Private Sector Involvement and Innovative Financing in Improved Cookstove Sector of Asia

Improved cookstove sector can’t be sustained without a market-led approach and privates sector involvement. This is now increasingly understandable to me that to create demand and meeting consumers’ needs, we must need innovative business model (including financial innovation).

Unfortunately, globally, most of the improved cookstove programmes do not function in a private sector led business model. Many cookstoves programmes again miss clearly defined development objectives.

 The irony is that either ICS programme are overly ruled with ‘profit motives’ or being controlled merely with an aid or grant mechanism. The idea of impact investment is grossly absent in the existing business models in the household clean cooking energy domain.

 Therefore, there is a need of designing  a result based business and finance model in the clean and improved cooking stoves, which will ensure production and supply of cooking energy solutions at an affordable price, with effective and socially acceptable market led approach.

 In SNV, we are now working on this mission to identify critical success factors for creating sustainable supply and demand chains and its management based on the reviews of available ICS programmes in Asia (including the SNV’s own ICS programme). As part of this, an innovative financing instrument to fund local energy solutions (including cookstoves) will also be developed along with highlighting the necessities for designing programme based retailing and franchise

mechanism in the cookstove market. The The expectation of users for subsidy is another challenge in the cookstove market, which has been planned to manage by transforming it into a positive externality to create market demand in rural areas of least developed countries.

 We’ll look forward for partnership!

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Keshav C Das

Kdas@snvworld.org

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