March 28, 2016
In Conversation with... Sheila Oparaocha
Sheila Oparaocha, Programme Manager of ENERGIA—a network of organizations addressing gender and energy issues—and a member of the Power for All Steering Committee talks to us about the critical role of women in achieving energy access.
Listen to the Q&A or read the full transcript below.
Power for All: Can you tell us a bit about ENERGIA and the impact of its work to mainstream gender into energy?
Sheila Oparaocha: It is very important to say that the gender, energy and women space has really come a long way. When ENERGIA first started in 1996, gender was not considered a legitimate issue in the energy sector. The Sustainable Energy for All initiative (SE4All) that was launched by the UN Secretary General in 2012 has played a significant role in placing gender, energy and women nexus at the highest energy and development policy level, to the extent that the first two years of the SE4All decade [2014 -2024] focussed on a global campaign on energy, women, children and health. Also we were happy to observe that during their endorsement of the Sustainable Development Goals (SDGs), governments recognized the link between Goal 7 on Sustainable Energy for All as an essential enabler of SDG 5 on Women’s Economic Empowerment and Gender Equality. We have come a long way on this in creating an enabling international policy environment and partnerships like ENERGIA and SE4All have contributed to this outcome.
We started with a gender mainstreaming approach, where we worked with partners and supported program managers and staff to integrate gender into their energy interventions. We have now complemented this with a women economic empowerment approach. Part of this change—which links very much with what Power for All is doing—is that we moved from mainly working with large mainstream grid rural electrification programs, to also working with off-grid energy delivery programs. We realized that if we are going scale up energy access at the last mile and also have real time impact on the lives of women then we needed a decentralized targeted approach.
What we have found from our research is that the poor spend $37 billion on poor-quality energy solutions to meet their lighting and cooking needs, which represents a substantial and largely untapped market for the private sector. However, the conventional private sector players find it difficult to tap this potential as operating distribution channels to reach last mile markets remains a challenge: customers in remote areas do not shop at standard retail channels; local distribution chains are fragmented; sales volumes are low. Through our own research and experiences we have found is that women and their institutions are uniquely positioned to play a critical role to bridge this gap at the last-mile.
Worldwide, a large number of women are engaged in small and medium-sized enterprises. In fact, female ownership represents 30 to 37 percent of all SMEs [eight million to ten million women-owned firms] in emerging markets. In the late 1990s, 84 percent of women non-agricultural workers in sub-Saharan Africa were informally employed compared to 63 percent of men. This provides a ready springboard for selling energy products and services. At the same time, due to their roles and experience as household energy managers, women play a critical role in the promotion, sales, servicing and financing of household energy devices. They are able to leverage their networks to promote adoption of new technologies and use their firsthand experiences for effectively marketing solutions: they can serve as spokespeople for use of clean energy, endorsing marketing messages, taking advantage of women-to-women communication strategies. As a result number of energy enterprises have begun to employ women as sales representatives in order to reach energy markets in this last mile segment.
Power for All: What are key challenges that you find in the women's economic empowerment approach?
Sheila Oparaocha: On the finance side, we have found that access to seed financing, working capital and growth capital to women business has been a challenge and a hard nut to crack. On the one hand we have found that women operate businesses differently from men’s. Women tend to be more risk averse, to aggregate products in order to share the risk and work much better in groups. On the other hand, we find that commercial banks in developing countries do not know enough about the market opportunities at the last mile and perceive women’s businesses to be riskier, higher cost, and with lower returns. Microfinance has partly compensated for women’s low access to formal finance; however, as women businesses grow, they need financial products and services that go beyond microcredit if they are going to go for scale. On the supply chain, we have found that most women businesses find it difficult to buy in bulk and to pay high upfront costs for off-grid products yet these are the conditions we have to operate with, when we link the women businesses to commercial suppliers.
Thus one of our sharp learning curves has been to implement innovative financing schemes that work for women, for example using loan guarantee funds and pay-as-you-go systems to offset the risks to suppliers and lenders, as well as working with Village Savings and Loan Associations (VLSAs) that can aggregate financial resources to the purchase off-grid products in bulk and pay high up-front costs.
