Productive Use of Electricity: How Technology, Financing, and Market Integration Frameworks Can Turn Electricity Access into Agricultural Efficiency
In East Africa, cultivation during the dry season is impossible for most farmers. Yet, innovative solutions are emerging to address this challenge. Consider this testimonial from a Kenyan farmer: ‘I have water all the time. Even during the dry season, I can plant crops as I wait for the rains to come.’
This transformation was facilitated by SunCulture's flagship RainMaker, a solar-powered irrigation system that pumps up to 6,000 litres of water per day using a 120 watt solar panel and battery. The RainMaker can sufficiently irrigate a half hectare farm and meet household needs such as drinking, cooking and cleaning. To make this technology accessible, SunCulture uses an in-house credit system to spread payments over two years.
SunCulture is part of a growing wave of productive use of electricity (PUE) initiatives in East Africa. PUE refers to activities that generate income and increase productivity through the consumption of electricity. By pairing off-grid solar with technologies such as irrigation systems, refrigeration units, and processing equipment, PUE companies empower rural communities to maximise the value of renewable energy.
Technology
Technology adds value to existing business models when it is reliable, affordable, and able to fit into existing local practices.
Table 1. Overview of agricultural technologies and their market advancements
Maize accounts for 40% of Africa’s cereal production, with East Africa producing nearly one third of the continent’s total output. Most maize is processed in diesel powered mills, but solar-powered mills can be 70% more profitable due to the elimination of fuel costs and reduced labour intensity. A wide-spread transition to mini-grid powered mills would lead to increased agricultural self-sufficiency, reduced emissions, and would fuel further demand for electricity as rural incomes rise, improving the financial viability of future electrification projects.
Financing
However, in East Africa, most farmers require a payback period of at least one year to make these technologies affordable. To drive widespread PUE adoption, technology must be paired with financing mechanisms that alleviate high upfront costs. Financing mechanisms mitigate perceived risks for users, uncertain about the technology’s value, and investors, concerned about end-user repayment, by connecting producers to buyers and defining value chains. In most cases, where liquidity is low and risk perception high on both the demand and supply sides, additional incentives are needed to boost financing supply and access.
There are four inputs in a PUE business model:
1. Local capacity: the experience community members have with activities and equipment, and how easy it would be to upskill them. Many agricultural projects in East Africa fail as smallholder farmers abandon new technologies after projects end due to insufficient training and lack of access to spare parts and maintenance services.
2. Access to offtake markets: the accessibility of potential customers, and whether they are willing to pay enough for the proposed electrification outputs/services to be profitable. By combining rural cold rooms, temperature-controlled trucks, and large cold storage centres near urban buyers, this Nigerian Energising Agriculture Programme (EAP) project increased fisher’s incomes by over 30%. Similar interventions are needed in East Africa, where strengthening market linkages can help absorb increased agricultural production and drive higher demand for locally produced goods, ensuring profitability for smallholder farmers. In East Africa, more than 50% of rural producers face significant market access challenges, including lack of transport, absence of quality certifications, and limited access to price-tracking information.
3. Electric equipment: technology that provides performance advantages over non-electrical alternatives.
4. Scalability: the ability to roll out a solution to multiple communities — either within the region or across the off-grid energy provider’s network.
Figure 1. Agriculture PUE activities by readiness and intervention needs across value chains. Source
Business models allocate operational responsibilities, which involve the party operating the PUE equipment and earning income, and credit risk, which refers to the party financing the asset and bearing default risks. These responsibilities and risks are distributed among three stakeholders: developers, who are off-grid energy providers; the host community; and third-party partners, who finance or operate the PUE asset.
Productive Use Appliance Financing (PUAF) Model
The most common and easily implemented PUE model. Developers finance PUE procurement for community members engaged in productive activities, with individuals typically paying in instalments. This model offers flexibility, as developers can procure equipment based on community requests. Success requires managing the creditworthiness of members seeking financing and ensuring they can operate the equipment. Unlike other models, PUAF usually does not create new markets or industries directly.
Figure 2. Productive use appliance model. Source
2. Facility Manager Model
This model involves the developer using its operational expertise to manage investments by partners. Partners finance a PUE asset and contract the developer to operate it for community benefit. The developer may charge community members for using the asset, or partners may provide philanthropic funding for free access. This creates an anchor load – a predictable, sizable electricity demand – and additional revenue with limited developer risk.
Figure 3. Facility manager model. Source
3. Off-Taker Model
This model involves an off-taker investing in and operating processing facilities in host communities. Community members bring raw produce to the centre, where it is purchased and processed by the off-taker. The community gains a guaranteed market for local, and often perishable, produce, while the off-taker secures a reliable supply to sell. Successful off-takers are typically large, financially strong organisations. The developer supplies energy for the facilities, benefiting from increased community income leading to increased electricity consumption. Combining with insights from tech section, why could this work.
Figure 4. Off taker model. Source
Irrigation as an East African PUE Opportunity
A 40–55% reduction in rainfall during the October–December 2016 rainy season led to a 70% decrease in maize production in southeastern Kenya. By January 2017, an estimated 2.2 million people were in need of humanitarian aid. Similar situations have been observed in Uganda and Tanzania. As climate change continues to impact the region, enhancing agricultural resilience is crucial. Currently, over 80% of land in Eastern and Southern Africa has medium to high potential for increased agricultural productivity. One of the most effective ways to access this potential is with increased irrigation.
Table 2. East African irrigation potentials. Source
In Asia, 41% of cultivated land was irrigated by 2000, driving the Green Revolution. Expanding irrigation in East Africa, currently at just 3%, presents the opportunity to reproduce these productive gains. In many parts of Asia over-irrigation led to water depletion and land degradation. East Africa cannot afford to repeat this mistake – water demand in key agricultural regions in Eastern Africa already exceeds renewable water availability. PUE solutions could provide the precise, water- efficient irrigation and pumping systems needed to sustainably support agricultural growth.
Solar water pumps and irrigation systems have already demonstrated potential to increase yields by up to 500% in Uganda. Beyond technology, connecting rural farmers to growing agricultural markets is critical. Kenya’s InspiraFarm cold rooms demonstrate how supporting farmers with sales strategies, market information, and commercial opportunities can help them meet international food safety and quality standards and sell produce at a higher price. Blended financing mechanisms, including demand-side subsidies and results-based financing, have proven effective in reducing upfront costs and de-risking investments for smallholder farmers, as evidenced by programs like Togo’s CIZO project. Together, these elements create a scalable blueprint for leveraging electricity to support irrigation and agricultural productivity across East Africa.
Conclusion
East Africas electrification efforts have made significant progress, but access to electricity alone is not enough to drive rural economic growth. productive use of electricity solutions, such as solar powered irrigation, cold storage, and milling, offer pathways to increased productivity and food security. However, their success depends on overcoming key challenges, including affordability, technical capacity, and market linkages.
SunCulture, the solar irrigation firm introduced earlier in this article, recently secured $27 million in series-B funding, from the likes of EDF and former Google CEO Eric Schmidt. The company has raised $65 million to date, reflecting growing investor confidence in scaling PUE solutions across the region, and highlighting the value of pairing energy access with productive applications.
