Keeping it Cool: How Ghana’s ECOFRIDGES GO Initiative Cuts Energy Costs and Emissions

Summary: Ghana’s ECOFRIDGES Green On-Wage (GO) is an innovative financial mechanism to promote affordable, climate-friendly and energy efficient domestic room air conditioners and refrigerators. The programme is a collaborative effort, offering a creative and comprehensive solution to refrigeration accessibility and affordability in the country.

Context: Temperatures in the Economic Community of West African States (ECOWAS) region often reach 30-43°C (86-109°F), particularly in the dry season. As a result of rising heat and incomes, the demand for cooling appliances, especially in the residential sector, has increased. Many consumers constrained by low incomes purchase less efficient appliances with shorter life spans.

Managing e-waste is a major challenge in Ghana. Agbogbloshie is the country’s largest dumping ground for e-waste and considered one of the most toxic areas on the African continent. According to the Ghana Energy Commission, over 2.8 million used fridges were imported into the country between 2005 and 2018. Dumped fridges and air conditioners release toxic chemicals into the environment, threatening the health of waste workers and the community.

Solution: ECOFRIDGES GO, an innovative Green On-Wage (GO) credit facility, was introduced in Ghana in 2019, to reduce the initial purchase cost of efficient refrigerators and room ACs – making them more affordable to consumers in increasing need of cooling services. The program is a collaborative effort between the government of Ghana, the United Nations Environment Programme’s United for Efficiency initiative (UNEP U4E), and the Basel Agency for Sustainable Energy (BASE) with funding support from Kigali Cooling Efficiency Program (KCEP).

• The program offers flexible repayments at 0% interest for 12 months and encourages vendors to provide eligible models of air conditioners that meet the energy efficiency standards, so it introduces more highly efficiency appliances into the country. Eligibility criteria was aligned with the Ghana Star Label – refrigerators with 5 stars and R600a refrigerants, and room air conditioners with 3 stars or more with R32 refrigerants were eligible.
• Financing was made possible through a partnership with banks that provided loans for efficient cooling appliances to salaried workers; the loan payments were made via a monthly paycheck deduction. This made it possible to purchase appliances deemed as ‘expensive’.
• Public awareness raising efforts via vendors and media platforms (i.e., TV, radio, social media and YouTube) educated consumers on the financial and environmental benefits of highly efficient appliances. Salaried workers were encouraged to take advantage of the innovative financial mechanism through discussions hosted through various worker’s welfare associations and union groups. Government procurement managers, accountants, and facility managers were encouraged to take advantage of ECOFRIDGES during training sessions focused on Green Public Procurement of cooling appliances.
• The programme’s take back scheme offered a financial incentive to those who turned in their used working appliances. Unfortunately, this part of the programme had to be delayed because of an institutional barrier – but is anticipated to be instated soon.

“Before, I was concerned about using non-energy efficient appliances that were bad for the environment and expensive to run. Now the appliances I have last longer, reduce climate change, are better for the environment and save me money on electricity bills.” Francis Hughes, a science teacher from the Cape Coast in Ghana.

Impact

The successful and comprehensive financial and educational support of ECOFRIDGES GO resulted in significant benefits for Ghanaians and the planet. Between October 2020 to July 2023, ECOFRIDGES GO;

• Supported the sale of 1,984 new energy-efficient refrigerators and 1,460 room air conditioners
• Mobilized GHs 19.06 million in financing (approximately USD 1.72M)
• Resulted in reduction in energy consumption by 28.260 MWh, equivalent to direct and indirect GHG emissions reduction of 23,694 Tonnes of CO₂ (see Figure 2), and;
• Shifted consumer preference from used obsolete appliances to new efficient appliances, defeating the initial price barrier argument.