Investments in this strategy aim to produce fewer harmful emissions to reduce health risks from burning biomass and fossil fuels, decrease related economic burdens, and limit negative environmental impacts from status quo fuels. The sections below include an overview of the strategy for achieving desired goals, supporting evidence, core metrics that help measure performance toward goals, and a curated list of resources to support collecting, reporting on, and using data for decision-making.

What

Dimensions of Impact: WHAT

Investors interested in deploying this strategy should consider the scale of the addressable problem, what positive outcomes might be, and how important the change would be to the people (or planet) experiencing it.

Key questions in this dimension include:

What is the problem the investment is trying to address? For the people experiencing the problem, how important is this change?

In emerging-market countries, emissions from the burning of fossil fuels, wood, and charcoal, especially for lighting and cooking, harm billions of individuals. Investments in this strategy can contribute to impact by:

  • reducing health risks—especially risks of respiratory ailments, visual impairment, and cancer—related to burning biomass and fossil fuels like kerosene;
  • reducing the economic burdens of expensive energy and emissions-related healthcare; and
  • reducing the negative environmental impacts caused by burning fossil and bio-based fuels, including air pollution from emissions of high-particulate black carbon and the emission of other greenhouse gases.

What is the scale of the problem?

The challenges of harmful localized emissions vary substantially among emerging-market countries, but they are quite broad in scale, especially in parts of Africa and Asia. In the Economic Community of West African States (ECOWAS) alone, 178 million people lack access to the electricity grid, which means they rely on biomass and fossil fuels for cooking and lighting (3). In 2010, between 2.6 and 4.4 million deaths each year were estimated from poor indoor air quality associated with cooking with solid fuels (wood and charcoal) (3 ). The soot from black-carbon emissions is the second-largest contributor to global climate change (4); global climate change, meanwhile, also more greatly harms those living in emerging-market countries, because many are at low latitudes and have economies based on climate-susceptible industries, including forestry and agriculture (5).

Who

Dimensions of Impact: WHO

Investors interested in deploying this strategy should consider whom they want to target, as almost every strategy has a host of potential beneficiaries. While some investors may target women of color living in a particular rural area, others may set targets more broadly, e.g., women. Investors interested in targeting particular populations should focus on strategies that have been shown to benefit those populations.

Key questions in this dimension include:

Who/What is helped through this strategy?

While this strategy has many potential end beneficiaries, subject to investor preferences, the following groups are most often targeted as the primary users of biomass and fossil fuels:

Low-Income Individuals in Emerging Markets: The pollution related to biomass and fossil fuels used for cooking and lighting harms the health of the people using them, causing millions of deaths and contributing to lower life expectancy compared to developed countries.

Women and Children: Women and children often spend more time indoors than men, which exposes them to indoor emissions from traditional fuel sources. Children, especially infants, are most susceptible to diseases and long-term harm caused by these emissions. These increased health risks lead to individual- and community-level health problems. Due to indoor air pollution, individuals face time away from work and greater likelihood of disability and respiratory problems. Meanwhile, these problems place additional strain on already-stretched community health systems.

In addition, this strategy can target improvements in the environment, since burning solid fuels for cooking releases black carbon and greenhouse gases. Soot from black carbon only briefly persists locally, but it has major impacts on global climate. Localized pollution from these fuels where they are heavily used can cause further environmental problems (1).

What are the geographic attributes of those who benefit?

Of the 1.1 billion people worldwide without access to electricity and 2.7 billion without clean energy for cooking, 95% live in emerging-market countries in sub-Saharan Africa and Asia. Approximately 80% reside in rural areas (2).

Contribution

Dimensions of Impact: CONTRIBUTION

Investors considering investing in a company or portfolio aligned with this strategy should consider whether the effect they want to have compares to what is likely to happen anyway. Is the investment's contribution ‘likely better’ or ‘likely worse’ than what is likely to occur anyway across What, How much and Who?

Key questions in this dimension include:

Is the investment’s contribution ‘likely better’ or ‘likely worse’ than what is likely to occur anyway across What, How Much and Who?

The extent to which this strategy can reduce harmful emissions depends on the specific investee business and the product they are bringing to market. For this strategy, investments reducing reliance on fossil and bio-fuels shown to produce high levels of black carbon and greenhouse gas emissions will almost certainly drive greater improvement than what would occur without the investment. One estimate suggested that shifting the global population now using traditional cookstoves to use of efficient cookstoves could save emissions of one billion gigatons of carbon per year, or approximately 2.5% of the world’s output (6).

How Much

Dimensions of Impact: HOW MUCH

Investors deploying capital into investments aligned with this strategy should think about how significant the investment's effect might be. What is likely to be the change's breadth, depth, and duration?

Key questions in this dimension include:

How many can receive the outcome through this strategy?

The potential breadth of impact depends on the number of individuals in emerging markets who lack access to clean energy, or roughly 1.1 billion people worldwide, as noted above.

How much change can beneficiaries experience through this strategy?

