ACE DELIVERS: Distribution of Energy to the Last-Mile through an Inclusive Value-Chain Ensuring Responsible Services

African Clean Energy (ACE), in collaboration with The Challenges Group, seek to establish a scalable, decentralised and digitised distribution model for transitioning households from harmful charcoal usage to sustainable local fuel options. ACE has demonstrable demand for its sustainable briquettes, however, the existing method of ordering and delivering fuels through local agents becomes impractical and unsustainable as ACE expands its geographical market penetration.

This project will demonstrate the advantages of developing an inclusive approach to reconfiguring and incentivising Uganda's current physical infrastructure -- including local retailers serving as satellite suppliers, and motorcycle riders -- to promote efficient and cost effective decentralised last-mile delivery. By then overlaying this infrastructure with a digital framework, the approach will enhance access to affordable sustainable cooking options. This will, in large part, be accomplished by further enhancing ACE's proprietary app, ACE Connect.

The project's innovativeness revolves around the following three components:

1\. Digital Technology: Inspired by companies like Jumia Foods, ACE will utilise digital technology to engage and incentivise decentralised distribution value chain players and drive the transition to sustainable energy.

2\. Hybrid Finance Model: ACE will implement a hybrid finance model that utilizes measured carbon offset revenue and scalable digital systems. By utilising digital tools to measure, collect, and monetise impact data, the project aims to disrupt existing practices by introducing positive incentives and commercial operations that consider both the "ability to pay" of end consumers and the "willingness to pay" of Carbon Offset Buyers.This approach aims to alleviate the financial burden on the poorest households while ensuring their active engagement in the project.

3\. Value Chain Replication: The project will ensure replication the innovative decentralised and digitised value chain approach in different contexts (including humanitarian, development and conservation) through partnerships with third parties. This strategy enables scalability and financial viability in multiple locations, promoting sustainable growth.

Given 92% of energy consumed in Uganda comes from biomass, primarily charcoal, used for home cooking, this project is extremely timely. Uganda has experienced a significant loss in tree cover due to charcoal production, prompting recent executive orders to ban charcoal production in Northern Uganda. ACE's responsible approach to catalysing a just transition from the charcoal value chain will have a lasting impact on affordable, reliable and low carbon energy access in sub-Saharan Africa and beyond.