MECS Talk Series: Consumer Financing for Clean Cooking Solutions 23.09.2023

A new Talk Series, led by the MECS programme through its in-country partner Finovista and other stakeholders, focuses on different topics relating to transitioning to modern energy cooking services The twelfth webinar in the second phase of the Talk Series, held on 21 September 2023, focused on consumer financing for clean cooking solutions. Globally, 2.4 billion people lack access to clean cooking facilities, necessitating a substantial annual investment of $10 billion. However, insufficient funding, limited sector expertise, and perceived risks have impeded the financial support crucial for this sector. Encouragingly, the landscape of the clean cooking industry has been undergoing a transformation. This shift is driven by the emergence of innovative technologies and solutions, a growing acknowledgment of the sector's significance within the broader clean energy context, and the proliferation of start-ups, innovators, and small to medium enterprises (SMEs) in this domain. Consequently, the topic of access to finance has regained prominence as a pivotal area of focus within the sector. The viability of any successful clean cooking business model depends on various factors: the cost of the clean cooking hardware, operational expenses (particularly fuel costs), and end-user financing. While certain households can absorb the expenses of adopting new clean cooking technologies by reallocating their current expenditure on polluting cooking fuels toward cleaner alternatives, a considerable number of less affluent customers are unable to manage the upfront expense associated with modern cooking devices. Additionally, it's important to highlight that the majority of clean cooking appliances continue to be sold through direct cash transactions or retail credit.