Kayonza Tea Growers

The East African Development Bank are delighted to present a potential project with one of our clients, Kayonza Tea Growers, to renovate their estate and to adopt a more climate sensitive approach to their operations, by installing solar panels to run the factory.

Kayonza Tea Growers work along the tea value chain, from their own production and in assisting 6,000 smallholder farmers to produce tea (through supplying fertilizer and teaching farmers in best practice), to processing green tea leaves at their factory in Kanungu (Western Uganda), to selling the leaves at auction in Mombasa.

Kayonza Tea Growers have a long and successful history with the East African Development Bank.  Between 2004 and 2016, Kayonza Tea Growers have received six financial agreements, in the form of either loans or assets leases, ranging from US$200,000 to US$1,100,000, from EADB.  EADB have been particularly keen to finance Kayonza’s advancements due to the enormous developmental impact of the tea estate.  The tea estate and factory is extremely labour intensive and so provides a valuable source of income to a large community and their families, whilst also generating foreign exchange through tea exports.  EADB estimate that the first loan to Kayonza (US$700,000 in 2004) generated UGX 3.9 billion in tax revenue, US$43 million in foreign exchange, 270 direct employment opportunities and served 3,800 smallholder famers.  We hope that later loans will reap an even greater developmental impact once completed.

Kayonza Tea Growers Factory

Kayonza Tea Growers Factory

In 2013, Kayonza Tea Growers purchased a generator in order to deal with frequent power fluctuations and outages.  However, diesel generators are both extremely expensive to run and emit an enormous amount of pollution into the atmosphere.  Consequently, EADB are now investigating more environmentally friendly methods (solar power) to supply the Kayonza Tea Growers factory with electricity.

Solar panels on the residential housing

Solar panels on the residential housing

At present, all residential housing on the estate is run by solar energy.  The tea estate has 3,600 watts installed generation capacity, which has cost UGX 43 million to install, and is sufficient to maintain workers accommodation.  We estimate that it would cost UGX 200 million to install sufficient solar capacity to operate the entire estate (that currently uses 1.8 million kWh per annum), which would be less than four years electricity bills (estimated at UGX 55 million per annum).  A detailed strategy is still being considered, but EADB are very excited to support Kayonza Tea Growers and climate change mitigation in Uganda.