industrial activities involving
electricity services as a direct input to the production of goods or provision of services

Through increased productivity, energy access can be stimulated by private sector revenue
• In the long term, increased energy access stimulates economic activity in communities, which in turn
increases income and proportion of income spent on energy, creating a continuous virtuous cycle

Expanded energy
access
Investment Finance and
in training – are
productive needed to spur
tech enterprise
investment2
Increased
Clear government utility
regulation and policy revenue
on tariffs helps with Increased
consistency in revenue productivity
& income
Increased
energy demand

Sources: UOMA analysis & interviews supplemented by 1. GIZ’s “Productive Use of Energy – PRODUSE A Manual for Electrification Practitioners”:
https://www.giz.de/fachexpertise/downloads/giz-eueipdf-en-productive-use manual.pdf 2. ESMAP “Maximizing the Productive Uses of Electricity to Increase the Impact of Rural
64 Electrification Programs”: https://www.esmap.org/node/714
Productive Use Overview Insights

Productive use appliances are accessible across the 4 tiers; SHS


providers focusing on tiers 1-2 with increased interest in tier 3
Energy service tiers
W per day
Residential areas largely using lighting, phone charging &
some small appliances (TV, fans, hair clippers, etc.)
Tier 1-2

Larger more business type appliances such


as refrigerators, mills, irrigation pumps.
Tier 3
Continuous, large, guaranteed power draw
(e.g. telecom towers), but few industries of
this size outside of major cities and
Tier 4 telecommunication towers

0 500 1000 1500 2000 2500 3000


Wh/day
• Access programs have typically overlooked tier 3 uses of power because they require substantial capital
expenditure1,2
• However, businesses using tier 3 technology have potential to generate significant energy demand and
positive externalities

Sources: OCA analysis & interviews supplemented by


1. Tier categories are based on the International Renewable Energy Agency’s 2015 definitions, described in “Off-grid Renewable Energy Systems: Status and Methodological Issues”:
65 2 Overview of access programs in Uganda from Open Capital Advisor’s “Ugandan off-grid energy market accelerator”:
Productive Use Overview Insights

Increased opportunity for productive use technologies across


various stakeholders

• Support expansion – cross subsidizing operations in rural areas by diversifying


product range to include higher tier appliances / prod use tech
SHS operators
• Provide the opportunity to support existing customers to move up the energy
ladder and own larger value assets

• Have the potential to significantly, and perhaps sufficiently, supplement residential


Utility &
energy demand, enabling shorter payback periods on capital invested; and as a
mini-grid
result accelerating residential connectivity
developers

• Can be used as a solution to generate increased off-grid energy awareness and


sustainable uptake in rural areas where supply is expensive & communities are
Government predominantly agrarian
• Can increase constituents’ income and improve standard of living

• Can increase synergies across various programs currently supported, (e.g.


Development agriculture value chains, financial inclusion and energy), enabling great impact in
partners consumer income, productivity and economic growth

66
Productive Use Overview Insights

Productive use appliances are distributed by mini-grid operators,


SHS providers & non energy providers through different channels

• Usually set up by communities or mini-grid developers where productive use


appliances are set up and managed at the hub e.g. setting up a milling machine
Business hub or milk chilling machine and charge people a fee for using the appliance

• Independent providers of SHS distribute productive use appliances through their


Standalone agents and distribution centers
appliances • These are usually smaller appliances for individual or household use e.g. small-
scale irrigation pumps, refrigerators

• Specific technologies should be adapted to power generation, production quantities, and local technical
capacity to install, maintain, and repair
• DC appliances considered more energy efficient and compatible with most SHS & mini-grid providers,
however, are more expensive and less accessible on the market
• AC appliances are most readily available on the market especially for large appliances where consideration
for grid connection is made

67
Productive Use Overview Insights

Prod use tech has potential to boost overall demand; agricultural


applications most relevant to building an economic case in UG
Agricultural sector in Uganda employs the majority and provides the highest potential for
impact

Employment by sector
Irrigation Coffee
Agriculture

Percentage
80
Fishing 70
Maize & rice
60
50
40
Carpentry Welding 30
20
Industry

10
Shops & 0
Bakery
businesses Agriculture Services Industry
• Agricultural sector employs over 70% of
Uganda’s work force and has the significant
potential for value addition across the country1
Services

Education Health • Productive use equipment in agriculture could


potentially increase individual monthly
incomes by 30%2

Sources: OCA analysis & interviews supplemented by


1. CIA World Fact Book: https://www.cia.gov/library/publications/the-world-factbook/fields/2048.html
68 2, National Survey and Segmentation of Smallholder Households in Uganda
Productive Use Overview Insights

This section aggregates research & insights from pilots and reports
covering UOMA initiatives

Access to finance Unserved populations Enabling environment

To design programs or set up


To foster a conducive
distribution points for the
business & regulatory
Since quite nascent, unserved, there is an
environment, there is need to
important to consider overarching need to clearly
assess impact of current
financing instruments and define these groups,
policies & standards, identify
awareness to investors to understand their preferences
gaps and advocate for
promote funding in the and challenges, then
suitable policies that could
productive use space determine pathways, and
increase uptake &
associated costs, to reach
participation of stakeholders
them

69
Productive Use Overview Insights 1 Access to finance

Businesses looking to provide productive use technology struggle


to access finance due to internal & external limitations
Internal External

1. Limited business traction 4. Low emphasis on energy demand


• Businesses are at prototype & pilot stage and • Financiers are overwhelmingly focused on
don’t have sufficient traction of operations to increase of household access to energy as
support investor assessment opposed to energy demand
• Investors usually require traction of revenues,
cashflows & customers to assess the business 5. Limited market information on successful
business models
2. Poor management of businesses • Market still nascent with limited information on
• Majority of businesses are not managed successful business models for productive use
professionally, have poor systems for data from which investors can leverage learnings
collection and limited skill for scale • Some investors are not aware of productive use
• Investors are hesitant to finance such opportunities that can be can financed
businesses due to high perceived risk
6. Lack of impact measurement metrics for
3. Unproven business models productive use appliances
• Productive use still nascent and businesses • Financiers hesitant to invest due to lack of
don’t have proven models with clear visibility standardized impact measurement metrics to
on customers, distribution strategies, revenues, evaluate impact created on customers through
etc. productive use

70
Productive Use Overview Insights 1 Access to finance

In order to promote productive use tech, important to train SMEs &


support pilot execution through innovative financing mechanisms
1 Offer technical support to businesses to develop efficient systems for data collections and build
strategies for growth to attract more financing
Support operators to increase their chances of raising capital for productive use projects; for example,
businesses can be supported to develop data collection tools for traction & business plans for investor outreach

2 More concessional and grant financing to support businesses run pilots and incentive programs to
encourage innovation for high-potential industries
Providing more concessional financing, grants & equity required by industry players and manufacturers to
test opportunity within significant industries like agriculture; opportunity exists to encourage manufacturers
through challenge competitions & local testing

3 Develop innovative financing mechanisms like guarantees to stimulate private sector sales
Developing innovative financing mechanisms to incentivize businesses to supply productive use appliances;
opportunity exists to use guarantees to mitigate a portion of default risk equipment providers face when
appliances are offered to customers on credit

4 Further market research needed to help identify investment gaps and explore productive use
opportunities
More information in this nascent sector will help operators and investors fully understand and take
advantage of potentially large market, and stimulate innovation of highly-scalable business models

71
Productive Use Overview Insights 2 Unserved populations

Based on consumer pilots conducted, we identified key themes


influencing consumer uptake of productive use technologies

How affordable is the purchase & installation of productive use technologies for
Affordability consumers?
• Many consumers such as rural farmers that require technologies to increase productivity,
don’t have stable incomes to make high capital investments; need credit financing

Do products suit consumer needs and meet quality standards required?


