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EKOenergy Climate Fund: Renewables for Development

Rebecca Fay | 31 August 2018 |

Businesses buying renewable energy sometimes opt to specify EKOenergy-labelled electricity: For every megawatt hour (MWh) of EKOenergy sold, a minimum of 10 eurocents (€0.10) goes to the EKOenergy Climate Fund, which finances new renewable energy projects in developing countries around the world. We spoke to Steven Vanholme, Programme Manager at EKOenergy, to discuss the Fund’s progress.

EKOenergy Climate Fund: Renewables for Development

EKOenergy is an international ecolabel for renewable energy. It sits on top of Energy Attribute Certificates (EACs) such as Guarantees of Origin (GOs), Renewable Energy Certificates (RECs) and International RECs (I-RECs). Read on to find out about the EKOenergy Climate Fund and its impact on development projects in Madagascar, Senegal, Tadjikistan, and around the world.

Rosie Helson (RH): Can you tell us a little about the Fund and the reasons behind it?

Steven Vanholme (SV): EKOenergy started in 2013 as a project of the Finnish Association for Nature Conservation and other European environmental NGOs. We wanted to make it easier for households and companies to switch to renewable energy, by guiding them towards the best available, most sustainable options.

As an ecolabel, we help consumers take a further step while keeping additional costs limited. One of the ways we do this is through our Climate Fund. Every company that buys EKOenergy-labelled electricity automatically contributes to our Climate Fund. With the contributions, we finance renewable energy projects which help tackle energy poverty and contribute to several Sustainable Development Goals (SDGs) such as SDG 7 – affordable and clean energy, SDG 10 – reduced inequalities, SDG 11 – sustainable cities and communities, and of course SDG 13 – climate action.

The first EKOenergy-labelled electricity was sold in Northern Europe in June 2013. By early 2014, we had amassed the first €10,000 and donated money to a project to install solar panels and a smart converter in the school of Ngarenanyuki, Tanzania.

RH: And how has the Fund progressed since then?

SV: In 2017, the Fund donated €190,000 to renewable energy projects in nine countries. In early 2018, the Fund donated €270,000 to 12 new projects.

RH: How do you select the projects to support each year?

SV: In recent years, we have held open calls to which more than 300 organisations applied with over 400 proposals for projects managed by experienced non-profit organisations. We additionally organised two focused calls in 2017. One of these was for projects associated with the Siemenpuu Foundation, which raises funds for grassroots organisations in Mali, Myanmar and Nepal. Through this cooperation we were able to combine money from the Climate Fund with money from the Foundation, allowing us to finance even more projects. In the other focused call, we invited previous beneficiaries to propose extension projects.

The EKOenergy Secretariat undertakes the preselection, assessing each submission against a set of criteria which includes the impact and efficiency of the project, its long-term viability and local stakeholder involvement.

Most projects that are rejected early are rejected because the organisations cannot prove to us that they are experienced and reliable, and we simply can’t take the risk. I’m happy to say that of the €340,000 donated between 2014 and 2017, we haven’t had any issues.

Getting from 75 down to the final 25 projects is very difficult and requires several consultation meetings. The top 25 are sent to a jury, which includes development aid experts, members of the EKOenergy network, one or two interested consumers and one or two interested sellers. Each time we have a selection process, we invite people through our newsletter and on social media to apply for a position on the jury. Each member of the jury reads and ranks the projects independently. Finally, we collate all the comments and rankings to get an average, resulting in our final five to 10 projects. This process ensures that each euro is spent in an area where it will have the greatest impact.

RH: How do you decide the amount that goes to each project?

SV: That is based on the budgets submitted by the organisations in their project proposals. If we like all the components of the project and the budget is convincing, we donate what they ask for. However, sometimes we try to support more projects, by giving the chosen projects a little bit less than requested. In that case we renegotiate the project budget and we recommend that certain activities are left out.

RH: Could you briefly describe a few of the projects you have chosen?

SV: By the end of this year, we will be able to tell you about the 2018 project impacts and show you the first pictures. For now, I can describe the impacts of some of our 2017 Climate Fund projects.

We contributed €20,000 to a solar pump and drip-irrigation programme for women farmers in southern Senegal. Most water collection was previously done by hand, so this new system allows women more time to spend on other activities. The pumps increase agricultural productivity and income for the farmers, enabling them to diversify their produce, in turn increasing food security for the community.

We also allocated €15,000 to an energy café project in a remote area of Tajikistan, which lacks electricity supply having suffered an earthquake in 2015. A 1 kW photovoltaic system powers two laptops with internet access, a printer, a photocopy machine, and allows community members to charge mobile devices. But, like all these projects, the contribution does not stop at the provision of equipment. The café operates on a commercial basis to ensure its longevity and also distributes solar lamps. It has become a hub of social activity and students are learning computer literacy as well as benefitting from opportunities afforded by the internet.

The final project I want to mention is in Madagascar. The Climate Fund’s contribution of €25,000 helped install solar kiosks in three rural village schools. This project is exciting because not only does solar-powered electricity enable more than 500 pupils to study, but it also enables adults in the community to engage in evening learning classes, enables refrigerated beverages to be sold, mobile devices to be charged, it powers TV and radio, and permits evening cultural events.

RH: Will the Climate Fund always support solar projects?

SV: At the moment we are investing in small scale renewable energy projects with high added environmental and social value. However, as the world around us changes from year to year, we will need to develop too. It is very possible that in 10-20 years, the real challenges will no longer be in energy production, but in CO2 sequestration. Our Climate Fund could play a role in this, for example by focusing on activities where carbon storage goes hand in hand with nature conservation. We don’t yet know how the world will look in 2035 and where the Fund’s euros will be most useful. One thing is for sure: we will not decide this top-down. We will consult our stakeholders and organise public consultations, as we already do.

RH: What are your hopes and plans for the future of the Climate Fund?

We hope that our Climate Fund will grow by between 60 and 100% each year. I know this is ambitious, but we are confident. This will allow us to finance more and bigger projects. It’s important that we use the first successes to convince more consumers of the value of EKOenergy-labelled electricity.

We also hope to attract extra funding either through organisations such as Siemenpuu Foundation, or through EKOenergy consumers. The €0.10/MWh contribution made to the Climate Fund is the minimum amount. Companies can choose to donate more and some already do either on a regular basis or as a one-off donation.

Contact us to find out more about using EKOenergy-labelled EACs and achieving your renewable energy goals.

About EKOenergy

EKOenergy is an international ecolabel for energy sold to and used by end-consumers. Founded in 2013, it is a non-profit managed by more than 45 environmental organisations from over 30 countries.

EKOenergy-labelled electricity is always renewable and fulfils additional sustainability criteria with the aim of lowering the impact of renewable power plants on biodiversity. For example, EKOenergy considers how solar farms and wind turbines impact the habitats of birds and other species and looks at fish migration and river connectivity issues around hydropower plants. EKOenergy-certified bioenergy originates from efficiently-used residues and waste or select forestry products (roots, stumps and large logs are excluded).