Kenya: Proposed Bill Threatens To Erode Gains in Clean Cooking Sector

  • Kenya’s Finance Bill 2020 proposes an introduction to VAT on items previously exempted under concessions accorded by the Cabinet Secretary.  
  • Particularly, the Bill introduces a VAT of 14% to clean cooking and solar products.
  • The move could see Kenyan households dig deeper into their pockets to pay for clean cooking solutions like Liquid Petroleum Gas (LPG) and improved cookstoves.

The clean cooking sector in Kenya has enjoyed fiscal incentives which have enabled millions of citizens to access clean cooking technologies and fuels. The introduction of VAT at the rate of 14% in proposed Finance Bill threatens to erode numerous gains that have been made toward the achievement of universal energy access by 2022 and Sustainable Development Goal (SDG) 7 which aims at ensuring access to affordable, reliable, sustainable and modern energy for all.

A study carried out in 2019 by CCAK (Clean Cooking Association of Kenya), showed that 58% of households still use the open fire method of cooking, 70% of households use biomass (firewood and charcoal) for cooking; while 19% of households use LPG. LPG adoption was at 3% a decade ago, zero-rating has made it more affordable to consumers, with the adoption increasing to 28% in 2020.

The global statistics paint a grim picture – nearly three billion people today do not have access to modern cooking products and services, with 4 million people dying annually due to indoor pollution caused by dirty fuels. According to the World Bank, “Despite three decades of efforts, access to clean cooking fuel and technologies has continued to be an issue with severe health, gender, economic, environmental, and climate impacts.”

To shed light on the issue and to lobby Parliamentarians to reject the proposed amendment, the ACCESS East African node – Kenya Climate Change Working Group (KCCWG) – convened a webinar that brought together Kenyan stakeholders in the clean cooking sector. These included CSOs, representatives from the private sector, Kenya Ministry of Energy, and the wider public.

During the webinar, ACCESS Coordinator, Jacqueline Kimeu, explained that in Africa, Kenya was a front runner in terms of adoption of renewable energy compared to neighbours such as Tanzania and Uganda, and this was attributed to the current fiscal incentives.  She noted that introducing VAT would not only impact the adoption of clean cooking products but that of solar as well. “The overwhelming majority of off-grid consumers and households who access their energy needs through solar-powered energy solutions come from lower-income, rural communities where VAT exemption on the products has played a critical role in increasing affordability.”

The panelists underscored the implications that would arise out of this amendment including: loss of jobs, the introduction of low-priced counterfeit products from unscrupulous manufacturers, as well as eroding investor confidence in the sector. Not to mention the probability that more Kenyans will resort back to unclean fuels – approximately 70 per cent of households in Kenya still use a type of woodstove as either their primary or secondary fuel, with a greater prevalence of 92 per cent in rural areas.

Update: The Bill is currently being debated and Kenyans are waiting to see what decision the parliamentarians take. The proposed Bill is set to become law by July 1st 2020.

ACCESS is collaborating with Hivos on a project that brings together government and CSOs to share experiences and learnings on how the policy environment is contributing or hampering progress towards achieving Clean Cooking and DRE targets in East, West and South Africa.

To read more on the Ghana workshop, click here.

Clean Cooking Association of Kenya (CCAK) Launch Sector Study

Submission by ACCESS member CCAK (Clean Cooking Association of Kenya). You can read more about their work on https://ccak.or.ke/

Clean Cooking Association of Kenya (CCAK) is a private, not for profit, business membership organization that represents the interest of clean cooking stakeholders by advocating for an enabling environment at both national and county level to catalyze the growth of the clean cooking sector and promote adoption of clean cooking technologies, capacity building of the sector and sector coordination.

On 5th November 2019 at the Clean Cooking Forum 2019 held at Radisson Blu Hotel (Nairobi), Cabinet Secretary for Energy, Hon. Charles Keter launched the Kenya Clean Cooking Sector Study Report, the country’s first-ever clean cooking study commissioned by the Ministry of Energy and the Clean Cooking Association of Kenya.

Photo credit: CCAK

The study offers a glimpse of the situation in Kenyan kitchens, providing answers to many questions raised about the clean cooking sector, and meets key data needs outlined in the SEforALL agenda. It provides a powerful baseline for the sector in 2018 showing the status of both household and market elements of cooking. The study show that 92% of the rural populations still rely on solid fuels as their primary fuel source.

This means that there is need to deeply look into the clean cooking sector and visualize a shift to alternatives for all populations, and especially vulnerable populations. Kenya commits to shift to clean cooking through development of efficient cooking solutions thereby projecting an abatement potential of 7.3MtCO2e by 2030 as a means to mitigating climate change. Using clean cooking solutions will support the move by the government to restore Kenya’s forest cover to 10% up from the current 7%.

