Kiva Labs - Closing the Energy Gap

Traditional sources of energy
are pricey and toxic.
Renewables bring change and
economic opportunity.

Sources Photo by Dhani Borges

The challenge

The vast majority of people living off the grid depend on kerosene, diesel, charcoal and burning wood for light and heat — all sources of energy that have been used for generations. But these energy sources are also expensive, dirty and dangerous. This is an area with incredible potential for change, but also significant barriers.

Problem #1: Lack of adequate access to light and power affects families' health and productivity

  • The high upfront costs for solar home systems and community microgrids reduces the number of options for off-the-grid families.
  • Without access to productive power sources, households can’t run fans, heaters, refrigerators, and more powerful lighting to keep their homes and families healthy. Businesses and communities can’t run productive assets such as water pumps and grain mills.

Proposed solutions

Loans for customers that are delivered through flexible and creative means – like an SMS-based, pay-as-you-go system – allow end users to benefit from clean energy technologies without worrying about paying for the entire cost upfront.

One partner’s innovative approach

PowerGen Renewable Energy, in Kenya, offers in-kind loans to groups of borrowers to connect to microgrids. This means the borrowers gain access to power right away and pay for the service over time, versus receiving a monetary loan. Once the loan is fully repaid, the grid becomes the property of the community, and usage fees are reduced to cover only the metering cost and ongoing maintenance of the grid.

Problem #2: Traditional cookstoves and fuels are costly and pose adverse health risks

  • Globally, 3 billion people rely on solid fuels to cook, causing serious environmental and health impacts that disproportionately affect women and children. According to the World Health Organization, household air pollution from cooking kills over 4 million people every year and sickens millions more.
  • Market barriers, including a lack of capacity building for enterprises and insufficient financing along the supply chain, impede the production, deployment, and use of clean and efficient cookstoves and fuels in developing countries.

Proposed solution

Loans for producers and sellers of clean cookstoves encourage the development and use of local service providers to help create jobs and strengthen indigenous markets for the clean cooking sector.

One partner’s innovative approach

ASA Initiative FNGO, in Ghana, offers loans to support a growing local industry for a clean cookstove that runs on biochar. Through Kiva, ASA is funding trained entrepreneurs to produce the stoves and the biochar made from locally available materials such as sawdust waste and palm oil kernel husks, as well as to sell the cookstoves in their local communities.

What is success?

Over the next decade, we want to see clean energy products become regular household necessities. We define success as:

  • Sustainable supply chains: Clean energy products and services being delivered through permanent, self-sufficient channels.
  • Social dividends: Clean lighting extending study and work hours, clean cookstoves making homes healthier, and sustainable, cost-effective fuels saving end users time, money or both.
  • Falling prices: Costs coming down as the market becomes more competitive, expanding access even further.