Alternative Fuel Challenge Fund (AFCF)
Call for proposals for a competitive challenge fund to support fuel producers’ upscale production and sale capabilities.
Reference Number: 83471355
Publication date: 25.09.2024
1.Context
According to the Fifth Rwanda Population and Housing Census, 2022 Main Indicators published in February 2023, one third of the Rwandan households (32%) have and use energy-saving stoves. This means that the remaining 68% of the households still rely on traditional cookstoves and use firewood or agricultural residues for cooking. The inefficient traditional biomass use has a high impact on climate, the environment as well as user’s health.
In its Nationally Determined Contributions (NDCs), the Government of Rwanda committed themselves to the following:
- At least 80% of the rural population phase out open fires by accessing modern efficient or alternative cleaner fuels and cooking stoves technologies.
- At least 50% of the urban population use modern efficient cookstoves or cleaner cooking fuels, such as pellets, briquettes, electricity, or green charcoal.
- Reduce institutions’ demand of wood biomass for cooking and heating through supporting and encouraging institutions to use alternative improved cooking technologies with emphasis on Electricity, LPG and Green Charcoal
- Reduce the consumption of wood for charcoal by improving the efficiency of charcoal production and its value chain.
- Increase supply of woody biomass through improved sustainable management of woody biomass resources and agroforestry promotion background
The Reducing the Climate Impact of Cooking in Rwanda (ReCIC) project, implemented by EnDev, is co-funded by the European Union under the Global Climate Change Alliance Plus (GCCA+) initiative and aims to address the above mentioned challenges through a threefold approach: increasing and improving the production capacities of ICS and fuel producers, raising consumer awareness, and supporting dissemination density.
By designing an Alternative Fuel Challenge Fund (AFCF), ReCIC seeks to empower private sector companies in the Rwandan cooking energy sector to increase the production and enhance the distribution of alternative fuels such as briquettes and pellets. In particular, the project pursues the following objectives
- Provision of technical training for alternative fuel producers
- Establishment of operational and functional production sites
- Testing of fuels
- Establishment of retail points in Kigali and outside the capital
Through the Fund, ReCIC will support selected companies with business development services such as trainings and targeted financial contributions (installment) against evidence support to enable companies to develop, test and scale up biomass-based alternative fuels, and business models that have not been fully disseminated in Rwanda.
2. Technology Focus and Support Pillars
The application and support will focus on market and business model development for alternative fuels (i.e. briquettes, green charcoal and pellets)
The Alternative Fuel Challenge Fund (AFCF) aims to:
- Enhance the production of alternative fuels such as briquettes and pellets
- Establish and improve production sites of alternative fuel companies
- Extend the supply chain of alternative fuels
- Enhance the business capacities of private sector companies
The Alternative Fuel Challenge Fund has two pillars
- Financial support: applicants will be requested to outline a comprehensive business plan incl. equipment and materials needed to either enhance the production of alternative fuels or to establish and improve the production side
- Capacity development: targeted training such as technical training as well as business development services will be provided to all selected companies to provide new skills to improve the alternative fuel production and to further develop existing business models.
3. Who can apply
Applications are open to all Small and Medium-sized Enterprises (SMEs), cooperatives or companies operating in the clean cooking sector in Rwanda and producing alternative fuels such as briquettes, pellets and green charcoal.
Eligibility criteria
A company / cooperative will be expected to meet the following conditions to qualify for the AFCF:
Technology Focus
- Applicants are encouraged to produce / promote efficient and affordable alternative fuel sources (pellets, briquettes, and green charcoal) to firewood and/or traditional charcoal that minimize fuel consumption
- Having tested the calorific value, moisture content, hardness, ash content, chemical composition, particle size of the promoted alternative fuel tested by a recognized and independent institution is an advantage.
Lega Status
- The company must be registered with Rwanda Development Board (RDB) or Rwanda Cooperative Agency (RCA) (attach certificate)
Financial Status
- The company must be able to make its own contribution of at least 20%. The remaining 80% of the total cost of the implemented business solution will be covered by the AFCF.
- The company should be able to submit a detailed budget for the business model and should be able to provide a clear understanding and explanation of the required funds to improve and scale up the alternative fuel production
Capacity Status
- The company has been operational for at least 36 months and has been selling alternative fuels for at least 24 months
- The company can prove that at least 10% of the technical staff has at least 4 years of working experience in the alternative fuel (briquettes and pellets or green charcoal) production sector with relevant marketing and management skills as an obligation
- A proven collaboration with local government officials/ district is an added value.
- The company/ cooperative should have a clear organizational structure.
4. Evaluation Criteria
Given the fulfillment of the eligibility criteria, the applicants will be assessed based on their motivation, business plan as well as against the following evaluation scorecard (hereafter referred to as technical assessment).
