The United Nations Environment Programme’s (UNEP’s) African Rural Energy Enterprise Development initiative (AREED) provides early-stage funding and enterprise development services to entrepreneurs, as well as training and hands-on business development assistance for affordable energy services designed to deliver clean renewable energy. Currently more than 30 enterprises are in development in Ghana, Botswana, Mali, Senegal and Zambia, and the expansion of the project into Brazil will help provide renewable energy to 20 million rural Brazilians who are currently without access to modern energy services, says the UNEP.
The new investment comes on top of a previous $2 million donation from the UN Foundation in 1999, which funded the start-up of the AREED project, and is a key element in the UNEP’s push to promote sustainable energy, says UNEP Executive Director Klaus Toepfer. “For the 2.8 billion people currently without access to modern energy services, AREED offers a workable, enterprise-based model to deliver those services from climate-friendly technologies via the private sector,” said Toepfer.
Examples of AREED projects include solar-powered crop dryers in Ghana; and the manufacture of briquettes from crop wastes such as peanut shells in Mali, which is designed to protect local forests severely depleted by the demand for fuel. According to Toepfer and Tim Wirth, President of the UN Foundation, access to modern energy services for the rural poor increases local economic activity, with the consequential improvement in basic health and education, but without detriment to the environment.
Part of AREED’s success, says the UNEP, is due to on-the-ground partnerships with innovative organisations which develop the skills and expertise to nurture new entrepreneurs, such as the United States-based E&Co, a pioneer in the provision of patient investment capital to developing country energy enterprises.
“AREED demonstrates how the UN system can build new public-private approaches in the quest for sustainable development; approaches that leverage significant additional funding from other donors and investment from financial institutions and the private sector,” said Wirth.
The UN Foundation was established in 1998 following an historic $1 billion gift from a wealthy philanthropist to support UN efforts on global issues. The Foundation’s board of directors has identified sustainable energy and climate change as one of its principal environmental funding priorities.