The amount of change end beneficiaries derive from this strategy depends on the product delivered and the status-quo product(s) replaced. Individuals currently relying on kerosene or solid fuels could see more significant change from using more renewable and reliable sources of energy that individuals already using low-emissions products. Examples of outcomes from investments in this area include the following:

  • Studies in Peru, Mexico, and Honduras found that improved cookstoves decreased exposure to air pollutants (particulate matter), with a 70.5–74% reduction in kitchen concentrations of particulate matter and reduced personal exposure between 35% and 63% (7, 8, 9).
  • A study of individual households in Bangladesh found that users of solar home systems reduced their annual carbon-dioxide emissions by 68.3–95.3 kg (10).

Illustrative Investment

Burn Stoves has developed a model of clean cookstove for sale in East Africa that burns biomass solids, with emissions comparable to liquefied petroleum gas (LPG) or natural gas cookstoves. The cookstove reduces fuel usage by 56% and emissions by over 60%. Its users have reported substantially fewer health problems with continued use of their new cookstove, compared to when they used their prior stoves. The product is the first commercially viable clean cookstove rated as a ISO/IWA Tier 4 stove, placing it in the highest ranking available for a combination of factors including efficiency, emissions, and safety (11).

Draw on Evidence

This mapped evidence shows what outcomes and impacts this strategy can have, based on academic and field research.

NESTA: 3
Access to Energy in Rwanda: Impact Evaluation Of Activities Supported By The Dutch Promoting Renewable Energy Programme

Dutch Ministry of Foreign Affairs. 2014. Access To Energy In Rwanda: Impact Evaluation Of Activities Supported By The Dutch Promoting Renewable Energy Programme. IOB Evaluation No. 396.

NESTA: 2
Stiftung Solarenergie (Sts) & Hybrid Social Solutions (HSSi) - Social Impact Assessment

Planète d’Entrepreneurs. 2011. Stiftung Solarenergie (Sts) & Hybrid Social Solutions (Hssi) – Social Impact Assessment.

NESTA: 1
Capturing the Multiple Benefits of Energy Efficiency: Roundtable on Industrial Productivity and Competitiveness

OECD/IEA. 2014. Capturing The Multiple Benefits Of Energy Efficiency: Roundtable on Industrial Productivity and Competitiveness.

NESTA: 1
Identifying and Reducing the Health and Safety Impacts of Fuel-Based Lighting

Mills, Evan. “Identifying and Reducing the Health and Safety Impacts of Fuel-Based Lighting.” Energy for Sustainable Development 30 (2016): 39-50.

NESTA: 2
A Comparative Risk Assessment of Burden Disease and Injury Attributable to 67 Risk Factors and Risk Factor Clusters in 21 Regions, 2990 - 2010: A Systematic Analysis for the Global Burden of Disease Study 2010.

Lim, Stephen S., Theo Vos, Abraham D. Flaxman, Goodarz Danaei, Kenji Shibuya, Heather Adair-Rohani, Mohammad A. AlMazroa et al. “A Comparative Risk Assessment of Burden of Disease and Injury Attributable to 67 Risk Factors and Risk Factor Clusters in 21 Regions, 1990–2010: A Systematic Analysis for the Global Burden of Disease Study 2010.” The Lancet 380, no. 9859 (2013): 2224-2260.

NESTA: 3
Impacts of Solar Lanterns in Geographically Challenged Locations: Experimental Evidence from Bangladesh

Kudo, Yuya, Abu S. Shonchoy, and Kazushi Takahashi. Impacts of Solar Lanterns in Geographically Challenged Locations: Experimental Evidence from Banglades. No. 502. Institute of Developing Economies, Japan External Trade Organization (JETRO), 2015.

NESTA: 1
Access to Clean Lighting and Its Impact on Children: An Exploration of SolarAid's SummyMoney

Esper, Heather, Ted London, and Yaquta Kanchwala. “Access to Clean Lighting and Its Impact on Children: An Exploration of SolarAid’s SummyMoney.” Child Impact Case Study 4 (2013).

NESTA: 2
Micro Hydro Power Plants in Andean Bolivian Communities: Impacts on Development and Environment

González, A. Hueso, A. B. Aristizábal, and R. M. Díaz. “Micro Hydro Power Plants in Andean Bolivian Communities: Impacts on Development and Environment.” In International Conference on Renewable Energies and Power Quality, Valencia. 2009.

NESTA: 2
Application of Environmental Assessment Related to GIZ ECO Micro Hydropower Plants in the Sidama Zone/Ethiopia

Meder, Katharina, Olaf Bubenzer, and Marcus Nüsser. “Application of Environment Assessment Related to GIZ ECO Micro Hydropower Plants in the Sidama Zone/Ethiopia.” PhD diss., MSc Thesis, Heidelberg University, 2011.

NESTA: 1
Black Carbon and Kerosene Lighting: An Opportunity for Rapid Action on Climate Change and Clean Energy for Development.

Jacobson, Arne, Tami C. Bond, Nicholoas L. Lam, and Nathan Hultman. Black Carbon and Kerosene Lighting: An Opportunity for Rapid Action on Climate Change and Clean Energy for Development. The Brookings Institution, Washington, DC (United States). Global Economy and Development, 2013.

