Carbon Credit Financing for Productive Use Appliance Markets

Long-term, sustainable growth in solar-powered appliance and equipment markets will require a significant increase in financing available to companies and customers. Carbon finance is one mechanism that could drive funding to this market, making solar-powered appliance and equipment more affordable. However, the current infrastructure for carbon finance in this sector is not fit for purpose and needs an upgrade.

This report presents a strategic approach for improving carbon credit financing into the PUA sector in Africa, with a particular focus on solar- powered irrigation, cooling, and milling. It provides a comprehensive review of existing carbon methodologies applicable to PUAs and offers practical recommendations for their improvement.

The review uses a novel evaluative framework and analyzes each methodology’s use of baseline studies, monitoring, reporting and verification processes, integration of social and environmental safeguards, and alignment with both voluntary and compliance carbon markets.

Key Findings

• A review of existing methodologies for carbon projects involving solar Productive Use Appliances (PUAs) revealed significant gaps, especially in terms of regional applicability, data consistency, and monitoring accuracy.
• These gaps limit the effectiveness of the methodologies, making it difficult to capture the true emissions reduction potential of solar PUA projects across different regions, particularly in Africa.

Recommendations

• Develop a new, consolidated solar PUA carbon methodology
• Conduct robust, standardized baseline studies
• Support innovation around digital monitoring, reporting, and evaluation
• Develop and adopt an emission reduction calculation tool