African climate innovators secure scale-up funding
Ecobodaa,a Kenyan start-up with a vision; to replace the country’s 1.3 million polluting petrol motorcycles with locally designed and assembled electric motorcycles, cutting emissions and improving air quality has received a timely funding.
The startup becomes becomes one of five sub-Saharan African start-ups to secure a share of nearly £900,000 in grant funding.
The funding comes from PREO the Powering Renewable Energy Opportunities programme. The programme is funded by the IKEA Foundation and UK aid from the UK government via Transforming Energy Access (TEA) and delivered by the Carbon Trust and Energy 4 Impact.
To qualify, projects must demonstrate their contribution to “Productive Use of Renewable Energy” which means their business models generate local, economic, and social value, with the potential to scale operations.
Ecobodaa’s hopes to have 1000 e-bikes in operation by the end of the year and its work will help hundreds of small business owners, as most of the country’s motorcycle riders operate as taxis, known as boda bodas.
Riders have been reluctant to trade their fossil-fuelled bikes for electric alternatives, due to the high upfront capex cost of batteries which often require large down payments.
While cheaper in the long run, the upfront cost of each battery is anywhere from six to eight times the cost of a tank of gas.
Instead, Ecobodaa are removing this barrier to ownership by offering a lease-to-own payment plan through a digital platform which riders can use to make micro pay-as-you-go (PAYGO) payments on motorcycles and batteries.
PREO funding will enable the company to trial this technology for a fleet of 50 electric motorcycles in Nairobi.
Jon Lane, PREO Programme Manager, said: “We are proud to be supporting five early-stage productive use of renewable energy companies creating pioneering solutions in e-mobility, sustainable cooling and low emissions power. Through PREO the financial and advisory support will accelerate the progress needed to support these companies to prove and scale their business models, creating positive impact socially, economically and environmentally across sub-Saharan Africa. In the past, this support has led to organisations securing investment to grow their operations further. We look forward to seeing how this group of organisations will develop in future.”
The other four successful projects also receiving funding are SokoFresh, Hinckley Associates, Charm Impact and TRī.
SokoFresh is a Kenya-based social enterprise which provides affordable cold storage for rural communities to reduce waste and financial losses for farmers.
TRī offers affordable electric three-wheelers to professional drivers in Tanzania on a lease-to-own scheme, aiming to support small business owners and decarbonise the country’s transport.
Hinckley Associates is creating lithium battery packs to power fridge freezers across Nigeria during power cuts, replacing petrol and diesel generators.
Charm Impact is a peer-to-peer impact investment platform, which provides loans to local clean energy companies. So far, they have provided 23 loans, improving energy for more than 350,000 people across seven countries.
The five recipients join a cohort of 29 previously supported private sector and non-profit enterprises to previously receive a share of £5.5 million in PREO grant funding.
This funding has helped these projects scale and go on to raise a further £24 million in public and private capital.