Suitability & • With high initial investment, consumers are keen to have quality products with low
adaptation maintenance and suitable features like autonomy, low energy consumption, etc.
• Also key to assess consumer behavior as a driver of adaptability to new technologies

Are consumers aware of products available & their impact on businesses? Do consumers
Awareness & have skill required to spur enterprise sustainability?
training • Consumers ought to be aware of products & value of productive use to utilize available
opportunities; require technical & business training to manage enterprises effectively

What are the most effective distribution strategies for productive use technologies?
Distribution • Operators require cost effective distribution channels that increase uptake while
maintaining affordability of technologies; need to be coupled with technical & ongoing
consumer support

72
Productive Use Overview Insights 2 Unserved populations

Affordability: Possible to tackle affordability challenges of productive


use through innovation of business-specific PAYGo models
High cost of products key hinderance of uptake Potential to increase affordability through PAYGo

Important to understand factors driving high costs Operators can leverage PAYGo model used for SHS
of productive use technologies to increase affordability of productive use
• Most products are imported and have high • Learnings from PAYGo solar solutions can be
initial costs of production and distribution transferred to productive use to increase
– Operators transfer cost burden to affordability
consumers in form of high prices, reducing • To do this, operators would need to understand
affordability consumers and sector-specific nuances for
• Locally manufactured products are often successful implementation
inefficient and of poor quality – What is the revenue potential and income
– Ongoing costs incurred to cater for repairs cycle of the consumer?
& maintenance are expensive in the long run – What payment structures will positively
– Foreign products run risk of high impact customer cashflows and increase
maintenance costs due to lack of skilled ability to pay?
technicians – How do operators assess credit worthiness
• Productive use tech requires supplementary of customers and potential impact of
costs to be effectively maximized default?
– Additional costs like installation, technical & – Is use of productive use asset economically
training costs also contribute to overall feasible and viable, etc.?
affordability

73
Productive Use Overview Insights 2 Unserved populations

Affordability: To develop flexible payment models, operators need to


assess business models, product types and target consumers
From pilots conducted, we identified key findings on consumer payment of productive use appliances
• Consumers found down payments too high to be paid in a lumpsum; introduction of short payment tenors
(weekly) for down payments influences uptake and makes products more affordable;
• Consumers like farmers were unable to meet additional costs like installation; these can be catered for by
operators to gain customer trust and create brand awareness

Operators require in-depth knowledge of business needs, target consumers & product types to develop
sustainable payment structures
Understand business models of consumers, production processes and income cycles
• Businesses have varying income cycles and revenues based on products / services offered, business
stage (early stage, mid sized) and market available
• Operators need to assess cashflows for different consumer groups like farmers who are more inclined
to seasonal payments during harvests
Assess willingness & affordability to pay of target consumers through product pilots
• From surveys, some customers were willing to pay installments outstanding during after sales services
as opposed to mobile money payments as they found it more convenient
• Important to also assess income levels and social factors that influence affordability & willingness to
pay when developing PAYGo structures
Modify products to suit businesses across size, functionality & capacity, etc.
• From our surveys, product features like size, and complexity in functionality informed prices; usually
larger sized appliances with difficult functions were more expensive than small, easy-to-use products
• Operators will need to align products to match affordability & needs of customer groups

74
Productive Use Overview Insights 2 Unserved populations

Suitability & adaptation: Consumers consider product quality,


functionality and adaptability when making purchase decisions
• Consumers considered quality as an indicator of product suitability; quality products were
characterized by low maintenance & minimal technical support
Quality
• Quality products had little or no downtime, creating high impact like increased revenues,
farming yields, etc.
• Energy efficient products were considered suitable due to lower energy costs associated
Suitability

Energy with running the appliance especially when powered by mini-grids


efficiency • Operators need to match products with consumer energy needs, power generation &
required production quantities
• Easy-to-use products were considered suitable as they were easily adopted; consumers
were inclined to purchase products that could be used after one initial training
Functionality
• Consumers like farmers, required multipurpose functionality to mill a variety of grain
types, hull to separate grains from husks, etc.

• Consumers easily adapted to technologies they deemed valuable; for example, farmer
Consumer
change in technology was influenced by technical training though demonstrations or
Adaptation

perception
successful pilots with neighboring farmers

• Social beliefs hindered adaptation of technologies; for example, communities that


Social beliefs believed women shouldn’t run businesses made it difficult for them to adapt to new
appliances

Other factors like availability of land, water & technical expertise need
to be considered
75
Productive Use Overview Insights 2 Unserved populations

Awareness & training: Targeted information campaigns and technical


& business training are necessary for success of productive use
To influence productive use uptake, target-oriented communication is needed across 4 key areas:

Impact of productive Appropriate use of


Consumer awareness Business development
use technologies

• Conduct well targeted • Provide information • Provide information • Offer


information on the relevance of on technologies entrepreneurship
campaigns to expose new technologies to available, quality & training & coaching
consumers to the increase uptake providers available to prepare consumers
concept of productive • Understand whether: • Support consumers for roles as business
use – Target groups choose cost-effective owners
• Operators need to have basic technologies that suit • Support includes,
assess: knowledge about their needs development of
– Who is the target the importance • Offer technical business plans,
group? of new training on product pricing,
– What technologies? appropriate use of assessment of profits
information – There are any technologies through & turnover, etc.
needs to reach other convincing demonstrations,
the targeted arguments in product pilots, etc.
group, etc.? addition to
profit?

Sources: 1. Energy for Development, GIZ. An Overview of Technology Options and Approaches for Promotion, http://www.euei-
76 pdf.org/sites/default/files/field_publication_file/Productive_Use_of_Thermal_Energy_Overview.pdf
Productive Use Overview Insights 2 Unserved populations

Awareness & training: To scale productive use uptake, it’s necessary


to leverage partnerships to conduct awareness campaigns

1 Important to consider the right type of partnerships to create consumer awareness


• Campaigns were easily conducted through partnerships with existing groups like savings & farmer groups;
this supported outreach to large numbers of consumers
• Increased referrals once products were piloted since groups with similar needs shared information amongst
themselves

2 Technical support required on case-by-case basis to choose suitable products


• One-on-one guidance when choosing appliances was necessary to assess consumer needs like capacity
required, power consumption and investment need to purchase machinery
• Consumers were also not aware of products available and distributors of quality which was necessary to
make purchase decisions

3 Important to communicate the relevance and impact of productive use appliances


• Consumer decisions were largely driven by understanding the economic and social importance of productive
use appliances
• Consumers were keen on understanding how they can increase their incomes, farming yields, customer base,
etc.

4 Products work best with entrepreneurs that had received both technical & business training
• Such consumers understood the benefits of the product and were willing to increase uptake as well as
influence other community members

77
Productive Use Overview Insights 2 Unserved populations

Distribution: Operators can leverage learnings from PAYG to pilot


cost-effective distribution models for productive use
1. Distribution partnerships 2. Product bundles

• Operators can partner with grass root


• Regular SHS products can be bundled with
structures like savings, farmer & women
productive use appliances to increase
groups that reach rural populations
distribution
• Operators can also partner with MFI’s,
• For example, portable saloon kits can be sold
especially those with rural presence, to
together with solar lamps
distribute productive use appliances coupled
with financing

3. Agent models

• Equipment providers can deploy sales agents


in different communities to distribute
products to customers and offer technical
training
• Local sales agents are usually effective as
they have community context

78
Productive Use Overview Insights 3 Enabling environment

Important to address challenges at regulatory level that hinder


acceleration of productive use technology

Develop • Develop policies & standards to increase credibility of the market and attract
policies & financiers to support innovations
standards

• Create awareness to ensure market is not saturated with poor quality


appliances; awareness increases affordability when tax exemptions are
utilized
Create • Provide business training to businesses in order to ensure appliances are
awareness on income generating
policies

• Introduce subsidies to increase affordability of productive use appliances,


government should introduce subsidies on imported products
Offer • Introduce government programs to encourage local manufacturing of quality
subsidies on products to make appliances more accessible
products

79
Industry stakeholders

80
Industry stakeholders Operators Financiers Dev partners Government Others

There are a number of private sector players in both the SHS &
productive use technologies in the off-grid energy space

Solar Home Systems Productive use Mini-grids

P Mandulis
L Energy
A
Y
E
R
S

The private sector plays a vital role towards achieving universal electricity access through off-grid in
Uganda

81 Sources: Various company websites, OCA Team analysis, https://www.energy4impact.org/file/2039/download?token=8ardN8he


Industry stakeholders Operators Financiers Dev partners Government Others

Associations: Represent private sector interests, advocate policy


issues to government
Uganda National Renewable Energy and Energy Efficiency Alliance is an umbrella body whose aim is to avail a platform that
consolidates Uganda energy sector leadership
Mandate & description Membership & capacity
• >100 members consisting of engineers running
USEA • Seeks countrywide mobilization of solar
local businesses and solar product distributors;
Uganda Solar providers, coordinating stakeholders, playing an
receives targeted support from dev partners like
Energy Association advocacy role and capacity building
RECP, DFID, UNCDF & PSFU
BEETA
• Promotes biomass energy efficient technologies • 50 member companies involved in production of
Bio-mass Energy
through networking, sharing information, and biomass efficient technologies, such as briquettes
Efficient
developing knowledge among member & stoves, & institutions involved in research and
Technologies
organizations / individuals development of biomass energy
Association
HPAU
• Champions hydropower development in the • Membership open to private sector companies,
Hydropower
hydropower sub-sector through advocacy, organizations & associations, consumers, & policy
Association of
capacity devt & resource mobilization makers; receives support from GIZ, CREEC, & WWF
Uganda
EEAU
• Aims to foster provision for quality energy • Large capacity of technical members working to
Energy Efficiency
efficiency services, enhancing research, get association accreditation to certify Energy
Association of
innovation & knowledge transfer Efficiency Professionals in the country
Uganda
UNBA • Seeks to unite and support stakeholders as well • National umbrella organization of the UG biogas
Uganda National as existing regional associations in the biogas sector; four associations organized according to
Bio-gas Alliance sector regions, supported by partnership with GIZ

