Facilitating climate change mitigation through sustainable green financing
Our world faces a sustainability crisis. The planet is not on track to meet our sustainable development commitments and insufficient investments are flowing in the right direction. The government, the private sector and development partners must come together and show the same level of ambition that rebuilt Europe in 1948, in tackling climate change. Lack of appropriate financing and limited awareness of innovative technologies linger among the biggest barriers to clean energy transition. Equity Bank has set aside over Ksh20 billion for climate financing to facilitate access to clean energy transition, adoption and purchase of innovative clean energy technologies that directly impact people's health, incomes, and the environment. This is in line with its transformative climate dictum of prioritising purpose over profits. With the glaring negative effects of climate change on the entire world, protection of the environment and sustainable use of our natural resources is key to Equity’s interventions. The battle of environmental protection cannot be won by the government alone and therefore the private sector can avail its sunk costs in terms of infrastructure and balance sheet to support climate change initiatives. The Bank, being cognisant of this fact, is playing a leading role in sustainable financing and is strategically providing infrastructure and expertise to accelerate and scale programmes and projects aimed at protecting the planet. Recently, the bank unveiled its inaugural initiative to support learning institutions to transition from wood-fuel based cooking to cleaner, sustainable, and environmentally friendly sources of cooking and lighting. It is estimated that over 90 percent of Kenyan institutions use wood or charcoal to prepare meals. According to the Clean Cooking Alliance of Kenya 2019 report, schools consume over one million metric tons of wood per year, with an estimated value of Ksh10 billion. Switching schools to cleaner and efficient sources of energy will not only reduce costs but will also provide better health and environmental outcomes. This initiative will see Equity support learning institutions cut their annual cost of wood fuel by up to 40 percent. As of the end of 2019, the bank had introduced other programmes such as Ecomoto, to enable households access clean energy for lighting and cooking purposes. Ecomoto has enabled Kenyans to buy modern energy solutions such as LPG, clean cook-stoves, electric pressure cookers, Solar Home Systems and water purifiers through a simplified loan product that allows for instalment payments for as little as Ksh15 a day over 12 months. Besides, the loan is available on mobile via Equitel, Eazzy Banking app and USSD by dialling *247#. Customers who apply for Ecomoto get access instantly as it is approved and disbursed into the stockist’s account in real-time, allowing them to pick up the equipment at the agent location. This is a first in the clean energy space and drastically reduces the loan acquisition time to less than five minutes. To enable sustainable resource management and afforestation, the bank is committed to planting 35 million trees by 2022. To date, Equity has planted 3.12 million trees and is geared to plant more in the current planting season, with a clear focus of growing and nurturing the trees. The commitment in October 2019 by the Group to plant 35 million trees was not only aimed at marking the Bank’s 35 years of operation but also a recognition and support to the government of Kenya’s initiative to plant two billion trees by 2022 to increase the forest cover to over 10 percent. Equity Group Foundation also promotes the conservation and smart use of natural resources by improving water security as well as promoting climate-smart agriculture. These interventions are aimed at reversing environmental degradation, combatting climate change through mitigation and adaptation, improving people’s health outcomes and saving costs. The Foundation does not only aim at strengthening environmental sustainability and stewarding natural resources for future generations, but also improving the lives and livelihoods of African people through clean energy transitions. Farmers have been supported to adopt Climate Smart Agriculture technologies such as solar water pumping, solar irrigation systems, bio-digesters for biogas production and bio-slurry application, post-harvest loss management, energy efficiency solutions for households, industries and institutions through interventions like solar water heating, retrofits and replacement of polluting fuels used by industries with cleaner and environmentally friendly alternatives. Other initiatives include support for clean biomass fuel production such as briquettes and pellets and distribution of clean energy products to households by leveraging the Bank’s network of branches and agents. The Bank has, in addition to other environmental and energy initiatives, supported productive use of energy (PUE) in areas such as solar water pumping for drip irrigation and for livestock, aeration for aquacultures, refrigeration and poultry lighting, pest control and electric fencing. These measures have seen impact of solar electricity on agricultural activities increase productivity (including higher yields, lower losses, and faster production) and improved natural resource management. With these interventions and clean energy transitions in place and all stakeholders working together, it is possible to have a safer, sustainable, and cleaner planet for all of us.