Envirofit is a social enterprise that specializes in designing, developing, and distributing clean cooking and energy-efficient technologies primarily for households in emerging and developing regions. Their mission is to address some of the critical issues associated with traditional cooking methods, such as indoor air pollution, environmental degradation, and health concerns.
BIX Capital saw the opportunity to make significant impact through an investment to Envirofit through multiple tranches of funding totaling USD 3m. This funding has assisted in the role-out of a clean stove programme and expansion across the pan-African region, which has supported the commercial growth of Envirofit’s business operations.
What makes this story unique is the positive financial ecosystem which allows Envirofit to repay their debts to BIX Capital through a carbon credits trading scheme. The Emissions Reduction Purchase Agreement (ERPA), which is a legally binding contract was structured into the deal. It facilitates the purchase and trading of carbon credits, which are backed by a Korean ERPA (Hyundai Green Power) and brokered by their buyer CERPD. Envirofit’s activities, with BIX’s financial backing, are converting any reductions in CO2 emissions into carbon credits, which they can then sell to pay back the loans and accrued interest for investors.
The impact
Since the investment from BIX Capital, Envirofit have been able to distribute 100,000 clean cooking stoves to 500,000 people living in rural areas in Kenya, Nigeria, Ghana, Liberia, and Cote d’Ivoire. The innovative nature of the energy efficient designs has saved 340,000 tCO2e in greenhouse gas emissions.
Date
2016
Investment value
USD 3 million
Instrument
Underwriting Carbon Credits
