Promoting Sustainable Rural Energy Technologies for Households and Productive Uses in Ethiopia Project
Brief project description
The Government of Ethiopia has a vision to achieve middle-income status by 2025 and to create a climate-resilient green economy with zero net carbon emissions. To meet this challenge, the country needs to reach its economic goals in a sustainable manner, which includes increased levels of access to modern energy. With this context, the country faces four principal barriers that prevent the widespread dissemination of small-scale renewable energy technologies. These are:
Barrier 1: Need for strengthened national regulatory and legal framework for rural renewable energy in Ethiopia
Barrier 2: Lack of public awareness of the benefits of low-cost renewable energy household appliances
Barrier 3: Lack of affordability of small-scale renewable energy solutions and lack of a financial support mechanism to help accelerate the dissemination of household renewable energy appliances
Barrier 4: Lack of enterprises involved in supplying renewable energy technologies to rural communities in Ethiopia
The overall objective of the project is to promote and encourage significantly greater use of renewable energy technologies for household and productive uses in rural communities in Ethiopia. It is set within the strategic framework of the country’s ambition to reduce GHG emissions. In order to achieve the project objective, and address the identified barriers, the project’s intervention has been organized into four project components.
Component 1: strengthening regulatory and legal framework based on national standards
Component 2: Rural public awareness campaign on renewable energy technologies
Component 3: Sustainable Financial Mechanism for renewable energy technologies (RETs) for rural households
Component 4: Business incubation to promote greater entrepreneurship for investment in RETs
The project seeks to implement a more private sector-driven and market-based approach towards promoting renewable energy technologies in rural communities in Ethiopia. The four components consist of a combination of de-risking instruments (Component 1) and market-enabling activities (Component 2 and Component 4) that will combine with a financial support mechanism (Component 3) to help transform the market for off-grid renewable energy technologies in rural communities. By using this approach, the project targeted off-grid rural parts of the country in the nine regional states and planned to disseminate 800,000 rural energy technologies (200,000 solar energy technologies particularly solar home systems and 600,000 improved cook stoves).
The project is a five years project started on June 2016 that spans till June 2020. It is financed by GEF and co-financed by UNDP Ethiopia Country office and United Nations Capital Development Fund (UNCDF). The total budget of the project is USD 5,571,781.00 of which USD 4,091,781.00 is from GEF, USD 500,000.00 is from UNDP and USD 980,000.00 is from UNCDF. The project is also supported by in kind contribution of the Government of Ethiopia, UNDP and the private sectors. The main implementing partners for this project are the Ministry of Water, Irrigation and Electricity, Ministry of Environment, Forest and Climate Change, Development Bank of Ethiopia, UNCDF and UNDP Ethiopia Country office in collaboration with regional energy bureaus.