OVE R VI E W S TAT E O F ELECTRICITY ACCESS R E P O RT 2017 b    S TAT E O F E N E R GY ACCES S R EPO RT  |  2 0 1 7 Copyright © 2017 International Bank for Reconstruction and Development / THE WORLD BANK Washington DC 20433 Telephone: +1-202-473-1000 Internet: www.worldbank.org This work is a product of the staff of the World Bank with external contributions. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of The World Bank, its Board of Executive Directors, or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work and accept no responsibility for any consequence of their use. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. The material in this work is subject to copyright. 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Photo Credits Cover: © World Bank Page ii: © Malcolm Cosgrove-Davies | World Bank Page v: © Sofie Tesson | Taimani Films | World Bank Page vi: © Asian Development Bank (via flickr CC lic) Page 14: © Aarthi Sivaraman | World Bank OVE R VI E W S TAT E O F E L E C T R IC I TY A C C E SS 2017 R E P O RT ii    S TAT E O F E N E R GY ACCES S R EPO RT  |  2 0 1 7 ACKNOWLEDGMENTS The development of the State of Electricity Access Report (SEAR) benefitted from advice of a Steering Committee led by the World Bank, Energy Sector Management Assistance Program (ESMAP). The membership of the Steering Group was as follows: African Development Bank (AfDB) Asian Development Bank (ADB) Department for International Development—UK Government (DFID) Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) Food and Agricultural Organization (FAO), Inter-American Development Bank (IDB) International Network on Gender and Sustainable Energy (ENERGIA) Kreditanstalt für Wiederaufbau (KfW) Practical Action Renewable Energy Policy Network for the 21st Century (REN21) Sustainable Energy for All (SEforAll) United Nations Foundation (UNF) World Bank (WB) World Health Organization (WHO) Members of the Steering Committee were Mr. Anthony Jude (ADB); Mr. Giorgio Gualberti and Mr. Daniel Schroth (AfDB); Mr. Alistair Wray (DFID); Ms. Erika Felix, Ms. Irini Maltsoglou, Mr. Olivier Dubois (FAO); Mr. Ariel Yepez-Garcia (IDB); Ms. Monika Rammelt (GIZ); Ms. Jane Ebinger, Mr. Mohinder GULATI (SEforALL); Mr. Jens Drillisch (KfW); Ms. Christine Lins, Ms. Rana Adib, Ms. Kanika Chawla (REN21); Ms. Richenda Van Leeuwen, Ms. Yasemin Erboy (UNF); Mr. Carlos Dora, Ms. Michaela Pfeiffer, Ms. Susan Wilburn, and Ms. Heather Adair-Rohani (WHO). Mr. Rohit Khanna (ESMAP Program Manager), oversaw the development of the State of Electricity Access Report. The technical team was led by Mr. Koffi Ekouevi (World Bank) and Ms. Elisa Portale (ESMAP). The main contributing authors of the SEAR 2017 were: Mr. Koffi Ekouevi, Ms. Elisa Portale, Ms. Dana Rysankova, Mr. Ivan Jaques, Mr. Morgan Bazilian, Mr. Govinda Timilsina, Mr. Pedro Antmann, Ms. Raluca Georgiana Golumbeanu (World Bank/ESMAP); Ms. Niki Angelou, Mr. Dean Cooper, Mr. Jean Armando Fabiani Appavou, Ms. Rana Adib, Mr. Alan Miller, Mr. Robert W. Bacon; Mr. Ravindra Anil Cabraal, Mr. Benjamin Kenneth Sovacool; Mr. William James Blyth; Ms. Josephine Tioseco; Mr. Javier Castillo Antezana; Mr. Arnaldo Vierra de Carvalho; Mr. Miguel Revolo Acevedo; Mr. Yacob Mulugetta; Mr. Daniel Schnitzer, Mr. Smail Khennas, Mr. Mark Howells, Mr. Fabiani Appavou, and Ms. Laura Williamson. Valuable support in preparation was provided by World Bank/ ESMAP staff and consultants: Mr. Venkata Ramana Putti, Ms. Barbara Ungari, Ms. Lara Born, Ms. Clara Alvarez, Ms. Xuege Lu, Ms. Natsuko Toba, Ms. Sunita Chikkatur Dubey, Ms. Srilata Kammila, and Ms. Connie Smyser. iv    S TAT E O F E L E C TR I CI TY ACCES S R EPO RT  |  2 0 1 7 Special Features were coordinated by Mr. Koffi Ekouevi and prepared by the following lead authors: Mr. Mark Howells, Mr. Marco Hüls, Ms. Emanuela Colombo, Mr. Sameer Akbar, Mr. Matt Jordan, Ms. Soma Dutta, Mr. Diogo Rodriguez, Mr. Olivier Dubois, Mr. Andreas Thulstrup, and Mr. Jem Porcaro. Case studies were coordinated by Ms. Dana Rysankova (ESMAP) and prepared by Mr. Sudarshan Kumar Saini, Mr. Ravindra Joshi, Ms. Sunita Dubey, Mr. Tim-Patrick Meyer, Mr. Jens Drillisch, Ms. Kathrin Kaestle, Mr. Robert van der Plas, Ms. Tomo Tanaka, Ms. Tripta Singh, Mr. Hung Tien Van, Ms. Jenny Tracy, and Mr. Kilian Reiche. Impact evaluation reports were coordinated by Ms. Elisa Portale (ESMAP) and implemented by CIES International SRL (Bolivia); Infotrack Research and Consulting (Kenya); Sengsavang Rural Electrification (Laos); and field work and analysis were conducted by Mr. Hussain Samad and Mr. Voravate Tuntivate, the collaboration of Ms. Wendy Claribel Guerra Navarro, Ms. Lucia Spinelli, and Mr. Rome Chavapricha. Review and Consultation: The World Bank’s internal peer review process was led by Mr. Lucio Monari (Director of Energy and Extractives Global Practice, World Bank), with contributions from Mr. Simon Stolp, Mr. Ashok Sarkar, Mr. Jon Exel, Ms. Sudeshna Banerjee, and Ms. Yabei Zhang. Substantive comments along the process were provided by Ms. Wendy Hughes, Mr. Malcolm Cosgrove-Davies, Ms. Vivien Foster, Mr. Richard Hosier, and Mr. Zubair Sadeque (World Bank); Ms. Naomi Paula Bruck, Mr. Russell Sturm, Mr. Leo Joseph Blyth, and Mr. Rahim Kanani (IFC); Ms. Jane Ebinger (SEforAll ); Mr. Jens Drillisch (KfW); Ms. Monika Rammelt (GIZ); Mr. Alistar Wray (DFID); Ms. Yasemin Erboy Ruff (UNF); Ms. Rana Adib (REN21); Mr. Roberto Aiello, Mr. Arnaldo Viera, Mr. Javier Castillo, Ms. Alice Driver, Mr. Lauro Lage-Filho (IDB); and Mr. Giorgio Gualberti (AfDB). Outreach: The communications process was coordinated by Ms. Susan Pleming and Ms. Anita Rozowska (World Bank). Four short video on SEAR were coordinated by Ms. Aarthi Sivaraman and Mr. Andy Shuai Liu. The online platform (http://esmap.org/sear) was developed by Ms. Aarthi Sivaraman and Ms. Barbara Ungari. The report was edited by Ms. Laura Wallace. Graphic design was by Naylor Design, Inc. with production support of Ms. Heather Austin (ESMAP). This work was funded by ESMAP. The authors gratefully acknowledge the financial and technical support provided by the Energy Sector Management Assistance Program (ESMAP). ESMAP is a global knowledge and technical assistance program administered by the World Bank. It provides analytical and advisory services to low- and middle-income countries to increase their know-how and institutional capacity to achieve environmentally sustainable energy solutions for poverty reduction and economic growth. ESMAP is funded by Australia, Austria, Denmark, European Commission, Finland, France, Germany, Iceland, Japan, Lithuania, the Netherlands, Norway, The Rockefeller Foundation, Sweden, Switzerland, and the United Kingdom, as well as the World Bank. vi    S TAT E O F E N E R GY ACCES S R EPO RT  |  2 0 1 7 OVERVIEW KEY MESSAGES • Given current conditions, universal electricity access will not be met by 2030 unless urgent measures are taken. While nearly 1 billion people in Sub Saharan Africa alone may gain electricity access by 2040, due to population growth, an estimated 530 million people in the region will not have electricity access (IEA 2014). • This energy shortfall must be rectified if the international community hopes to meet the 2030 Sustainable Development Goals, in light of the linkages between energy and other sustainable development challenges— notably, health, education, food security, gender equality, poverty reduction, and climate change. • In many countries with low levels of electrification access, both grid and off-grid solutions are vital for achieving universal electricity access—but they must be supported by an enabling environment with the right policies, institutions, strategic planning, regulations, and incentives. • Against a backdrop of climate change, plummeting costs for renewable energy technologies and adequate energy efficiency measures offer a tremendous opportunity for countries to be creative about electricity access expansion—with the emphasis on “clean energy.” • Emerging and innovative energy service delivery models offer unprecedented opportunities for private sector-driven off-grid electrification and accelerating universal electricity access—but only if countries can create the necessary environment for them to be replicated and scaled up. INTRODUCTION W ithout access to electricity, the pathway out of What can be done to get the international community poverty is narrow and long. The current pace of on track to close the electricity access gap? This report— progress is not moving fast enough: 1.06 bil- The State of Electricity Access Report (SEAR) 2017 begins lion people still do not have access to electricity, and 3.04 with an examination of the critical role of energy toward billion people still rely on solid fuels and kerosene for the achievement of the SDGs, then provides a snapshot of cooking and heating (IEA and World Bank 2017). Despite the status of electricity access, based on the recent Global significant progress in recent decades, achieving universal Tracking Framework Data (IEA and World Bank, 2017). It access to modern energy services by 2030 will not be pos- goes on to explore how countries can create a conducive sible without stepped-up efforts by all stakeholders. environment for a transformative electricity access roll out, In September 2011, the Sustainable Energy for All how clean energy fits into the picture, and how emerging (SEforAll) initiative was launched with a call for: (i) universal and innovative service delivery models can accelerate access to modern energy services; (ii) double the global progress on meeting the goals. rate of improvement in energy efficiency; and (iii) double This report is supplemented by a package of other the share of renewable energy in global energy produc- materials: (i) 10 Special Features that delve into topics rang- tion. This call is also one of the 17 UN Sustainable Devel- ing from electricity planning, human capital, gender, water, opment Goals (SDGs), which are part of the 2030 Agenda health, food, and agriculture—including in emergencies— for Sustainable Development, adopted in September to climate change, energy efficiency, and results-based 2015. At root is a recognition that energy is a key factor for financing (they are summarized at the end of this overview); sustainable development and poverty alleviation, and that (ii) 5 case studies; and (iii) 4 impact evaluation reports. it plays an important role in all major development chal- Its objective is to prompt governments, donors, the lenges that the world faces. private sector, civil society organizations, and practitioners   1  2    S TAT E O F E L E C T RI CI TY ACCES S R EPO RT  |  2 0 1 7 to develop interventions to close the electricity access WHY IS ELECTRICITY ACCESS CRITICAL gap by integrating lessons learned from countries that FOR ACHIEVING THE 2030 AGENDA have expanded electricity access to their population, with FOR SUSTAINABLE DEVELOPMENT? insights drawn from emerging innovative business and delivery models. The SEAR is organized around five main For the international community, there is broad agreement questions: that access to modern energy services is a necessary pre-requisite for alleviating poverty and boosting shared • Why is electricity access critical for achieving the 2030 prosperity. Without energy, it is challenging, if not impossi- Agenda for Sustainable Development? ble, to promote economic growth, overcome poverty, • What is the status of electricity access? expand employment, and support human development. Sustainable energy is the seventh goal of the 17 UN Sus- • What are the challenges and drivers of transformative tainable Development Goals (SDGs), with a call to “ensure electricity access? access to affordable, reliable, sustainable and modern • Why is it important to explore synergies between ac- energy for all.” Its five targets indicate areas where policies cess, renewables, and energy efficiency? can be designed—such as boosting the share of renew- able energy in the global energy mix and doubling the • What are the emerging and innovative business and global rate of improvement in energy efficiency (Box O.1). delivery models? Furthermore, energy can contribute to achieving the The key findings of the SEAR Report 2017 are that urgent other 16 SDGs (Figure O.1). A review of all SDG targets measures are needed to speed up access to modern indicates that energy is interconnected with 125 (74 per- energy services or there will still