CQC’s management of the Stove Auction on contract to SNV in Cambodia is a great success. The last Auction held today punched through the 5000 stoves mark with good completion from distributors on price. Since the auction started the prices bid for the high end forced draft “gasifier” stoves has moved up 51% to be in the range of Euros 40-50 each. The objective is to move bid prices on the platform to the wholesale price for stoves sold under fully commercial conditions. Recent movement in price at the auction is encouraging that prices may get close to these levels before the auction ends. In the meantime, CQC is introducing a fuel and stove bundle that enables the full retail price of these sophisticated stove to be amortized overa 12 month period as part of a fuel delivery price that reduced the cost of cooking significantly compares to charcoal. We will post the launch of this product in April when a large scale market pilot begins.
As a member of the Atlas Energies consortium in Malawi and in partnership with ibvogt, Germany, CQC and partners have submitted a highly competitive bid for construction of emergency solar PV power to augment supply to the Escom grid. Then consortium was able to keep its bid low down in single digits and offer Tier I components for site for which it has conducted full feasibility. Technical evaluation of the bids is now underway. Once shortlisting of technically qualified bidders has been completed, bid price evaluation will proceed. Technical; evaluation and announcement of shortlisted companies is to be completed by March 31st.
Results from a pilot study in Cambodia led by Faraz Usmani and Marc Jeuland from Duke University with contribution from Jason Steele in his previous position as Sector Leader Renewable Energy, SNV Cambodia, and now the Chief Operating Officer at C-Quest Capital, are now published in the scientific journal Environmental Research Letters. The full article is open access and can be viewed online and downloaded in PDF format here.
While much work has examined approaches to increase uptake of a variety of household environmental, health and energy technologies, researchers and policymakers alike have struggled to ensure long-term use. Drawing on a pilot-scale experiment conducted in rural Cambodia, this study evaluates whether economic incentives enhance continued use of—and fuel savings from—improved cookstoves (ICS). Capital-cost subsidies that have been traditionally employed to enhance ICS adoption were augmented with rebates linked to stated and objectively measured use in order to investigate impacts on both initial and sustained adoption in the treatment group. Results show that households do respond to these rebates by adopting the intervention ICS at significantly higher rates, and by using it more frequently and for longer periods. Consistent with these stove-use patterns, solid-fuel use and time spent collecting or preparing fuels also decline. However, this effect appears to diminish over time. Thus, while economic inducements may significantly increase adoption and use of new environmental health technologies, corresponding reductions in environmental or livelihood burdens are not guaranteed. Additional research on the design and implementation of incentive-based interventions targeting households directly—such as carbon financing or other forms of results-based financing (RBF) for improved cookstoves—therefore seems warranted prior to wider implementation of such solutions.
In the first two weeks of January, CQC's African cookstoves projects achieved issuance of a further 186,000 carbon credits from a stove fleet of 114,000 in rural Malawi and Zambia. These events mark an important milestone in CQC's partnership with the leading suitable rural livelihoods NGOs in the South-East Africa region, Total LandCare of Malawi, and COMACO of Zambia.
The success of these projects has enabled CQC and its NGO partners to plan a further round of stove investments building on the many lessons learned from consumer feedback and track record of stove wear and tear under constant use. This feedback has led to complete redesign of the metal components of the original TLC-CQC stove, making it possible to envisage a ten-year life for a rural stove built with high grade heavy stainless steel parts coupled with much greater emphasis and support for ongoing maintenance of bricks and mortar stove infrastructure by the women who build and operate them. Already CQC has invested in more than 50,000 "next generation" stoves that are in various stages of installation across Malawi, Nigeria and Zambia. New long-life materials are being closely monitored in the field and subjected to stress testing in a US laboratory.
