CookFund Programme: Accelerated Market roll-out of Clean Cooking Solutions in Tanzania

Deadline: 17-Dec-22

The United Nations Capital Development Fund (UNCDF) is inviting eligible Small and Medium Enterprises (SMEs) and companies which are involved in the clean cooking value chain / technologies to apply for technical and financial assistance to accelerate market roll-out of clean cooking technologies in Programme targeted urban areas/regions.

Financial assistance will mainly focus in addressing enterprises/companies’ undercapitalizations and end-user affordability.

The fund will be disbursed in consecutive rounds until completion during a three-year period with current funding of up to EUR 9.7 million in total. Targets, Incentives and subsidies may be readjusted and recalibrated in the next rounds (guidelines will be modified accordingly) depending on the response of the market to this first round of the call.

The CookFund Programme, funded by the European Union (EU), is a three-year programme (2022 – 2024) that seeks to accelerate market rollout of clean cooking solution in Tanzania mainland, targeting five regions namely Dar es Salaam, Pwani, Morogoro, Dodoma and Mwanza. The Programme is implemented by the United Nations Capital Development Fund (UNCDF) in collaboration with United Nations Industrial Development Organisation (UNIDO). UNCDF is both the Fund Manager and implementor of the Programme.

Objective

The main objective (impact) of the programme is to reduce climate change impact in Tanzania by increasing the share of the population with access to sustainable cooking solutions. The specific objective is to increase usage of modern and clean cooking solutions in urban areas for improved environment and inclusive wellbeing of the population. CookFund aims to bridge a critical gap between early-stage support, equity financing and concessional/commercial debt needed to transition to modern, clean cooking at scale.

Categories

Funding will competitively be provided to address end-user affordability barriers as well as undercapitalization on the side of enterprises and companies (category one) and to leverage technology focused business models to overcome affordability areas especially upfront costs for household energy products (category two).

• Category One: This is a combination of investment and working capital growth grants and of performance-based subsidy. The latter will be provided as a result of attained sales volume or number of units to end users and upon third party verification of sales.
• Category Two Working and Investment Capital -PAYGO: This CookFund Programme is also encouraging new digital innovations in reaching out more end-users. Working and investment capital will be provided to enterprises or companies that reach out users with clean cooking products and services through flexible payment systems and digital communications.

Target Cooking Technologies

Funding Information

• The size of individual awards will range from €10,000 – €300,000, with a possibility for follow-on funding subject to performance and availability of funding.

Eligible Enterprises

• SMEs/Companies (producers, importers, distributors, assemblers, wholesalers, retailers) engaged in various clean cooking technologies: These include enterprises that can scale up production and/or sales to penetrate the market as well as those that can import and replicate proven and certified energy efficient cooking technologies for local assembly and/or distribution.
• Innovators and suppliers of end user payment modalities for alternative energy for cooking solutions. These are clean cooking businesses with innovative solutions which make easy access of alternative cooking solutions for end users such as flexible payment systems (e.g.,

Eligibility Criteria

The CookFund Programme is open to SMEs and companies that will have the following criteria:

• Geographical Scope: Have operations in the urban areas of Dar es Salaam, Pwani, Morogoro, Dodoma and Mwanza regions only. NOTE: Players in the bio-ethanol cooking solution for Dar es Salaam only should apply through a different window.
• Thematic Scope and Product Eligibility: Committed to adhere to targeted cooking technologies (LPG, Natural Gas, Ethanol, Electricity, Briquettes, and ICS) and related quality standards and industry best practices by Tanzania Bureau of Standards (TBS).
• For profit and market-oriented enterprises and companies: Have existing business, a welldeveloped business plan, cash flow positive and profitable, or showing a clear path to expansion and profitability following support by the Programme.
• Professional capacity requirements;
  • Applicants should be able to show that they have/has sufficient resources, competence and experience to perform projects in the clean cooking market.
  • Applicants will also be required to establish a key management team responsible for performing and coordinating the project.
  • The qualification of the team members must be adequate for the implementation of the proposed project activities.
• Market experience requirements;
  • Applicants should demonstrate that they have sufficient market experience of working in one or more country, region, or district level market(s).
• Applicants should specify the total amount of funding being requested and their predicted annual funding requirements for the project implementation period (2021-2024).
• The funding should not replace the pre-allocated national expenditure in the sector/subsector or crowd-out commercial lenders from serving the enterprises or companies. This is in line with the EU principle of additionality.
• The successful applicant should open a separate and dedicated bank account for receiving CookFund grant support. The grant paid to the beneficiary enterprise or company should not be used to service pre-existing financial obligations i.e., bank loan etc
• Impact driven as well as operating a business model which includes selling to the household market or agents who are directly selling to end-users either households, businesses, or institutions. To receive programme funding, successful applicants are required to deliver and sell affordable and high-quality clean cooking services directly to end-users in a stable and sustainable manner.
• Monitoring and Reporting: The applicant’s capacity and readiness to track and report sales to end users of the technology, including data management and data quality checks. Baseline data on existing performance should be provided.
• Proof of business track record and relevant experience: Have at least one year of business operations with minimum financial records or will commit to deliver business financial statements within six (6) months of grant disbursement with proper system of recordkeeping, Page 13 of 15 financial management and evidence of bank account operations. Previous borrowing and repayment records is an added advantage
• Compliance: The applicant complies with national (Tanzania), international and home country (if different) laws, regulations and best practices including Tanzania Revenue Authority (TRA), Business Registrations and Licensing Agency (BRELA), Environmental and Social Performance Standards and human rights principles, particularly on decent labour conditions.
• Business legality and status: Legally registered, incorporated and operates in Tanzania. Entities incorporated outside Tanzania but having branches and operations in Tanzania, should provide evidence of operations in the country.
• Environment and sustainability: For bioethanol and briquettes the successful Applicants must demonstrate that any eligible fuels used are produced or sourced in a sustainable manner, including that any pellets or briquettes are manufactured from sustainable or renewable sources. Proof should be provided during the Application stage on the nature of the raw materials used and their effects on the environment, i.e., deforestation or other form of ecological degradation.
• Capability of matching 25% of investment funds requested.
• Gender mainstreaming
  • Applicants are encouraged to offer equal opportunities for men and women through their own policies and employment practices as well as in proposed projects.
  • This will be assessed based on the Applicants’ present organizational governance (preference will be given to companies having gender-balanced representation at all hierarchical levels and equality of pay)
  • Successful applicants will be required to develop gender action plans, including a marketing/awareness-raising strategy that is responsive to needs and motivations of both women and men for purchasing clean cooking solutions.

For more information, visit https://bit.ly/3cNQSOB