The Democratic Republic of Congo (DRC) stands at a pivotal juncture in its journey towards sustainable development. While the nation grapples with significant humanitarian challenges and a vast population in need, its potential for clean energy solutions remains immense. The key to unlocking this potential lies in the DRC's ability to amplify clean energy initiatives and safeguard its rich environmental heritage.

The DRC is home to the world’s second largest tropical forest massif after the Amazon with nearly 155.5 million hectares of forest. These forests, constituting 60% of the Congo Basin, are a treasure trove of biodiversity, ranking fifth globally. They not only sustain a myriad of flora and fauna but also underpin the livelihoods of countless rural communities. However, the shadows of population growth and economic challenges threaten these forests with deforestation and degradation. A key driver of deforestation is the use of wood for cooking fuel; largely because many households cannot afford or are aware of clean cooking alternatives.

A pressing question arises: How can the population adopt clean cooking solutions if their financial constraints hinder them?

Microfinance Institutions (MFIs) Spearheading Clean Cooking

To bridge this gap, innovative strategies and collaboration are paramount. In this context, the role of MFIs in the DRC becomes crucial. With their deep-rooted connections to low-income communities, MFIs possess a unique insight into their needs and aspirations. By leveraging this relationship, MFIs can bolster the clean energy sector in several ways:

• Market Analysis: Delving into the energy needs, technology options, and price points.
• Strategic Partnerships: Facilitating collaborations between energy providers and themselves, opening avenues for mutual growth in the clean energy domain.
• Financial Product Innovation: Crafting tailored clean energy financial solutions in tandem with energy providers.
• Supply Chain Enhancement: Addressing and rectifying any discrepancies in the chosen technology or service's supply chain and offering last mile distribution networks given their existing outreach.
• Consumer Education: Elevating awareness about the advantages of novel fuels, technologies, and financing options.

The UN Capital Development Fund (UNCDF) has been supporting the microfinance sector through its ACTIF program. More recently, it has taken an important role in addressing deforestation via the Joint Program on the Sustainable Consumption and Partial Substitution of Wood Energy in DRC, a collaboration with the UN Development Programme (UNDP) and funded by FONAREDD and the Central African Forest Initiative (CAFI).

Through this initiative, UNCDF has provided technical assistance, grants, and industry workshops. The aim? To encourage MFIs to collaborate with the burgeoning number of energy companies. These companies, specializing in LPG and improved cookstoves (ICS), need affordable financing to ensure the consistent adoption and use of their sustainable solutions.

Since 2021, UNCDF has observed a rising demand for the purchase of energy products on credit from its 16 Challenge Fund partners. Approximately 50 percent of their clients now opt for this payment mechanism. With more support for MFIs, this trend can see a significant surge, particularly for higher volume products catering to productive users.

Coopec AKIBA YETU: Advancing Clean Cooking through Financial Solutions

In response to UNCDF’s 2022 Challenge Fund Window, Coopec AKIBA YETU, a prominent MFI in the DRC, joined forces with Ihusi Gaz, a clean cooking distributor. Serving areas like Goma, Nyiragongo, Mugunga, and Sake, this collaboration aimed to provide their clientele with clean cooking alternatives. With the support of a grant from UNCDF, AKIBA YETU introduced a credit program named "Jiko Bora." This initiative allows customers to establish an account with AKIBA YETU, purchase an LPG kit, and secure a loan that's subsequently channeled to Ihusi Gaz. Once the payment is processed, Ihusi Gaz takes charge of the equipment's delivery and setup. Customers then have the flexibility to repay in monthly installments, with contract durations ranging from 3 to 24 months.

This credit scheme caters to three distinct customer segments: individual households, LPG distributors, and LPG-utilizing businesses such as hotels and restaurants. The credit amount and repayment terms vary depending on the specific client and product purchased, with loan values spanning from US $50 to $30,000.

AKIBA YETU goes beyond providing financial solutions; they actively inform their clients about the advantages of clean cooking while ensuring affordability through flexible payment plans. Their dedicated outreach efforts bore fruit when they forged a partnership with VIRUNGA NATIONAL PARK, facilitating the provision of LPG kits to the park's staff. Beginning with administrative personnel, the initiative will soon extend to over 3,000 dedicated rangers. These rangers play a pivotal role in safeguarding this UNESCO World Heritage site from threats like deforestation, poaching, and illicit charcoal exploitation.

The results so far…

Between January and June 2023, clean cooking equipment and fuel sales surged to a commendable US $42 155. That includes 513 LPG kits sold and over 7,500 kilograms of LPG purchased by customers. This does not account for the refills and purchases made by individuals influenced by the awareness campaigns spearheaded by AKIBA YETU.

The pivotal role of MFIs for clean cooking in the DRC

As the DRC grapples with environmental challenges and the pressing need for sustainable development, MFIs have emerged as pivotal players. The collaboration between AKIBA YETU and Ihusi Gaz, with support from UNCDF, exemplifies the potential of such partnerships. Through tangible impact, with thousands of dollars invested in clean cooking, it is evident that the fusion of finance and clean cooking solutions can indeed pave the way for a greener future in the DRC.