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Post-Event Report

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The Conference at a Glance:

Following the trade mission from Europe to Rwanda in March 2017, RECP and its partners concluded

the second business matchmaking event in Kigali successfully convening over 150 industry experts,

policy makers and innovators from 19-20 October 2017.

The event was organized by Rwanda Energy Private Developers (EPD) and the European Renewable

Energies Federation (EREF). The conference featured panel discussions, technology exhibition and a

business-to-business (B2B) matchmaking session with renewable energy private sector players

interested in investing in Rwanda. It was preceded by a training day organized by the Renewable

Energy Performance Platform (REPP) to Rwandese hydropower developers on Project Finance and

Risk Assessment for mini hydro projects in Rwanda.

The interest in Rwanda’s renewable energy market reflects the existing opportunities for private

investments in the off-grid sector to provide electricity to over 1.2 million households. During his

opening remarks, Hon. James Musoni, Minister of Infrastructure, appreciated the current

contribution of the private sector in Rwanda and noted the need for an even stronger and more

vibrant private sector. He highlighted that the Gov. of Rwanda envisions a private-sector led

progress towards reaching its 100% energy access target emphasizing that stand-alone solar systems

and isolated mini grid solutions will deliver almost half the required level of electrification by 2024.

The private sector is expected to spearhead this process from investment to operation.

The CEO of Rwanda Development Board – the government entity that plays the lead role in

investment mobilization and promotion, including the energy sector – emphasized in her opening

remarks that Rwanda’s energy sector calls for innovation not only for energy access but also to make

energy available, affordable and sustainable.

Following a series of interactive deliberations with policy makers, leading industry representatives

and a host of financing initiatives (see key highlights below), the last session concluded with a

business-to-business matchmaking of 115 meetings.

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Key Highlights:

1. Rwanda is banking on the private sector to lead the implementation of its 100% energy access

target by 2024 (52% of the population via on-grid connections and 48% via off-grid SHS and mini

grids), with the current rate standing at around 40% (29.5% on-grid and 11.2% off-grid). The

private sector is invited to deliver sufficient viable business propositions. The off-grid market

(Stand-alone solar systems and isolated mini grids) is the highest Gov. priority at the moment.

2. In addition to attractive top scores in global and regional competitiveness and performance

indicators (such as “Most Transparent Gov.”, “ICT Promotion”, “East of Doing Business”, “African

Competitive Economy”, “Safety and Security”, etc), Rwanda provides a host of fiscal and non-

fiscal incentives to attract energy businesses relocate their headquarters to Rwanda and boost

export.

3. Rwanda energy sector, like many steadily fast-developing countries, is changing rapidly where

some sub sectors - notably pico-solar PV (less than 10W) and solar home systems (SHS) (up to

200W) - are moving at a faster rate than others.

4. The Rural Electrification Strategy (RES) – approved by the Gov. of Rwanda in June 2016 – sets

four programmes to boost energy access, with a significant focus on off grid solutions, not only

for households but also for around 60% of ‘productive use areas’ referring to all users excluding

households (i.e., schools, health centers, Gov. offices, agro processing facilities, mining sites,

telecom towers, etc). The Strategy signals two main points to the private sector: 1) stand-alone

solar systems and isolated mini grid solutions will deliver almost half the required level of

electrification by 2024; and 2) the private sector is expected to lead this process from

investment to operation.

5. Currently, there are 26 companies working in Rwanda’s off grid sector– a figure that is increasing

rapidly. The market encompasses large multi-national companies to smaller start-ups. For stand-

alone systems, the business models range from PAYGo, fee for service, upfront sales, to

specialized credit sales directly from the company or via SACCO/MFI, etc. For mini grids, Rwanda

hosts several mini grids operating generally with grant assistance and using solar PV, mini hydro

or some hybridized with diesel generators. These mini grids use either Direct Current (DC) or

Alternating Current (AC) low voltage distribution grids.

6. A simplified mini grids licensing framework issued by the Rwanda Utilities Regulatory Authority

(RURA) in September 2015 exempts mini grids below 50kW from licensing, provides a simplified

license for those below 1000kW and a provides a Small Power Distribution License for grid-

connected mini grids.

