September 2018 Newsletter

GLPGP September 2018 Newsletter

This issue brings news of exciting progress and new findings from expanding microfinance programs, ever-broadening engagement with the United Nations system, an important, deepened research partnership, and several global fora focused on addressing the links between clean cooking access, health and sustainable development. Among these is the upcoming LPG for Development event co-hosted by GLPGP and the World LPG Association at the annual World LPG Forum, held this year in Houston, USA on October 4, 2018.  Readers who will be in Houston are urged to register and attend. Please read on!

In late 2017, GLPGP launched an expansion of its OPEC Fund for International Development (OFID), European Union (with KfW) and Clif Bar Family Foundation- funded Cameroon microfinance program Bottled Gas For Better Life. The expanded program is designed to be more commercially scalable than the pilot.

In October 2017, GLPGP and its Cameroonian partners MUFFA (microfinance partner) and Glocalgaz (LPG equipment provider) added 50 households in Buea, southwest Cameroon. Loans of 50,000 XAF (US$90) were provided to cover household LPG equipment purchases and were repaid on a monthly basis over six months.

By the end of the loan period:

• Each household had purchased on average 4.3 refills of 12.5kg cylinders.

• This is equivalent to annual per capita consumption of 19kg, substantially higher than Cameroon’s national average of 4kg per capita.

• 95% of the loaned capital was repaid.

• 76% of households were able to complete repayments in under five months, as compared to the pilot phase, in which only 10% completed repayments in that period.

Unlike the pilot phase in which funding partners required considerable GLPGP supervision, loan servicing and collection was primarily carried out by MUFFA. Civil disorder towards the end of the phase delayed the completion of loan payments for a few households, and a repayment grace period was extended to them.

The second, larger expansion phase is now ongoing, thanks to continued support from the OPEC Fund for International Development, KfW and the Clif Bar Family Foundation. There is now a larger group of program partners, targeting nine different communities and 630 households across five regions of Cameroon. Community sensitization and participant registration commenced in mid-April, and we have so far enrolled 400 participants, already double the number in the first two phases.

GLPGP launched a new microfinance program in Kenya in August, 2018. Together with Equity Bank and the National Oil Corporation of Kenya (NOCK), microloans will be provided to 150 households for LPG equipment purchase in Magumu, Nyandarua county (about 41 miles from Nairobi) and Kimende in neighboring Kiambu county. Bottled Gas for Better Life aims to increase awareness and usage of LPG in both urban and rural parts of Kenya by providing educational campaigns and financial assistance to address upfront LPG switching costs.

Each household is provided a loan to cover the purchase of LPG equipment, costing 9,900 KES (US$98.01) with a monthly interest rate of 1.083% on a declining balance (excluding the security deposit of 2000 KES) over six months. The program is expected to benefit from Kenya’s thriving mobile payment platforms, enabling better data collection on loan repayments and gas refills. An evaluation of the program will be carried out through surveys with participant and control households, at the beginning and end of the loan period. The evaluation will be funded by the London School of Economics/ International Growth Center and led by the University of California, Berkeley.

This August, the Global LPG Partnership was granted Special Consultative status with the UN Economic and Social Council. This will allow GLPGP to engage within the UN system on matters related to global energy development and addressing energy poverty. GLPGP looks forward to continuing its engagement with existing and new UN partners in this capacity.

On July 12, 2018, GLPGP participated in a webinar hosted by the Climate & Clean Air Coalition,  targeting policy makers, practitioners, and researchers who were interested in improving the access and affordability of LPG.

Alex Evans, Chair of GLPGP’s Operating Committee spoke about Ghana’s ongoing LPG reforms and sector development, as well as GLPGP’s facilitation role, highlighting the challenges often faced in LPG sector development. These include overcoming affordability issues for very poor consumers who cannot fully afford the upfront equipment costs of the stove, burners, hose, and cylinder deposit. He also spoke about Ghana’s LPG ecosystem and the ongoing transition to the “cylinder recirculation model”, to improve LPG cylinder safety across the distribution chain and to customers. Mr. Evans highlighted expected LPG market growth in Ghana and how the transition to the new model will be able to support net creation of 4,100 jobs.

Envirofit and Entrepreneurs du Monde also presented. Participants were introduced to Smartgas, a new technology developed by Envirofit allowing users to pay for LPG as they cook, which has already been piloted in Kenya and Ghana. Entrepreneurs du Monde presented the economics of LPG access in Haiti and the associated effects in terms of short-lived climate pollutants (SLCP) and greenhouse gas emissions.

Kimball Chen (left), Chairman of GLPGP, spoke at the 27th World Gas Conference in Washington DC on June 29, 2018. Addressing global leaders in the gas industry, Mr. Chen discussed the role of effective public communications and advocacy in advancing policy and action in the global energy sector. He stressed that gas liquids (including LPG) suffer from an ‘image problem’ in the public eye. This continues to impede their uptake as a viable lower carbon solution in the transition to a more sustainable future. He spoke about the rigorous and empirical research which has found that LPG, despite being a fossil fuel, is environmentally benign, and also offers the most practical, feasible solution for developing countries’ cooking energy needs.

He emphasized the need for educating key stakeholders on the benefits of gas for development. The LPG sector’s keen use of grassroots communications and partnerships with neutral third parties for objective research, as well as the accumulation of favorable evidence, has brought LPG to the center of national energy development policies in major countries like India and Indonesia.

In April 2018, Dr. Daniel Pope at the University of Liverpool was awarded, contingent on a scoping phase, a three-year grant from the UK National Institute for Health Research for the establishment of the Clean Air (Africa) Research Group. The group will conduct a program of research and capacity building around access to clean energy (LPG) for cooking, in Kenya, Ghana and Cameroon, with support from local academic institutions. GLPGP was a co-applicant and a key research partner, contributing both to the design of the research program and to leveraging in-country support by key government stakeholders. 

LPG for Development Lunch - Cooking Up Solutions for Modern Energy Access (October 4)

Planning to be at the World LPG Forum in Houston, TX in October? Please join us for a lunch discussion on Thursday, October 4, 1pm in Room 343, to hear the latest from leaders across Africa and Asia on developments to support wide-scale adoption of LPG for clean cooking. The discussion will be moderated by GLPGP Chair, International Institutions, Richenda Van Leeuwen.

Stanford Natural Gas Initiative 2018 Symposium (October 16-17) and NGI Industrial Affiliates Meeting (October 18-19)

Kimball Chen, Chairman of GLPGP, will be a keynote speaker at Stanford University’s Natural Gas Initiative (NGI) Symposium on October 17, 2018 and will also address the 2018 NGI Industrial Affiliates Meeting on October 18, 2018. Mr. Chen will deliver the keynote address at the Future Energy Systems symposium on issues of energy access, sustainability and affordability. At the Affiliates Meeting, Mr. Chen will talk about LPG for distributed energy in the developing world as a keynote speaker.