The Armenia Project uses an asset-backed loan model that enables agro-businesses to install solar stations and reduce the cost of food production.
Micro-enterprises in Armenia’s agribusiness sector often do not use modern mechanized processes, which result in low levels of productivity. Productivity is further constrained by production costs, which are comparatively high, and a major cost is electricity. Installing a solar station would reduce overall production costs by 30 percent, but they cannot afford this US$ 10,000 investment.
Project Armenia aims at setting up a financial model with the private sector to provide affordable access to credit for small and medium enterprises (SMEs) to install solar stations and reduce their energy dependency and operational costs. Such solar systems are expected to reduce electricity costs resulting in 30 percent savings for businesses.
Project Armenia has selected twenty micro-enterprises operating in Armenia’s agribusiness sector and provided them with a subsidy worth 30 per cent of solar station installation in December 2022. Going forward, the team will be conducting monitoring activities to assess the impact of using solar energy on the supported businesses and use these results to raise additional funds that will be used in similar initiatives and increase WFP’s impact in the country.
