MCFA to support KOKO Networks to scale up its bioethanol solution for clean cooking across Kenya

The first project from MCFA’s second funding round has been signed with KOKO Networks, a Kenyan provider of clean cooking solutions based on the use of sustainable bioethanol.

The first agreement under the second MCFA funding round has been signed with KOKO Networks Limited (KOKO). The company has been operating in Kenya since 2015 with the mission of accelerating the energy transition in Africa, protecting forests and transforming lives.

The company manufactures and sells a modern two-burner stove that runs on a renewable liquid bioethanol cooking, which is sold through KOKO’s dense network of Smart Fuel ATMs located in corner shops. As of today, the company serves over 1.3 million households across twelve cities and towns in Kenya.

“The MCFA programme has made a key contribution to advancing innovation in the modern clean cooking sector in Africa. We are proud to partner with MCFA to innovate and expand our SASA agent distribution model, serve more households through the KOKO platform and help bridge the accessibility gap for clean fuel between urban and rural areas in the country,” says Greg Murray, CEO and Co-Founder of KOKO.

With the MCFA funding, KOKO will scale up its new ‘SASA’ agent model to reach less densely populated areas, starting in the Western and Mount Kenya regions. The aim is to provide access to clean cooking for up to 200,000 low-income households, benefiting 750,000 people, by 2029. The results-based financing to be provided by MCFA will help in mobilising additional co-financing, with the objective of doubling the total capital invested by the end of project implementation in 2029.

“We are very proud to announce our first investee from the second funding round and support the scale-up of their business model, which has been successful in urban areas, to rural areas in Kenya. KOKO is a highly innovative company in its field, working to engage the whole value chain and reach the lowest-income consumers. It is also a great example of how the private sector can support market change and the acceleration of clean cooking solutions at scale in Sub-Saharan Africa,” comments Heli Sinkko, Fund Manager for MCFA at Nefco.

The Modern Cooking Facility for Africa (MCFA) supports access to and scale-up of higher-tier clean cooking solutions. KOKO was selected under the programme’s second funding round (MCFA2) under the Kenyan country programme. The selection process included third-party evaluations of the final applications by independent experts and a detailed due diligence process carried out by Danish Energy Management in consortium with LFS Advisory.

For further information, please contact:

Heli Sinkko, MCFA Fund Manager and Programme Manager at Nefco
heli.sinkko@nefco.int, +358 10 6180 659

Abdel Agadazi, Director, Strategy, Partnerships and Financing at KOKO Networks
a.agadazi@kokonetworks.com, +33 652 515 387

About KOKO Networks

KOKO Networks is a climate technology company that protects forests and transforms lives. KOKO operates urban bioethanol cooking fuel utilities in Kenya and Rwanda, supplying households with ultra-clean fuel and replacing demand for dirty fuels, such as charcoal, a driver of deforestation. Compliance carbon markets are used to provide a non-government energy subsidy, enabling even the poorest households to transition to clean cooking solutions. KOKO was founded in 2014 and is backed by a wide range of environmental investors including the Microsoft Climate Innovation Fund. In 2021, KOKO was recognised by the FT/IFC as the world’s leading emerging markets climate technology solution. Read more at www.kokonetworks.com

About MCFA

The Modern Cooking Facility for Africa is a multi-donor facility established and managed by Nefco – the Nordic Green Bank – with the aim to support the development of new markets for the clean cooking sector and accelerate access to high-technology, modern and affordable cooking equipment for consumers in Sub-Saharan Africa. It combines results-based financing with catalytic grant financing to companies active in the clean cooking market to grow and scale their businesses in the programme countries.

The overall aim of the MCFA programme is to provide access to clean cooking solutions for over 4 million Africans by financing companies that align with its mission. These companies are selected across two funding rounds. The EUR 61.5 million MCFA programme is funded by the European Union, Norway and Sweden. Read more on www.moderncooking.africa

About Nefco

Nefco – the Nordic Green Bank – is an international financial institution based in Helsinki, Finland, and owned by the five Nordic countries. It focuses on environmental and climate investments and works to take concrete actions to accelerate the green transition. Nefco also manages external funds in the climate and energy space. It is accredited by the European Union and the Green Climate Fund and is the Facility Manager for the Beyond the Grid Fund for Africa, a EUR 126 million multi-donor results-based financing facility funded by Denmark, Germany, Norway and Sweden. Read more on www.nefco.int

Photo: A KOKO customer in Nairobi buys fuel at her local KOKO Agent shop – KOKO Networks