be several countries in cent) out of the 169 targets, making it crucial for all societ- 2030, mostly in Sub-Saharan Africa, with a significant per- ies to recognize the key interlinkages of energy and the centage of the population going without. Both grid and wider development agenda (Vera, 2016). Thus, planning off-grid approaches will be critical, but they will have to be for universal access to modern energy services should be supported by a conducive enabling environment of the an integral part of national planning efforts to achieve the right institutions, policies, strategic planning, regulations, SDGs. Studies of power outages indicate that lack of and incentives. The good news is that lower costs for energy does lead to a loss of output at a firm level—for renewable energy technologies and adequate energy effi- example, in 2013, the World Bank Enterprise Surveys ciency measures should make it possible for countries to showed that power outages in Tanzania cost businesses be creative in meeting this challenge and put the emphasis about 15 percent of annual sales—and greater availability on “clean energy”—that is, renewable energy and energy of energy has been shown to lead to more income, jobs, efficiency. There is also a growing role for the private sec- and educational benefits at the individual household level. tor to finance interventions, assuming the incentives are in In addition, lack of access to modern energy (especially place for investors to earn returns on their investments. grid electricity) acts as a constraint on economic growth, while access to modern energy services can stimulate growth and employment opportunities. BOX O.1 Targets for Sustainable Development Goal 7 • By 2030, ensure universal access to affordable, reliable and modern energy services • By 2030, increase substantially the share of renewable energy in the global energy mix • By 2030, double the global rate of improvement in energy efficiency • By 2030, enhance international cooperation to facilitate access to clean energy research and technology, including renewable energy, energy efficiency and advanced and cleaner fossil-fuel technology, and promote investment in energy infrastructure and clean energy technology • By 2030, expand infrastructure and upgrade technology for supplying modern and sustainable energy services for all in developing countries, in particular least developed countries, Small Island Developing States, and land-locked developing countries, in accordance with their respective programs of support Source: UN 2016. O VE RVIE W    3  FIGURE O.1  Energy is linked to all the remaining Sustainable Development Goals POVERTY SDG GLOBAL PARTNERSHIPS SDG 1 SDG END HUNGER 17 2 SDG SDG 16 PEACE HEALTHY LIVES 3 TERRESTRIAL SDG SDG ECOSYSTEMS 15 4 EDUCATION SDG SDG 7 OCEANS, SEAS, and SDG MARINE RESOURCES 14 5 GENDER ENERGY SDG SDG WATER and CLIMATE CHANGE 13 6 SANITATION SDG SDG 12 SUSTAINABLE CONSUMPTION and PRODUCTION 8 ECONOMIC GROWTH SDG SDG INCLUSIVE and 11 SDG 9 INFRASTRUCTURE and RESILIENT CITIES 10 INDUSTRIALIZATION REDUCE INEQUALITY Countries with the highest levels of poverty tend to nesses suggest that electrification results in higher house- have lower access to modern energy services—a problem hold income, with the magnitude varying considerably that is most pronounced in Sub-Saharan Africa and South among countries. In Bhutan, non-farm income increased by Asia, where a large share of the population depends on 63 percent, while farm income was unaffected (Kumar and traditional biomass for cooking and heating and lacks Rauniyar, 2011), and in India, non-farm income rose by 28 access to electricity. Poor households lack the resources to percent (Khandker et al., 2012). However, recent studies purchase modern energy services (especially when there is also show that the benefits of electrification can be overes- a connection charge to obtain the modern energy source, timated if the endogeneity of a household is ignored—that as with electricity). At the same time, households lacking is, electrification does not only affect income but income access to electricity and other modern energy sources can also determine whether or not a household is electri- have fewer opportunities for income generation (especially fied. For example, higher-income households are more will- from agriculture). These households earn less, spend more ing to get a connection as soon as the grid arrives time collecting biomass and less time on education, and (particularly if the connection fees are not fully subsidized), pay more per unit for the limited amounts of modern and utilities prefer to provide electricity to higher-income energy that they can purchase (such as batteries for light- communities (Bacon and Kojima 2016). ing and phone charging). As for the environment, the link between energy and In addition, households using solid fuels and traditional climate change is twofold. The energy system is a major cooking methods are subject to high levels of indoor air contributor, as it generates greenhouse gas (GHG) emis- pollution, which is associated with high rates of mortality sions through energy production and use, while climate and morbidity, especially for women and children who have change can disrupt the world’s energy system—as the greatest exposure to this pollution. Access to modern extreme weather events, sea level rise, water availability energy services, either through the form of advanced com- changes, and temperature increases affect supply and bustion cook-stoves using biomass, or through a switch to demand of energy. It is particularly challenging to esti- the use of LPG, can substantially reduce the long-term mate future impacts of the energy sector on climate costs to the household from diseases associated with high change, as multiple factors are coming into play. Fortu- levels of indoor air-pollution. Several studies estimating the nately, the goal of achieving universal access to modern benefits of electrification on households or small busi- energy services in itself would result in a negligible 4    S TAT E O F E L E C T RI CI TY ACCES S R EPO RT  |  2 0 1 7 increase of carbon dioxide (CO2) emissions if the energy followed by Nigeria and Ethiopia for electricity—and the demand of the affected population is projected to remain 20 highest access-deficit countries for electricity account low. However, as people emerge from poverty, demand for 80 percent of the global deficit (Figure O.2). for energy will increase, and power system planning will Between 2000 and 2014, there were advances in elec- have to account for spillover effects. trification, with the global electricity deficit declining from In sum, there are many opportunities for access to mod- 1.3 billion to 1.06 billion—and the global electrification ern energy services to contribute to achieving the other rate rising from 77.7 percent to 85.5 percent. Progress SDGs if interventions are designed to operationalize the with rural electrification is evident, with the global rural linkages between electricity access and other sustainable electrification rate increasing from 63 percent in 2000 to development challenges—such as health, education, food 73 percent in 2014. Urban areas across the world are security, gender equality, poverty reduction, and climate already close to universal access at 97 percent. Although change. urban access rates have risen relatively little in the past 25 years, this level remains a major achievement when viewed against the rapid urbanization that has brought an WHAT IS THE STATUS OF ELECTRICITY additional 1.6 billion people into the world’s cities during ACCESS? this period. In 2014, 1.06 billion people still lived without access to Among the regions, improvement in access to elec- electricity—about 15 percent of the global population— tricity in the period 2000–14 has been remarkable in and about 3.04 billion still relied on solid fuels and kero- South Asia (rising from 57 to 80 percent), in other regions sene for cooking and heating (IEA and World Bank 2017). growth during the same period has been moderate: for The electricity access deficit is overwhelmingly concen- East Asia and Pacific (from 90 to 96 percent), Middle East trated in Sub-Saharan Africa (62.5 percent of Sub-Saharan and North Africa (from 91 to 97 percent), Latin America & Africa population ) and South Asia (20 percent), followed Caribbean (from 92 to 97 percent) and Sub-Saharan by East Asia and the Pacific (3.5 percent), and Latin Amer- Africa (from 26.5 to 37.5 percent). Trends in population ica (3 percent) and the Middle East and North Africa (3 per- lacking access to electricity are rising in Sub-Saharan cent). In Sub-Saharan Africa, 609 million people (6 out of Africa, where 609 million people still do not have access 10) do not have access to electricity, and in South Asia, 343 to electricity services. (Figure 0.3). million people do not have access to electricity. How much improvement will be needed to get the At the country level, India alone has a little less than world back on track? Progress has fallen consistently short one-third of the global deficit (270 million for electricity), of the population growth rate since 2010, meaning that efforts in the remaining years will need to be stepped up to 0.9 percent for electricity (Figure O.4). At the regional level, Latin America, East Asia, and South Asia will be able to reach universal access by 2030, assuming conditions of FIGURE O.2  India has the world’s largest electricity access deficit constant growth in electricity, constant growth in popula- (Top 20 countries for access deficit in electricity, 2014) tion, and no major changes in political willingness and financial investments in increasing access. However, Access deficit, 2014 Sub-Saharan Africa is falling behind—currently growing at India 5.4 percent annually against the needed 8.4 percent annu- Nigeria ally to reach universal access by 2030. Ethiopia Although the access deficit in 2014 for electricity was Congo, Dem. Rep. overwhelmingly rural, the expected population growth of Bangladesh 1.5 billion by 2030 will be almost entirely urban, reflecting Tanzania rural-urban migration. This implies that the number of rural Uganda households for which access needs to be created will sta- Kenya bilize and not be inflated by population growth. Although Myanmar urban connections may be perceived as lower cost and Sudan therefore easier to implement than rural connections, the Mozambique challenges presented by urban slums require regulatory Madagascar Korea, Dem. People’s Rep. and financial incentives to ensure that universal access is Angola attained. A further challenge is presented by the recent Niger spread of the “rapid growth of households” from devel- Malawi oped countries to developing countries (Badger 2014, Burkina Faso Bradbury, Peterson, and Liu 2014). Chad What is the anticipated price tag for closing the gap? A Mali 2011 study by IEA on comparable estimates of current South Sudan financing trends and future investment needs for achieving universal access to electricity provides a high-level esti- 0 50 100 150 200 250 300 mate of investment needs of $45 billion a year, against Source: IEA and World Bank 2017 actual investment flows at that time of an estimated $9 Note: These countries account for more than 81 percent of the global access deficit. billion a year (IEA 2011). O VE RVIE W    5  FIGURE O.3  Sub-Saharan Africa is not keeping up with population growth for electricity access (Trends in population lacking access to electricity, 2000–2014) Population (million) 700 600 500 400 300 200 100 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 East Asia & Pacific Latin America & Caribbean South Asia Sub-Saharan Africa Source: Data from IEA and World Bank 2017 The World Bank’s Access Investment Model provides FIGURE O.4  Electricity access falls short of the detailed bottom-up estimates of the cost of reaching uni- pace to meet the 2030 target versal access in each of 15 countries with large electricity access deficits. These countries reflect differences in pop- 1.0 ulation and geography as well as local unit costs, and they Additional progress can be used to give a global estimate of access investment required due to lag 0.1 since 2010: +0.1 needs (IEA and World Bank, 2015). The model, based on 0.8 the Multi-Tier Framework, allows users to choose the tier of access that would be used to meet the universal access target, and illustrates how dramatically this affects the 0.6 costs of electrification. Reaching universal access at Tier 1 (enough to light a few light bulbs and charge a mobile 0.82 telephone) would require investments of $1.5 billion annu- 0.4 0.69 ally up to 2030. By contrast, reaching universal access at Tier 5 (full 24x7 grid power) would require investments of 0.51 $50 billion annually. 