Environmental Markets
This investment area consolidates Musika’s existing work in the renewable energy sector, and also explore other opportunities for smallholder and rural community engagement in markets that combine the elements of commercial benefit and ‘value add’ market service provision with environmental protection and climate change mitigation.
Energy is an essential enabler for national and household economic development, and yet Zambia’s national power grid only covers about a quarter of the population and only 3-4% of rural households. The majority of the population without access to electricity relies on traditional biomass-derived sources of energy generation for cooking and lighting, the extraction of which is one of Zambia’s primary drivers of forest destruction and degradation.
At the same time, the country spends huge amounts on petroleum fuel imports a year. Fuel represents Zambia’s single largest imported commodity and the cost and reliability of these imports are major factors influencing the country’s economic growth.
Within the environmental markets portfolio, Musika focuses on the following areas:
1. Consumptive use of clean energy: Musika supports the development of the market for renewable energy products to tackle the crippling ‘energy poverty’ that pervades the rural economy, aimed primarily at productive use (solar irrigation, cold chain solutions, etc.) and household level use (cooking solutions, renewable fuels, etc.).
2. Productive Use of Clean Energy: Musika places an emphasis on the productive use of clean energy to drive rural economic development particularly in the agricultural space. The smallholder-related economy – from agricultural production, handling, storage and logistics through to value addition – is widely acknowledged to be chronically ‘under-powered’. Therefore, Musika is supporting the clean powering of the lower end of the agricultural market through support to the suppliers of, for instance, solar sprayers, cold chain solutions and irrigation solutions to demonstrate and roll out their products and services.
3. Production of Clean Energy: Musika’s efforts in this area is to stimulate private investment in the development of supply chains in which the rural poor are the producers of sources of renewable energy, primarily through biomass and biofuel production and agricultural waste aggregation systems, linked closely to Musika’s work in the agricultural diversification investment area.
4. Sustainable Natural Resource Utilisation: Musika is explore opportunities for intervention in, for example, honey production and wild mushroom extraction. The focus for Musika is to explore innovative commercial opportunities for investment that directly deliver financial reward for rural communities for environmental protection practices such as the fledgling – and currently struggling – carbon markets that in theory at least pay for the provision of ‘environmental services’ by rural communities