82 Source: UOMA interviews & consultations, http://unreeea.org


Industry stakeholders Operators Financiers Dev partners Government Others

Associations: Represent private sector interests, advocate policy


issues to government
Organization Work in Uganda

• UNREEEA is an NGO for profit incorporated 2014 as result of the private sector
players in the various renewable energy and energy efficiency sub-sectors signing
a memorandum of understanding to come under one umbrella body. The primary
role of the Uganda National Renewable Energy and Energy Efficiency Alliance
(UNREEEA) is to avail a platform for consolidating the renewable energy and
energy efficiency private sector wing as well as improving its business
environment

• The association members of UNREEEA include: Biomass Energy Efficient


Technologies Association, Uganda National Bio-gas Alliance, Hydro-Power
Association of Uganda, Uganda Solar Energy Association, Energyy Efficiency
Association of Uganda, Wind Power Association of Uganda

• The alliance aims to among other objectives:


• Identify and disseminate best practices related to market development for
renewable energy and energy technologies in Uganda.
• Establish permanent working relationships with government institutions,
civil societies as well as other sector stake-holders in the energy sector.
• Initiate and upgrade a strong private sector led approach in the
development of the renewable energy sub-sector in Uganda

Source: UOMA interviews & consultations, supplemented by https://www.gogla.org/ , http://sendea.org/ , http://www.sun-connect-news.org/articles/business/details/a-new-support-


83 for-solar-entrepreneurs-sendea/
Industry stakeholders Operators Financiers Dev partners Government Others

Associations: Represent private sector interests, advocate policy


issues to government
Organization Work in Uganda

• Uganda Solar Energy Association was formed by companies operating in the


solar sector with support from the Private Sector Foundation Uganda and had
120 members by end of January 2019.
• The aim of USEA is to facilitate business growth and promote self regulation and
aimed at spurring off-grid solar industry-led advocacy and coordination to
support universal energy access

To further its’ objective, USEA has partnered with the following organizations:
• USAID’s Power Africa Uganda Electricity Supply Accelerator – supporting
USEA in solar market development, public awareness and promotion, creating
linkages through the supply chain, business development and capacity and
monitoring and evaluation
• UNCDF/DFID – market sales data collection in collaboration in with GOGLA &
Dalberg data insights to run a data collection pilot for the sector, business
development services, media and PR campaign to increase visibility and reach
and tax advisory services in conjunction with URA & government to develop a tax
handbook
• PSFU/WORLD BANK - Through the World Bank Energy for Rural Electrification
project (implemented by PSFU), USEA has obtained support in setting up the
secretariat infrastructure, hiring staff and providing HR & Finance Expertise as
well as TA in business strategy and financing models to adopt for an association

Source: UOMA interviews & consultations, supplemented by https://www.gogla.org/ , http://sendea.org/ , http://www.sun-connect-news.org/articles/business/details/a-new-support-


84 for-solar-entrepreneurs-sendea/
Industry stakeholders Operators Financiers Dev partners Government Others

Financial institutions & donors provide capital to the off-grid sector


to enable scale
Many investor types exist with several active players; some examples below
Typical ticket size (USD)
Large PE funds

10M DFIs

Dev partners

PE funds & Impact investors


5M

Foundations
Local banks

1M

Concessionary Commercial
Grants Equity Quasi
debt capital

85
Industry stakeholders Operators Financiers Dev partners Government Others

A number of organizations have funds in place with an energy focus


in Uganda
Organization Focus Areas Instruments Capital Companies
Used committed in EA invested in
Bamboo Capital Clean energy through innovative Equity $52M BboX
Partners disruption Debt Greenlight Planet
Off-grid technology
OikoCredit Off-grid solar Debt $90M Bbox
Off-grid projects focusing on Equity PEG Africa
SDG7 SolarNow
Clean cooking

Crossboundary Aggregate finance for medium Equity $33M Garden city


Energy scale renewable self-generation Kigali Genocide
projects Memorial

Symbiotics Unspecified Debt ~$45M M-KOPA


Zola-Electric
Cordiant Capital Unspecified Debt $564 Off-grid Electric
(now Zola-electric)
CDC Group Renewable energy Debt ~$27.5M Off-grid Electric
d.Light
M-KOPA
Nordic Funds Unspecified Equity ~$15M M-KOPA
Debt

86
Industry stakeholders Operators Financiers Dev partners Government Others

Many recent debt deals in the region


Investor Company Amount Date
SunFunder, responsibility, Oikocredit SolarNow US$9m 2019
EIB d.Light US$29m 2018
ElectriFI, TRINE Azuri US$20m 2018
Bamboo Capital Partners BBOXX US$50m 2018
responsAbility Mobisol US$12m 2017
Stanbic Bank, CDC, FMO, Norfund, Triodos, responsAbility, Symbiotics M-KOPA US$80m 2017
Banque Populaire du Rwanda (Atlas Mara) BBOXX US$2m 2017 >$600M debt
SunFunder SolarNow US$2m 2016 financing in East
Oikocredit BBOXX US$5.3m 2016 Africa over the last
Packard Foundation, Ceniarth, the Calvert Foundation Off-Grid Electric US$45m 2016
few years
OPIC SunFunder US$15m 2016
demonstrate
CBA M-KOPA US$4m 2016
increasing
responsAbility Off-Grid Electric US$18m 2016
SunFunder d.light US$2.5m 2016
bankability of off-
OPIC, Rockefeller Foundation, MCE Social Capital SunFunder US$21m 2016
grid sector,
Developing World Markets d.Light US$7.5m 2016
particularly SHS
Oikocredit, responsAbility PEG Africa US$1.5m 2016
OPIC Nova-Lumos US$50m 2016
Developing World Markets Off-Grid Electric US$7.5m 2016
DEG Mobisol Undisclosed 2015
LGTVP-led M-KOPA US$6m 2015
Oikocredit BBOXX US$0.5m 2015
IFC Off-Grid Electric US$4.5m 2015
Cordiant Capital Off-Grid Electric US$2.5m 2015
Centenary Rural Development Bank SolarNow Undisclosed 2015
Acumen SolarNow US$1.4m 2014

87 Source: UOMA interviews & research; all data publicly available


Industry stakeholders Operators Financiers Dev partners Government Others

A number of facilities have been set up in the region to promote the


off-grid energy sector (1/7)
Region
Fund/Facility Purpose Focus Instrument Fund Size
Focus

Hand-held solar Equity $64M East & West


Support, scale and learn power, cook stoves, Debt Mezzanine Africa
Acumen Fund from innovative energy off-grid, home Grants
companies over 3 yrs systems, bio-
gasification systems

Mobile for Seed grants and


Test & scale the use Grant $2.6M SSA
Development market validation
of mobile to increase grants
Utilities access to energy,
Innovation Fund water and sanitation

Specialist debt East and West


financing partner for Debt
$50M Africa
SunFunder solar companies active Off-grid, productive
in off-grid residential, use and C&I solar
commercial & industrial

Highly energy-efficient, SSA


Global LEAP durable, off- and weak- Productive use Grant £100k
awards grid appropriate
refrigerators

88
Industry stakeholders Operators Financiers Dev partners Government Others

A number of facilities have been set up in the region to promote the


off-grid energy sector (2/7)
Region
Fund/Facility Purpose Focus Instrument Fund Size
Focus

Provide commercial
$75M SSA
capital and advisory to
SIMA Fund for High risk, earlier Debt
energy businesses with
Off-grid Solar stage businesses
financial, social, and env.
impact.

Provide local
currency lending for Debt $100M Africa
Solar Frontier PAYG companies
pay-as-you-go off-
Capital grid solar companies
across sub-Saharan
Africa.

The household
Catalyze local financial energy access Debt SSA
Off-grid Energy markets’ support for sector including $500M
Access Fund innovative energy distributors,
access strategies manufacturers &
credit providers

Dependent
Invest in solar energy in on co. & SSA
Solar Energy Crowdfunding funds
TRINE growing markets
refrigerators raised

89
Industry stakeholders Operators Financiers Dev partners Government Others

A number of facilities have been set up in the region to promote the


off-grid energy sector (3/7)
Region
Fund/Facility Purpose Focus Instrument Fund Size
Focus

Support, scale, and learn Energy generation Common & $20M East & West
Pioneer Energy (SHS, Solar & hybrid Preferred Equity, Africa
from innovative energy
Investment mini-grids) & Energy Convertible Debt
companies over the next
Initiative usage (Innovations
three years.
for energy use)

Dev. of state of the


Energy art tech., products & SME’s Mezzanine Debt $50M SSA
Entrepreneur processes in energy Incubation support
Fund efficiency, power
generation, heat and
electricity storage

Solar, biomass,
Provide working capital Equity & Quasi- Kenya, Ug, Tz
ResponAbility geothermal & wind
to manufacturers & equity $30M &Rwanda
Energy Access distributed
Fund distributors of modern generation (captive
energy products generation & mini-
grids)

Small hydro, wind, SSA excluding


Increase renewable $10-
African geothermal, solar, SA
energy generation in Equity $30M/co
Renewable stranded gas and
Africa.
Energy Fund biomass projects)
refrigerators

90
Industry stakeholders Operators Financiers Dev partners Government Others

A number of facilities have been set up in the region to promote the


off-grid energy sector (4/7)
Region
Fund/Facility Purpose Focus Instrument Fund Size
Focus

Supports and accelerates


$1M SSA
innovation in off-grid Grant
Efficiency for
and weak grid appliance Productive Use
Access Coalition
technologies and
markets.