0.2 In sum, universal electricity access will not be met by 2030, unless urgent measures are taken. While nearly 1 bil- 0.19 lion people in Sub Saharan Africa alone may gain electricity access by 2040, due to population growth, an estimated 0.0 1990–2010 2010–2012 2012–2014 2014–2030 530 million people in the region will not have access (IEA Historical Target rate 2014). One tool that would help facilitate the effort would reference be a new way of measuring the electricity access target, period beyond the traditional binary metrics—which can be mis- Source: IEA and World Bank 2017 leading because they do not capture the multi-dimension- ality of electricity access. The World Bank and ESMAP are working with partners to promote broader adoption of the Multi-tier Framework as the key monitoring platform for tracking progress toward SEforAll and SDG 7. 6    S TAT E O F E L E C T RI CI TY ACCES S R EPO RT  |  2 0 1 7 WHAT ARE THE CHALLENGES AND DRIVERS to address the problems of intermittency. In very remote OF TRANSFORMATIVE ELECTRICITY ACCESS? communities, energy services can be provided by off-grid units, such as PV solar home systems or pico-solar prod- More than 70 countries have been working over the last ucts. These can be deployed faster and more simply than four years to develop action plans, strategies, and projects a mini-grid. to deliver on the goal of universal access to modern energy What is holding up progress? The key hurdle appears services. Their efforts have been supported by partner- to be creating an enabling environment for an electricity ships and initiatives from both the public and private sec- access roll out. While no single recipe exists, the evidence tor that have emerged at the national, bilateral, and points to the need for the right policies, institutions, multilateral levels. strategic planning, regulation, and incentives as vital pre- For electricity, meeting the demand created by requisites. increased access follows two main tracks: (i) grid-electrifi- cation providing connections to urban, peri-urban, and For rapid grid-based expansion, lessons from successful rural areas; and (ii) off-grid electrification through commu- countries suggest the following main drivers: (i) there needs nity level micro- or mini-grid systems, or isolated devices to be a sustained government commitment over a long and systems at the household level. These two approaches period of time; (ii) there should be dedicated institutions to have different capital requirements, serve different popula- plan, implement, and expand electrification programs; (iii) tion densities, and use different technologies. there should be predictable financing mechanisms to sup- The expansion of national electricity grids, which is the port public sector programs and to attract private sector “conventional” method for broadening access, involves initiatives; and (iv) measures should be adopted to ensure adding power plants and extending high-voltage transmis- the affordability of electricity services. sion lines and distribution networks into rural areas. In the past two decades more than 1.7 billion people have been For developing off-grid schemes, mini-grids offer a means added to national electricity networks worldwide, mostly in of supplying “grid-quality” power to communities quickly urban areas. Although progress has also been made in without having to wait many years for the grid-based distri- rural areas, the numbers are not rising as fast, because rural bution network to reach distant communities. However, grid electrification programs involve connecting villages there are challenges to be met in order to ensure that mini- incrementally to the existing grid, with remote areas with grids are the least-cost solution and continue to provide small populations, high line losses, and low usage usually affordable electricity services over the long-run, and that the last to be connected. key risks are mitigated to offer viable business opportuni- The biggest challenges to expanding grid-based elec- ties. High upfront investment requires anticipated load trification and access are the lack of sufficient generation growth to materialize, or else there will be inadequate rev- capacity, poor transmission and distribution infrastruc- enues to cover costs. Mini-grids tariffs are usually higher ture, the high costs of supply to rural and remote areas, than grid-based tariffs (unless there is a significant subsidy the inability of low income households to pay high con- to the mini-grid), which may limit the willingness-to-pay of nection charges, and the weak financial state of the utili- households. ties. The investment needs for a program to expand access to rural areas are large, while the possible receipts Where both grid and off-grid solutions are being devel- are likely to be insufficient to cover costs without financial oped, it is important to ensure complementarity of these support. A very substantial barrier to household access is solutions. For example, if the grid reaches the mini-grid the cost of connection. In Africa, unsubsidized connec- service area, demand for mini-grid services would decline tion costs often exceed the country’s monthly income per sharply and the investment in the stranded assets would person, and households have to pay these plus fees for become unrecoverable, in the absence of special policies inspection and application, security deposits, internal wir- to address this issue. Often, off-grid solutions are devel- ing, and equipment costs. These fees are usually charged oped in geographic areas far from the grid to provide upfront making it difficult for low income households to communities with electricity services sooner than the afford the service. grid. Take the case of Cambodia, where, as a study by Energy services can also be expanded using “off-grid” Tenenbaum et al. (2014) explains, there was a lack of pol- electrification, which involves much smaller grids than in icy on what to do when the grid reached the mini-grids. grid electrification. One approach is “mini-grids”—iso- Eventually, the situation was resolved by the regulator lated groups of generation, distribution, storage facilities issuing licenses to transform the mini-grids into distribu- within a confined geographical space. They are usually tion utilities—but it underscores the need for planning locally managed, have less than 10 MW of installed capac- upfront for the eventual arrival of the grid to give inves- ity, serve small household loads, and serve an area of up to tors more confidence to develop mini-grids in rural and 50 kilometers radius. Another approach is “micro-grids”— remote areas. The study recommends four options for smaller units, typically operating with less than 100 kW of when the grid arrives: capacity, at lower voltage levels, and covering a radius of up to 8 kilometers. • Small Power Distributor (SPD) Option where the Small Both of these can be powered by fossil fuels (diesel) or Power Producer (SPP) operating a mini-grid converts to by renewables (hydro, solar PV, biomass combustion, and distributor that buys electricity at wholesale from the wind). Hybrid systems using renewable energy sources national grid and resells it at retail to its local customers. together with batteries or a diesel generator can be used O VE RVIE W    7  • SPP Option where the mini-grid operator sells electrici- renewable power and fuel in developing countries in 2015 ty to the operator of the national grid but no longer to surpassed that in developed countries. Energy efficiency its local customers. and technology reduced the growth of global final energy demand by almost two thirds (0.7 percent increase as • Buyout Option where the SPP sells its distribution grid opposed to the previous decade’s average 2 percent). This to the national grid operator or other entity designated growth has been driven by significant reductions in the by the regulator and receives compensation for the sale costs of renewables. In 2014/2015 the median cost of pro- of the assets. ducing baseload power from residential solar was $200/ • Combined SPP and SPD Option where the SPP MWh—sharply down from $500/MWh in 2010—compared converts to an SPD and also maintains a backup to about $100/MWh for conventional sources. Wind and generator as a supply source to the main grid and re- solar PV costs were lower, and long-term contracts in some tail customers. countries were in the range $60-80 for onshore wind, and $80-100 for utility scale solar PV. As part of the planning process, it is essential to choose As renewable energy continues to gather momentum, the right technology to provide the electricity, whether to grid integration is emerging as a key issue to accommo- urban or remote rural areas, in a cost-effective manner. date a higher share of renewables. One of the biggest That is where geographical information system (GIS) mod- challenges will be coping with the variability and intermit- els—which enable the assessment of the cost of electricity tency of modern sources of renewable energy (such provision and energy cost implications of competing tech- as solar and wind)— given that the current grid infra- nological systems in space and time—fit in (Howells et al., structure in many countries was built on the basis of 2017). In addition, for electricity access programs to be controllable energy sources and organized around the transformative, special attention needs to be paid to pro- generation-transmission-distribution model. The good ductive uses of electricity services—defined as agricultural, news is that renewable energy technologies are flexible, commercial, and industrial activities that require electricity modular, and can be used in various configurations, services as direct inputs to the production of goods or pro- ranging from those that are grid-connected to those that vision of services (EUEI PDF 2011; Short 2015; Contejean are off-grid. and Verin 2017). Rural and remote areas, which are often Mini-grids are emerging as a key player for cost-effective inhabited by low-income households and lack electricity and reliable electrification of rural areas (Figure O.6) . It is supply, may not have opportunities to expand productive projected that one-third of total investments toward uses even if electricity is made available. In those cases, achieving universal access by 2030 will be targeted to complementary initiatives—such as facilitation for micro-fi- mini-grids, with the vast majority (over 90 percent) com- nance and vocational training—may be needed to both ing from renewable energy generation. Hybridization of maximize the benefits of electricity programs and promote mini-grids is increasingly popular, especially in countries long-term sustainability. that have been powering exiting mini-grids with diesel. In sum, while recognizing that each country will have to Moreover, improvements in storage systems will increase decide on its own pathways to universal access, sustain- the use of renewables and decrease the share of diesel able government commitment will be essential, as which would mainly supply evening peaks. Mini-grids occurred in Vietnam (Box O.2 ). Also vital will be making can also contribute to the socioeconomic development modern energy provision part of a broader vision of social of a region. Besides providing basic energy services and economic transformation. In many countries with low (lighting and phone charging), they can fuel productive levels of electrification access, they will need both grid and activities such as pumping, milling, and processing. off-grid solutions—supported by an enabling environment A recent comparison of diesel and hybridized mini-grids with the right policies, institutions, strategic planning, reg- at seven sites in Africa, Asia, and Latin America, showed ulations, and incentives. potential savings ranging from 12 to 20 percent, depend- ing on oil prices. WHY IS IT IMPORTANT TO EXPLORE It is true that the huge potential for electricity access SYNERGIES BETWEEN ACCESS, using mini-grids is hindered by numerous challenges— including inadequate policies and regulations, lack of RENEWABLES, AND ENERGY EFFICIENCY? proven business models for commercial roll-out (notably Meeting the global target for electricity access while for pico-solar systems), and lack of access to long-term achieving the Paris Agreement’s goal of limiting global finance. But many countries are currently developing mini- warming to below 2˚C will require a major shift toward grid policies to address these problems. India has released “clean energy”—that is, renewable energy and energy a draft national policy for mini and micro grids, which, if efficiency. Supply from renewable energy technologies is adopted, will create the proper framework and environ- now growing at an unprecedented rate, while the growth ment for developing 500MW capacity over the coming in the global economy is starting to decouple from ener- decade. Kenya’s Energy Regulatory Commission has gy-related carbon emissions, thanks to the adoption of licensed Powerhive East Africa Ltd. to generate, distribute, energy efficient measures and technologies. and sell electricity—the first private company in Kenya’s Since 2013, the world has added more renewable history to receive a utility concession. Powerhive will energy power capacity (an estimated 147 GW by end develop and operate solar mini grids of a total capacity of 2015) than conventional capacity, while investment in 1MW to power 100 villages. 