We also find we need to address security and strengthen women’s agency. Due to women’s positions in developing countries communities and social norms, they tend to stay and operate their businesses much closer to the home. Yet for their businesses to grows, they have to extend their markets beyond their communities. Thus, we are working with the our partners, Winrock, Global Alliance on Clean Cookstoves and John Hopkins University, to provide training that build women’s confidence and leadership to travel away from their home to find markets and wider their distribution networks, while at the same time we help them to understand how these markets work, and how to make entry points into these markets usually occupied by men. An example of what we are doing is in Uganda, working with our partner Solar Sister that is supporting women entrepreneurs living along the shores of Lake Victoria to sell solar products across the border in Rwanda.
Another important issues is the enabling policy environment. Gender needs to be included in energy policies and investment plans, including the SE4All country actions. Within ENERGIA we say: “What doesn’t get measured, doesn’t get done.” Women’s and gender issues need to be central stage in our strategies to ensure we invest in them and deliver on them.
Power for All: Can you give us a specific example of targeted programs where ENERGIA has seen success?
Sheila Oparaocha: We are running a four year program in seven countries called Scaling up Energy Access through Women’s Economic Empowerment (WE). In Senegal, we are working with our partners GVEP International in two of the poorest areas. The average electricity access in Senegal is 57 percent, in rural areas it is 27 percent and where GVEP is working in Tambacounda it is as low as nine percent and in Kedougou it is four percent. Delivery of off-grid solar products is therefore critical to improving the livelihoods of people within these communities. GVEP is supporting women entrepreneurs to do this, in collaboration with TOTAL.
TOTAL is the sole importer of d.light products into Senegal. The reason GVEP thought it would be good to work with Total is that TOTAL has a Corporate Social Responsibility (CSR) objective to deliver solar products to the last mile. However while TOTAL is able to deliver the products to their filling stations they have not been successful in moving the products beyond this, so the products have been piling up in storage and not reaching their market target. When GVEP first approached Total, and informed them that they were working with women entrepreneurs running businesses at the last mile who were eager to sell off-grid solar products, TOTAL did not understand who these women entrepreneurs were, or whether it was too great a risk for them to engage with. Thus, GVEP through their WE program signed a MoU with TOTAL with the objective of accelerating the deployment of solar energy products—ranging from solar lanterns to solar home systems, in rural areas by deploying 36,000 solar lanterns, some of them with phone charging facility—to be sold by the 150 micro enterprises/groups [20-50 women/group] selected by GVEP in 344 rural villages of Tambacounda and Kedougou. The selected micro enterprises or income generating groups pay 25 percent of the product costs up-front and have the possibility to repay the remaining amount of the purchased price in 60 days. GVEP facilitates these sales on credit terms through a loan guarantee fund that guarantees payment of the full amount of the remaining 75 percent of the purchase price. Thus, in case there is any default (though there has not been any), TOTAL has the assurance that the risk is mitigated.
Another advantage is that as TOTAL is already transporting products to Tambacounda and Kedougou, the women entrepreneurs are able to piggyback on their distribution chain and cut down transportation costs which makes the price that the women are able to sale the solar products much more competitive. Thus although we are starting point with 36,000 units we feel that this will grow exponentially. It works for TOTAL, as TOTAL is able to deliver on its CSR objectives and to move products it was not able to before. It is working for the women who are running credible businesses. We see this as win-win collaboration, and one we are quite proud of.
Power for All: What are your hopes for the future and some of the things you see coming up the pipeline?
Sheila Oparaocha: I think that in the future we will find that there are more and more stakeholders and actors occupying this space. For instance the UN women launched its Women Economic Empowerment and Energy Programme at COP21 in Paris in December last year, impact investors such as Calvert Foundation who have committed to lending an additional $20 million to financial intermediaries and social enterprises that specifically enable the development and distribution of clean energy technologies in off-grid communities, are beginning to see that this is a credible and worthwhile investment; the World Bank a multilateral bank, is implementing its AFREA gender and energy program and GVEP an International NGO, in the forefront of energy enterprise development is increasing its work with women businesses in East and West Africa. So many different actors are engaging in the gender, energy and women space under the auspices of SE4All and we see this as a really positive development.
However, if we are going to go to the scale that is required, we cannot continue to work in silos. We need to have a much more coordinated effort. We also need financial resources not just to run one off programs, but money that is going be there for next 10 years or more, really major investments to deliver on this. This is where we feel SE4All initiative can have value addition to be able to convene and coordinate different stakeholders to work towards and highlight gender equality and women’s economic empowerment as a central approach to universal energy access by 2030.
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