For most of us, electricity is…something we take for granted. For a vast part of the world, however, it is something they have never had. Achieving universal access to electricity is essential for solving many global development challenges yet 1.1 billion people still lack electricity. What are the consequences of this deficiency for developing countries and what might the solutions be? We addressed these questions to several international experts.
What are the effects of a lack of energy supply for developing countries?
“Reliable and affordable electricity directly influences productivity capacity and the resilience of rural populations to extreme events. It can power small and medium-sized rural enterprises, increasing their contribution to job creation and income generation as well as improving living conditions in rural areas. Since the beginning of the last century, electricity consumption and economic growth have gone hand-in-hand and today it’s more important than ever to recognize this relationship.”
“The lack of (or limited access to) a reliable electricity supply in particular, has a negative impact on (i) industry and economic activities in general, (ii) education and (iii) health. A lack of or discontinuity in electricity supply acts as a brake to investment and leads to increased production costs and, therefore, loss of competitiveness. This affects both industrial (urban) and rural activities. In addition, due to the shortfall in clean energy production (i.e. hydro-electricity), industry and populations are using alternative power supplies such as (fuel-based) generators or wood (domestic use) causing other environmental concerns and damage (pollution and deforestation).”
How do you assess the impact of international aid that has been directed to the energy sector in developing countries? Has it been effective or not?
“International aid for the energy sector in developing countries has been steadily on the rise for the last decade. International donors and bilateral institutions have secured both funding and technical assistance to support energy supply initiatives including both grid and renewable energy solutions. Of course, more funding and new approaches are needed to increase the impact, to realize large scale projects or to be able to reach the most needy, poor and remote communities. However, the biggest challenge seems to be the coordination of efforts between different development bodies as well as leveraging private sector engagement with governmental support to secure law reforms and create a favorable investment environment. There seems to be too many initiatives happening at the same time which, on the one hand has created a level of overlap. On the other hand, some critical private sector initiatives have stalled because their implementation requires changes to legislation, which have either been delayed or have failed to happen at all.”
“Foreign aid to the energy sector is of unquestionable importance given the poor state of energy systems in many developing countries and the magnitude of resources that are required to transform these so that they can deliver the outcomes necessary to bring about both for poverty eradication and climate change mitigation. The enormity of the energy challenges that developing countries face is one of the main justifications for a sustained level of foreign aid and for increasing efforts to make this aid efficient and effective. Most developing countries will not be able to reach the targets of energy access, renewable composition or general efficiency without aid and major investments, mostly by the private sector given the massive scale of investment required.”
“The effectiveness of foreign aid towards the energy sector of developing countries has often been limited because some aid has been project-focused (usually involving infrastructure projects on energy supply) rather than programme or system-oriented. Project-based foreign aid does not lend itself easily to this type of coordination and is not strong on project long-term sustainability and country ownership. Design of programme-based approaches, rather than project-based, can more easily be aligned with the strategies of recipient countries. Such approaches can also support sectoral strategies that many countries already have in place and that can be more appropriately supported through sector-wide approaches. Programme-based approaches can also lend themselves more easily to policy dialogue and support to policies with targeted goals and results, linked to a budget framework.”
What are some possible solutions to ensure access to electricity in developing countries?
“Energy for All by the year 2030 is achievable only if the governments of developing countries undertake serious planning and coordination as regards power Generation, Transmission and Distribution. The productive use of electricity must be prioritized and funds must be made available to finance capital projects on electricity. The efforts of all stakeholders could be mobilized through a government framework. Investors and governments need to put in place economic and policy frameworks to attract mini-grid developers, off-grid developers, grid extenders and also to improve training. These will create economies of scale and attract the necessary commercial commitment that will support an energy infrastructure. Rural electrification is a critical factor to development; therefore, governments should create rural electrification plans such as roll-outs plans for a centralized grid, tariffs subsidy regimes, smart meters and prepaid meters. Technology and innovation have produced different viable solutions such as decentralized renewable energy technologies that produce small, clean energy utilities called mini grids and off grid.”
“Rethinking access to clean, reliable and affordable electricity is key to winning the energy poverty fight in developing countries and enabling economic and sustainable development. In this sense, opportunities arise when looking beyond solely the electricity supply: additional services, complementary value chains, innovative partnerships and horizontal integration can bridge the gap between viable and non-viable projects. Decentralized renewable energy solutions are key to achieving this goal, particularly in reaching rural areas where the majority of people with no access to electricity – who very often also lack access to safe water and have issues with food security too – live.”
“Fortunately, many solutions based on available natural energy sources (hydropower and solar) exist, which have already been initiated by local authorities and the international community. These include international initiatives – UN finance entities (IMF, WB) to encourage and support the international focus of finance and expertise, i.e. the Solar for Health (S4H) project led by UNDP; regional initiatives – local development organizations need to take the lead in developing countries, i.e. the Power and Light Africa (AfDB) program; regional cooperation – local governments should promote the Pooling of efforts and the use of regional bodies for better coordination, i.e. the West African Power Pool (WAPP); joint use of key mega power infrastructures to support investment, i.e. the Grand Inga Hydroelectric Project in DRC Congo which will also benefit neighbouring countries; interconnection of electricity lines to reduce shortages and optimize efficiency; increasing the mix of clean and renewable sources, i.e. solar, bio-gas (agriculture waste) and thermal (gas/steam turbines) and geothermal.”
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