07.02.2024 | News
The Beyond the Grid Fund for Africa (BGFA) is expanding its portfolio in Uganda and has signed a new agreement to scale up solar powered water pumps and irrigation systems in the country. Through access to off-grid irrigation systems, smallholder farmers are able to increase their annual crop yields.
The latest BGFA agreement has been signed with SunCulture Uganda Limited to scale up access to solar water pumps and irrigation systems in rural areas across the country. The company started its operations in Uganda in 2022 and its headquarters is located in Kampala. For over ten years, SunCulture has been developing and commercialising solar irrigation systems in several African countries. The approximately EUR 3.2 million in results-based financing to be provided from BGFA will mobilise at least an equal amount of additional co-financing by the end of 2027.
“Affordability remains the primary barrier preventing farmers from accessing technologies that can not only revolutionise their livelihoods but also contribute substantially to global food security. In developed nations, governmental subsidies have long played a vital role in making agricultural and energy products accessible to farmers. However, in Uganda and many other African nations, such direct governmental support is often absent. BGFA’s innovative approach, replicating these subsidies through results-based financing, is a game-changer. It adopts a proven strategy, tailoring it to the unique contexts of these countries. As we embark on this journey with BGFA, we are enthusiastic about the potential of this programme and hope that it will inspire other companies to pursue results-based financing to make products more affordable,” says, Samir Ibrahim, CEO at SunCulture.
With the financial support of BGFA, SunCulture plans to expand its business operations in Uganda across the country. The aim is to establish and service up to 13,200 energy service subscriptions by the end of 2027. The company is developing and producing its own solar powered water pumps and provides a holistic product offering, including delivery, installation, monitoring and on-site after-sales services. Some of the pumps are also combined with a battery system, which can be used for early morning and cloudy weather irrigation when evaporation is low, reducing water requirements. The company’s main customer group is smallholder farmers cultivating less than one hectare of land. Many of these farmers are women and the majority rely on rainfed farming. The solar water pumping systems can also serve households and livestock farmers.
Through access to irrigation, farmers can secure their rainy season crop and their planting window during the dry season. Currently, over 50% of crop yields dry up due to reliance of rainfed cultivation. Irrigation systems also help farmers cultivate higher value crops and vegetables that require regular irrigation. The use of solar-powered irrigation systems can increase smallholder farmers’ yields by up to five times.
“By supporting SunCulture to scale up its business operations and reach more rural farmers, we are able to increase farmers’ incomes, empower women, help farmers adapt to climate change and increase access to clean energy alternatives in the country,” comments Tina Möller, Programme Manager at Nefco.
The Beyond the Grid Fund for Africa has so far contracted six companies in Uganda, and a total of 26 companies across Burkina Faso, DRC, Liberia, Uganda and Zambia. Once implemented, the current programme portfolio will have the potential to reach over 8.6 million people across these five countries. The BGFA funding window in Uganda is funded by Denmark and Sweden.
For further information, please contact:
Tina Möller, Programme Manager at Nefco
firstname.lastname@example.org, +358 10 6180 651
Hack Stiernblad, Director of Business Development at SunCulture
email@example.com, +254 708 025 877
Founded in 2012, SunCulture designs, sells, finances and services Africa’s market-leading IoT-enabled solar irrigation systems. SunCulture uses financial services and carbon revenues to reduce the cost of solar irrigation by 50% compared to diesel and petrol pumps, and uses an embedded data science platform to help smallholder farmers make better decisions and access the agriculture value chain. Read more at sunculture.io/ug
The Beyond the Grid Fund for Africa (BGFA) is a multi-donor facility established and managed by Nefco – the Nordic Green Bank. Nefco is an international financial institution based in Helsinki, Finland, focusing on environmental and climate investments and fund management. BGFA is implemented by Nefco, with the support of two project implementation partners. NIRAS is a development and engineering consultancy company headquartered in Denmark. The Renewable Energy and Energy Efficiency Partnership (REEEP), an international multilateral partnership based in Vienna, Austria, works to accelerate market-based deployment of renewable energy and energy-efficiency solutions in developing countries.
The current EUR 126 million BGFA programme was established in 2019 on Sweden’s initiative through the Swedish International Development Cooperation Agency (Sida). It has since been developed by Nefco into a multi-donor programme funded by Denmark through the Ministry of Foreign Affairs, Germany through its development bank KfW, Norway through the Norwegian Agency for Development Cooperation Norad and Sweden. Power Africa, an initiative administered by USAID, is providing an in-kind technical assistance contribution. Read more at www.beyondthegrid.africa
Photo: A female farmer using a solar-powered irrigation system in Uganda – SunCulture