8    S TAT E O F E L E C T RI CI TY ACCES S R EPO RT  |  2 0 1 7 BOX O.2 Vietnam’s National Drive to Achieve Universal Electricity Access Vietnam’s experience demonstrates that where strong political record investments leveraged from users, communities and commitment exists, the goal of universal access to electricity is local governments. achievable irrespective of the country’s starting condition. This However, there was a trade-off between the pace and the commitment, however, needs to go hand in hand with a willing- sustainability of the electrification efforts. As it turned out, ness to learn from past mistakes and correct one’s course when many new distribution networks were of low technical quality circumstances change. and suffered high losses, and the newly established entities In 1994, when Vietnam started its universal access drive, its did not have sufficient experience nor the financial strength to electrification rate was only 14 percent, comparable to the operate them. The subsequent phases, therefore, prioritized access rates of the least electrified countries in Africa. By 1997, sustainability measures, with a heightened focus on ensuring the rate had jumped to 61 percent, and by 2002, it was over 80 service quality and both technical and financial viability. Grad- percent. Today, the Vietnamese population enjoys the full ben- ually, the dispersed local electrification networks were consol- efits of electricity, with an access rate over 99 percent. idated into larger units and their operators corporatized; most Vietnam’s secret to success was not betting on a particular of them were eventually absorbed by the national utility, EVN. electrification approach, but rather allowing the approaches to While many elements of Vietnam’s electrification approach evolve over time. In the initial “take-off” phase (1994–97), the are unique to Vietnam, its key lessons are pertinent to all elec- goal was to trigger fast access expansion by empowering trification efforts: communities and local authorities to build their own systems. • Vietnam has achieved universal access to electricity largely During this phase, little attention was paid to service quality, due to the government’s unwavering commitment to electri- costs, tariff levels and other regulatory aspects. It was a highly fication, and its willingness to learn and when necessary decentralized approach, with a very limited role for the change course. national utility EVN, which was only selling electricity in bulk to these newly created mini-distribution entities. This was a • Fast progress and a record fund mobilization was possible period of extremely fast electrification, with the rate jumping by making electrification a national priority, engaging cen- from 14 percent to 61 percent in just three years—as well as tral, regional, and local government, along with rural com- munities. • Fast progress is not just a matter of political commitment, it FIGURE O.5  Electrification Becomes a National Priority also requires a strong demand and a willingness to pay from (Vietnam Household Electrification Rate, %) the participating population—when rural income rose, elec- trification took off. 100% • The trade-off between speed and sustainability of electrifi- 80% cation efforts needs to be carefully managed. • Technical standards appropriate for rural areas should be de- 60% veloped and enforced right from the start of the national electrification program. 40% “Take off” phase • Electrification goals should not happen at the expense of 20% the national utility’s financial viability. 0% Source: SEAR Case Study: Vietnam’s national electrification program, forth- 1994 1996 1998 2000 2002 2004 2006 2008 2010 2013 coming. Further, with the rapidly decreasing costs of stand- The stand-alone electricity product market is expand- alone/isolated renewable energy systems, renewable ing rapidly, and Navigant Research estimates the market energy is no longer an expensive solution for electricity for pico-solar products will grow from $550 million in access. Solar lanterns, solar mobile phone chargers, and 2014 to $2.4 billion in 2024. Globally, some 20 million certain solar home systems can provide Tier 1–3 energy households are now powered by solar home systems services (as per the Global Tracking Framework Tier Based and 0.8 million households are supplied by small scale System) for between 4 and 20 percent of the cost required wind systems, according to IRENA estimates. Pico solar for grid extension. Solar Aid, a private solar company, PV systems—which typically provide less than 10 watts which has sold some 1.5 million solar lights (benefiting of power and are primarily used for lighting or powering some 9 million people), estimates that $10 solar lights can electrical appliances (like radios or mobile phones)— help African families save an average of $60 annually, sim- have developed rapidly in recent years, due to the fall in ply by not using kerosene for lighting purposes. price of solar modules, the use of highly efficient LED O VE RVIE W    9  FIGURE O.6  A growing role for mini grids and renewables (Opportunities for grid extension, mini grids, and distributed renewable energy systems) Unsubsidised electricity retail cost on site [Euro/kWh] National grid extension Solar Home Systems and Pico PV Mini-grid Space rids mini-g Solar/diesel/biomass Hydro mini-grids Large Size of community Small High Density of population Low Close Distance to national grid Far Easy Complexity of terrain Complex Strong Economic strength Weak Source: EUEI PDF/REN21 (2014) lighting systems, and the emergence of innovative busi- kets where access is to be increased; (ii) financial con- ness models. straints that tend to favor products with the lowest initial So what are the biggest obstacles that countries face in cost, even though many products with superior energy introducing and scaling up the share of renewables in performance have a lower lifecycle cost despite a higher energy use? They range from the presence of large fossil upfront cost; (iii) a lack of overlap between professional fuel subsidies, the inadequate communication of the advan- communities engaged on electricity access and on energy tages of renewables, unclear government policies, a lack of efficiency; and (iv) a lack of focus on the overall energy good financial options, and insufficient community involve- sector, often because of concentration on solutions involv- ment. Fortunately, these obstacles can be ameliorated by ing increased grid generation capacity. the creation of a pro-renewables policy and long-term gov- Even so, there are many examples of smart practices ernment commitment—sand within this framework, innova- and effective models for incorporating energy efficiency. tive business models are emerging and are leading off-grid Some high-impact programs have prioritized a broader electricity access developments. view on developing electricity access markets looking to Energy efficiency, once overlooked, is being seen commercial and supply-chain management, policy reform, increasingly as a tool in delivering modern and clean and consumer awareness. One relatively simple way to energy services. It reduces the costs of energy supply, improve efficiency is through distribution transformers, therefore making access more affordable. For example, which are an integral part of every grid. Transformers are energy efficient light emitting diodes (LEDs) radically a globally traded product, and at least 16 developed and reduce the size and costs of the solar PV and batteries developing economies (including Brazil, China, India, needed to provide service, making these technologies Mexico, and Vietnam) have either minimum energy per- affordable for vast new market segments. By end-2015, at formance standards or labels in place that regulate or least 146 countries had enacted energy efficiency policies, facilitate the installation of highly-efficient transformers. while at least 128 countries had energy efficiency targets. These existing efforts make the establishment of new pro- There has also been a drop of more than 30 percent in the grams and policies far less burdensome for developing primary energy intensity between 1990 and 2014. economies. What is hindering energy efficiency from playing a big- The success of off-grid technologies for providing ger role? The barriers are many: (i) high tariffs and import energy solutions in recent years is largely attributable to duties on appliances and equipment used in those mar- the availability of energy efficient appliances. For instance, 10    S TAT E O F E L E CTR I CI TY ACCES S R EPO RT  |  2 0 17 FIGURE O.7  Solar home systems are increasingly offering more for less (Retail purchase price for three solar home systems that provide identical levels of service) SHS with Standard Appliances (2009) SHS with Standard Appliances (2014) SHS with Super-Efficient Appliances (2014) SHS with Super-Efficient Appliances (2017) $0 $200 $400 $600 $800 $1,000 $1,200 Retail price by component ($US) Lights Battery PV Balance of system Appliances Source: Phadke, A. et al. 2015. in many countries the use of high efficient LED lamps has WHAT ARE THE EMERGING AND INNOVA- enabled the implementation of various modern lighting TIVE BUSINESS AND DELIVERY MODELS? programs and initiatives in rural and electrified areas. As the Royal Swedish Academy of Sciences put it when A major focus of the universal electricity access push these announcing the 2014 Nobel Prize in Physics: “The LED days is reaching people living in remote areas, but it is lamp holds great promise for increasing the quality of life increasingly clear that the traditional approach to electric- for over 1.5 billion people around the world who lack ity grid extension will not suffice. Grid-based extension of access to electricity grids. Due to low power requirements, electricity supply involves significant upfront investment by it can be powered by cheap local solar power.” utilities, and the connection costs to remote areas—which Energy efficient appliances have helped to reduce the demand less electricity—are high. Consumers cannot energy investment costs required to kick-start electricity afford large upfront costs, so payback to the utilities can be access programs. Shaving a single watt from an off-grid achieved only over an extended period, or is simply not appliance’s load results in lower initial solar package costs, feasible. Until recently, support for non-grid electricity sys- improved service, or both (Van Buskirk 2015). Similarly, tems has been based on funding allocations from public energy efficiency can make larger off-grid solar home sys- programs, but this approach is not sustainable. tems more affordable. According to a recent analysis “the There are good prospects for private sector business upfront cost of a typical off-grid energy system can be applications to supply this market, but there are only a lim- reduced by as much as 50 percent if super-efficient appli- ited number of