NOW WE ARE COOKING The new improved cookstove uses even less fuel, subsequently reducing emissions
Financial institution Standard Bank announced last month that it had finalised an agreement to support global carbon project developer The African Stove Company (TASC) with funding for what is believed to be the first carbon credit project of its kind in South Africa.
The carbon credit project has been designed to combat climate change and simultaneously drive positive social outcomes in rural areas.
The facility will provide TASC with funding to support its socially orientated projects.
“The company’s revenue stream is derived from selling carbon credits issued in respect of emission reductions that will result from rural communities using about 680 000 cookstoves already donated by the company to South African communities,” says Standard Bank Carbon Credit Trading lead Lawrence Cole-Morgan.
He adds the efficient stoves significantly reduce the wood required to fuel the stoves.
“This has immediate benefits for the emission of greenhouse gases, particularly carbon dioxide, combats climate change and helps preserve biodiversity.”
Additionally, the tangible advantages for the communities involved are reduced costs and less time spent sourcing cooking fuel from surrounding environments.
Owing to the stoves burning much cleaner than traditional cooking methods, they also offer health benefits and avoid the dangers of cooking on open fires to users and the community, Cole-Morgan adds.
TASC generates carbon credits as a result of the reduction in carbon emissions from the use of the cookstoves and the distribution of cookstoves is funded by the sale of carbon credits to companies that need to contribute to combatting climate change and want to do so by offsetting their emissions.
However, these sales can occur months or even years after a project is established and the development of carbon credit projects requires upfront capital to execute the project.
Standard Bank is providing TASC finance against the future sale price of the carbon credits and thereby assisting TASC in reaching its goal to distribute 750 000 efficient cookstoves to rural communities.
“Through this deal, Standard Bank has demonstrated that it can fund against carbon credits as a commodity,” says Standard Bank Energy and Infrastructure Finance executive George Kotsovos.
The TASC project differentiates Standard Bank’s Corporate and Investment Bank by displaying its key competencies and highlighting its ability to provide complex, sustainable green and social loans on the African continent, Kotsovos adds.
“Further enabling our capabilities is the African footprint of the Standard Bank Group and our reputation for providing our clients with bespoke solutions for their specific needs,” he says.
“Our African presence is a competitive advantage as we provide clients access to various markets and back this strength with locally-based expertise to offer market insights.”
“Carbon credits enable companies to offset their carbon emissions and contribute to a more sustainable future,” says TASC Africa CEO Shelley Estcourt.
“We are delighted to have Standard Bank as a partner in fighting climate change and improving the lives of rural communities. We look forward to a long, mutually rewarding association in the future,” she concludes.