World Bank Top Manager: In her first address to staff on taking up her new role as World Bank CEO, Kristalina Georgieva acknowledges role of CQC Founder, Ken Newcombe, as a pioneer of the global carbon market in the World Bank as an example of how the Bank can be an innovator on a global scale. Kristalina is reflecting on climate change doubters and skeptics of the idea of making a market in greenhouse gas emissions to mitigate climate change when she says "...carbon trade was like a cuckoohead idea, and there was a guy named Ken Newcombe who said, well lets test it, and we actually made it happen, and that is what..I see in this job..to have the ability, to have the bravery, when we hear is (something is) impossible, to just..get it done". Current and ex-World Bank staff with access to the Bank’s intranet can get all of Kristalina's Return to the Bank speech.
Ken and his team won an internal competition for new product development under an initiative for innovation spearheaded by then Bank President Jim Wolfenson. $3.25 million was allocated to Ken to set up a team and prepare the first global carbon fund. The Prototype Carbon Fund achieved first closing on April 11, 2000 at $135 million and second closing in December 2000, with a total 6 government and 13 large corporate investors from Europe and Japan.
IETA: In recognition of his contribution to carbon market development, Ken Newcombe, CQC's CEO, was admitted as a Fellow of the International Emissions Trading Association in its December 2016 Board meeting.
History of Carbon Market Development: In November 2016, the International Emissions trading Association published an oral history of carbn market creation "From Kyoto to Paris" which noted the role played by Ken Newcombe as an entrepreneur inside the World Bank Group in the 1990's to persuade the President of the World Bank to have the Bank take the lead in pioneering the global carbon market through the establishment of the Prototype Carbon Fund which laid out the rules of the game for creating and trading greenhouse gas emissions reductions as a marketable commodity under the UNFCCC.
As of early October, C-Quest Capital (CQC) Cambodia is under contract with SNV Netherlands Development Organisation Cambodia to manage The Stove Auction project. The Stove Auction is an innovative concept developed by SNV that facilitates the sale of advanced biomass stoves between international stove suppliers and local distributors through an auction platform in Cambodia.
As of mid-December 2016, 16 auctions have been conducted with 3,604 advanced biomass stoves sold. The auctions started in late March 2016 under SNV management and transitioned to CQC in October 2016. CQC has implemented the past 5 auctions, selling 2,176 stoves in just the past 2.5 months.
“So far so good” is how CQC’s Chief Operating Officer, Jason Steele, explains the progress of the world’s first wholesale auction for advanced biomass stoves. “We are testing a hypothesis for a new way of developing the market for advanced biomass stoves, which have struggled to gain market share in most other places in the world. And so far, it is going quite well. The market is reacting positively to these stoves. We have 10 registered bidders and half of them are quite active, returning to the auction on multiple occasions for more stoves. We see evidence of their consumer sales records when they claim their results-based-financing payments, so we know people are buying them and paying retail prices that most other development practitioners in- and outside of Cambodia said would be impossible. Consumers in poorer strata do care about their cooking appliances and are willing to pay more for the benefits that these stoves provide,” explains Steele.
“The auction is not without its challenges though. We see auction prices remaining on the lower end and stagnant, requiring more results-based financing funds to fill the gaps. We have plans to address this through a new reserve price policy by setting a specific floor price per stove per auction that gradually increases over time, and of course to increase the number of registered bidders thereby increasing competition and having bid amounts increase naturally. The reserve prices will be published compared to how it is now, which is a hidden reserve price that has been a fixed percentage of the Full Wholesale Value of the stove that increases on a periodic basis,” explains Steele.
Advanced biomass stoves purchased through the auction have reached consumers in 16 provinces to date, the majority in Svay Rieng, Kampong Speu, Prey Veng, and Phnom Penh. The buyers of the stoves at auction are locally registered companies in Cambodia, mostly with a last-mile distribution sales and marketing approach. They place their bids on auction day via SMS messaging and receive periodic updates throughout the day on the status of their bids, giving them a chance to increase their bid price and volumes if desired.
The Stove Auction warehouse managed by CQC is located in Phnom Penh Thmei district in Phnom Penh. It is currently filled with the world’s most efficient and cleanest portable biomass stoves, including the ACE-1 Solar Biomass Cookstove produced by African Clean Energy (a Dutch company manufacturing in Lesotho), Mimi Moto Cookstove produced by Mimi Moto (a Dutch company manufacturing in China), Prime Fuelwood Square produced by Prime Cookstoves (manufactured in Indonesia), and 3G Small produced by Solar Serve (manufactured in Vietnam).
