Energy consumption from cooling systems constitutes a substantial proportion of production costs for many enterprises and investments in energy efficiency may represent an opportunity for improvement in productivity and modernisation. Investments in new efficient cooling technologies present attractive returns and have the potential to generate the cash flow to allow the investor to recover their investment in a reasonable period of time, while also improving productivity/efficiency and reducing emissions as well as costly energy waste. Energy efficiency in the residential sector offers significant benefits to households, as it reduces monthly expenses on electricity and therefore increases purchase power. However, these investments are not happening at the scale expected.
The Rwanda Cooling Initiative aims to transition the market to environmentally friendly and energy efficient cooling technologies. BASE is participating in the project in partnership with the United Nations Environmental Program (UNEP) and with support of United for Efficiency (U4E). BASE is leading the design and development of financial mechanisms for the programme.
The national initiative is funded by the Clean Cooling Collaborative (formerly K-CEP) to support the Kigali Amendment of the Montreal Protocol. The project includes the development of Minimum Energy Performance Standards, labelling policies, financial and risk mitigation mechanisms as well as awareness campaigns.
The project is based on the “Coolease” financial mechanism, which aims to promote adoption of energy efficiency and climate-friendly cooling solutions in the commercial sector in Rwanda. The Coolease model enables suppliers and consumers of air conditioning and refrigeration products to transition to the latest technology without an upfront investment. Through this mechanism, a financial institution provides financing directly to the client through a finance leasing agreement, in which the cooling system is either owned by the financial institution or taken as collateral. The technology provider maintains a direct relationship with the client and facilitates the credit request with standardised protocols to streamline the leasing process.
Coolease is provided by BDF to the client (typically an enterprise) through a finance leasing agreement, in which the air conditioning or refrigeration system is used as collateral. The technology provider installs the equipment and commits to providing high-quality maintenance, which is embedded into the Coolease agreement. A positive list describes which technologies are eligible for the programme, considering both their efficiency and refrigerant type. Coolease is being onboarded by BDF as one of the products of its dedicated leasing unit to finance the cooling system for the client in exchange for monthly payments. A Green Growth Guarantee Fund set up by BDF and FONERWA will cover part of the loss in case of default. The technology provider maintains a direct relationship with the client and facilitates the credit request with standardised protocols to streamline the leasing process. The Coolease mechanism was officially launched in Kigali in June 2019 with the former Minister of Environment of Rwanda Dr. Vincent Biruta, the CEO of BDF Mr. Innocent Bulindi, and the CEO of FONERWA Mr. Hubert Ruzibiza.
For more information, visit the FONERWA project page, and the United for Efficiency project page
