Finance mechanisms for private sector-led energy access in urban informal settlements

This paper examines financing mechanisms to support Energy Service Providers (ESPs) in delivering sustainable energy solutions to urban informal settlements in Uganda. With Uganda’s urban population projected to surpass its rural population by 2060, access to affordable and reliable energy services is critical to managing the expansion of informal settlements and improving economic and health outcomes.
 

The study focuses on clean cooking solutions but also extends its insights to other energy solutions, such as decentralised renewable energy and productive use appliances. Various financing mechanisms including equity, debt, grants, crowdfunding, and carbon credits are analysed through the lens of clean cooking ESPs.

The paper highlights that while equity and grants currently dominate clean cooking finance, mechanisms like carbon credits and output-based grants hold significant potential to reduce capital risks for ESPs, ultimately enhancing energy access for underserved urban populations.

Abstract ased on original source.