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Financing energy SMEs in Ghana and Senegal: Outcomes, barriers and prospects

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  • Haselip, James
  • Desgain, Denis
  • Mackenzie, Gordon

Abstract

The article presents the findings of primary research carried out in Ghana and Senegal, which revisited the main assumptions behind the African Rural Energy Enterprise Development (AREED) initiative (2002–2012), and other donor-backed programmes, designed to promote small and medium-sized energy enterprises (energy SMEs). These assumptions were (1) that the lack of affordable local financing presented the most significant barrier to setting up and expanding energy SMEs, and (2) that these barriers would be overcome by a ‘demonstration effect’ whereby successful businesses, supported by donor-backed programmes, could in turn influence the commercial financial sector to invest in energy SMEs, thus triggering a virtuous circle of growth and profitability.

Suggested Citation

  • Haselip, James & Desgain, Denis & Mackenzie, Gordon, 2014. "Financing energy SMEs in Ghana and Senegal: Outcomes, barriers and prospects," Energy Policy, Elsevier, vol. 65(C), pages 369-376.
    • Handle: RePEc:eee:enepol:v:65:y:2014:i:c:p:369-376
    DOI: 10.1016/j.enpol.2013.10.013
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    1. Karekezi, Stephen & Kithyoma, Waeni, 2002. "Renewable energy strategies for rural Africa: is a PV-led renewable energy strategy the right approach for providing modern energy to the rural poor of sub-Saharan Africa?," Energy Policy, Elsevier, vol. 30(11-12), pages 1071-1086, September.
    2. Pietro Calice & Victor M. Chando & Sofiane M. Sekioua, 2012. "Working Paper 146 - Bank Financing to Small and Medium Enterprises in East Africa: Findings of a Survey in Kenya, Tanzania, Uganda and Zambia," Working Paper Series 377, African Development Bank.
    3. Céline Kauffmann, 2005. "Financing SMEs in Africa," OECD Development Centre Policy Insights 7, OECD Publishing.
    4. Brew-Hammond, Abeeku, 2010. "Energy access in Africa: Challenges ahead," Energy Policy, Elsevier, vol. 38(5), pages 2291-2301, May.
    5. Meghana Ayyagari & Thorsten Beck & Asli Demirguc-Kunt, 2007. "Small and Medium Enterprises Across the Globe," Small Business Economics, Springer, vol. 29(4), pages 415-434, December.
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    Citations

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    Cited by:

    1. Ahmed, Abubakari & Gasparatos, Alexandros, 2020. "Multi-dimensional energy poverty patterns around industrial crop projects in Ghana: Enhancing the energy poverty alleviation potential of rural development strategies," Energy Policy, Elsevier, vol. 137(C).
    2. Jin, Yi & Gao, Xiaoyan & Wang, Min, 2021. "The financing efficiency of listed energy conservation and environmental protection firms: Evidence and implications for green finance in China," Energy Policy, Elsevier, vol. 153(C).
    3. Dorothee Apfel & Carsten Herbes, 2021. "What Drives Senegalese SMEs to Adopt Renewable Energy Technologies? Applying an Extended UTAUT2 Model to a Developing Economy," Sustainability, MDPI, vol. 13(16), pages 1-21, August.
    4. Ogundiran Soumonni & Kalu Ojah, 2022. "Innovative and mission‐oriented financing of renewable energy in Sub‐Saharan Africa: A review and conceptual framework," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 11(1), January.
    5. Yuting Li & Tong Chen & Baogui Xin, 2016. "Optimal Financing Decisions of Two Cash-Constrained Supply Chains with Complementary Products," Sustainability, MDPI, vol. 8(5), pages 1-17, April.
    6. de Lange, Deborah E., 2016. "Legitimation Strategies for Clean Technology Entrepreneurs Facing Institutional Voids in Emerging Economies," Journal of International Management, Elsevier, vol. 22(4), pages 403-415.
    7. Tigabu, Aschalew & Berkhout, Frans & van Beukering, Pieter, 2017. "Development aid and the diffusion of technology: Improved cookstoves in Kenya and Rwanda," Energy Policy, Elsevier, vol. 102(C), pages 593-601.
    8. Abudu Braimah & Yinping Mu & Isaac Quaye & Alhassan Abubakar Ibrahim, 2021. "Working Capital Management and SMEs Profitability in Emerging Economies: The Ghanaian Case," SAGE Open, , vol. 11(1), pages 21582440219, February.
    9. Jun Dong & Huijuan Huo, 2017. "Identification of Financing Barriers to Energy Efficiency in Small and Medium-Sized Enterprises by Integrating the Fuzzy Delphi and Fuzzy DEMATEL Approaches," Energies, MDPI, vol. 10(8), pages 1-26, August.
    10. Sovacool, Benjamin K. & Van de Graaf, Thijs, 2018. "Building or stumbling blocks? Assessing the performance of polycentric energy and climate governance networks," Energy Policy, Elsevier, vol. 118(C), pages 317-324.
    11. Obi Berko Obeng Damoah & Augustine Awuah Peprah, 2021. "Synthesis of small and medium enterprise research in Ghana," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 11(1), pages 451-468, December.

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    Keywords

    Energy SME; Financing; Africa;
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