The Beyond the Grid Fund for Zambia (BGFZ) has reached a successful conclusion – the delivery of energy service subscriptions to over 1 million Zambians. Building on the success of this pilot, the programme has been expanded into the Beyond the Grid Fund for Africa (BGFA) that signed its first new agreements in Zambia last week. To acknowledge these two important milestones, the Embassy of Sweden in Lusaka invited partners and stakeholders to the Swedish Residence on March 17th.
HE Anna Maj Hultgård, Swedish Ambassador to Zambia and COMESA, hosted an afternoon of speeches, a panel discussion and introductions to the new energy service providers at her Residence.
“I am proud to say that Beyond the Grid is now reaching well beyond Zambia and we look forward to welcoming more actors and partners into this family. Sweden is confident that electricity is a key factor for increasing people’s opportunities to support themselves. Energy services have long been central to the cooperation between Zambia and Sweden and remains a prioritised area, representing a fair share of our development cooperation in Zambia,” she says.
Senior government officials, representatives of cooperating partners, representatives of public and private sector institutions, members of the Off-Grid Taskforce, cooperating partners, and media representatives gathered to hear the lessons learnt from the Beyond the Grid Fund for Zambia pilot programme. The guests were also introduced to the first companies contracted under BGFA in Zambia.
Zambia’s Minister of Energy, Hon. Peter Kapala, was represented by Mr. Martin Nyahoda, Director for Human Resources Department, who said:
‘’Scaling up solar is a major priority for off-grid electricity solutions in the country, along with leveraging private sector finance through public-private initiatives in order to promote resource mobilisation. In this context, contracting Energy Service Providers for a second funding round in Zambia and the first funding round of the Beyond the Grid Fund for Africa is an important milestone. We are particularly pleased that the newly contracted companies are supporting productive use of energy for income generation and for delivering energy services to communities in deep rural areas.’’
During the evening, representatives from a cross-section of stakeholders in the BGFZ pilot programme participated in a panel discussion. Arnold Simwaba, Director, Department of Energy, Ministry of Energy, Magdalena Svensson, Embassy of Sweden, Russell Lyseight, Managing Director, Vitalite and Linus Chanda, Chief Executive Officer, Rural Electrification Authority discussed the lessons learned and their experiences which lead to the Beyond the Grid Fund for Africa expansion.
‘’BGFZ is an accumulation of innovative ideas and experience which have led to the realisation of the dream to connect rural communities to off-grid power and improve their livelihoods and standards of living,’’ says Lloyd Chingambo, head of the Off-Grid Task Force Secretariat Support Team, who moderated the event.
The BGFZ pilot programme achieved remarkable results: as of December 2021, 194,724 Energy Service Subscriptions had been rolled out benefitting 1,012,565 Zambians, 53% of whom live in rural areas. Of the customers surveyed in an impact study in 2021 , 96% of the customers experienced an improvement in quality of life, with 83% reporting their lives have been “very much improved”. In total, USD 49 million in co-financing with 21 new third-party financiers was mobilised and 1,860 jobs have been created (428 employees and 1,432 commission-based). 9% of customers used their energy access for income generating activities, a percentage that donors hope to increase through the Beyond the Grid Fund for Africa.
Anders Arvidsson from Sida/Power Africa, gave the Swedish perspective on their investment in Zambia, ‘’Sweden has been a development partner in Africa’s energy sector development for more than 50 years. Last year we set new and more ambitions targets to be reached by 2030, and we are aiming to support another 10 million renewable energy electricity connections and also 5 million people with access to clean cooking alternatives. BGFA is an important step in reaching this goal’’
The second milestone acknowledged at the event was the signing of the first three contracts in Zambia under the Beyond the Grid Fund for Africa. Vitalite, RDG Collective and Zengamina Power are now on board, with further contracts under negotiation.
Ash Sharma, Vice President of the Nordic Environment Finance Corporation (Nefco) and Head of Beyond the Grid Fund for Africa introduced Beyond the Grid Fund for Africa at the event. “We are very pleased that BGFA is showing the way and inspiring other energy service providers in Zambia to raise their ambition levels. We now have strong evidence that results-based financing accelerates business growth and makes it possible for companies to open up challenging areas in off-grid energy markets as well as mobilise additional financing.”
RDG Collective Limited, have their own designed and developed solar home systems which provide lighting, charging and TVs for households, as well as industrial water pumps for farmers for commercial use. Their solar fridges are working without a battery but through an innovative system that cools the water inside of the fridge through solar energy.
Zengamina Power Limited, located in North-Western Province in Zambia, about 900 kilometres from the capital Lusaka, currently operates a mini-grid with an existing hydropower plant, with the intention to extend the capacity with a new solar power plant and battery storage for higher tier customers.
Market pioneer Vitalite Zambia Ltd., which was a beneficiary under the pilot programme, has now signed a BGFA contract to scale up its business further. The company provides basic solar home systems to low-income customers in remote areas with productive use options including solar pumps, solar powered sewing machines, and egg incubators.
Negotiations are currently ongoing with further companies to be contracted in Zambia under this funding round of BGFA.
Launched by Sweden in 2016 and implemented by the Renewable Energy and Energy Efficiency Partnership (REEEP), the pilot programme Beyond the Grid Fund Zambia (BGFZ) aimed to incentivise growth and market entry of private sector players offering clean energy solutions, increase confidence and capacity of banks to extend credit to off-grid business ventures and engage market stakeholders and facilitate coordination of measures to improve the enabling environment of the local market. Four Energy Service Providers were contracted under the first funding round to illuminate the lives of rural and per-urban people all across the country by 2021, which they have successfully managed to do.
The Beyond the Grid Fund for Africa is a multi-donor facility established and managed by the Nordic Environment Finance Corporation (Nefco). Nefco is an international financial institution based in Helsinki, Finland, focusing on environmental and climate investments. BGFA is implemented in partnership with the Renewable Energy and Energy Efficiency Partnership (REEEP), an international multilateral partnership based in Vienna, Austria, working to accelerate market-based deployment of renewable energy and energy-efficiency solutions in developing countries.
The current EUR 107.6 million BGFA programme was established in 2019 on Sweden’s initiative through the Swedish International Development Cooperation Agency (Sida). Sweden contributes SEK 835 million (EUR 80 million) from the Swedish embassies in the target countries. It has since been developed by Nefco into a multi-donor programme. Denmark, through the Ministry of Foreign Affairs, joined the BGFA programme in December 2020 and is now providing DKK 117.5 million (EUR 15.8 million) to support the programme in Uganda. Power Africa, an initiative administered by USAID, is providing an in-kind technical assistance contribution worth USD 4.5 million (approx. EUR 4 million) over three years to help operationalise the initiative and develop a pipeline of commercially viable projects within the framework of BGFA. Germany, through its development bank KfW, has joined the BGFA country programme for Zambia with a focus on mini-grids, providing EUR 7.5 million.
Photo: Event in Zambia 17 March – Jason Mulikita