About ABC Kenya

Funded by the Dutch Ministry of Foreign Affairs (DGIS), the Danish International Development Agency (DANIDA) and the European Union (EU), the African Biodigester Component (ABC) in Kenya aims at facilitating a shift of the biodigester market from its pioneering to the expansion phase where more than 20,000 small (0 to 50 m³) and 250 medium (50 to 500 m³) size biodigesters will be installed. The component is implemented by a consortium between GIZ and SNV (the Netherlands Development Organisation) in cooperation with Africa Bioenergy Programs Limited (ABPL - ex-Kenya Biogas Program).

The project objectives will be achieved by means of a well-balanced mix of demand-side, supply-side, financing and enabling environment interventions, geared at boosting demand and supporting biodigester companies in acquiring more clients.

Supply Side Interventions

This intervention area aims at strengthening the private sector’s capacity to provide high-quality biodigester technologies and services to its clients and to gradually expand their geographical reach and client base. Professionalization of the biodigester companies in Kenya shall be achieved by deploying technical assistance (TA) and tailored business development services (BDS), based on the specific needs of the small and medium-scale segment and relevant technologies. ABC focuses on defining the overall supply side strategy and on extending punctual TA to biodigester suppliers with regards to increasing biodigester penetration/uptake, as well as biogas utilization. For the medium-scale segment, the Project has also developed and in the process of carrying out a training on design and construction for small and medium scale biodigesters (focus on fixed dome model), including a component that enables companies to provide training on the biogas valorization. The Project works on identifying opportunities to involve new actors (investors, entrepreneurs, or companies from other sector with affinity to the sector (agricultural machinery, construction, etc.) that have the necessary structures to supply biodigesters at a larger (semi-)industrial scale, such as also acting as aggregators of the many individual artisans that have been trained in past biogas projects. They could act as distributors of prefabricated digesters for companies that are not present in the Kenyan market. Furthermore, the Project engages in providing market intelligence and support to local and international players that could be interested in establishing a local production for prefabricated biodigesters in Kenya. Based on the Lead Implementer Kenya’s knowledge of the market, the following considerations can already be raised for the two market segments:

Small-scale segment: for this segment, the focus is on capacity building and professionalisation of fixed dome biodigester companies in form of technical assistance, training and mentorship. Areas critical to improving small-scale suppliers include business formalisation, bookkeeping, staffing, tax compliance and enhancing their institutional capacity to meet the government’s requirements to participate in public tenders, as well as marketing and pitching skills.
Medium-scale segment: for this segment, the focus is on building more biodigesters, increasing biogas utilization for valorization and energy generation, bio-slurry and bio-slurry enriched compost application and trading and on quality assurance.
Furthermore, to strengthen the credibility and sustainability of the medium-scale segment, quality assurance needs to be urgently addressed by offering training to suppliers/installers to be accredited/certified. The Project is engaging with the National Industrial Training Authority (NITA) to update and roll-out a biodigester curriculum that is aligned with the modern standards and that sets the path for certification or accreditation of biodigester technicians.

Result-Based Reimbursement

A Result-Based Reimbursement (RBR) facility for domestic biodigesters is the core instrument of the African Biodigester Component (ABC). Through the provision of result-based reimbursements, ABC aims to provide the last push needed for the biodigester market to reach a critical mass of clients within Kenyan farmers. This is expected to enable suppliers of small-scale biodigesters to achieve economies of scale, the market to be firmly rooted in the expansion phase and become self-sustainable.

Enabling Environment

The goal is to support Biodigesters market development. This will be achieved through:

Supporting policy, regulatory development and fiscal incentives
Strengthening Bioenergy sector associations and networks
Providing Technical assistance, advisory and mentoring, capacity building interventions, dialogue events and/or advocacy support.
Project studies guiding implementation: Enabling environment & Capacity building, Awareness and GESI strategies and roadmaps

ABC through SNV will also be involved in capacity-building activities for county authorities to include biodigester and biogas in the county development planning. This activity will focus on 12 counties selected in a participatory manner.