successful installations. Experience from ances and right-sized solar PV and batteries are used, such approaches to energy service delivery suggest that while delivering equivalent or greater energy service.” the best models have a number of common features (Table (Van Buskirk 2015). Thus, advances in energy-efficient O.1): (i) consideration of the demands, interest, and restric- devices now allow households to reap more benefits from tions of local customers, including the desire to pay with the relatively small amounts of electricity available to them. mobile payments systems; (ii) strong partnerships along Instead of illuminating a single light bulb, CFLS and LED the whole supply chain, from the government and utilities lamps use provide more and better light and consumer to private sector service providers; and (iii) adaptation of less energy, leaving enough energy to power other elec- market dynamics to local conditions to support successful, tronic devices such as fans and low-wattage TVs and appli- sustainable clean energy solutions. ances (Figure O.7). In Tanzania, E.ON has five small-scale rural electrifica- In sum, it is clear that clean energy will play a strong role tion systems operating, with connections to 200–300 cus- in ensuring universal access to energy services. Plummet- tomers. The overall goal is to electrify 1 million people in ing costs for renewable energy technologies and adequate 10 years, or about 250,000 households—which means that energy efficiency measures offer a tremendous opportu- between now and entering the scale-up phase, it must nity for countries to think differently and be creative about develop the ability to standardize. In Nepal, Gham Power, electricity access expansion. a developer of solar micro-grids and commercial off-grid systems, has deployed over 600 projects, including large industries, small businesses, and hundreds of households. OV E RVIE W    11  These applications include three micro grids, with the PAYG providers can take one of two approaches to intention to develop at least 100 such projects in the next financing the system to the consumer: few years. The three existing projects have been imple- mented in partnership with N-cell, the largest telecom • An indefinite fee for service in which the consumer nev- company in Nepal, which participates both as an investor er owns the system itself, but rather merely pays for the and as an off-taker (with a PPA) from the micro-grid system. ability to use it. Payments are typically made on the Pay as you go (PAYG) models have become increasingly basis of when the consumer needs power and can af- attractive in many markets. This is based upon experience ford it. suggesting that, even under local conditions in remote • The consumer eventually owns the system after paying markets, the key to a cost-effective stand-alone energy sys- off the principal of the system cost—and the consumer tem business is a finance model that matches affordable must make discrete payments, typically on a daily, pricing for the target consumers with an adequate return weekly, or monthly basis (thereby resembling a typical on investment for the supplier. PAYG solar companies seek financing arrangement). to provide energy services at a price point that is less than, or equal to, consumers’ current spending on kerosene, Lighting Global (a World Bank platform) has estimated that candles, batteries, and other low-quality energy services. there are 32 PAYG companies in 30 countries, many of Providers are incentivized to offer quality after sales ser- them in Africa. They use existing mobile payment systems vice, since a user’s ongoing payments are tied to the sys- or scratch cards for fee collection. Consumers benefit from tem continuing to function. increased affordability, increased confidence in the prod- TABLE O.1  An Array of Emerging Delivery Models for Mini-Grids CURRENT ENERGY COMPANY OUTREACH TARGET COUNTRIES SOURCE SIZE RANGE FOCUS/INNOVATION E.ON 7 systems, 1m people Tanzania Solar, bio- 6–12kW Standardisation for scale; 420 customers in 10 years diesel Establish track record for finance Cellphone payment GHAM POWER 3 micro-grids >100 micro-grids Nepal Solar 1–10kW PPA with N-cell (telecoms) for in 10 years reduced risk revenue stream Rent-to-own agreements HUSK POWER 15,000 house- 75,000 house- India Biomass, 15–250kW Accept >5 year payback holds, several holds, 10,000 Tanzania Solar (biomass); Targeting 8–10 year loans 100 businesses businesses, 20kW (solar) Rural empowerment 125 agro units 3-year expansion plan Inclusive business model INENSUS Supports mini-grid development Senegal Solar, Wind 5–10kW Low-cost smartcard meter in Africa with related management Sale of “electricity blocks” systems and consultancy  “MicroPowerEconomy” delivery system—flexible tariffs & micro- credit M-KOPA 340,000 +500 homes/ Kenya, Tanzania, Solar 5–20W PAYG business model homes (Mar 16) day Uganda,  Small SHS, LEDs & mobile phone charging services POWERGEN 20+ mini-grids 50 mini-grids Kenya & Solar 1–6kW Mini-grids compatible with central (RENEWABLE in 2016 Tanzania, grid standards ENERGY) Zambia POWERHIVE 4 sites, 1500 100 villages Kenya, Solar ~20kW Integrated tech system; people (~300 Philippines Mobile money networks connections) (Africa/Asia for pre-payment expansion) Dedicated software—predict revenue streams; RUAHA POWER 1 pilot project 100 projects Tanzania Solar, biomass 300kW Business model without subsidies (JV with Husk Build Own Operate model Power) Pre-payment meters SPARKMETER 3 Earthspark No fixed target Asia, Africa, Service for 0–500W Metering with mobile payment mini-grids in Latin America all types of system Haiti mini-grids  Cloud-based software “Gateway” usage dbase 12    S TAT E O F E L E CTR I CI TY ACCES S R EPO RT  |  2 0 17 uct, and access to maintenance services. For the supplier, MOVING FORWARD PAYG lowers the transaction costs without the need for a significant rural financial infrastructure, and it reduces the In developing countries, traditional grid supply will be the cost and risk of doing business. M-KOPA Solar is an often- predominant approach for supplying urban households, cited example of a firm with good experience of successful whose number is likely to rise faster than population growth PAYG applications, having connected more than 330,000 because of large rural-urban migration and the downward homes in Kenya, Tanzania, and Uganda to solar power with trend in household size. However, this approach will not be over 500 new homes being added every day (Economist sufficient for meeting the goal of universal access to mod- 2016). ern energy services by 2030. Developing countries will also Increasingly, operators in the off-grid market are deal- need to use mini-grids and off-grid supply to provide access ing strategically with a set of factors that are opening space to the more remote households, whose global population is for business—notably, (i) thinking broader than energy; (ii) predicted to remain roughly constant during this period. seeking a mix of public and private finance; (iii) combining Mini-grids and off-grid solutions to energy supply are investment with assistance; (iv) dealing with affordability experiencing rapid falls in cost, because of technology issues in context; (v) engaging with consumers; and (vi) improvements and scale economies in supplying growing providing after-sales service. markets. Even at the lower hydrocarbon prices of recent The key challenge centers on the need for accessible years, solar- and wind-based generation supply solutions financing models—which are starting to be launched in the are approaching parity with traditional hydrocarbon-based form of new finance and investment companies that focus generation. The very high on-grid distribution costs associ- on mini-grids and solar home systems (SHSs). These firms, ated with connecting remote households in areas of low all established within the past few years, provide several population density will mean that few of these households means of financial support, including early-stage corporate will be able to afford grid-connection—unless there are investment, working capital, asset management, portfolio subsidies available to cover a large fraction of these costs. aggregation, and securitization. One way to offset the Even schemes of spreading repayment of such charges investment risk that arises in this sector has been to allo- over several years are unlikely to be financially viable with- cate short-term public funding. This allows project devel- out subsidies. opers to offset upfront development costs. Recognizing However, even with a cost superiority to on-grid supply, the need for such early-stage support, a range of interna- mini-grid and off-grid electricity will require state support tional development organizations is active in facilitating through a number of channels: (i) a long-term commitment the establishment of new delivery models. However, such by the government to the goal of reaching universal subsidies are difficult to access and other frameworks are access; (ii) the creation of institutions and regulations to being proposed that could be more effective, including facilitate the expansion of new forms of energy supply; and performance based subsidies, and risk-adjusted subsidies (iii) where needed, some financial support either to house- for capital and operating expenditures. holds so that they can afford access, or to firms to reduce In sum, emerging and innovative energy service delivery the high initial costs of developing a new business model mechanisms are encouraging. Innovations in technologies to deliver energy to previously unserved customers. and business models particularly present unprecedented The bottom line is that substantial progress toward new opportunities for private sector-driven off-grid electri- meeting the 2030 universal access to modern energy ser- fication. If countries create the necessary environment for vices goal can be expected in the coming years with the them to be replicated and scaled up, they could acceler- large number of different approaches that are now under ate efforts to achieve universal access to modern energy way to supply off-grid electricity to supplement efforts in services. grid electricity expansion. But this will only occur if coun- tries succeed in creating the enabling environment to de-risk and to attract the much-needed private sector investments. OV E RVIE W    13  REFERENCES Bacon, R., and M. Kojima. 2016. “Energy, Economic Growth Khandker, S., H. Samad, R. Ali and D. Barnes. 2012. and Poverty Reduction. A Literature Review.” World Bank, “Who Benefits Most from Rural Electrification? Washington, DC. Evidence from India.” Policy Research Working Paper Badger, E.. February 14, 2014. “Why we Should be Worried 6095, World Bank, Washington, DC. About the Rapid Growth in Global Households.” www. Kumar, S., and G. 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Washington, DC: World Bank. http://hdl.handle.net/10986/16537 14    S TAT E O F E N E R GY ACCES S R EPO RT  |  2 0 1 7 SEAR SPECIAL FEATURES LIST OF SEAR SPECIAL FEATURES SPECIAL FEATURE AUTHORS ENERGY ACCESS AND ELECTRICITY PLANNING Mark Howells, Hans Holger Rogner, Dimitris Mentis, and Oliver Broad RESULTS-BASED FINANCING: A PROMISING NEW Marco Hüls, Marcel Raats, Josh Sebastian, Martijn Veen, and TOOL FOR ENERGY ACCESS John Ward POWER OF HUMAN CAPITAL: MULTI-LEVEL CAPACITY Emanuela Colombo, Lorenzo Mattarolo, Stefano Bologna, and BUILDING FOR ENERGY ACCESS Diego Masera THE CLIMATE CHANGE-ENERGY ACCESS NEXUS Sameer Akbar and Gary Kleinman ENERGY EFFICIENCY: A KEY ENABLER FOR ENERGY ACCESS Matt Jordan, Jenny Corry, and Ivan Jaques ENERGY ACCESS AND GENDER: GETTING THE BALANCE RIGHT Soma Dutta, Annemarije Kooijman, and Elizabeth Cecelski ENERGY ACCESS AND THE WATER-ENERGY NEXUS Diego Rodriguez, Anna Delgado, and Antonia Sohns ENERGY ACCESS: FOOD AND AGRICULTURE Olivier Dubois, Alessandro Flammini, Ana Kojakovic, Irini Maltsoglou, Manas Puri, and Luis Rincon MODERN ENERGY ACCESS AND HEALTH Jem Porcaro, Sumi Mehta, Matthew Shupler, Sarah Kissel, Michaela Pfeiffer, Carlos Francisco C. Dora, and Heather Adair-Rohani ENERGY ACCESS: BUILDING RESILIENCE IN ACUTE AND Andreas Thulstrup and Indira Joshi PROTRACTED CRISES SUMMARIES OF SEAR SPECIAL FEATURES ENERGY ACCESS AND renewables, as well as other low carbon technologies in ELECTRICITY PLANNING the global energy mix energy. Moreover, it must occur at a By Mark Howells, Royal Institute of time when projected global electricity demand calls for Technology, Hans Holger Rogner, installing some 6.7TW of new electricity generating capac- International Institute for Applied ity—worth an aggregate projected investment of $20 tril- Systems Analysis, Dimitris Mentis, lion from 2015 to 2040. Royal Institute of Technology, and Clearly, a tall order, given that modern energy systems Oliver Broad, University College are highly complex and capital intensive. They are inter- London woven with many other sectors such as finance, natural resource systems, and the environment, as well as infra- To lift people out of poverty, access to affordable, reliable, structure. That means that countries will have to under- sustainable, and modern energy for all is critical. A central take comprehensive and systematic analyses and challenge is providing this access while avoiding past— planning to identify and avoid (as far as possible) expen- and not creating new—pitfalls. In reality, this can occur only sive stop-gap measures and long-term “lock-in” into if there is a fundamental transformation of energy systems. inadequate and unsustainable infrastructures. In many The change needs to be comprehensive and consider the instances, short-term pressure for immediate action will full set of “resource-to-energy-service” chains. That will take precedence over long-term consideration for sus- necessitate greater energy efficiency and a bigger role for tainability.   