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7. Solar PAYGo companies have grown rapidly in Rwanda and it is estimated that they represent

over 90% of all market sales. However, being highly capital intensive, the risk of saturating the

readily accessible markets at the expense of not serving the bottom-of-the-pyramid and more

complex markets is looming. It was debated that solar products available now can only

penetrate around 10% or so of the market, therefore affordability remains a major challenge.

This necessitates access to cheap capital, fast and easily accessible working capital and consumer

financing solutions. Simplified and coordinated customs clearance procedures to reduce delays

were also emphasized.

8. Some companies demonstrated success in reaching higher levels of bottom-of-the-pyramid

customers by providing a variety of product options. Using customer surveys, products can be

tailored to the poorest customers’ needs and their ability and willingness to pay.

9. Solar companies need to build trust of consumers and balance between customer acquisition

and customer retention. Best practices show that having close contact with the community and

demonstrating that systems work strengthens trust with customers. In Rwanda, the Energy

Development Company Limited (EDCL) supported the sector by launching customer awareness

campaigns of solar products, however, further support from the Gov. and development partners

is needed.

10. Rwanda hosts some of the oldest mini grids dating back to 2008. Despite significant progress,

there is still a need for grants, subsidies and a level-playing field to enable a faster growth rate of

mini grids. The mismatch between demand and supply combined with high costs of distribution

grids that typically range from 20-45% of total project cost remain a challenge. Government and

development partners’ support may focus on subsidizing assets for productive use and income

generation in addition to identifying sites for mini grids centred around anchor loads with

predictable electricity load profile to reduce distribution grid costs and ensure economic

viability.

11. Rwanda mini hydropower developers were some of the pioneers in the region since 2008

supported by development partners including GIZ and UNIDO, among others. Over the past

decade, the level of skills and competency in the sector has improved significantly providing

attractive partnership opportunities and joint ventures with international companies. However,

Project Financing is still lacking thereby imposing pressure on the sector to demonstrate a

stronger track record, benchmarks and predictability.

12. Project bankability depends on triple “L” conditions: i) Loud: clear and transparent Gov.

regulations and policies; ii) Long: stable legal frameworks that are predictable; and iii) Legal: law-

binding contracts and agreements.

13. Time is the biggest enemy for renewable energy projects to materialize. Projects currently take

between 1-7 years to develop depending on the country, the business model and the

entrepreneur. Time between project development stages should be shortened, to allow viable

projects to materialize and non-viable ones to terminate quickly.

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14. A successful renewable energy project usually combines a tailor-made product with innovative

financing solutions and a strategic partnership to deliver the service/product. It is an ecosystem

of conditions that enable only some business models to be successful. The sector is starting to

notice the trends leading to success.

15. Solar solutions for industrial and commercial customers were presented. Solar-as-a service

companies provide electricity at no up-front cost to users typically between 50kW – 2MW, and

bridge the financing gap existing between local finance (usually less than €50,000) and

international development finance (usually over €2.5M). One presented example of innovative

capital raising used crowd funding to secure €260,000 in three weeks for a Kenyan flower farm.

16. It was debated that access to funding is not a challenge; rather it is the lack of viable deals

combined with the ease and speed of access to funders. The conference highlighted several

active and upcoming financing/Technical Assistance initiatives, including:

o GIZ EnDev’s Results-Based Financing (RBF) allows companies to access grants upon

completion and verification of activities, to encourage and stimulate private sector

development and overcome market barriers in the off-grid sector. A local micro-finance

institution Urwego Bank (UOB) manages the funds, while EnDev provides technical

support and monitors fund administration. The RBF Solar Lighting (SL) program has, to

date, supported 40,000 systems, reaching 180,000 people. Furthermore, projections for

Q4 2017 are at 65,000 systems installed, reaching 261,212 persons. Through its RBF

village-grid (VG) program, EnDev has facilitated and supported the development of 23

mini-grids (2 operators). In order to support the development of a sustainable energy

market, EnDev works closely with the Government of Rwanda and energy stakeholders

through the provision of technical and policy advisory support.

o The upcoming Renewable Energy Fund (REF) (funded by the Scaling-up Renewable

Energy Program (SREP) Trust Fund) that will be managed by Development Bank of

Rwanda (BRD) will support the off-grid sector via three components starting in Q1 2018;

(a) Window 1 - On lending through Savings and Credit Cooperative (SACCOs) to

households and micro-enterprises; (b) Window 2 - On lending through banks

(commercial and micro finance) to households and small and medium enterprises

(SMEs); (c) Window 3 - Direct financing of mini-grid developers (starting at a later stage).

