Exploring the potential of under-researched Productive Uses of Energy 

Productive uses of energy (PUE) have become a siren call for the impact sector in recent times. Innovators, governments, investors and donors seek to close the gaps that exist between energy access and economic activity in under-served populations. This aligns with Shell Foundation’s belief that for the energy transition to be successful, solutions must raise incomes while lowering emissions. PUE solutions lie at the heart of this vision.  

Under-researched PUE applications 

The research highlights less-documented PUE solutions. Much has been written about irrigation and agro-processing and the application of certain PUE solutions to address problems faced in the agriculture sector. However, there is an opportunity to extend the focus beyond these applications to other use cases that are impactful in increasing incomes for a wide range of users.  

The research covers 10 less-documented PUE applications that are commonly used by microenterprises. Challenges faced by suppliers of these PUE solutions are identified, and recommendations provided for how these challenges could be resolved to increase adoption. The PUE applications studied include:   

• Cooling (refrigeration and freezing)  

• Retail food and beverage preparation (cooking and juicing)  

• Animal husbandry (egg incubation and dairy milking) 

• Textiles 

• Metalwork  

• Carpentry  

• Information and communication technology  

• Cottage industries (e.g. household-based rope and cotton wick manufacturing)  

• Hairdressing 

These technologies were selected because they are more regularly used for income generation rather than household use. Importantly, large numbers of women entrepreneurs engage in these activities. Women constitute the majority share of customers among suppliers interviewed, up to 90% among cooking, cooling and textiles PUE solution suppliers.  

Landscaping three nations to find nuanced and shared challenges 

The research also adds to the existing knowledge on PUE solutions by adopting a cross-country view and focuses on India, Kenya, and Nigeria. In each country, the research covers the landscape of the intended users of PUE equipment: micro-entrepreneurs and the challenges they face. Micro-entrepreneurs – urban, peri-urban and rural small business owners – are one of the three customers who we seek to empower with our work.

The PUE technologies covered in the research demonstrate a transformative impact on the livelihoods of micro-entrepreneurs living below living incomes. In India, micro-entrepreneurs report an increase of $57 in monthly income after purchasing a solar-powered refrigerator, while the incomes of cold room customers in Kenya have been shown to increase by 25%. 

However, the challenges identified in the report are multifaceted and differ from supplier to supplier due to country contexts. In India, suppliers grapple with serving hard-to-reach customers, while Kenyan suppliers struggle with low levels of consumer awareness. Nigerian suppliers see access to finance as a primary challenge. 

Globally, 80% of PUE users reported an increase in their incomes after purchasing a PUE product, yet uptake is slow. There are common challenges across markets and sectors. Market fragmentation, funding mismatches, high upfront costs, detrimental importation regulations, limited consumer awareness, and gender-specific barriers have all been highlighted as obstacles to the widespread adoption and impact of PUE solutions.  

Practical resolutions to root causes 

In the report’s final section, practical resolutions are presented that address the root causes of universal challenges facing PUE suppliers. By offering specific, actionable solutions – such as tailored financing models, enhanced last-mile connectivity, and targeted gender support – the research offers a roadmap for stakeholders aiming to facilitate exponential increases in the adoption of PUE technologies by microenterprises in India, Kenya and Nigeria.  

Stimulating productive uses requires targeted interventions to overcome barriers like high upfront costs and limited financing, especially in low-income areas. By presenting this research we hope to catalyse others in the sector – innovators, scale partners and financiers – to understand the opportunity and their role in realising the potential of Productive Use Energy.