15  16    S TAT E O F E L E CTR I CI TY ACCES S R EPO RT  |  2 0 17 In practice, comprehensive energy planning at the RESULTS-BASED FINANCING: A PROMISING national, regional, or local levels is further complicated NEW TOOL FOR ENERGY ACCESS because there is no one-size-fits-all energy system—and By Marco Hüls, Deutsche Gesellschaft für Internationale priorities vary sharply. On the one hand, in developing Zusammenarbeit, Marcel Raats, Netherlands Enterprise countries, access to affordable energy services can be a Agency, Josh Sebastian and Martijn Veen, SNV Nether- priority for rural areas. It fosters rural socioeconomic lands Development Organisation, and John Ward, development and thus helps contain migration to the cit- Vivid Economics ies. On the other hand, with accelerating urbanization, low-income dwellers in large metropolitan areas may As donors search for ways to pro- soon become the new energy poor. In contrast, the mote energy access in the develop- developed countries of Europe, North America, and Asia ing world, a new tool being piloted struggle with the replacement of aging plant and equip- in the sector is results-based financ- ment. For electricity, the IEA estimates that some 40 per- ing (RBF). It typically offers incentive cent of the existing capacity stock is scheduled for payments on the basis of results retirement by 2040. Thus, the timely replacement of old achieved to businesses that deliver with (and the integration of) new renewable (and other pre-specified outputs—such as the low carbon) energy sources into the remaining infrastruc- number of new electricity connec- ture is a priority. tions or advanced cookstoves that are sold. By doing so, This Special Feature sheds light on how developing it tries to overcome market failures that constrain private countries can carry out energy planning by reviewing avail- sector delivery of modern energy services. able methodologies and tools. It includes the potential of So far, the global community has had limited experi- integrating rural energy access and assess the potential ence with the RBF in the energy sector, but a number of uptake of bulk renewable energy technologies. It also programs and initiatives are under way to explore how to probes how investment needs and cost-effectiveness are pilot and mainstream RBF into their activities. This Special reflected in different analytic and planning tools, with a Feature focuses on how the RBF works in theory and in case study on Ethiopia –where current per capita electricity practice, with a special focus on a project to spur solar mar- consumption is as low as about 50kWh, compared to ket development in Tanzania. This example comes from 13,200kWh in the United States and 1,750kWh in neigh- within the Energising Development (EnDev) program, a boring Egypt. In addition, it examines the interaction of multi-donor energy access partnership program that is energy planning and scenario development and how these actively piloting RBF and that is currently financed by six are applied to informed policy making. countries (the Netherlands, Germany, Norway, the United Implementation informed by sound energy analysis Kingdom, Switzerland, and Sweden). The program pro- and planning are essential to effectively bring electricity motes sustainable access to modern energy services that services to those currently without access. That analysis meet the needs of the poor—long-lasting, affordable, and and planning needs to map out an energy system trans- appreciated by users. It is one of the first outcome-based formation, consistent with long-term sustainability and and performance-based programs in the energy sector. By without making early access investment obsolete. Several end-2016, it had reached 17.3 million people in house- enabling conditions are needed: support for adequate holds, almost 19,400 social institutions, and 36,600 small- data collection, development of open accessible model- and medium-sized enterprises. ling tools, sustainable national capacity building to Currently, EnDev together with its implementing part- undertake analysis, and planning by local experts. Those ners, is carrying out 17 RBF projects in 14 countries. The local experts need to include stakeholders, especially portfolio is characterized by a balanced spread of imple- technocrats from governmental institutions. But even menters, RBF approaches, technologies, and geographies deeper skills and knowledge management is needed. spread across Africa, Asia, and Latin America—with 5 proj- Planning is not a one-time affair, and a lasting sustain- ects that have a multi-country/regional character. It com- able impact calls for the establishment of centers of bines (i) risky but innovative projects with a strong focus on excellence, tertiary education, and networks of experts. learning and (ii) models that have already been piloted and Only then will planning processes become sustainable are very likely to perform well. and be able to continue once the initial short-term assis- EnDev’s experience suggests that the RBF facility can tance ends. work best if it is flexibly embedded in a larger, more com- prehensive and interacting package of market or sector development support. EnDev has also found that there is a substantial need to engage with all actors in the RBF chain—from financial institutions to private energy service providers. This helps strengthen their capacity to work with the RBF model, to develop business plans and plan- ning, and to understand monitoring and verification requirements. And given that the centerpiece of RBF is that the private sector (including the financial sector) bears the full risk of dissemination of energy access solutions, it is critical to carefully think through pre-financing needs. OV E RVIE W    17  The Tanzania pico-solar RBF scheme, implemented by the entire energy supply chain—from production to SNV Netherlands Development Organisation, shows users—capacity building and training activities become these lessons well. The RBF approach trials innovative essential components of any successful project aimed at mechanisms needed to spur last-mile distribution of enhancing energy access. If properly designed, they clean energy solutions in the country. Of 41.5 million develop the local expertise needed to replicate and inhabitants, only 36 percent of the total population and scale-up successful initiatives, support ownership of 20 percent of those in rural areas have access to electric- stakeholders, and foster sustainability beyond the with- ity, and a vast majority of the country is expected to drawal of external partners. remain off-grid for the coming decades. The Tanzania This Special Feature examines the power of human RBF enables companies to scale up operations and accel- capital in expanding energy access. It begins with the con- erate last-mile distribution of Lighting Global approved cept of capacity building and its evolution, and then moves solar products in rural areas of Tanzania’s Lake Zone. Ini- to how human capital contributes to energy access, high- tial results of this front-runner in EnDev’s global portfolio lighting objectives, principles, approaches, and lessons of RBF initiatives look promising. Nevertheless, lon- learned. The role of smart distributed generation and local ger-term impacts, like its eventual effect on the market prosumers is also discussed as an innovative example inte- and the sustainability of the outcomes realized in Tanza- grating capacity building within the new framework of a nia will be measurable only in the years after the RBF transformative approach to access to energy. The recent project has come to its close. experiences of UNEP, IRENA, UNHCR, and GEF are dis- cussed to provide insights and general principles. Four case studies by UNIDO in Cambodia, Kenya, Gambia, and POWER OF HUMAN Nigeria are also deeply analyzed. CAPITAL: MULTI-LEVEL The authors conclude that the complexity of today’s CAPACITY BUILDING energy sector calls for a change of perspective on capac- FOR ENERGY ACCESS ity building based on a three-tiered integrated strategy, Emanuela Colombo and Lorenzo highlighting the who, what, and how: (i) a mix of target Mattarolo, Politecnico di Milano, groups, skills, and stakeholders; (ii) a comprehensive life Stefano Bologna and Diego cycle approach along the energy supply chain, including Masera, UNIDO socioeconomic analysis; and (iii) a set of diverse teaching strategies and tools to match the different targets’ needs, Over the past decade, the debate on access to energy expectations, and capacities. has tended to lean mostly on technology, finance, and This will facilitate the transformative change required to policy as key drivers. Thanks to this approach, there has scale up access to energy, while promoting local owner- been some progress in expanding global energy access— ship and empowerment, and convert energy into an although the goal of universal access is still far off and is enabler for access to other goods and services for eco- likely to remain so for the next two decades. Scaling up nomic and entrepreneurial development, ensuring long- the strategies for access to energy requires a different term impact. perspective and an innovative approach to capacity building. In line with the ethical imperative of the 2030 Agenda THE CLIMATE CHANGE– for Sustainable Development of “no one left behind” ENERGY ACCESS NEXUS and its focus on people, the cross-cutting role of human By Sameer Akbar and Gary capital (individually and collectively, as communities and Kleinman, World Bank institutions) becomes crucial both as a catalyst and a booster. Indeed, without the proper human resources, it If the world is to have a reasonable will be impossible to achieve a transformative change in chance of preventing global tem- energy access—one that is efficient, effective, equitable, peratures from increasing beyond empowering, and long lasting. That is why human capi- 2°C above pre-industrial levels, net tal is now recognized as a core dimension for any strat- emissions of carbon dioxide (CO2) and other long-lived egy designed to reduce energy poverty at the global greenhouse gases (GHGs) must approach zero in the sec- and local levels. ond half of this century. This will have implications for vir- The right skills and competencies are needed for the tually all aspects of the energy system, given the large design, uptake, and sustainable management of technol- and dominant role of energy-related emissions in our cur- ogies, business models, and the policy framework. At the rent carbon budget. At the same time, the effort under same time, the introduction and adoption of new or way to expand energy access through the Sustainable improved energy technologies require new skills for Energy for All (SEforAll) objectives—universal access to installation, maintenance, and service. The innovative modern energy services, double the share of renewable business