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MCFA opens second clean cooking funding round

MCFA opens second clean cooking funding round
A bottle of Nigerian-produced ethanol gel fuel and cookstove.

The Modern Cooking Facility for Africa (MCFA) has launched its second Call for Proposals, inviting interested private companies selling modern and clean cooking solutions to compete for funding. MCFA offers a combination of results-based financing, non-reimbursable catalytic grant financing, and technical assistance to companies active in the clean cooking market to support them in further expanding and scaling up their businesses in the Democratic Republic of the Congo (DRC), Kenya, Malawi, Mozambique, Tanzania, Zambia, and Zimbabwe.

The lack of clean cooking solutions is a global challenge and one of the key sectors in Africa for accelerating the green energy transition.

Globally, some 2.3 billion people lack access to clean cooking, of which some 900 million live in Sub-Saharan Africa. In most of the MCFA target countries, the current access rate to clean cooking is less than 20 percent.

To answer the demand for much-needed financial support in the clean cooking sector, we are launching our second funding round. The new Call for Proposals has been tailored to better meet the needs of companies operating in the sector. Together with our funded companies, donors, and partners, we aim to accelerate the creation of long-term sustainable markets in Sub-Saharan Africa to support access to clean and modern cooking solutions for 4 million people, commented Heli Sinkko, Programme Manager at Nefco.

Two funding windows

The new EUR 16 million MCFA funding round will be divided into two funding windows combining results-based financing and catalytic grant financing.

The total available funding for both windows will be up to EUR 16 million and the individual ticket sizes will vary from EUR 500,000 to 2.5 million.

An Ecosense pellet cookstove.

Applicants can be experienced providers of clean cooking services for residential, commercial, or institutional use, utilities, mini-grid operators, or companies deploying standalone solar systems that could support e-cooking services in conjunction with their main operations.

The Catalytic Funding Window will be targeted at earlier-stage companies with scaling potential. Of the requested MCFA financing within this window, 50 percent will be provided in the form of non-reimbursable catalytic grants and available to companies in the DRC, Malawi, Mozambique, Zambia, and Zimbabwe.

The Scale-up Funding Window will be open to more mature companies in all project countries under terms similar to those of the first MCFA funding round, but with Malawi introduced as a new target country.

This window will provide up to 30 percent of available funding in the form of non-reimbursable catalytic grants and the rest as results-based financing.

The new funding round will continue to support only higher-tier cooking solutions, including electric cookstoves and cookstoves that use sustainably produced solid and liquid biofuels or biogas solutions.

Two-stage application process

The application process is divided into two stages: a Prequalification stage and a Final Application stage.

During the Prequalification stage, Applicants are asked to provide limited information related to certain eligibility criteria as well as plans on how the funding will be used.

A gas cookstove in a residential kitchen in Aurangabad, India directly connected to the household’s biodigester where food- and vegetable waste is used as feedstock. Despite the lower energy content, raw biogas displaces around 25-30 percent of the bottled LPG used in the household for cooking.

Applicants passing the Prequalification stage will be invited to the Final Application stage and asked to submit full business plans, which will be evaluated and scored by an external evaluation committee appointed by Nefco, the Facility Manager.

Companies contracted or currently undergoing contracting under the first funding round (MCFA1) are not eligible to receive funding under the new funding round (MCFA2) for the same Project Country.

In other words, a previously successful Applicant can only receive funding in another MCFA Project Country under this new Call for Proposals.

The funding round is open for applications through an online application system with the deadline for submitting applications is January 31, 2024.  Applicants will be notified of the Prequalification stage outcome via the online application system in February 2024.

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