Why Lend to a Charcoal Seller?
By Sara Strawczynski, Tanzania
That’s a question I’d never considered before serving as a Kiva Fellow. I figured that charcoal is a dirty and unsustainable source of fuel, and not one that I want to support. Charcoal production causes massive deforestation and produces considerable emissions of carbon dioxide. So when presented with the option of lending to a charcoal seller on Kiva’s website, I always selected an entrepreneur in a different sector to support.
Flash forward a few months – I have now enjoyed hundreds of meals cooked on charcoal stoves and grills, first in Rwanda and now in Tanzania. I’ve also met about a dozen Kiva clients who make their living producing and selling charcoal. These experiences certainly haven’t made me a full advocate for continued use of charcoal fuel. They have, however, made me realize that the issues surrounding sustainable energy are not white and black, but closer to charcoal grey. So here’s why I would now consider lending to a charcoal seller through Kiva:
Everybody needs fuel to survive – for cooking, cleaning, and heating. Here in Dar Es Salaam, gas and electricity are available in some neighbourhoods, but they are expensive and unreliable. About three-quarters of households in Dar Es Salaam rely on charcoal as their primary cooking fuel. Charcoal is a step up from firewood because it burns slower, is easier to transport, and produces less smoke, which is dangerous to inhale. Though charcoal is not the cleanest energy source, it is the best source of fuel that is available and affordable to many of the urban poor, allowing them to cook and survive.
People involved in producing and selling charcoal are providing a product that is needed. Like all the other microentrepreneurs that you see on Kiva’s website, they are trying to support themselves and their families, and deserve the chance to make that happen through microfinance.
That said, Tanzania’s current charcoal sector is not driven by a few microentrepreneurs. It is operating on a macro scale, with massive environmental implications. Tanzanians consumes a million tons of charcoal a year, making charcoal the third largest sector in this country, after mining and tourism. Dar Es Salaam is one of the fastest growing cities in Africa, and charcoal demand is increasing even faster. More and more hectares of forests in the rural areas surrounding Dar Es Salaam are being logged to supply charcoal to the city. Some projections suggest that Tanzania’s forests will be gone within 50 years, while the demand for charcoal will only keep growing. In light of such dire possibilities, the government is trying to expand the electrical grid and encourage some of Dar Es Salaam’s 3 million inhabitants to switch to other energy sources; however, changes don’t come overnight. The fact is that charcoal will remain an important source of fuel in East Africa for decades or longer.
Given this reality, Tujijenge Africa (a local microfinance institution, and Kiva Field Partner Tujijenge Tanzania’s sister organization) is actively working for change through the Dar Charcoal Project. The project is a collaboration between the Worldwide Fund for Nature (WWF), Camco Advisory Services of Tanzania (an energy company), Barclays Bank and other partners. The project will engage rural communities where most of Tanzania’s charcoal production and associated deforestation take place. Communities are encouraged and supported to adopt sustainable forestry practices to help make sure that there is an ongoing supply of charcoal. Like other forestry industries, careful management including land use planning, seedling development, tree planting and scheduled harvesting can help lead to sustainable charcoal production, and reduced carbon dioxide emissions. Tujijenge Africa is working to develop a voluntary carbon market where private and public sectors can buy carbon credits to offset their own emissions. Communities involved in the Dar Charcoal Project will receive the revenue from the credits, encouraging them to continue sustainable charcoal production practices. Other components of the Dar Charcoal Project include improvements to charcoal-production kilns, promoting more efficient charcoal stoves, and championing charcoal alternatives such as biomass bricks that are made from agricultural waste.
I certainly don’t have any easy solution to propose on how to balance the fuel requirements of growing populations and developing economies with environmental sustainability; however, I have come to realized that microentrepreneurs (including those featured on Kiva) and microfinance institutions are one part of a complicated matrix of players, and will be part of any sustainable (or unsustainable) fuel industries that emerge in the future. Choosing to ignore or avoid loans to charcoal sellers on Kiva does not promote more sustainable fuel production or consumption. It does, however, penalize microentrepreneurs trying to fill a demand and support themselves and their families, which is why from now on I will consider lending to charcoal vendors like Juan and Margaret through Kiva.
Sara Strawczynski is a Kiva Fellow in Dar Es Salaam, Tanzania.