models that form the basis of the new energy energy in the global energy mix, and double the global markets require that the various actors (including con- rate of improvement in energy efficiency—will have sig- sumers, communities, policy makers, regulators, and nificant consequences for existing energy systems, espe- financial institutions) understand their role and the key cially if all three objectives are to be achieved. drivers. In strengthening the role of people throughout 18    S TAT E O F E L E CTR I CI TY ACCES S R EPO RT  |  2 0 17 On the bright side, emerging linkages between the businesses, and communities. Rather, it is the services that energy access and climate change agendas offer opportu- energy enables—such as lighting, telecommunications, nities to simultaneously bring energy access solutions to refrigeration, cooking, transportation, and mechaniza- scale, achieve mitigation objectives, and create more resil- tion—that transform lives and accomplish the goals of ient and sustainable communities. And there are some energy access. Yet billions of people today in developing signs of initiatives under way or being considered that try countries (in both rural and urban areas) lack sufficient to seize these opportunities. For example, at the Decem- access to reliable, cost-effective modern energy services, ber 2015 climate change negotiations in Paris (under the which would help lift them out of poverty. auspices of the UN Framework Convention on Climate What can be done to improve this picture? A potent, Change), an agreement was adopted that defines multiple too-often overlooked resource in global efforts to deliver objectives that, taken together, strengthen the global modern energy services at least cost is energy efficiency. response to the threat of climate change. At the same By reducing the energy supply investments required to time, it incorporates new terms and concepts, including provide energy services, greater efficiency optimizes the “climate justice” and “the right to development” that link delivery and utility of energy service while mitigating the the global mitigation effort to the UN Sustainable Devel- costs and harmful social and environmental impacts of opment Goals. energy supply. One estimate even suggests that universal The Paris Agreement’s structure—including “contribu- access to modern energy services could be delivered tions” from all countries and a technology framework that using 50–85 percent less energy if currently available effi- addresses access and finance for those technologies that ciency measures were utilized. shift away from fossil-based infrastructure—is critical for The benefits of energy efficiency are well-documented improving resilience and the eventual reduction of GHGs in residential, commercial, industrial, and transportation in countries that still lack access to modern fuels. This point sectors in developed economies, and theory and limited has been reinforced by recent World Bank research that experience from the field suggest that efficiency is a shows that very poor, agriculture-focused countries typi- first-order energy access resource. Wherever energy sup- cally do not consume a lot of energy. In fact, in 2011, the ply investments are needed, energy efficiency should be 900 million people (13 percent of the population) living in considered to reduce the amount of investment needed. the 50 poorest countries emitted only 0.8 percent of global Wherever existing supply resources fall short, or are unduly CO2 emissions, yet they are among the most vulnerable to expensive on the margins, energy efficiency measures climate impacts. should be explored to: (i) improve sectoral or system reli- Given the range of issues that tie energy access and ability and performance, and (ii) mitigate marginal fuel or environmental, climate, and sustainability concerns to- tariff costs. gether, this Special Feature emphasizes that policy mak- Unfortunately, energy efficiency is too rarely used as a ers will need to deploy an optimal mix of mitigation, resource in energy access efforts, and there are important access, and financial strategies. For example, the princi- gaps in the research and techno-economic analysis needed ples of energy access require programs with strong gov- to support its use. The goal of this Special Feature is to ernment engagement that combine targeted subsidies highlight the role of energy efficiency as an energy access and microcredit programs with local community engage- resource, along with providing an overview of opportuni- ment and support. At the same time, ensuring that ties where energy efficiency is supporting—and in many mitigation concerns are included offers a point of cases enabling—significant energy access impacts. Key engagement for climate finance by prioritizing renew- recommendations for policymakers and energy access able generation and landscape management aspects of professionals include: these programs. Success in either of these challenges Make efficiency “first in the access loading order.” The requires that communities be resilient in the face of cli- ideal approach is to first address generation, transmission, mate impacts. This means that energy access programs and demand-side inefficiencies, and then adjust supply to must be robust to temperature and weather extremes. It meet demand as needed. also means that mitigation strategies must account for GHG emissions that are essential for achieving access Give efficiency a seat at the table. Energy access experts objectives and include sequestration options that offset are not necessarily energy efficiency experts, and vice any residual emissions during a transition to carbon-free versa—and the public interest goals that draw individuals energy access for all. to these professional communities are not necessarily the same. Even so, these communities have a lot to learn from one another. ENERGY EFFICIENCY: A KEY ENABLER Educate and equip consumers. It is vital to educate con- sumers about the benefits of high-quality, energy-efficient FOR ENERGY ACCESS appliances and devices—and equip them to act on that By Matt Jordan, CLASP, Jenny education through certification schemes, labels, and qual- Corry,CLASP, and Ivan Jaques, ity-assurance frameworks. World Bank Redefine success. Defining success as “50,000 MW of Energy itself does not meet the generating capacity installed” will result in efforts to install needs of energy-poor households, 50,000 MW. Rather than setting project goals and metrics OV E RVIE W    19  that imply access is solely a supply-side problem, define access projects in Africa and Asia to mainstream gender. In success as delivering energy service at least cost and set addition, it is currently working with 3,750 women-led the appropriate metrics. micro and small entrepreneurs in 7 countries, who have sold energy technologies to 1.8 million people. The AFREA Gender and Energy Program of ESMAP piloted gender ENERGY ACCESS AND activities in 6 countries (Senegal, Benin, Mali, Kenya, Tan- GENDER: GETTING THE zania, and Zambia). And the Global Alliance on Clean BALANCE RIGHT Cookstoves has been supporting its grantees under the Soma Dutta, Annemarije Kooijman, Spark Fund3 to integrate and mainstream gender within and Elizabeth Cecelski, ENERGIA, their companies and operations. International Network on Gender What are some of the universal strategies for engen- and Sustainable Energy dering energy access? These include (i) recognizing unpaid work and making it visible; (ii) taking into account Why does gender matter in access the differences in needs for energy services between men to energy services? One focus of the gender, energy, and and women in designing energy interventions and pro- poverty narrative has been that since women play a signif- viding targeted support to women’s informal businesses icant role in energy systems as part of their subsistence that use energy; (iii) recognizing women-led energy and productive tasks, they are disproportionately affected enterprises as a central strategy for universal energy by energy shortages. In recent years however, there is a access and providing targeted support, at a large scale, growing awareness that energy, as a critical enabler to to women energy entrepreneurs; (iv) targeting awareness development, can also play a transformative role in the lives of subsidies, measures for access to energy supply, and of men and women by enhancing their productivity and energy technologies and appliances, by gender and effectiveness at home and at work. For example, when income; and (v) training and involvement of both women women gain physical access to a connection and make use and men in the energy supply chain. of energy services, the poverty reduction impacts are multi- ple, on health, income generation, and family. At the same time, there is evidence that going beyond their traditional ENERGY ACCESS AND THE role as “users” and “beneficiaries,” women have started WATER–ENERGY NEXUS playing a role in expanding energy access—thereby becom- By Diego Rodriguez, Anna ing part of the solution to expand energy access for all. Delgado, and Antonia Sohns, Men and women differ in the purposes for which they World Bank need and use energy and in their levels of access. Ensuring equitable development outcomes of energy interventions The tradeoffs between energy and necessitates factoring in these differences. This Special water have been gaining interna- Feature explores the linkages between gender, energy, tional attention in recent years as resource demand grows, and poverty and the empirical evidence on these link- climate change impacts manifest, and governments strug- ages—with an emphasis on electricity and cooking energy. gle to ensure reliable supply. Today, about 663 million peo- It also reviews global experience on what strategies and ple still lack access to improved sources of drinking water, approaches have been employed to integrate a gender and 2.4 billion people remain without access to improved perspective in energy, what results have been achieved, sanitation. Water insecurity affects every continent. Addi- and good practices and lessons learned. Unfortunately, tionally, 1.06 billion people lack access to electricity. most energy access projects and programs continue to Water and energy resources are inextricably linked. Sig- deal with gender issues on a piecemeal basis. Thus, the nificant amounts of water are needed in almost all energy key challenge now is to use both the lessons learned from generation processes, including electricity generation and the past and new evidence to increase energy access for fossil fuel extraction and processing. Conversely, the water both men and women. sector needs energy to extract, treat, and transport water. In recent years, the linkages between energy access Energy and water are also both required to produce crops, and gender have encouraged practitioners to incorporate including those used to generate energy through bio- gender-related actions into operations. Methodologies fu-els. This relationship is what is known as the water-en- and good practices are emerging in three key areas: (i) ergy nexus, and it exists within the larger water-energy-food “engendering” energy projects, programs, and policies nexus. The impacts and tradeoffs of the energy-water through gender mainstreaming; (ii) empowering women to nexus are being felt today: contribute directly toward expanding energy access as • In the United States, power plant operations are being energy entrepreneurs; and (iii) financial inclusion, pricing, affected by water variability, such as low water flows or and subsidies. high water temperatures. In terms of gender mainstreaming, over the past decade, several organizations have taken this approach • In Sri Lanka, China, and Brazil, recurring and prolonged with energy programs and policies, for example, ENER- droughts are threatening hydropower capacity. GIA, Global Alliance for Clean Cookstoves, Asian Develop- ment Bank, and ECOWAS. Since 2007, ENERGIA has • In the Middle East and North Africa, desalinating wa- supported more than 35 medium/large scale energy ter is substantially increasing energy demand, and 20    S TAT E O F E L E CTR I CI TY ACCES S R EPO RT  |  2 0 17 pushing water utilities to explore ways to reduce en- cases, these changes can also alter energy needs as such ergy demand or produce energy on site—in 2010, conditions may require more