For more information about The Stove Auction, please visit www.thestoveauction.org
CQC launched a fully owned subsidiary, C-Quest Capital (Cambodia) Co., Ltd., in Cambodia in early September 2016 to manage The Stove Auction project funded by SNV Netherlands Development Organisation and GIZ/Energising Development and to further grow its business in Southeast Asia. The Stove Auction is an innovative concept developed by SNV that facilitates the sale of advanced biomass stoves between international stove suppliers and local distributors through an auction platform.
CQC signed an agreement with SNV to manage The Stove Auction as of 3 October 2016. The Stove Auction project in Cambodia is expected to distribute over 40,000 advanced biomass cookstoves over the next three years.
Please read the joint press release issued by SNV, CQC and EnDev.
For more detailed information about The Stove Auction, please visit www.thestoveauction.org
CQC is thrilled to enter into a partnership with BiX to expand our cookstoves projects in rural Africa with our remarkable on-ground partners in Malawi, Zambia and Nigeria, TLC, COMACO and SOSAI respectively. BiX funds will also us to supply new upgraded stoves and enhanced operational procedures to enable consumers to have the benefit of cleaner cooking and cleaner households air for up to ten years based on enhanced durability of key metal parts of women and artisan-built mud brick and metal stoves.
During August, CQC completed its 50,000 stoves project with COMACO in Zambia, achieved the 64,000 stoves built target in Malawi, and reach the 10,000 rural stoves milestone in Northern Nigeria. An additional 40,000 stoves will be built across these geographies over the next year using new stove parts designed for longer life. At the same time, BiX funding enables CQC to lay the foundation in surveys and analysis for new market methodologies and verification and forward sale of stoves co-benefits to carbon emissions reductions, including improved health outcomes from cleaner air, gender benefits for reduced drudgery in firewood gathering, and black carbon reductions.
CQC is pleased to announce that the CDM Executive Board issued emissions reductions from its Second Verification from its hard won Northern Nigeria project to distribute and construct efficient cookstoves to low income urban and base-of-the-pyramid rural households in Kaduna and Kano States. This second verification stems from portable metal cookstoves made by Ecozoom, whereas the program has shifted to the rural areas with a new program to install high efficiency mud brick and metal stoves built by artisans in the village communities for women cooks. The first phase of 12,000 stoves is almost complete with 10,000 stoves built as of today.
CQC is proud to join The Gold Standard in developing the first ever Methodology for verifying improved health outcomes of cleaner cooking: cleaner air through both better cookstoves and improved kitchen ventilation. Innovative Gold Standard Methodology Announced
The metric for improved health outcomes is Averted Disability Adjusted Life Years (ADALYs). This Methodology’s development was instigated by CQC as part of its pioneering work in creating a forward market for improved health outcomes from clean cooking, working with the World Bank and the leading researchers and service providers in the field of household air pollution, including Professor Kirk Smith, University of California and Berkeley, and the staff and managers of Berkeley Air Monitoring Group, Berkeley, California. The ADALY Methodology should be published at the end of 2016 and be linked to registry functions to allow transparent settlement of contracts for forward sale of ADALYs, with payment on delivery into designated buyer’s registry accounts. Independent high integrity third party verification is a cornerstone of results based financing and market creation for monetizable development impacts and benefits streams. The next step for C-Quest is to develop and manage the first-of-its-kind health and climate project based on cleaner burning biomass cookstoves, replacing open fires or smoky traditional firewood stoves. Such projects have been designed for Malawi and Laos.
CQC's new rural stoves program in Nigeria installing innovative brick and metal rocket stoves reached 7000 stoves of the planned 12,000 first phase. After testing of various distribution business models and capacity building for stove makers and field coordinators, CQC's women-owned and managed partners, SOSAI Renewable Energies, achieved 2500 stove per month installation rate as of June, despite the onset of rains. On the basis of this success, CQC and investment partners BioCarbon Group are reviewing program expansion to 20,500 stoves by the end of 2016.
