• Monday, April 15, 2024
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Clean cooking investment hits record $200m in 2022

Clean cooking investment hits record $200m in 2022

The move to reduce global carbon footprint has recorded a significant development as clean cooking saw a $200 million investment in 2022.

Clean Cooking Alliance (CCA) 2022 Annual Report revealed that the development is more than in any year since it began tracking investment in 2014.

“After weathering years of uncertainty through the pandemic, clean cooking companies are now seeing record levels of investment— some $200 million in 2022,” said Dymphna van der Lans, Chief Executive Officer of CCA.

She said last year’s investments include $6 million disbursed by the CCA-supported Spark+ Africa Fund, the first impact fund to finance clean and modern cooking solutions in developing markets.

“Carbon finance is another bright spot with significant potential to transform the sector,” she said. “The clean cooking ecosystem can only take advantage of the opportunities provided by carbon finance if fair policies and protocols are in place, and if tools and market insights help markets to operate more efficiently.”

CCA recently launched the Responsible Carbon Financing Initiative, which aims to improve program quality and to expand carbon financing opportunities and the benefits they can provide to the widest possible audience.

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“More than ever, 2022 highlighted the myriad ways in which clean cooking companies are innovating, making their products more efficient, affordable, and user-friendly.

“CCA’s work with companies has supported projects ranging from improving gender-inclusive practices, to better understanding production costs,” the CEO said.

In terms of the drivers of investment in the sector, CCA supported the development and launch of the Spark+ Africa Fund, the world’s first impact fund financing clean and modern cooking solutions. The fund raised $54 million at first close and has already made initial investments of $4 million in BURN Manufacturing and $2 million in Sumac Microfinance Bank, both in Kenya.

The Alliance has increased access to finance by launching new strategic partnerships with the UN Capital Development Fund (UNCDF) and the African Guarantee Fund to promote financial innovation and investment in African and Asian markets. The partnerships aim to further increase the flow of both public finance and newer forms of climate and social impact finance to clean cooking companies.

In a report released in the fourth quarter of 2022, CCA and Modern Energy Cooking Services developed innovative case studies of results-based financing (RBF) initiatives in the clean cooking sector that could help program developers design future RBF programs.

“I am honored that the Clean Cooking Alliance (CCA) and our partners helped drive the tremendous growth across the clean cooking ecosystem,” she said.

According to the CEO, this year is already off to a promising start. “I am confident of even greater progress in 2023, as the initiatives under CCA’s Systems Strategy continue to develop and we strengthen ties with adjacent sectors, including for climate action and nature-based solutions.”