Facility for SME’s Mezzanine Debt $50M SSA


Energy Inclusion Development of state Incubation support
Off-Grid Energy of the art tech.,
Access Fund electricity storage

Geothermal, Grants blended


EU-Africa Mobilizes additional hydropower, solar with long-term SSA
finance for & wind power, financing ~$920M
Infrastructure
Trust Fund infrastructure projects transmission lines,
in sub-Saharan Africa sustainable cooking
fuels

Encourages and Energy, Transport Senior,


Emerging Africa mobilizes private Water & Sanitation subordinated SSA
~$1.2M
Infrastructure investment in ICT, Agribusiness & or mezzanine
Fund infrastructure in SSA to Mining debt
promote economic dev.

91
Industry stakeholders Operators Financiers Dev partners Government Others

A number of facilities have been set up in the region to promote the


off-grid energy sector (5/7)
Region
Fund/Facility Purpose Focus Instrument Fund Size
Focus

Provide flexible, tiered Not


Development available Global
grant funding to test and Grant
Innovation scale evidence-driven Sector agnostic up to
Ventures innovation to any $5m/co
development challenge

Supporting private-
Sustainable sector led economic Grant and equity $95M SSA
Clean energy
Energy Fund for growth through the
Africa efficient utilization of
untapped clean
energy resources.

Mobilizing additional Not


finance for SHS co.s Grant available Uganda
USAID-Derisking
that wish to expand PAYG SHS $145k-
PAYGO
sales of PAYGO SHS in 175k/co.
refugee settlements

Catalyzing financing for Irrigation co.s


Grant, Debt, Not stated
businesses providing operating at the SSA
AlphaMundi Equity or $100k-
clean energy solutions nexus of clean
Foundation – mezzanine $2m/co
that inc. ag. productivity energy &
Powering Ag financing
and/or value in agriculture
developing countries.

92
Industry stakeholders Operators Financiers Dev partners Government Others

A number of facilities have been set up in the region to promote the


off-grid energy sector (6/7)
Region
Fund/Facility Purpose Focus Instrument Fund Size
Focus
Cloud-based platform,
aiming to provide $5M Africa
developmental Equity
BEAM
infrastructure for off-grid Off-grid energy
energy services across
SSA

Design & implement Not


Grant Uganda
Solar Electric solar energy Solar available
Light Fund solutions to assist
people living in
poverty

SMEs active in EA and


Equity
electricity generation Southern
Energy Access SHS, Micro-grid Quasi-equity $55M
and distribution, and Africa
Venture Fund infrastructure &
electricity related hybrid technologies
services in SSA

Irrigation co.s EA and


Address innovation Grant, Debt,
operating at the Southern
challenges that Equity or $0.5M
The EnAccess nexus of clean Africa
renewable energy co.s mezzanine
Foundation energy &
face through lack of financing
agriculture
financing

93
Industry stakeholders Operators Financiers Dev partners Government Others

A number of facilities have been set up in the region to promote the


off-grid energy sector (7/7)
Region
Fund/Facility Purpose Focus Instrument Fund Size
Focus
Providing attractive loan
financing for businesses $50M Africa
Biodiversity that can demonstrate Equity
Investment Fund impact or contribution Off-grid energy
towards biodiversity in
Uganda
Giving support in
energy policy, Pico PV & SHS No info €12.25M Uganda
EnDev Uganda improved biomass Grid densification
technologies, rural
electrification &
energy efficiency.

Not EA and
Providing early stage & Grant available Southern
EEP Africa catalytic financing to €200k – Africa
innovative clean energy Solar PV
500k/co.
projects, technologies

Developing,
Equity or SSA
constructing and $60M
Frontier Energy II Renewable energy mezzanine
operating renewable
Fund debt
energy generation
projects

94
Industry stakeholders Operators Financiers Dev partners Government Others

The European Union is supporting a number of programs to


influence the private sector and advance off-grid access (1/2)
European Union Target Target action Approach Results to date Affiliated
(EU) Industry organizations
• 1341 SHS sold
Scaling–up rural • Scale up the use of • Provide business Implementers:
electrification using SHS solar PV systems at training & specific • Solar systems (1000W WWF in partnership
innovative solar schools, health centers, solar PV energy each) installed in 31 with Kasese District
photovoltaic (PV) Mini- and business levels in training to CBOs schools and 20 health Local Government
distribution models1 grids the districts of Kasese, • Provide 51 social centers in 6 districts and Enterprise
Arua, Masindi and 17 • Contractor selected for Uganda Foundation
institutions with
other districts in installation & mgmt of
solar PV systems
Ongoing Albertine & build local 6 mini grids Funders:
capacity to install & • Set up solar mini- ACP-EU
maintain solar PV grids in 6 trading • Capacity of CBO’s to
systems centers in Kasese install & manage solar
and Rubiziri photovoltaic
districts tech. strengthened

Access to energy • Sustainable • Provide a no. of social • 2924 ha of woodlots & Implementers:
services in rural and SHS management of bio institutions with energy orchards established Church of
peri-urban areas in – energy resources, efficient cooking stoves within by the project & Sweden in
Northern Uganda increasing use by and solar systems a no. of tree Partnership
(Teko Wa Project) 2 Cook households and • Disseminate, in co-op seedling biz. set up with Lutheran
stoves social institutions of with private co.’s, SHS &
cooking stoves to • 35,366 households & 24 World
Ongoing solar PV energy and Federation
households institutions accessed
energy efficient
Bio
• Inc. awareness & build energy efficient stoves Uganda
fuels cook stoves
capacities of • 25,750 households & 24 Funders:
local communities in institutions accessed EU
sustainable mgmt. of with SHS for lighting
bio- energy resources
95
Industry stakeholders Operators Financiers Dev partners Government Others

The European Union is supporting a number of programs to


influence the private sector and advance off-grid access (2/2)
European Union Target Target action Approach Results to date Affiliated
(EU) Industry organizations
Providing access to • Project focused on • Disseminate solar PV • Distribution of clean Implementers:
modern energy for SHS increasing the use and improved stoves cookstoves to hhs GIZ
northern Uganda of solar PV, • Build capacity for • Street lighting project
(PAMENU)1 On- improving Funders:
intermediaries & in Yumbe Town
grid household ACP-EU
training of local stove Council
Completed cookstoves and builders
Cook mini-hydro power • Construction of the
stoves for small grids • Create awareness pico-hydro power sites
campaigns
• Provision of health
• Coordinate centers with solar PV
installation of MHP & drug storage
and mini-grids

Scaling up access to • Working to scale up • Provide a number of • The project has 3460 Implementers:
modern electricity SHS access, in the households and SMEs new SHS customers in Foundation
services on a predominantly rural, with access to energy Mali and Uganda (42% Rural Energy
regional scale in poor communities services via SHS and of the target). Target Services
rural Sub-Saharan of the targeted solar mini-grids achieved in Mali and Funders:
Africa by means of a countries in 60% customers ACP-EU
• Facilitate bi-annual
fee for service Mini- Cameroon, Mali, recruited in Uganda.
workshops for areas
business model2 grids Uganda & Guinea- in the four countries • 4,496 SHSs have been
Bissau concerned installed in Mali,
Ongoing Guinea-Bissau and
Uganda.

96
Industry stakeholders Operators Financiers Dev partners Government Others

World Bank has partnered with the government to implement the


15 year ERT initiative to improve lives of rural households
World Bank Target Target action Approach Results to date Affiliated
Industry organizations
Energy for Rural • Increase access to Off-grid • USD 8.5 million fund Implementers:
Transformation SHS electricity in rural component: to be disbursed to REA, MOWE,
Phase III (ERT-3)1 Uganda, with • Installation of local banks to MOH,MOESD,
focus on three solar PV systems provide working UECCC, PSFU,
Ongoing On- components: for public capital financing to MEMD
grid — On grid access institutions in SHS PAYG operators
— Off-grid rural areas Funders:
Mini- access • Business World
grids — Institutional development Bank/GEF
strengthening support
through • Provision of credit
impact facilities
monitoring • Quality standards
enforcement
support

Sources: UOMA interviews & consultations, supplemented by


97 1. http://www.energyandminerals.go.ug/downloads/ERDreportERTII1.pdf; http://projects.worldbank.org/P133312?lang=en
Industry stakeholders Operators Financiers Dev partners Government Others

Add’ly, World Bank runs independent programs to advance access


& create a conducive environment for private sector growth
World Bank Target Target action Approach Results to date Affiliated
Industry organizations

Lighting Africa • Enable access to off- Catalyze the market • Market assessment Implementers:
Campaign1 SHS grid lighting and through: study to determine Broad global
energy products for demand for solar alliance – imps.
• Market intelligence
Ongoing 250 million people products, market varying by
across sub-Saharan • Quality assurance bottlenecks, & country
Africa by 2030 • Access to finance assess options for
supporting the Funders:
• Consumer education growth World Bank /
• Business development • Consumer IFC
support awareness
• Policy & regulation campaigns
• Supporting UNBS in
adopting and
enforcing
internationally
recognized
standards
• 2M people
impacted, ~920k
quality veified
products sold &
~185k GHG gas
emissions avoided

