The BASE Foundation is thrilled to announce the release of a new report that sheds light on implementing market-based financing mechanisms to drive the adoption of energy-efficient and climate-friendly appliances. The report, published by the Clean Cooling Collaborative (formerly K-CEP) and compiled by United for Efficiency (U4E) and BASE, highlights valuable lessons learned from our initiatives in Ghana, Senegal, and Rwanda.
Striving to facilitate sustainable domestic cooling
Over the past five years, the BASE Foundation, in collaboration with U4E and the governments of Ghana, Senegal, and Rwanda, has implemented initiatives, with innovative financial models at their core, to promote energy-efficient and climate-friendly cooling solutions.
In Ghana and Senegal, the ECOFRIDGES initiative introduced the green on-wage (GO) financing and on-bill financing mechanisms, respectively, to facilitate the replacement of outdated refrigerators and air conditioners with certified energy-efficient and climate-friendly alternatives. These endeavours have yielded remarkable outcomes, including selling more than 3,000 new appliances, unlocking a financial influx of GHS 15.8 million (USD 1.4 million), resulting in energy savings exceeding 25,000 MWh and more than 21,000 tonnes of total CO2 emissions reductions.
Meanwhile, on the other side of the continent, the Rwanda Cooling Initiative (R-COOL) has been focused on attracting investments in energy-efficient cooling technologies through an on-wage financing approach. As of July 2023, the programme has facilitated the sale of 300 highly efficient refrigerators. These undertakings highlight the effectiveness of market-driven financing models for propelling the adoption of sustainable cooling solutions in the region.
Sharing the knowledge
The new report showcases the impact of, and lessons learned from, these initiatives which have been significant in advancing the adoption of energy-efficient appliances within the target markets.
One crucial factor involves mobilising stakeholders – including vendors, financial institutions, and government entities – by offering compelling incentives to spur active engagement and collaboration. For example, financing mechanisms greatly improve the affordability of high-efficiency appliances for local households, resulting in a wider market base for vendors and potentially increased sales. Additionally, as customers become increasingly aware of energy costs, vendors who offer energy-efficient options through financing models benefit from a strong competitive advantage over other businesses. Finally, vendors involved in such programmes can enjoy an enhanced reputation and brand image as they may be perceived as socially responsible and environmentally conscious.
Another key takeaway is the importance of running limited pilot programmes before rolling it out nationally. This approach allows for more precise feasibility assessments, the identification of challenges, and making necessary adjustments.
Sustainable long-term funding emerges as another crucial aspect for ensuring the availability of recurrent resources to support programme management, awareness-raising campaigns, and other vital initiatives.
The report also emphasises the importance of early stakeholder engagement, which nurtures a sense of ownership, facilitates feedback integration, and paves the way for a more inclusive and effective approach. The flexibility to adapt and modify the financing mechanism based on stakeholder feedback and market responses is identified as another key factor in achieving long-term success.
Finally, the report underscores the significant role of government policies, such as minimum energy performance standards (MEPS), energy labelling, and regulations on e-waste management, for driving the promotion of sustainable practices.
As an extensive resource for stakeholders aiming to implement comparable financing mechanisms on a global scale, the report provides pragmatic insights for vendors, financial institutions, and government bodies looking to enhance consumer access to environmentally friendly appliances. It also presents essential recommendations for programme developers to build upon as they pursue the development of future effective initiatives.
As advocates for sustainable energy solutions, we invite you to explore the report and join us in our commitment to #ActOnCooling and promote #CoolingForAll. Together, we can accelerate the adoption of energy-efficient appliances and pave the way for a greener future.
