An Ecommerce application that integrates in-house asset financing for clean cookstoves with mobile money transfer and free home delivery.
sector: renewable energy
location: bukavu and goma
project since: 2018
Sombabien addresses key aspects of the “energy trilemma” - three barriers to energy sustainability recognised internationally:
(i) Energy equity: Asset finance facilitated by Sombabien will bridge the gap between low-income consumers and clean cookstoves. The market for clean energy products is growing, but the majority of low-income households are unable to afford the up-front costs. Sombabien enables customers to purchase a cookstove on credit and make installment payments using savings made through reductions in charcoal usage.
(ii) Environmental sustainability: Deforestation is a systemic problem in the DRC. The country loses 1,200 square miles of forest annually, of which the World Bank estimates 84% is used for charcoal and firewood. Sombabien will promote affordable access to clean cookstoves and cleaner burning charcoal. This could help reduce household carbon dioxide emissions from cooking by 65%.
(iii) Security of energy supply: Sombabien will help facilitate an on-demand delivery model that addresses some of the infrastructure barriers to low-income households accessing clean, efficient forms of energy. Altech’s 24-hub distribution model will mean that when a customer orders through Sombabien they can select a specific time slot for delivery to their home or business. The option for ongoing free delivery of clean burning charcoal straight to their home will also encourage customers to keep utilising this cleaner, more efficient form of cooking fuel.
The potential for clean cookstoves is significant. In Kinshasa for example, the World Bank estimates that only 4% of households use an energy efficient cookstove. The product is there, but barriers to sales, marketing and distribution are impeding potential impact.
There is also a burgeoning market for Ecommerce mobile applications. Whilst only 4% of DRC’s population have a traditional bank account, 9% have a mobile account which is used to pay bills, receive wages and purchase products. GSMA estimate that DRC will be one of four countries that will account for 50% of the 115 million new mobile phone subscribers expected across sub-Saharan Africa by 2020.
Sombabien is the first of its kind in the DRC - a mobile Ecommerce application and courier service that provides on-demand, door-to-door delivery of cleaner burning charcoal and clean cookstoves using mobile money payments.
The linking of mobile money - through the integration of the world’s most extensive and best-known mobile banking platform - with a credit facility will permit asset financing in a more efficient, cost-effective way. The sales application is integrated into Altech’s existing CRM system and 24-hub distribution network to enable free door-to-door delivery, a strong after-sales service and a two-year product warranty.
In addition to unlocking the ability of low-income households to purchase clean cookstoves through installments, a key innovation of Sombabien is the ability for customers to order various amounts of cleaner-burning charcoal alongside their cookstove. From small daily amounts to weekly or bulk ordering, this ensures that customers can more effectively manage household income.
The switch to a more efficient clean energy product could also save the average household $120-$144 per year once the cost of the clean cookstove has been repaid. For customers who are now spending anywhere from $180 to $360 per year on cookstoves and charcoal this could have a significant impact on their household income.
A prototype of the application has now been developed and is under review by Vodacom for potential M-Pesa integration. A key next step beyond technical development is to test the prototype with a customer focus group in Goma to identify additional service functionality. Ensemble is also actively seeking financing to support the next stage of development and rollout.