In Kenya, approximately 75% of the population still relies on solid fuels such as firewood, charcoal, and kerosene for cooking, especially in rural areas. This reliance on traditional fuels contributes to severe indoor air pollution, which leads to an estimated 21,560 deaths annually due to respiratory illnesses caused by smoke exposure. Furthermore, the use of charcoal and firewood is a significant driver of deforestation and environmental degradation. 

When it comes to electricity, around 70% of the population has access to electricity, but this figure drops to 30% in rural areas. Most rural households are off-grid, meaning they lack reliable access to electricity for basic needs such as lighting and cooking. This gap in clean energy access highlights the urgent need for sustainable solutions that can reduce environmental harm and improve health outcomes across the country. 

Mwangaza Light, a Kenyan faith-based social enterprise, is addressing these challenges by providing clean, affordable energy solutions for underserved communities. 

Mwangaza Light plans to use the loan for the purchase of induction stoves and electric pressure cookers, aimed at replacing charcoal stoves in urban and peri-urban households. This aligns with Mwangaza Light’s strategic focus on addressing the growing demand for electric cooking solutions in the urban on-grid market. Through its close collaboration with churches, the enterprise has gained strong access to this market, with urban congregations specifically requesting affordable, clean cooking alternatives. 

Another portion of the loan will be used to import solar home systems for distribution to low-income households in rural areas. This includes serving 50,000 existing customers in central Kenya who have already transitioned from traditional open fireplaces to rocket stoves. These households are targeted because they have already shown a willingness to adopt cleaner energy solutions, making them more likely to embrace solar home systems as the next step.  

These efforts will help Mwangaza Light continue its mission of guiding off-grid households up the clean energy ladder.

In addition, part of the loan will be used to finance the company’s school kitchen programme, the construction of two new offices, an IT update and IT support for the company’s e-commerce platform and administrative costs.

The school kitchen programme:

Most school kitchens in Kenya use open fires to prepare meals for the many pupils. This contributes significantly to deforestation and the kitchens are often simple huts full of smoke and soot. Churches run around 50% of educational institutions in Kenya and are keen to switch to modern cooking methods – both for environmental reasons and to improve working conditions for the school cooks and the quality of nutrition for the pupils. Mwangaza Light is in a unique position to work with church-run schools to provide affordable technology for institutional cooking. This allows the company to contribute to the development of the emerging market for institutional cooking solutions.

e-commerce platform:

Mwangaza Light is currently developing an e-commerce platform to supply urban and peri-urban markets with electric cookstoves. At the same time, the platform will facilitate international donations, whether to support the company’s work or for campaigns with a humanitarian focus. In May, Mwangaza Light launched its first fundraising campaign to help families affected by the effects of climate change and in need of clean energy solutions to rebuildtheir lives.

Opening of two regional offices (in Muranga and Mombasa):

These offices are an important step to significantly improve the efficiency and productivity of cross-selling in these regions. They will not only optimally support the growing market and expanding team , but also significantly reduce administrative and shipping costs . With a stronger focus on customer service and after-sales support, the new offices can optimise the company’s processes and sustainably increase service quality.

Through its business model, Mwangaza Light contributes to five of the UN’s Sustainable Development Goals (SDGs): 

 By providing access to affordable and reliable clean cooking solutions and solar energy, Mwangaza Light empowers low-income households, especially in rural and peri-urban areas, to transition from harmful traditional cooking methods like charcoal and wood to modern electric cooking and solar-powered systems (Goal 7). This shift reduces indoor air pollution and improves health, while also lowering household energy costs, making clean energy more accessible to underserved communities.

Mwangaza Light’s solutions directly improve public health (Goal 3), as its customers move away from cooking over open fires, which are responsible for significant indoor air pollution and related respiratory diseases. The adoption of improved cookstoves and electric cooking technology contributes to better health outcomes, particularly for women and children, who are most affected by the harmful smoke.

The company’s focus on women-led operations and its partnership with churches promote gender equality (Goal 5). With over 75% of its staff and agents being women, Mwangaza Light enhances women’s economic participation and leadership at all organizational levels. Furthermore, 65% of the customers are women and benefit from better health, less cooking time, and income saving from using less cooking fuel. 

 Mwangaza Light’s Green Churches model addresses both environmental and social challenges (Goal 13). By integrating environmental stewardship into church activities and promoting clean energy, the company enables communities to reduce CO2 emissions, transition away from charcoal, and engage in climate action, such as tree planting initiatives. This not only mitigates climate change but also contributes to local livelihoods and food security. 

 Finally, the organization helps alleviate poverty (Goal 1) by providing sustainable, low-cost energy solutions that reduce expenses on fuel and electricity, freeing up household income for other essential needs. Its distribution of solar home systems and improved cookstoves empowers communities to break the cycle of energy poverty and embrace cleaner, healthier alternatives. 

The Mwangaza Light project contributes directly to climate protection by saving up to 26 tonnes of CO2 emissions per year through its environmentally friendly cooking solutions. By replacing traditional firewood cooking methods with electric cookstoves and biomass stoves, the project reduces the harmful greenhouse gases produced by burning solid fuels. This switch not only reduces CO2 emissions, but also helps to combat deforestation and preserve ecosystems and biodiversity.

The investment risks associated with the subordinated loan are described in detail in the risk information. With regard to the assessment and limitation of risks for investors, the issuer draws attention to the following special features in the design of the project: 

For the crowdfunding campaign on bettervest, a special purpose entity called BETTERVEST INVESTMENT LTD, based in Germany, was established to act as the borrower in this project. It forwards the collected capital as a secured loan to the project owner in Kenya, Mwangaza Light Limited. Shareholders and managing directors of BETTERVEST INVESTMENT LTD are independent of Mwangaza Light Limited. In contrast to a German special purpose vehicle, the special purpose vehicle based in Kenya can act as a borrower for several projects. However, there are no changes to the contracts and the risk assessment compared to a German special purpose vehicle. 

In addition, assets worth 150% of the loan and interest amount, such as the solar home systems and cookers to be financed, as well as existing contracts and goods, are pledged to the Kenyan special purpose vehicle until the loan has been repaid in full. This is done by official entry in the Kenyan register. 

The financing plan contains the total projected cash flows for Mwangaza Light covering the receipt, initial utilisation and repayment of the loans.

Investment needs 

The loan of €66,250 € is intended to finance the purchase of sustainable cookers and solar home systems for sale to private households as well as for the financing of the company’s school kitchen programme, the construction of two new offices, an IT update and IT support for the company’s e-commerce platform and administrative costs. 

The term of the loan is 4 years and has an annual interest rate of up to 7.3% p.a. for the crowd investors. The funding threshold for this project is 50,000 euros. If the funding target is not reached, but at least the funding threshold is, the project owner will still use the investor funds to a small extent to purchase the above-mentioned products. 

Repayment 

The loan is repaid from liquid funds that Mwangazalight generates in the course of its business activities as income from selling clean cooking solutions and solar home systems.