Source: UOMA interviews & consultations, supplemented by


98 1. https://www.lightingafrica.org/country/uganda/,
Industry stakeholders Operators Financiers Dev partners Government Others

USAID’s Power Africa is playing a crucial role in leading and


coordinating initiatives in Uganda (1/4)
USAID / Power Target Target action Approach Results to date Affiliated
Africa Industry organizations

The Power Africa • Facilitate the • Supports • Organized the 2nd Implementers:
Uganda Electricity SHS increase of clean generation and Project East Africa Energy and
Supply Accelerator energy electricity access projects summit in Security Group
Mini- generation and through grants, collaboration with
grids electricity access transaction the Office of the Subcontractors:
Ongoing among rural and advisory support, Prime Minister NRECA
On- urban short term International,
grid technical • Supporting REA in Nexant, African
communities in
assistance and the promotion of the Solar Designs
Uganda by
linkages with ECP* by supporting and Konserve
working with
other Power publishing/airing of Advisory
clean energy
Africa partner public information Services
generation and
tools messages
access project
developers to • Supported USEA and Funders:
reach financial UNCDF effort to Power Africa,
close and project create solar GE Africa
commissioning, awareness hotline
• And enhance the • Supported Mandulis
enabling Energy in technical
environment for proposal to AfDB
clean energy
investment

99 Sources: UOMA interviews & consultations,


Industry stakeholders Operators Financiers Dev partners Government Others

USAID’s Power Africa is playing a crucial role in leading and


coordinating initiatives in Uganda (2/4)
USAID / Power Target Target action Approach Results to date Affiliated
Africa Industry organizations

Quality Assurance • Address some of the • Provide a flexible • Provided a formalized, Implementers:
Mini- root challenges of alternative to rigid common standard for NREL, DOE
Framework for
grids providing safe, top-down classifying energy
Mini-Grids1
quality, and standards by consumers Funders:
Ongoing financially viable defining: • Facilitated aggregation Power Africa,
mini-grid power − Levels of of mini-grid projects & Global LEAP
systems to remote service unlock private
customers framework investment from data
− Accountability generated
and • Supporting
performance implementation of
reporting consumer protections,
framework thus a better consumer
service
Last Mile • Incentivize solar • Exploring results- • Work will soon begin Implementers:
Distribution Results- home system based incentives after approach is EnDev
SHS companies to finally defined
Based Finance • Approach to be
more rapidly defined in the Funders:
Beginning expand into coming months USAID
commercially
viable last-mile
markets

100 Source: UOMA interviews & consultations


Industry stakeholders Operators Financiers Dev partners Government Others

USAID’s Power Africa is playing a crucial role in leading and


coordinating initiatives in Uganda (3/4)
USAID / Power Target Target action Approach Results to date Affiliated
Africa Industry organizations

Electricity • Rapidly increase • Develop 12 new • The first three Implementers:


Expansion and SHS electricity access master plans for masterplans NRECA, REA
Improvement in its rural areas all the rural completed&
program service territories identified over 100 Funders:
Mini- in Uganda mini-grid sites in Power Africa
Ongoing grids • Support REA to only three service
the develop a territories
On- connections • > 120,000 new
grid policy connections
• Support REA to identified within the
develop an Off- existing distribution
grid Policy footprint
• Electricity
Connections Policy
developed could
add 1,400,000 new
connections by 2022

• Connections policy
& implementation
plan developed

• Options Paper draft


presented to REA
and stakeholders

101 Sources: UOMA interviews & consultations


Industry stakeholders Operators Financiers Dev partners Government Others

USAID’s Power Africa is playing a crucial role in leading and


coordinating initiatives in Uganda (4/4)
USAID / Power Target Target action Approach Results to date Affiliated
Africa Industry organizations

Uganda Electricity • Support the • Develop a practical Held technical Implementers:


Mini-
Regulatory development of a guide to the workshop to: NARUC, ERA
grids
Partnership1 regulatory and regulatory • Examine
policy framework for treatment of mini- international best Funders:
Ongoing electricity access grids to outline the practices on mini- USAID / Power
with focus on the practical issues and grid technical Africa
role of mini-grids to potential decision- requirements (e.g.
address the making tracks for interoperability,
electricity needs of regulators compatibility)
rural customers • Develop an outline
• Implement a
technical workshop on mini-grid
on mini-grid technical
technical, requirements,
performance and interconnection to
interconnection the national grid and
guidelines to assist business models for
ERA in developing interconnection,
tailored technical power quality, and
and performance service quality
guidelines for • Developed an
mini-grid providers outline for mini-grid
of electricity in regulation
rural service
territories

Source: UOMA interviews & consultations, supplemented by


102 1. https://www.naruc.org/international/where-we-work/africa-middle-east/uganda
Industry stakeholders Operators Financiers Dev partners Government Others

DFID initiatives work to increase investment in off-grid energy


firms, overcome regulatory barriers & foster innovation
DFID Target Target action Approach Results to date Affiliated
Industry organizations
Energy Africa • Accelerate • Campaign to • Coordinated & signed Implementers:
Campaign1 SHS expansion of improve policy and Energy Africa Compact MEMD, DFID,
household solar support conditions with Ug government REA, SE4ALL,
Ongoing market to help bring to accelerate and other stakeholders USEA, USAID /
Mini- universal electricity market-based SHS making commitment Power Africa,
grids access in Africa delivery to address several UNCDF, et al.
forward from 2080 • Core tool is Energy challenges facing the
on current trends to Africa Country SHS market Funders:
2030 Compacts matched • Market assessment to DFID
with a coordinated be conducted in all
multi-donor support countries in then
offer campaign
Transforming • Address critical • Partnership with Shell • Shell Foundation Implementers:
Energy Access SHS evidence gaps, test Foundation to support created Uganda Off- Shell
(TEA)2 innovative technology private sector Grid Energy Market Foundation,
applications, business innovations Accelerator to advance Innovate UK
Cook models, financing, & • off-grid access
Support Innovate UK’s
Ongoing stoves skills development to Funders:
Energy Catalyst to • Testing P2P Solar
accelerate the DFID
stimulate technology crowding platform
Bio provision of innovation
affordable, clean • Scoping potential
fuels
energy based services • Build other strategic partnership with Gates
to poor households & innovation partnerships Foundation on Mission
enterprises Innovation

Sources: UOMA interviews & consultations, supplemented by


1. https://www.gov.uk/government/news/energy-africa-campaign; https://www.contractsfinder.service.gov.uk/Notice/1a44f944-fe22-4e77-b300-2da4fbb6068e
103 2. http://energyaccess.org/news/recent-news/applied-research-program-transforming-energy-access/
Industry stakeholders Operators Financiers Dev partners Government Others

DFID initiatives work to increase investment in off-grid energy


firms, overcome regulatory barriers & foster innovation
DFID Target Target action Approach Results to date Affiliated
Industry organizations
Africa Clean Energy • Catalyze a market • Provide TA to • REACT-HS awarded Implementers:
Program (ACE) SHS based approach for improve the US$ 7.4 million to 10 AECF, TBC, IFC,
Ongoing private sector enabling household solar co.s DAI
delivery of solar environment for mkt with 8 disbursements Funders:
home system (SHS) based approach for beginning DFID
products and private sector • Compact actions
services which will delivery of SHS aimed at improving
lead to improved • Finance businesses policies & regulations
energy access to wanting to enter that facilitate a market
people in SSA who new and emerging approach to solar
are currently without SHS markets in SSA energy implemented
modern energy in 7 countries
Renewable Energy • Incentivising private • Facilitates a market • Helping to Implementers:
SHS sector delivery of AECF
and Adaptation to driven approach to demonstrate the
Climate low cost clean increased energy access viability of many of Funders:
Technologies energy and climate through off-grid the companies that DFID
(REACT) Window, adaptation renewable energy, as have accessed
Africa Enterprise technologies to help well as increasing commercial
Challenge Fund rural beneficiaries resilience & adapting to investment (e.g. M-
Ongoing adjust to climate climate change in rural KOPA, Mobisol and
change and escape areas Off-Grid:Electric)
poverty using grant
funding to catalyse
greater investments
into these sectors

104 Sources: UOMA interviews & consultations


Industry stakeholders Operators Financiers Dev partners Government Others

Embassy of the Netherlands runs programs to support the private


sector & advance energy access
Netherlands Target Target action Approach Results to date Affiliated
Industry organizations

Milking the Sun & • Provide dairy and • Subsidy to provide • Over 10,000 systems in Implementers:
Harvesting the Sun1 crop farmers and farmers with access to collaboration with lead Solar Now,
SHS their households 37,000 solar products partner Solar Now Barefoot Power,
Ongoing with high quality, with reliable after Uganda Crane
affordable and sales service Creameries
Solar sustainable solar Cooperative
agric. lighting systems and Union & other
app solar powered value chain
agricultural managers
appliances
Funders:
Government of
Netherlands