CQC and the Gold Standard announced today their partnership in designing, funding and managing the development of the new Gold Standard methodology for verification of Averted Disability Adjusted Life Years (ADALYs) from cleaner cooking and cleaner air. ADALYs are effectively additional years of healthy living, in this case for family members having much reduced exposure to toxic pollutants in biomass smoke thrum cleaner burning cookstoves and improved ventilation. The methodology also covers reduced household pollution from cleaner biomass fueled households heating. The partners expect the ADALY Methodology to be published in Q4, 2016, and to be the cornerstone of a new set of pay-for-performance investments in women's and children's health through clean cooking, where investments are made against forward purchase contracts with sovereigns and private foundations and corporations for payment on delivery of ADALYs issued annually from specific projects.
CQC and its conservation and sustainable development NGO partner COMACO are pleased to announce the construction of the 45,000th rural stove in COMACOs service area of Eastern Zambia. The stoves being installed derive from a Total LandCare and CQC design being installed in Malawi. Based on this achievement, CQC has raised funds to expand the COMACO stoves project to 75,000 stoves with an option under its partnership with KfW to add a further 30,000 stoves in 2017.
CQC's CEO participated as an adviser to the World Bank in a successful donor consultation in Amsterdam convened by the World Bank with the Cardano Foundation and BiX capital. Newcombe presented the investment thesis for the planned first-of-its-kind cookstoves project to be financed by the forward sale of ADALYs from healthier women and children due to reduced households air pollution from replacement of smoky traditional cook fires with forced draft gasifier stoves.
CQC is pleased to announce posting of the Monitoring Report for the second verification of its partnership project with Total LandCare in Malawi, to supply 64,000 stoves to rural households. Expected CER issuance is 100,000 CERs, well on target with investment projections. As of this date, 60,000 stoves had been built and registered under the project co-financed with CQC's investment partner, the BioCarbon Group.
CQC received notice that CERs from the second verification of its Nigeria Efficient Cookstoves project would be issued on August 24th. The project is an investment partnership with the BioCarbon Group. This is a milestone long awaited given the difficulties CQC and its development partner have experienced with project implementation in the face of serious disruption to business by Boko Haram insurgents throughout the project area, now abating.
Through its pioneering partnership with Total LandCare of Malawi, and their joint venture Total LandCare Green, CQC is thrilled to note early proof of concept of the shared vision with TLC on sustainable affordable production of firewood by villagers within 50km of the capital of Lilongwe. Sustained delivery of bundled firewood is being supplied at the level of several tons per week to pick up points outside the city and delivered to TLCG depots for distribution in town. The pilot was funded by Irish Aid and has demonstrated that by providing a secure market price and infrastructure that reduced the burden and cost of market access, well-managed village forestry under TLC's guidance can supply Lilongwe and reduce the damage of unsustainable harvest of watersheds and protected forests in the Lilongwe firewood forage zone. The model should be replicable in other African Cities where firewood is still supplied and traded.
CQC is pleased to announce that its partnership with Malawian business interests in Atlas Energies to build the first large scale grid-connected Solar PV achieved major milestones of signed terms sheet for 100MW of Solar PV with a storage option, and allocation for a 45MW solar PV plant near Lilongwe and a signed sovereign support agreement to cover counter-party credit and convertibility risk. Atlas Energies is partnering with ibvogt of Germany as the designer, EPC contractor, and finance arranger for the project.
CQC announces the sale of the first ever International Renewable Energy Certificates from renewable energy facilities in developing countries. The sale has been brokered by Natural Capital Partners and is from the Ecopower Ishasha small hydropower plant in Uganda, which CQC manages for carbon and environmental attributes. The emerging IRecs market promises to fill some of the gap left through the collapse of the global compliance carbon market.
CQC is pleased to announce completion of field visits for the first verification of its Zambia cookstoves project, a partnership with the NGO OMACO, funded by the German development bank, KfW. This first verification is based on verified installation of 29,000 of the 50,000 stove first phase of the project by end October, 2016.