World Bank project to help light up sub-Saharan Africa

By CATHERINE RIUNGU
Special Correspondent
Power to the people. This is the objective of a new initiative to provide modern lighting to the 250 million people in sub-Saharan Africa who have no access to electricity.

Jointly managed by the bank and its private sector lending arm, the International Finance Corporation (IFC), Lighting Africa aims to develop market conditions for the supply and distribution of new, non-fossil fuel lighting products such as fluorescent light bulbs and light emitting diodes in rural and urban areas that are not connected to the electricity grid.

The “energy poor” in Africa spend about $17 billion a year on fuel-based lighting sources such as kerosene lamps that are costly, inefficient, and provide poor quality light while causing pollution and posing fire hazards.

For these consumers, lighting accounts for 10 to 15 per cent of total household income. They offer a potentially huge market for modern lighting products that are safe and reliable, that provide higher-quality light, and that are cost-competitive with fuel-based lamps and powered by renewable energy or mechanical sources.

Lighting Africa, which is supported by a number of donors, including seed money from the Global Environment Facility, seeks to attract the international lighting industry, as well as local suppliers and service providers, to this market.

IFC executive vice president Lars Thunell said, “In partnership with the private sector, IFC will help develop sustainable business models to supply good quality lighting to the poorest of the poor in Africa. Our goal is to give families and small business owners clean, modern and affordable alternatives to fossil fuel lamps.”

S. Vijay Iyer, World Bank energy sector manager for Africa, said, “Modern lighting will mean improved air quality and safety for millions of people in Africa. It will mean longer reading hours for students and longer business hours for small shops. Lighting Africa will directly contribute to the Millennium Development Goals. It is a cornerstone of the World Bank’s Clean Energy and Development Investment Framework and the Africa Energy Access Scale-Up Plan.”

More than 350 companies have already expressed interest in the initiative.

Gerard Kleisterlee, president and CEO of Philips, said in a recent speech, “The rural lighting market, like many markets for low-income people in developing countries, is not well known or explored. It is essential that governments and international organisations such as the World Bank, NGOs and various companies get together in a network to work out the appropriate business models.”

The chairman of the Kenya Renewable Energy Association, Vincent Loh, said, “The Development Marketplace competition provides a unique opportunity for local African companies to participate in the development of lighting products and services tailored to local market needs and conditions.”

The World Bank’s Development Marketplace is a competitive grant programme that funds innovative, small-scale development projects. These projects not only deliver results, but also have the potential to be expanded or replicated elsewhere. Since its inception in 1998, the programme has awarded over $50 million to roughly 1,000 projects through global, regional and country-level Marketplaces.

The first phase of Lighting Africa, which started last week, will launch a competition for the design and delivery of innovative, low-cost, high-quality, non-fossil lighting products that target low-income consumers in sub-Saharan Africa. Ten to 20 winners will receive grants up to $200,000. The project will then initiate market research in Kenya, Ghana, Tanzania, and Zambia to better understand consumer demand, behaviour and preferences. The research will also look at local supply, marketing, and distribution channels. Initial results of this research are expected early next year and will be used to inaugurate a business-to-business Web portal where manufacturers, distributors, and marketers from all over the world can create partnerships, conduct business online and access the latest market information.

To kickstart the project, a competition for the design and delivery of innovative lighting products was also launched, dubbed “Innovations in Off-Grid Lighting Products and Services for Africa.” The competition will reward project ideas that address the various off-grid lighting needs of sub-Saharan Africa, including alternative distribution models, new clean lighting technology, stronger production chains, and improvement of the policy environment. Ten to 20 winners will receive grant funding up to $200,000.

The competition is open to a broad range of innovators around the world, including private businesses, non-governmental organisations, universities, government entities and individuals.

Lead sponsors include the Energy Sector Management Assistance Programme, the Global Environment Facility, and the Public-Private Infrastructure Advisory Facility. Other supporters include Good Energies Inc, the governments of Norway and Luxembourg, the European Commission and the Renewable Energy and Energy Efficiency Partnership. The deadline for submitting proposals is October 31, 2007.