105 Sources: UOMA interviews & consultations


Industry stakeholders Operators Financiers Dev partners Government Othrs
Others

UNCDF’s global CleanStart program has partnered with other dev


partners to provide financing to local businesses & advance access
UNCDF Target Target action Approach Results to date Affiliated
Industry organizations

UNCDF CleanStart1 • Supports low- • Risk capital • Providing finance Implementers:


SHS income hhs (performance-based and business UNCDF
transition to grant) to bring early advisory services
Ongoing
renewable energy stage business ideas to to 6 businesses Funders:
Mini-
grids market under the • RECF Uganda:
• Co-invests in early
Renewable Energy Embassy of
stage business ideas • Advisory services to
Cook Challenge Fund- Sweden in
of private companies address implementation
stoves Clean cooking Uganda (RECF),
that can bring bottlenecks, facilitate
window UNCDF, DFID
affordable clean linkages to partnership &
Bio energy to under- funding opportunities • Providing finance Uganda
fuels served markets and business • CleanStart
• Knowledge and learning
advisory services Global: Austrian
• Emphasis on the in the form of research
to 8 businesses Development
inclusion of women initiatives, M&E, &
under the Agency,
and youth in value networking events
Renewable Energy Liechtenstein,
chain • Nationwide campaigns to Challenge Fund-
Norad, Sida,
improve consumer Solar Window UNCDF
awareness & protection
• With the Schatz
• Partnerships with Energy Research
government, dev Center (SERC)
partners, & other Humboldt State
stakeholders to leverage University released
resources & strengthen study on Energy
sustainability & impact Access and Off-
Grid Solar

106 Sources: UOMA interviews & consultations


Industry stakeholders Operators Financiers Dev partners Government Others

BMZ has provided support to both the government and private


sector to further advance access & support clean energy (1/2)
BMZ Target Target action Approach Results to date Affiliated
Industry organizations

Promotion of • Promote sustainable • Support the Ministry Policy support: Implementers:


Renewable Energy SHS use of energy for of Energy in areas of • Energy programs MEMD, REA,
& Energy Efficiency social economic energy policy, structured in West Nile ERA
program (PREEEP)1 empowerment, improvement of & Lango
increased access to market structures and • Quality management Funders:
Ongoing renewable energy, energy efficiency. system for the BMZ ,KfW, EU
and efficient planning, steering and
• Support activities in
utilization of existing evaluation processes of
implementation of
energy resources MEMD
energy programs at
Focuses on three district level, • Fully operational GIS
areas: monitoring and lab
evaluation and Market development:
• Supporting clean
mainstreaming of
energy strategies • Capacity building
cross cutting issues
• Mitigating climate through associations
such as gender and
change HIV / AIDS • Awareness campaigns
• Promoting access to • Work through EnDev Licensing:
energy to achieve advance • Standardized licensing
access procedures for small-
scale off-grid energy
projects with REA &
ERA

107 Source: UOMA interviews & consultations


Industry stakeholders Operators Financiers Dev partners Government Others

BMZ has provided support to both the government and private


sector to further advance access & support clean energy (2/2)
BMZ Target Target action Approach Results to date Affiliated
Industry organizations

Promotion of Mini- • Promote Four components: • Created task force Implementers:


Mini-
grids for Rural decentralized with REA & the GIZ,
grids 1. Develop off-grid
Electrification (Pro electrification Ministry to develop MEMD,REA,
strategy for the
Mini-Grids)1 strategies such as directive and ERA
National Electrification
mini-grids to support
Ongoing Policy & develop
support development of Funders:
methodology to
employment and mini-grid tender EU
identify mini-grid
economic mechanism
project locations
development • Ongoing support to
2. Develop mechanisms REA to promote
• Develop for license concessions, development of site
mechanisms to efficient tenders identification
support private
sector capacity for 3. Implement and award expertise
installation and tenders to private mini-
operation of off-grid grid concessionaires in
systems villages
4. Promote productive
use in villages to raise
household incomes &
improve the economic
feasibility of service
providers’ business
model & tariff revenue
structure

108 Source: UOMA interviews & consultations


Industry stakeholders Operators Financiers Dev partners Government Others

UNDP has partnered with the government to provide sustainable


energy solutions to boarding schools in off-grid areas in Uganda
UNDP Target Target action Approach Results to date Affiliated
Industry organizations
NAMA-Green • Provide • Creating an • Project has been Implementers:
Schools project1 SHS sustainable appropriate financing pre-selected to UNDP, MEMD
energy solutions vehicle (Revolving receive funding by
Ongoing to boarding Loan Fund) for the Germany and the UK Funders:
Cook schools in the planned large-scale of up to € 60 million UK, Germany
stoves mainly off-grid roll out of green to support the
rural areas with technologies in the development phase
Bio solar energy, schools & designing
fuels efficient cook new business models
stoves, and for schools to pay
biogas back installation costs
technologies • Complementing the
technologies with
capacity-building &
awareness trainings
for companies and a
Life Skills Programme
for youth and local
communities

109 Source: UOMA interviews & consultations


Industry stakeholders Operators Financiers Dev partners Government Others

AFD has partnered with local banks to finance renewable energy


investments in order to reduce the carbon footprint in East Africa
AFD Target Target action Approach Results to date Affiliated
Industry organizations
Sustainable Use of • Developing the • Providing technical • A cumulated Implementers:
Natural Resources SHS share of assistance to commitment of > AFD, Diamond
and Energy Finance renewable energy companies & banks €120 million to Trust Bank
East Africa in the energy mix to assist them in finance green
(SUNREF)1 Bio in East Africa identifying investments in East Funders:
fuels opportunities for Africa (Uganda, AFD, EU-Africa
• Improving energy
Ongoing green investments Kenya and Tanzania) Infrastructure
efficiency for
Trust Fund
companies • Installation &
monitoring of projects
• Encouraging local
banks to increase • Supporting partner
lending activities banks in their risk
towards low- assessment approach,
carbon projects communication
strategy & marketing
in green finance

110
Industry stakeholders Operators Financiers Dev partners Government Others

UNIDO supports the EAC’s initiative aimed at refining energy policy,


capacity development and knowledge management in East Africa
UNIDO Target Target action Approach Results to date Affiliated
Industry organizations
East African Centre • Create increased • Develop & implement • Holding of various Implementers:
for Renewable SHS access of modern, a coherent regional workshops that have EACREEE
Energy and Energy affordable & RE&EE policy culminated in the
Efficiency reliable energy framework for the formulation of an Funders:
(EACREEE)1 Bio services EAC & facilitate its Action Plan which UNIDO, ADA
fuels implementation on outlines strategies &
• Increased energy
Ongoing national levels measures for the
security in East
Mini- successful
Africa • Develop & execute
grids implementation of
regional programs
• Mitigation of the first phase of the
and projects in
negative effects centre
cooperation with GEF,
e.g. local
other partners and
pollution &
mobilize funding
greenhouse gas
emissions • Provide co-funding
for demand-driven
programs and
projects executed by
the private and public
sector or civil society
in the region, etc.

111
Industry stakeholders Operators Financiers Dev partners Government Others

The Shell Foundation has launched a number of initiatives to


catalyze sustainable and scalable solutions(1/2)
Shell Foundation Target Target action Approach Results to date Affiliated
Industry organizations

Market • Leverage • Market • Help build demand Implementers:


Development SHS foundations, govt, institutions used through Various
private sector, DFIs to tackle barriers communications and
Ongoing and other financiers and facilitate market advisory
Mini-
to amplify impact and effective Funders:
grids • Providing learning
accelerate market deployment of Shell
and analysis for key
growth blended capital Foundation
Cook themes such as last
to accelerate
stoves mile distribution, rural
marker growth utilities & gender
Produse impact
• Funding for industry
associations such as
GOGLA, GACCC
• Supporting local
accelerators to act as
neutral market
influencers such as
EPD in RW and
UOMA in UG
• Supporting
innovation for market
infrastructure such as
impact valuation

112 Source: UOMA interviews & consultations


Industry stakeholders Operators Financiers Dev partners Government Others

The Shell Foundation has launched a number of initiatives to


catalyze sustainable and scalable solutions(2/2)
Shell Foundation Target Target action Approach Results to date Affiliated
Industry organizations

Building an • Support • Provide grants, • Financing and Implementers:


ecosystem to SHS entrepreneurs in the innovative technical assistance Various
accelerate access to off-grid sector by financing provided to:
energy working with products &
Mini- • Energy Product
partners to provide technology Funders:
grids manufacturers and
Ongoing investment, Shell
• Support service providers that
business skills and Foundation
Cook development of providers aimed at
market linkages in
stoves business skills rural households,
order to scale their training & productive use,
businesses and
Produse market linkages communities and
deepen impact on urban populations for
BoP • Provide support
example energy
for development
efficiency & storage,
of disruptive
PAYG solar, waster to
solutions to
energy fuels etc
increase the
availability of • Market Enablers such
energy as supply chain
intermediaries,
financing facilities and
catalytic institutions
and bodies

