Scaling Innovation at the Energy-Agriculture Nexus in East Africa

The climate is changing.  Food and agriculture must, too. 

With this year’s theme of the World Food Day on October 16^th, the Food and Agriculture Organization (FAO) chose a strong message that tackles key issues of our modern global society. Indeed, climate, energy and agriculture are all interconnected. We recently hit on this topic through the launch of our newest SAG-SEED Sectoral Business Condition Brief on the Energy-Agriculture Nexus in East Africa and discussed policy instruments during a Policy Roundtable at the SEED Africa Symposium in Nairobi.

Unfortunately, the world’s poorest - many of whom are smallholder farmers - are being hit hardest by the adverse effects of climate change. According to FAO's newest flagship report, 25% of the economic impact of climate-related disasters in developing countries is felt in agriculture. At the same time, global population is expected to reach 9.6 billion by 2050, resulting in a rising demand for food. To prevent future crises, we need to find climate-smart ways NOW to make agricultural production more resilient, productive and sustainable.

Did you know that about 30% of the global energy consumption comes from agriculture and food processing? Various opportunities for clean energy technologies arise for smallholders along the agricultural value chain: For example, solar- or wind-powered pumping or irrigation helps to intensify production and solar- or biogas-powered cold storage and cooling decreases post-harvest losses. Biomass powered milling or solar fruit drying are sustainable alternatives to conventional processing technologies that are often based on diesel fuels.

East Africa is a hub for green agribusiness innovation

In over 10 years of the SEED Awards, we have seen a trend towards innovation at the nexus between energy and agriculture in East Africa. Eco-enterprises develop and adopt diverse low-cost solutions for smallholder farmers and Small, Medium and Micro-sized Enterprises (SMMEs) to power their agriculture, or generate clean energy.

An example of such a company is the social enterprise SunCulture in Kenya. The business sells irrigation kits that combine cost-efficient solar pumping technology with high-efficiency drip irrigation systems achieving yield increases of up to 300% and water savings of up to 80%. SunCulture also pilots pay-as-you-go to make technology more affordable for smallholders.

Another example is the East Africa Fruit Farm and Company in Tanzania. The 2015 SEED Africa Winner significantly reduces post-harvest losses from 48% down to 10% by cold storage and powers all processing activities with renewable energies.

Besides promising progress, technology application is still in its infancy

East African eco-entrepreneurs and SMMEs might be heading the movement to connect energy and agriculture but they still face numerous challenges. Most companies are still in the pilot or early growth phase and in the process of developing viable business models.

The relatively high costs of technologies make financing difficult and most applications fall between the cracks of energy and agriculture regulations, making it harder to attract sector-specific investments. In addition, little public knowledge and awareness on the benefits of green energy solutions for agriculture prevent business models from reaching significant scale.

Policy makers in East Africa can scale Innovation at the Energy-Agriculture Nexus

In our recently published Sectoral Business Condition Brief for East African governments, SEED and Endeva show why it makes sense to invest in this nascent sector and how policymakers can scale innovation at the nexus between energy and agriculture. Based on lessons learned from both developed and developing countries, we outline four policy strategies that include:

1. Provide a consistent policy strategy and coordinate sector activities
2. Invest in research and development of appropriate technologies at the local level
3. Incentivize the application of green technologies at the farmer level, and 
4. Facilitate access to finance for innovative companies

Through collaboration with international and local partners, governments in East Africa can leverage technical and financial resources and lay the basis for the development of a local high-tech manufacturing industry that can lift smallholders out of poverty and boost economic development in the region.

Policy Prototyping to Scale Innovation at the Energy-Agriculture Nexus in East Africa

To put these recommendations into practice, we introduced the method of “Policy Prototyping” at this year´s SEED Africa Symposium.  Policymakers, experts from business associations and civil society as well as researchers developed and discussed the following three innovative policy prototype instruments with a focus to scale innovation at the energy-agriculture nexus in Kenya.

1. Intensify research and development on innovation diffusion and social innovations, including why particular technologies are taken up under which conditions. This research will influence the design of a strategy for wider uptake of climate-smart solutions in East Africa.
2. A campaign to enhance productivity and lower greenhouse gas emissions of small-scale tea factories by cutting down the use of fossil and wood fuel and shifting to thermal solar tea withering. Tea, which constitutes 20% of Kenya's exports and 11% of the agricultural GDP, is highly energy-intensive and currently based on diesel-powered generators and wood. This comprehensive strategy could support the shift to clean energy and includes public awareness campaigns on drying solutions, the training of technicians and industries on the use of solar dryer technology in operations and equipment maintenance, marketing campaigns, technology demonstrations in tea factories, financial incentives to address the issue of initial cost of the technology and enhanced institutional collaboration amongst governments, the private sector and the civil society.
3. A policy instrument to incentivize the use of bioenergy, in particular, biogas, among smallholders could support the shift to cleaner energy. Besides from making it mandatory for dairy farmers to use biogas, the training of youth as artisans in polytechnics on constructing biogas digesters in selected sub-counties could create awareness, and subsidies could motivate smallholders to follow this path.

Interested in learning more about the process and advantages of policy prototyping and SEED´s approach of putting research into practice? Follow our blog! We will give you the latest on policy prototyping.

Access the SAG-SEED Sectoral Business Condition Brief here.