NESTA: 2
Quantifying Carbon and Distributional Benefits of Solar Home System Programs in Bangladesh

Wang, Limin, Sushenjit Bandyopadhyay, Mac Cosgrove-Davies, and Hussain A. Samad. “Quantifying Carbon and Distributional Benefits of Solar Home System Programs in Bangladesh.” (2011).

NESTA: 1
Off-Grid Solar Market Trends Report, 2016

Global, Lighting, and Bloomberg New Energy Finance. “Off-Grid Solar Market Trends Report 2016.” Bloomberg New Energy Finance and Lighting Global in cooperation with the Global Off-Grid Lighting Association (GOGLA) (2016).

NESTA: 3
Electricity and Sustainable Development: Impacts of Solar Home Systems in Rural Bangladesh

Blunck, Michael. “Electricity and Sustainable Development: Impacts of Solar Home Systems in Rural Bangladesh.” (2007): 43.

NESTA: 3
A First Step up the Energy Ladder? Low Cost Solar Kits and Household's Welfare in Rural Rwanda

Grimm, Michael, Anicet Munyehirwe, Jörg Peters, and Maximiliane Sievert. “A First Step Up the Energy Ladder? Low Cost Solar Kits and Household’s Welfare in Rural Rwanda.” The World Bank Economic Review (2016): lhw052.

NESTA: 1
Accelerating Access to Electricity in Africa with Off-Grid Solar: The Impact of Solar Household Solutions

Harrison, K., A. Scott, and R. Hogarth. “Accelerating Access to Electricity in Africa with Off-Grid Solar: The Impact of Solar Household Solutions.” Overseas Development Institute ODI Report (2016): 9.

NESTA: 2
Welfare Impacts of Rural Electrification: Evidence from Vietnam

Barnes, Douglas French, Shahidur R. Khandker, Minh Huu Nguyen, and Hussain A. Samad. Welfare Impacts of Rural Electrification: Evidence from Vietnam. No. 5057. The World Bank, 2009.

NESTA: 1
Energy, Gender, and Development: What Are the Linkages? Where Is the Evidence?

Köhlin, Gunnar, Erin O. Sills, Subhrendu K. Pattanayak, and Christopher Wilfong. “Energy, Gender and Development: What are the Linkages? Where is the Evidence?.” Where Is the Evidence (2011).

NESTA: 3
Impacts of Rural Electrification in Rwanda

Bensch, Gunther, Jochen Kluve, and Jörg Peters. “Impacts of Rural Electrification in Rwanda.” Journal of Development Effectiveness 3, no. 4 (2011): 567-588.

NESTA: 2
Connective Power: Solar Electrification and Social Change in Kenya

Jacobson, Arne. “Connective Power: Solar Electrification and Social Change in Kenya.” World Development 35, no. 1 (2007): 144-162.

NESTA: 2
Off-Grid Energy Services for the Poor: Introducing LED Lighting in the Millennium Villages Project in Malawi

Adkins, Edwin, Sandy Eapen, Flora Kaluwile, Gautam Nair, and Vijay Modi. “Off-Grid Energy Services for the Poor: Introducing LED Lighting in the Millennium Villages Project in Malawi.” Energy Policy 38, no. 2 (2010): 1087-1097.

NESTA: 1
Social Impact Assessment of BBOXX in Uganda

Enea Consulting. 2012. Social Impact Assessment Of BBOXX In Uganda.

NESTA: 2
Affordability and Expenditure Patterns for Electricity and Kerosene in Urban Households in Tanzania

Mnenwa, Raymond, and Emmanuel Maliti. The Affordability and Expenditure Patterns for Electricity and Kerosene in Urban Households in Tanzania. Research on Poverty Alleviation (REPOA), 2011.

NESTA: 1
From Carbon to Light: A New Framework for Estimating Greenhouse Gas Emissions Reduction from Replacing Fuel-Based Lighting with LED Systems

Mills, Evan, and Arne Jacobson. From Carbon to Light: A New Framework for Estimating Greenhouse Gas Emissions Reductions from Replacing Fuel-Based Lighting with LED Systems.” Energy Efficiency 4, no. 4 (2011): 523-546.

NESTA: 2
Self-Reported Impacts of LED Lighting Technology Compared to Fuel-Based Lighting on Night Market Business Prosperity in Kenya

Johnstone, Peter. “Self-Reported Impacts of LED Lighting Technology Compared to Fuel-Based Lighting on Night Market Business Prosperity in Kenya.” Lawrence Berkeley National Laboratory (2009).

NESTA: n/a
Rural Lighting in Kenya (forthcoming)

Innovations for Poverty Action. 2017. Rural Lighting In Kenya. Accessed July 12.

Each resource is assigned a rating of rigor according to the NESTA Standards of Evidence.

Define Metrics

Core Metrics

This starter set of core metrics — chosen from the IRIS catalog with the input of impact investors who work in this area — indicate performance toward objectives within this strategy. They can help with setting targets, tracking performance, and managing toward success.

Additional Metrics

While the above core metrics provide a starter set of measurements that can show outcomes of a portfolio targeted toward this goal, the additional metrics below — or others from the IRIS catalog — can provide more nuance and depth to understanding your impact.