113 Source: UOMA interviews & consultations


Industry stakeholders Operators Financiers Dev partners Government Others

Philips Lighting Foundation supports youth-focused, female-


focused as well as SME training activities in Uganda
Philips Lighting Target Target action Approach Results to date Affiliated
Foundation Industry organizations

Village Academy • 48 young men & • In-village • Held MCE Sales Implementers:
SHS
women trained to trainings for Agent Training on Village
Ongoing be PV solar youth on September 2017 Academy
electricians by technical skills, where 20 youth were
2018 sales & soft skills trained as solar sales Funders:
• 60 out-of-school necessary to agents and equipped Philips Lighting
Ugandan & urban enter the solar with stock in Foundation
refugee youth industry partnership with
trained to be by MCE Uganda and
• Tailor made
2018 d.light
courses for
• 20 of small/ energy • Conducted Soroti
medium size companies on Solar PV Training on
business owners capacity building May 2016 where 10
trained in and soft skills young men and
productive use of women were trained
energy by 2019 • Facilitating access
and certified, 8 of
• At least 60% of to start-up
whom found work in
graduates placed financing, high
the solar industry in
in employment quality solar
Soroti
and/or have products &
increased income mentorship on
by 3Q2018 scaling for SMEs
• At least 50% of
trainees targeted
being female
graduates
Source: UOMA interviews & consultations, supplemented by
114 https://www.villageenergy.com/village-academy/
Industry stakeholders Operators Financiers Dev partners Government Others

Many development partners have partnered on initiatives to further


accelerate progress towards shared access goals (1/6)
Multi-lateral Target Target action Approach Results to date Affiliated
Industry organizations
Energizing • Achieve sustainable • Business • Increased access of BoP Implementers:
Development SHS access to modern development to improved cook GIZ EnDev
(EnDev)1 energy services for support for local stoves by 680,000 Uganda
Cook 19M people by 2019 stove companies people
stoves • Target for upcoming (cookstoves & solar) • > 500 rural stove Funders:
Ongoing in production and Netherlands,
phase to be artisans trained and
until 6/2019 with On- sales & distribution Germany,
elaborated & new able to sell higher
new phase from grid Norway, UK,
global targets to be • Rural partner number of stoves and
7/2019 – 12/2022 Switzerland and
defined synergy & private to increase their income
Sweden
Solar sector development
EnDev Uganda: • Increased household
lantern approaches for cook access to energy for
• Increasing stoves & solar lighting/electric
household access to market appliances for 125,000
improved cooking development people to date
by 680,200 people
• Implement • Supported solar co.'s to
• Increasing access to innovative financing increase distribution
energy for & distribution outreach with quality
lighting/appliances schemes solar products
for 157,800 people
• Grid densification
by mid-2019
projects targeting
• Provide modern no-pole
energy services for connections
1,100 social
institutions & 1,600
SMEs
Source: UOMA interviews & consultations, supplemented by
115 1. https://www.giz.de/en/worldwide/24209.html ; http://endev.info/content/Uganda
Industry stakeholders Operators Financiers Dev partners Government Others

Many development partners have partnered on initiatives to further


accelerate progress towards shared access goals (2/6)
Multi-lateral Target Target action Approach Results to date Affiliated
Industry organizations

GET.invest1 Catalyze • Project and • Project Development Implementers:


SHS development of Business Support GIZ
Ongoing markets to: Development • 330+
Mini- support helps Funders:
• Promote access applications
grids projects achieve Germany,
to energy, by project
readiness for & European
supporting developers
On- access to financing Union, the
sustainable
grid • 50+ project Netherlands,
economic growth • Information and and business Austria
matchmaking for
• Develop value developers
developers and
chains, providing received
financiers on
employment advisory
regulatory
opportunities support
framework and
• Enhance energy opportunities • 17 projects
security and successfully
• Creating an
mitigate the assisted in
enabling
impacts of volatile accessing
environment to
fossil fuel prices investment
assist regulators
• Mitigate climate implement • 34 national &
change by processes for international events
substituting clear private with more than 4,400
energy sources investments participants
for fossil fuels

Source: UOMA interviews & consultations, supplemented by


116 file:///C:/Users/Business%20Analyst/Downloads/GETinvest%20fact%20file.pdf
Industry stakeholders Operators Financiers Dev partners Government Others

Many development partners have partnered on initiatives to further


accelerate progress towards shared access goals (3/6)
Multi-lateral Target Target action Approach Results to date Affiliated
Industry organizations

Support Uganda • Promote industry- • Developed annual • Developed Implementers:


Solar Energy SHS led market work plan and handbook for solar UNCDF
Association development for strategy plan. taxation
Ongoing Mini- off-grid Funders:
• Recruited and • Implemented
grids Energy Africa,
• Supporting USEA trained three full awareness
DFID
to have proper time secretariat campaigns in Eastern
On-
governance and staff. and West Nile
grid
management • Developed toolkit • Launched 161 IVR
structure,
on building strong Solar channel on
• Empower USEA to associations Airtel to increase
deliver services to awareness for solar
its member • Trained 40
services such as technicians on
provision of BDS installation and
services, sales troubleshooting
data collection to solar systems
ascertain number
of solar system • Business diagnostic
sold and big data for BDS support
customer research • USEA sales data
collection on-going
(public report will be
available end of June
2019)

117 Source: UOMA interviews & consultations


Industry stakeholders Operators Financiers Dev partners Government Others

Many development partners have partnered on initiatives to further


accelerate progress towards shared access goals (4/6)
Multi-lateral Target Target action Approach Results to date Affiliated
Industry organizations

Scaling Off-Grid • Accelerate the growth • Platform for leading • 50+ companies & Implementers:
Energy (SOGE): SHS of a dynamic, donors and investors market enablers USAID
Grand Challenge for commercial off-grid to incentivize supported across 18
Development1 Mini- energy market to technological countries in sub-
grids provide clean, innovation, fund early Saharan Africa Funders:
modern, and stage companies, and • USAID / Power
3.75 million expected
Ongoing affordable energy support critical Africa,
connections
access to the millions elements of the off- DFID / Energy
of households and grid ecosystem • $435 million in private Africa,
businesses beyond investment catalysed Shell
the grid in sub- Foundation
Saharan Africa

Source; UOMA interviews & consultations, supplemented by


118 1. http://www.cleanenergyministerial.org/Events/scaling-off-grid-energy-grand-challenge-for-development-new-funding-opportunity-80276; https://www.scalingoffgrid.org/
Industry stakeholders Operators Financiers Dev partners Government Others

Many development partners have partnered on initiatives to further


accelerate progress towards shared access goals (5/6)
Multi-lateral Target Target action Approach Results to date Affiliated
Industry organizations

Energy and • Contribute to • Funding projects in all • Providing sustainable Implementers:


Environment SHS reduction poverty by fields of renewable energy and agro hubs KPMG Finland
Partnership/ promoting inclusive energy and energy in Kamwenge district
Southern and East Mini- and job-creating efficiency, bridging • Providing clean energy
Africa1 grids green economies, the gap between a Funders:
for the Ugandan dairy
and by improving good idea and a Ministry of
Cook industry, biogas for
Ongoing energy security in the bankable project Foreign Affairs
stoves milk cooling
Southern and East of Finland, DFID
Africa regions while • Projects are selected • Providing sustainable and The
mitigating global through two funding energy services for Austrian
climate change windows from early Kitobo island Development
stage to market ready Agency
projects, including last
mile feasibility
studies, pilots,
demonstrations,
commercial scale-ups,
replication and
rejuvenating projects

Source: UOMA interviews & consultations, supplemented by


119 1. http://eepafrica.org/projects/uganda/
Industry stakeholders Operators Financiers Dev partners Government Others

Many development partners have partnered on initiatives to further


accelerate progress towards shared access goals (6/6)
Multi-lateral Target Target action Approach Results to date Affiliated
Industry organizations

New Deal on Energy Achieve universal • Mobilizing Approval of 29 energy Implementers:


for Africa1 SHS access to energy in domestic and sector operations worth AfDB
Africa by 2025 by: international USD 1.7 billion to
Ongoing Mini- capital for deliver: Funders:
• Increasing on-grid
grids innovative AfDB, Africa
generation to add • 546 MW of
financing in Energy Leaders
160 GW of new additional installed
On- Africa’s Energy Group,
capacity by 2025 capacity of which
grid sector Sustainable
526 MW are from
• Increasing on-grid Energy Fund for
• Supporting renewable energy
transmission & Africa, SE4ALL,
African countries sources
grid connections UK’s Energy
in strengthening
that will create 130 • 21,264 km of Africa
energy policy,
million new distribution lines Campaign and
regulation and
connections by Power Africa
sector • 641 km of
2025
governance transmission lines
• Increasing off-grid and associated
generation to add substations
75 million • 7,800 public lighting
connections by units
2025
• 688,950 new
• Increasing access households/
to clean cooking businesses receiving
energy for ~130 M electricity access
households

Source: 1. https://www.afdb.org/fileadmin/uploads/afdb/Documents/Generic-Documents/Brochure_New_Deal_2_red.pdf ; https://www.huffingtonpost.com/kristina-skierka/new-deal-