EnDev Rwanda and BRD will work in close cooperation to facilitate sector development,

particularly on the mini-grid component, whereby the RBF grants can be linked to the

REF’s complementary mini-grid financing window.

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o Energy and Environment Partnership (EEP): Provides seed funding to renewable energy

and energy efficiency projects, with a portfolio of 14 projects in Rwanda. Phase 3 is

expected to start early 2018 as a multi donor trust fund hosted by the Nordic

Development Fund. The “Call for Proposals” and the “Investor Forum” are expected to

take place in Q2 2018. EEA offers two funding windows (kindly note this is subject to

change as phase 3 is being designed):

Window 1: Early stage: For projects at an early stage of implementation,

including feasibility studies, pilots and demonstration projects. Grant between €

100,000 and € 300,000. Own contribution: 30 %

Window 2: Market ready, near-commercial stage, mainly private sector actors.

Grant between € 300,000 and € 1,000,000. Own contribution: 30 – 90%

o The Renewable Energy Performance Platform (REPP): Focuses on small to medium-sized

renewable energy projects (1-25MW) from feasibility to financial close. REPP provides:

1) technical assistance; 2) access to risk mitigation instruments and finance; and 3)

result-based finance.

o RECP Finance Catalyst: Provides Technical Assistance for small- and medium-scale (0.5-

50 MW) renewable energy projects in Sub-Saharan Africa to reach bankability and links

them to finance opportunities. Check the website here for eligibility and application

requirements.

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Business-to-Business Matchmaking Testimonials:

“We’d like to express a word of appreciation to the great work RECP is doing. [My Rwandese partner]

and myself met for the first time during the [RECP] match-making event in Lisbon last year. Since

then we have been interacting on a regular basis. During this week’s event in Kigali we have

concluded on the principles of a joint venture between Tiger Power and Hobuka to develop mini grids

in Rwanda over the coming years.”

Chris Prengels (Tiger Power, Belgium) and Ntare Karitanyi (Hobuka Ltd, Rwanda)

“Due to B2B meeting, I met experienced companies in

hydropower projects development and learnt so much.

[This] inspired me for better implementation of the pipeline

project of our company, 800kW hydropower plant.”

Philbert Dusenge (REPRO Ltd, Rwanda)

"Attending the EDP/EREF conference in Kigali has been a

great opportunity to get an update on the energy sector in

Rwanda and to meet with the local/international

stakeholders active in the market. […] a matchmaking

activity was also organised where I was able to meet with

the different parties I had selected. It has been a great

conference organised in a very professional way. And as

always in these meetings you end up knowing nice and

interesting people who will become a part of your business

network as from now. I would like to thank all the

organisers of this event for their effort and

professionality.”

Sabine Christiaens (VERD Q.I, Andorra)

“The event was well organised [and] structured. It covered all sides of energy in Rwanda (off-grid and

grid systems). The most advantage of such event for the growth of my company is networking and

[knowledge] transfer. We were able to meet people whom to share knowledge with and latest

innovations of solar systems. In addition through the B2B meetings I was able to meet people whom

there is potential to partner with on some projects.”

Jean Pierre Muhire (RENERG (R) Ltd, Rwanda)

“The Kigali Renewable Energy Matchmaking Conference and Exhibition on 19-20 Oct 2017 was a

great way for Ecoligo to network with potential partners for our business in Rwanda and will

definitely help us in expanding our business in Africa further. We’re grateful for the opportunity to be

on the panel to present our solutions to address the financing barriers of commercial and industrial

solar energy projects in Sub-Saharan Africa.”

Rasmus Hansen (Ecoligo, Germany)

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Evaluation Results:

A total of 40 participants filled and returned the evaluation forms, with the following results:

Significantly above , 37% Above , 32% Met , 23% Below , 8%

1. Did the event meet your expectations?

Excellent , 55% Good , 42% Poor , 3%

2. Quality of the B2B online platform

Too long, 8%

Too many , 5%

Appropriate , 87%

Appropriate , 77%

Too short, 5%

Not enough, 18%

Meeting time for one B2B talk

Number of meetings you had

3. Your B2B experience

Excellent , 63% Good , 32% Poor , 5%

4. Quality of speakers

Strongly agree , 78%

Agree , 22%

5. I will consider participating/recommending this event in the future