KOKO Networks, a startup aiming to tap into the $47 billion cooking-fuel market in Sub-Saharan Africa, is planning its first expansion outside of Kenya, where 1.5 million people use its bioethanol cookers.
KOKO will invest $25 million in a network of cooking-fuel dispensers, with Dalberg Ventures having a minority stake in the initiative. The eight-year-old startup aspires to reduce the usage of charcoal and wood in East Africa and replace it with a cleaner, sustainable fuel.
“Rwanda is targeting universal access to clean cooking by 2030,” the companies and the Rwanda Development Board said in a statement on Tuesday. This will help tackle “indoor air-pollution deaths caused by the use of charcoal and wood for cooking,” they said.
Charcoal production is the major cause of deforestation in Africa, putting the 850 million to 900 million people who cook with solid fuels, such as charcoal and firewood, in danger.
According to the World Bank, it is responsible for the deaths of more than half a million Africans each year by emitting carbon monoxide, a dangerous gas, and particulate pollution.
According to Greg Murray, the company’s chief executive officer and co-founder, while the Rwandan venture is a first step for KOKO out of Kenya, the company’s ultimate goal is to increase its ethanol stove manufacturing capacity 10-fold and expand globally, with about 60 countries suitable for its products.
The company is currently able to manufacture 10,000 cookers a week at a plant owned by KOKO in India.
Under the agreement, KOKO will establish a network of cooking fuel distribution points in Rwanda, while the government will waive value added tax and import duties on the cookers and the fuel.
That will help cut the cost of the cooker and the imported fuel, said Murray. A cooker, canister and an initial fuel allocation costs $18 in Kenya
According to the World Bank, charcoal and wood account for the majority of the $47 billion spent on cooking fuel in Sub-Saharan Africa, with only 18% of people utilizing electricity, kerosene, or liquefied petroleum gas.
According to Murray, KOKO hopes to have its initiative up and operating in Rwanda in approximately a year, with the potential to grow to serve nearly half of the country’s 2.2 million homes in five years.
Murray has stated that he intends to announce growth into two additional countries this year. The company is in talks with governments and other stakeholders about expanding into additional African and Southeast Asian areas.