In these counties, door-to-door consumer education activities will be led by ABPL through the biogas marketing hubs and existing demo farms. The project will also work through the energy, agriculture, and technical vocational training centres network.

Demand Activation

The main objective is to increase the demand for small and medium scale biodigesters among the project’s target groups, stimulating their adoption, and maximising end-user benefits through the valorisation of biogas and other by-products, such as bio slurry and compost.

This will be achieved through various awareness creation activities targeting marketing hubs and the use of digital campaigns on social and mainstream medias, for the small scale segment, demand activation will be realized in two ways:

Last mile agents- developing the network of last mile sales agents for biodigester companies
Financial Institutions- A pilot in specific counties aggregating demand for biodigesters through financial institutions such as MFIs, SACCOs and dairy cooperatives.

The medium scale segment’s demand activation will be realized in two ways:

Revolving fund- to establish and manage a revolving facility on behalf of ABC Kenya including after 2025. The fund will be accessed by biodigester enterprises installing / constructing commercial biodigesters (50 to 500m³) in Kenya
Super Sales Agents-ABC Targets 175 medium scale biodigesters to be delivered through Super Sales Agents whose core activities are to Promote, market and sell commercial biodigester (50-500m³) and associated financial products.

Access to Finance

Private Equity Support (PES) and Partners have undertaken a pivotal role in fostering 'Access to Finance' for end-users, encompassing households and small and medium-sized enterprises (SMEs) within the biodigester value chain in Kenya. The project's scope, aims, and ambitions are designed to amplify financial accessibility, ensuring the sustainable growth of businesses involved in any facet of the biodigester supply chain.

Scope:

Design and implement actions contributing to increasing access to finance for (M)SMEs active in any part of the supply chain
Map core activities that will increase access to finance into the biodigester market
(Co-)develop loan products specifically designed for end-users

Specifications:

Engage with (Micro) financial institutions operating in Kenya with an interest in the biodigester sector.
Make an inventory of existing green credit lines and loan products available for the end-users and (MS)MEs active in the biodigester sector.
(Co-)Develop or adapt credit lines and loan products for end-users and (M)SMEs active in the biodigester sector together with financial institutions, SACCOs, cooperatives etc.
Implement training and design of training materials on developed credit lines and products, in close collaboration with ABC Kenya’s lead implementers.
(Co-)Design an incentive mechanism for (Micro)Finance Institutions.
Provide advice and guidance on how to increase financial activities into the biogas market. Especially empowering ABC-Kenya’s lead implementers to scale best-case practices.

The A2F implementer aims to increase access to finance by utilizing existing and realizing new specific credit lines for SMEs and end-users in the biodigester sector in cooperation with international donors and (local) financial institutions, the A2F implementor will, in cooperation with local financial institutions, develop loan products specifically designed for smallholder and commercial farmers in order to increase their ability to pay. The lead implementers will help the A2F implementer to get a better understanding of the target group and the business case for biodigesters.

The expected outcome of the A2F implementer is increased access to finance for end users that would like to purchase a biodigester and increased working capital for enterprises active in the small scale and medium scale biodigester value chain, thereby contributing to increased and sustained supply and demand. The A2F implementer ensures that access to finance is increased for MSME active in any part of the supply chain, including importing, assembly, production, construction, auxiliary services, fuel preparation, software provision, maintenance and the end-users.

Gender Equality

The component will support women entrepreneurs and women-led businesses, while also specifically targeting women in demand activation through gender-sensitive Behavioural Change Communication (BCC) and household dialogue approaches. Gender will be mainstreamed in the project implementation processes, partners strategies and enabling environment – contributing to Kenya’s Gender Policy in Energy through supporting and building the capacity of women-led enterprises and promoting the employment of women, and target project beneficiaries. Women and men will equally benefit from the project, and this shall be achieved through gender equality during the identification and selection process of project participants and beneficiaries.