In this regards, the report will guide the Ministry of Energy in decision making for the clean cooking sector. It will also guide the Inter Ministerial Committee on clean cooking in planning for all related activities. The report should be able to be shared to multi-sectorial and be read by policy makers, researchers and planners across all sectors, and by anyone interested in making a change in the clean cooking sector.\

The Association was registered in 2013 with a mission to facilitate the scaling up of the clean cooking Solutions in the Kenyan markets. CCAK strives to build solidarity amongst relevant stakeholders and create effective partnerships to ensure that the use of clean cookstoves and fuels is the norm in Kenyan households and institutions.

Highlights of the Africa Regional Forum on Sustainable Development (ARFSD 2020)

*This is a submission from a participant who attended the forum – Bob Aston (ALIN, Kenya.)

Over 3,000 delegates, including 60 ministers and other high-level participants, attended the sixth session of the African Regional Forum for Sustainable Development (ARFSD 2020) that was held under the theme; 2020-2030: A Decade to Deliver a Transformed and Prosperous Africa through the 2030 Agenda and Agenda 2063 in Victoria Falls Zimbabwe on February 24-27, 2020.

Participants during one of the sessions.

In the ‘Victoria Falls Declaration on the Decade of Action on Sustainable Development’ in Africa that was adopted by 54 African countries, delegates, including ministers from across the continent responsible for all the 17 sustainable development goals that were under the spotlight at the forum, called on all African countries to urgently revisit their frameworks for the implementation of the 2030 Agenda and Agenda 2063; align their national development plans with the principles of the two agendas and set in motion programmes and projects to deliver.

Members of ‘Major Groups and other stakeholders in Africa’ recommended under SDG7 that national and sub-national governments invest in the transition towards 100% renewable energy, as well as climate-resilient infrastructure, and low emission development in cities and rural areas.

The final declaration also urged members states to take a position on gas energy as a transitional energy source for the continent as they prepare for the twenty-sixth session of the Conference of the Parties (COP26) to the United Nations Framework Convention on Climate Change (UNFCCC).

ACCESS members deliberating during the forum

Lack of disaggregated data and statistics hindering evidence-based monitoring and evaluation, tracking SDGs progress and resource allocation.

Most states lacked disaggregated data and statistics which affected the review methodology of the voluntary national review. There needs to be greater collaboration between national governments and CSOs in developing clear mechanisms for and investing in data generation, including remote sensing and other geospatial sources, big data and various observational networks and infrastructures. This will help to support evidence-based voluntary national reviews and national development frameworks, and in timely collection, dissemination and use of data and information to inform decision making.

Inclusive digital transformation can help meet SDGs and Agenda 2063 objectives.

The UN Capital Development Fund ( UNCDF) and the African Institute for Economic Development and Planning (IDEP) of the United Nations Economic Commission for Africa (ECA) High-Level Policy Dialogue side event which looked at digital infrastructure and services, digital literacy, digital ID, digital financing, showed that inclusive digital transformation can help meet the SDGs and Agenda 2063 objectives.

However, high illiteracy levels in Africa, language barrier, low level of digital literacy and lack of adequate infrastructure which reduces devices interoperability has limited the continent’s digital transformation. An opportunity is available for CSOs particularly those working On SDG7 to advocate for the inclusion of energy in the Inclusive Digital Economy Scorecard (IDEC) which has only been piloted in 8 countries and does not include energy among the thematic areas. The IDEC is a strategic performance tool that identifies the key market constraints hindering the development of an inclusive digital economy while helping advance the right priorities with public and private sector stakeholders for each country.

ACCESS members during the event

Need for sustained awareness creation and education on SDG7

Although the ARFSD looked at all the 17 SDGs, the importance of SDG7 as an enabler to most of the SDGs was subsequently missing or not reinforced. There is need for CSOs working on SDG7 to enhance their advocacy to promote decentralized renewable energy and clean cooking technologies.

Here is a view from another member who attended the forum – Thabit Mikidadi from Tanzania Gender and Energy Network (TANGSEN). “Coming from a gender organization in the energy sector, my particular focus was on an engendered perspective of SDG 7. Access to clean energy is still viewed as a separate endeavour and not as a catalyst to the achievement of many other SDGs. Numbers are still given priority, rather than impact – accelerated energy access versus reduction of poverty and opening up of opportunities. Women bear the biggest brunt of the energy deficit and this affects their socio-economic livelihoods thus widening the equality gap. This needs to change.”

*Thanks to the support of Hivos, other ACCESS members who attended the forum included: Maimuna Kabatesi (Hivos), Jacqueline Kimeu (ACCESS), Mamadou Barry ( Action Solidaire International ), Marvin Tumusiime (ENventure), Tendai Moyo, Wellington Madumira (ZERO).