24 November, 2023: A $6.5 million senior secured loan to produce and distribute 1 million improved cookstoves to the states of Madhya Pradesh and Odisha in rural India was signed by ADB – The Asian Development Bank and Greenway Grameen Infra Private Limited. A first-loss liquidity reserve of $3.25 million has been included from the Climate Innovation and Development Fund (CIDF), administered by ADB.
There will be a significant reduction in black carbon and carbon monoxide emissions as the improved stoves reduce the fuel needs by 65% and the generation of smoke by 70% as compared to the typical and traditional indoor stoves or mud chulhas.
Through this project, the cost of new cookstoves for rural households will be subsidized. These rural households are currently using traditional and inefficient means of cooking.
Suzanne Gaboury- ADB Director General for Private Sector Operations expressed how inefficient cooking was a major source of household and air pollution and how it led to the release of indoor carbon monoxide which posed serious health threats to millions of people, including women and children who were the most vulnerable. More efficient and cleaner cooking facilities were a quick and effective way to not just save lives but also reduce the daily domestic workload of women and empower them, she added.
This ADB financing will also establish a catalytic business case, which carbon markets could use to finance community-based projects.
The objective of the project is to achieve a total reduction of 22.9 million tons of carbon dioxide. Greenway, will sell the carbon credits generated from the use of improved cookstoves to international buyers, through its subsidiary SDG 13 Ventures Private Limited.
The debt financing of ADB will allow Greenway to bridge the gap between the time it takes to sell the carbon units and the general operation costs. This will generate a new avenue for channelling carbon markets to finance climate change mitigation projects.
Ankit Mathur – Greenway Cofounder and Chief Executive Officer mentioned that they were excited to scale up the distribution of Greenway Jumbo Stoves by partnering with ADB and CIDF. Hew as of the firm belief that blended finance structures can accelerate and deepen their climate action impact. Community led efforts to combat climate change through increased access to cleaner cooking has Greenway and SDG 13 ventures at the forefront, he added. He expressed his gratitude to ADB, their investors in making this initiative possible.
CIDF managed by ADB is a blended finance facility which was established in September 2021. Bloomberg Philanthropies and Goldman Sachs made an initial philanthropic commitment of $25 million. This fund can unlock up to $500 million if needed in private sector and government investments for sustainable low carbon economic development.
Greenway was established in 2010, and has sold more than 2.5 million improved cookstoves and more than 500 people are employed here.
Apart from its’ manufacturing facilities, Greenway is also engaged with community-based organizations such as cooperatives, banks, nongovernment organizations, and microfinance institutions to penetrate into rural communities.
Established in 1966, ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, and is working towards sustainable efforts to eradicate extreme poverty. It is owned by 68 members out of which 49 are from the region.
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