energy inputs. A lack of rain- energy requirements for desalination in the United fall can lead to farmers resorting to the use of groundwa- Arab Emirates were about 23.9 percent of total ener- ter for irrigation, which requires energy for pumping; gy needs. gradual land degradation can result in farmers using more chemical fertilizers, which in turn require more Such resource interdependencies could complicate possi- energy to be manufactured. ble solutions and make a compelling case to improve inte- Against this backdrop, the global community has been grated water and energy planning. Yet energy planners looking for ways to develop food systems—“energy-smart and governments often make decisions without account- food systems”—that can support food security and sus- ing for existing and future water constraints. Planners in tainable development. These systems improve access to both sectors often remain ill-informed about the drivers of modern energy services, rely more on low-carbon energy these challenges, how to address them, and the merits of systems, use energy more efficiently, and are deployed different technical, political, management, and gover- through a water-energy-food nexus approach. They also nance options. take advantage of the fact that agri-food chains are not This Special Feature highlights that tackling energy and only a consumer of energy but also a producer of energy. water challenges will necessitate addressing data gaps Various energy-smart technologies and practices exist and developing indicators that reveal resource use and across the world. The challenge is to identify the context cascading effects across sectors. Integrated water and where they are most effecting and bring the most benefits, energy planning enhances sustainable development, and then scale them up. national security, and economic stability—and it is espe- This Special Feature stresses that scaling up the cially needed in regions where climate change, urbaniza- uptake of sustainable energy solutions within the agri- tion, and population and economic growth are going to food system, practices, and behaviors will entail aligning exacerbate water scarcity. available solutions with local settings. Interventions As policies are implemented to ensure that affordable, require a people-centered “bottom-up” approach, and reliable, and sustainable energy is available to all, it is criti- they need to be better tailored to local contexts. This cal to consider the surface water and groundwater impacts means addressing the following questions: (i) For what that may result from them. There will be tradeoffs in all purpose is energy required?; (ii) Which equipment and cases, but in analyzing and quantifying the impacts, the systems would be needed to produce energy?; (iii) Will international community can ensure long-lived and sus- the system be economically viable in the identified con- tainable successes. text?; and (iv) How can local capacity to run and maintain the systems be built? ENERGY ACCESS: FOOD Production of bioenergy from agricultural residues is AND AGRICULTURE one promising way in which access to energy can be By Olivier Dubois, Alessandro increased in rural areas. But like other agricultural activi- Flammini, Ana Kojakovic, Irini ties, bioenergy can compete for labor and natural Maltsoglou, Manas Puri, and resources and thus the benefits to be accrued have to be Luis Rincon, FAO closely investigated to ensure food security is not ham- pered. In fact, some of these concerns can be addressed Over the past century, countries by well-designed policies and land management prac- have been able to meet ever-in- tices. What needs assessing is whether agriculture resi- creasing food demand partly due to the availability of dues are available once other uses are accounted for (such cheap fossil fuels. The agri-food chain covers the produc- as feed, fodder, and soil nutrients). If unused residues are tion of farming products, their transport, processing, stor- available, this option can also allow mitigating climate age, distribution, and food preparation. Energy is needed change impacts by avoiding residues to be burnt in the at all steps of the agri-food chain, be it in direct (such as for field. All options need to be environmentally and finan- production, processing and transport) or indirect (such as cially sustainable. The overarching key principle is to for manufacturing of inputs such as fertilizers, agro-chemi- ensure that the agrifood system and energy systems are cals and machinery) form. integrated. In addition, the use of fossil fuels has resulted in food systems becoming a major source of greenhouse gas (GHG) emissions, with significant contributions to global MODERN ENERGY climate change. A continued dependence on fossil fuel ACCESS AND HEALTH for food production would only increase agriculture’s By Jem Porcaro, Sumi Mehta, impact on climate, especially when considering that food Matthew Shupler, and Sarah Kissel, production is forecast to increase by 60 percent in 2050 UN Foundation, and Michaela from 2006-2007 levels in order to feed the global popu- Pfeiffer, Carlos Francisco C. Dora, lation. On the other hand, climate change and changing and Heather Adair-Rohani, WHO climate patterns can cause severe droughts or floods and Modern energy access is an import- changes in water availability and soil quality, which may ant determinant of human health, as it plays a critical role have significant impacts on agri-food systems. In some in the capabilities of healthcare facilities and aids in the OV E RVIE W    21  development of clean and safe household environments. needed to effectively and efficiently address multiple In the developing world, thousands of healthcare facili- SDG goals. ties and hundreds of millions of households lack access to modern energy services. The situation will only get worse as the energy needs of communities and the health sec- ENERGY ACCESS: tors in these countries are expected to increase dramati- BUILDING RESILIENCE IN cally in the years ahead. For example, the need for cold ACUTE AND PROTRACTED storage space for vaccines is expected to rise eightfold or CRISES more in coming decades, and the growing need to pre- By Andreas Thulstrup, and Indira vent or fight non-communicable diseases requires com- Joshi, FAO plex interventions that will drive additional energy Energy constitutes a key compo- requirements. nent of the physical capital required This Special Feature begins with a look at energy by individuals and households to pursue sustainable live- access and health implications, along with energy access lihoods. Modern energy services are essential for ensur- and reliability gaps, at two levels: electrification of health- ing the well-being of people, playing a key role in care facilities and household energy. It then tackles the providing clean water, sanitation, health care, reliable and barriers to better energy access and reliability, and con- efficient lighting, heating, cooking, mechanical power, cludes with opportunities and options. transport and telecommunications services to people. Its overall message is that addressing this unmet need However, the importance of providing fuel and appropri- in an efficient and timely matter will require decision-mak- ate cooking technologies in emergency settings is often ers to better incorporate health considerations into overlooked or inadequately prioritized by humanitarian energy policy, and vice-versa. At this point, there are and emergency response actors. While food may be pro- many barriers for electrification of health facilities, includ- vided—for example, through the World Food Programme ing weak enabling environments, lack of awareness and food basket—the means to cook that food is not consis- information, insufficient human capacity and institutional tently provided, and when aid agencies do provide fuel, support structures, affordability and lack of financing they often do not provide enough to cover needs. Lack of options, and weak local energy sector and service infra- access to cooking fuel, as well as appropriate technolo- structure. The barriers for household energy are also gies for cooking and heating, has implications for a range numerous and include user acceptability, gender norms, of sectors and for the well-being and livelihoods of lack of financing options, and undervaluation of fuel and affected households. time saving. The UN Food and Agriculture Organization (FAO) is The international community’s adoption of the UN’s 17 addressing these challenges by engaging in the Safe Sustainable Development Goals (SDGs) opens a major Access to Fuel and Energy (SAFE) Humanitarian Working opportunity for the health sector to improve access to, Group and implementing projects that address both the and the quality, of health services (especially for maternal, supply and demand for fuel in multi-hazard contexts. The newborn, and child health services), by providing an inter-agency SAFE group works to facilitate a more coordi- opportunity to apply a nexus approach to energy and nated, predictable, timely, and effective response to the health—building on various linkages that energy and fuel and energy needs of crisis-affected populations. health have with sustainable development (including Within FAO, one of the organization’s five strategic pro- SDG 5 on gender equality, SDG 11 on sustainable urban grams focuses on increasing the resilience of livelihoods to environments, and SDG 13 on climate action). threat and crises. The program is implemented through A more comprehensive and systems-based approach, cross-divisional and inter-disciplinary work that strengthens centered on a holistic evaluation of needs, is required, as the linkages between humanitarian and development con- opposed to a piecemeal approach that can lead to ineffi- texts. Under this framework, FAO’s SAFE work contributes ciencies in design, unmet needs, and, often, early system to reducing risks and vulnerability at the household and failure. The most promising solutions range from decen- community levels, by improving access to sustainable tralized renewable energy and hybrid solar PV/diesel, to energy. This work supports resilience building by contrib- grid extension, energy-efficient medical equipment, and uting to the diversification of income and energy sources, a greater availability of clean energy sources and technol- reduction of environmental impacts, and improvement of ogies at the household level (such as cleaner cookstoves food security and nutrition. FAO’s work on energy access in and fuels). emergencies also focuses mainly, but not exclusively, on Encouragingly, a growing number of organizations— protracted crises, and it adopts a holistic, multi-faceted including the WHO, Global Alliance for Clean Cook- approach that accounts for the mutually reinforcing link- stoves, Sustainable Energy for All, and the UN ages between energy and environment, nutrition, health, Foundation—are working with governments to raise gender, protection, and livelihoods. awareness about the inextricable link between energy FAO adopts a multi-disciplinary approach to address and health. As these organizations move to identify and the multi-sectoral challenges associated with energy in diminish research gaps, develop country-capacity for emergencies, involving three interlinked pillars: implementation, and overcome barriers associated with uptake and sustained energy use at the community and • Ensuring a sustainable supply of energy through the household level, they can simultaneously catalyze action establishment and promotion of agro-forestry, (which 22    S TAT E O F E L E CTR I CI TY ACCES S R EPO RT  |  2 0 17 can provide fuel and food from the same land, commu- fuel-efficient technologies for cooking and productive nal woodlots and other modes of reforestation and af- uses. forestation), sustainable natural resource management, • Promoting sustainable livelihoods and diversifying live- and use of agricultural residues and other alternative lihood activities to build resilience. The establishment fuels (including renewables). and sustainable management of woodlots and agro-for- • Addressing energy demand—for example, through estry can be promoted as a livelihood activity for both the promotion of fuel-saving cooking practices and men and women. To download the State of Electricity Access Report, overview, and Special Features, visit: http://esmap.org/SEAR