120 for-energy-a-big_b_9051000.html
Industry stakeholders Operators Financiers Dev partners Government Others

Ministry & several agencies dedicated to advancing access to


energy
Government body Mandate in industry

• Has the overarching mandate to promote development of sustainable-


Ministry of Energy use of energy and mineral resources.
and Minerals
Development • Renewable energy department serves under this Ministry and runs a
(MEMD) number of the programs for access both on and off the grid

• Promotes equitable rural electrification access with special regard to


Rural Electrification marginalized communities.
Agency (REA) • Provides oversight lead on how government sponsored projects are designed
and sequenced to provide appropriate energy services based on their value to
advance access & economic development

• Regulates the electricity supply industry and issues licenses for generation,
Electricity transmission, distribution or sales of electricity, as well as ownership or
Regulatory operation of transmission systems
Authority (ERA) • Establishes tariff structures and investigates tariff charges, approves rates,
terms, and conditions of electricity services provided by generation,
transmission and distribution companies

Uganda Energy • Facilitates investments in renewable energy sector by providing innovative


Credit financing products and technical assistance to firms in the sector.
Capitalization • Channels investment to projects as the administrator of Uganda Energy
Company (UECCC) Capitalization Trust, the framework for pooling resources from gov’t and
development partners

121 Source: UOMA interviews & consultations, supplemented by http://www.rea.or.ug/functions.html , www.ueccc.or.ug


Industry stakeholders Operators Financiers Dev partners Government Others

Several additional government institutions are interlinked with


oversight on issues affecting off-grid
Head of State Key

Provides executive oversight Provide policy direction Official relationship and reporting
requirements
Frequent interaction, no official
Cabinet Parliament reporting requirement

Office of the Prime Minister Provides oversight for all ministries

Ministries

Ministry of Energy Ministry of Finance, Ministry of Trade,


Ministry of Water &
and Mineral Planning & Economic Industry &
Environment
Development Development Cooperatives

Uganda Energy National


Electricity Rural Private Sector Uganda National
Credit National Planning Uganda Revenue Environment
Regulatory Electrification Foundation Bureau of
Capitalization Authority Authority Management
Authority Agency Uganda Standards
Company Authority

Uganda Electricity Uganda Electricity Uganda Electricity


Generation Transmission Distribution
Company Ltd Company Ltd Company Ltd

Source: Analysis from interviews and government websites


Industry stakeholders Operators Financiers Dev partners Government Others

There are a number of research institutions and consultants active


in UG working to support the market (1/4)
Organization Work in Uganda

• Created to enhance private sector competitiveness by providing capacity through


policy advocacy and enhanced business development services
• Also play a key role in implementing some government and donor projects
• Currently implementing technical capacity aspects of the Energy for Rural
Transformation phase III such as empowering USEA

• Focuses on the thematic areas of rural electrification, energy for productive use,
household energy and energy entrepreneurship
• Has two departments: testing services for product development & independent
testing of cookstoves & solar, and project engineering for project implementation
and consultancy

• Implemented by the Department of Electrical and Computer Engineering at


Makerere University in close cooperation with The Royal Norwegian Society for
Development (Norges Vel). The incubator was initially funded by Nordic Climate
Facility (NCF) and now funded by NORAD
• Main focus is on entrepreneurship, improved co-operation with SMEs and
technology transfer from countries outside Uganda which are all innovative
project activities which makes the project idea a unique and sustainable option
for development

123 Source: UOMA interviews & consultations, supplemented by http://creec.or.ug http://energyincubator.org , http://www.psfuganda.org
Industry stakeholders Operators Financiers Dev partners Government Others

There are a number of research institutions and consultants active


in UG working to support the market (2/4)
Organization Work in Uganda

• Signed five-year working relationship with GoU to foster green economic


growth implementing a planning framework with three outcomes:
– Mobilize financing for implementation of green growth strategy
– Support improved planning of secondary cities to catalyze green
growth & urbanization
– Support govt efforts to expand electricity investing in renewable energy

• Partnered with REA to define the country’s electrification strategy through the
Uganda Accelerated Rural Electrification Program. Funded by the World Bank,
developed a master electrification plan for one new electric service territory in
Uganda
• Today, the team is on a path to lay the groundwork to produce master plans
for all 13 of the country’s electric service territories funded by the
USAID/Power Africa

• Supports businesses serving off-grid communities with a range of services


form business development services, access to finance and project
development for innovative models
• Supporting the implementation of a number of initiatives such as the Off-grid
Refrigeration Challenge and Transforming Energy Access programs

124 Source: UOMA interviews & consultations, supplemented by www.energy4impact.org , East African Business Week , NRECA
Industry stakeholders Operators Financiers Dev partners Government Others

There are a number of research institutions and consultants active


in UG working to support the market (3/4)
Organization Work in Uganda

• Engages businesses, communities, institutions, and entrepreneurs to


accelerate the adoption of market-based solutions that cost-effectively shift
from fossil fuels to efficiency and renewables
• Supporting the government of Uganda to develop and implement an
integrated electrification strategy to drive energy access and economic
growth

• Research and policy effort that aims to address the challenges around
increasing access to modern energy solutions to underserved populations
around the world
• Supporting the development of new, disruptive tools, such as the means to
evaluate electricity access through machine learning techniques applied to
aerial imagery data

• Support businesses, investors, development partners & governments globally


to to identify appropriate, impactful ways to support off-grid energy access
• Supporting NRECA as they help the REA develop an off-grid electrification
strategy for Uganda. This will involves actively engaging private sector service
providers and developers to coordinate renewable energy mini-grids and
stand-alone energy solutions as part of a larger national electrification
planning paradigm

125 Source: UOMA interviews & consultations, supplemented by https://www.rmi.org/ , Catalyst, , NRECA
Industry stakeholders Operators Financiers Dev partners Government Others

There are a number of research institutions and consultants active


in UG working to support the market (4/4)
Organization Work in Uganda

• The E4D Network is run by the Sustainable Energy Research Group (SERG)
at the University of Southampton.
• It’s aim is to enable a step-change in collaborative research and project
development addressing the energy needs of rural communities in
developing countries
• In Uganda, it has installed (2) mini-grids with a capacity of 13.5 kW

• The Alliance for Rural Electrification (ARE) is an international business


association that promotes a sustainable renewable energy industry for
the 21st century, activating markets for affordable energy services, and
creating local jobs and inclusive economies.
• They accept members from Uganda who enjoy the benefits of advice and
advocacy, knowledge and intelligence, business promotion & marketing
& business creation and support

• Research sustainable e-waste management and next generation battery


technology, with the purpose to promote critical industry advocacy and
build a body of evidence to inform responsible corporate waste
management programs and policies around end-of-life disposal,
recycling, and repair of solar home systems.

126 http://www.africaminigrids.com/Partners-Supporters-Africa-Mini-Grid, https://www.inensus.com/


Industry stakeholders Operators Financiers Dev partners Government Others

Global and regional networks and associations are also enabling


private sector players to leverage support services (1/2)
Organization Work in Uganda

• GOGLA represents over 100 global members as a neutral, independent, not-for-


profit industry association. Its mission is to help its members build sustainable
markets, delivering quality, affordable products and services to as many
households, businesses and communities as possible across the developing world
• Their key focus areas on access to finance working on standardizing reporting
metrics for PAYG, creating a conducive enabling environment by working in
advocacy around key issues like tax and on socio-economic research & insights
for the market more broadly
• Will be running pilot in partnership with GiZ on market database for data
collection in PAYG in Uganda in 2018

• Sendea "solar entrepreneur network for decentralized energy access" is a capacity


development platform for solar entrepreneurs to build their solar company and
let it grow
• Their key focus is providing support to a cohort of early stage local companies
with finance, technical assistance and long-tern coaching and mentorship to
nurture these companies and help them grow
• In Uganda, will be carrying out business skills training, supporting productive use
elements like solar irrigation and SME use and looking at the case for PV back up
systems in institutions like schools and health centers

Source: UOMA interviews & consultations, supplemented by https://www.gogla.org/ , http://sendea.org/ , http://www.sun-connect-news.org/articles/business/details/a-new-support-


127 for-solar-entrepreneurs-sendea/
Industry stakeholders Operators Financiers Dev partners Government Others

Global and regional networks and associations are also enabling


private sector players to leverage support services (2/2)
Organization Work in Uganda

• Collaborating with industry, policy-makers, government authorities, donors, and


other stakeholders to advocate for optimal policies and efficient capital
deployment that will benefit the mini-grid sector and the people it serves
• Serving as the voice of the mini-grid development industry in Africa to promote
the growth and sustainable development of the mini-grid sector and act as a
unified focal point for stakeholders to engage the sector
• Provide a platform that enables transparency in industry performance through
comprehensive market data and analytics in order to establish, evaluate and
promote key financial, business and policy solutions to overcoming the major
barriers to growth for the sector

128 Source: UOMA interviews & consultations, supplemented by https://www.africamda.org


Do contact us if you have any feedback or interest in
partnering:

[email protected]
https://uoma.ug/

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