POOR PEOPLE’S ENERGY OUTLOOK 2019

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Enabling energy access: from village to nation

With just over ten years to 2030, we are a long way from achieving the Sustainable Development Goal 7 (SDG7) of universal energy access. Despite some progress, obstacles remain. Proving particularly difficult is reaching the ‘last mile’: those whom business-as-usual approaches will not reach due to income, remoteness or social discrimination. Practical Action’s Poor People’s Energy Outlook (PPEO) series aims to raise the visibility of these challenges. PPEO 2019 is a compilation and update of the last three editions; showing the connections between planning, finance and delivery. The report offers a comprehensive framework for a more bottom-up approach to providing energy access.

Practical Action, an international development organisation putting ingenious ideas to work so people in poverty can change their world, established the Poor People’s Energy Outlook (PPEO) series in 2010. The series has been unique in drawing attention to the energy access needs and priorities of often overlooked and under-represented people around the world and, over the past decade, has been instrumental in shaping a more people-focused global energy access narrative. The 2019 edition summarizes and updates the second suite of PPEOs which focused on bottom-up energy access planning (2016), financing national energy plans (2017), and delivering inclusive energy access at scale (2018).

n PPEO 2019, the case study material from the previous editions is organized around the two overarching themes of clean cooking and electricity. Within these we look at issues of planning, finance, and delivery, making recommendations for each sector. PPEO 2019 is a guide to delivering on the energy access agenda at national scales, in ways that will most meet the needs of energy-poor communities.

 

THE ENERGY ACCESS CHALLENGE

Globally, billions of people continue to lack access to modern energy services. Without electricity, poor communities have few economic opportunities to transform their lives, while cooking with dirty fuels affects the health of women and children across the globe. In recent years, we have seen some good progress on electricity as the falling costs of solar power systems have made provision a lot more affordable and accessible. Clean cooking, on the other hand, has advanced much less.

The technical solutions to provide access for all by 2030 already exist, for the most part. Off-grid renewables such as Solar Home Systems (SHS) and solar or micro hydro-based grids can provide quick connections in the most remote places. Improved biomass cookstoves or biogas are amongst the options for cleaner cooking. Yet funding for these solutions, both public and private, remains a major problem. The funding that exists is often ploughed into grid extensions while many impoverished communities are still left behind. Only 1.3 per cent of the overall electricity access funding goes to off-grid renewables, while cooking receives only 1 per cent of the funding it needs.

Scaling up access remains a major challenge, requiring a huge increase in investment but also new innovative business models, changes in policy frameworks, institutional capacity, increased awareness, and improved locally applicable technical solutions. In PPEO 2019, we set out some of the changes that are needed.

 

Clean cooking – a poor relation to electrification

Around 3 billion people have little choice but to use dirty cooking solutions like wood and charcoal to cook their meals. It is mainly women and children who suffer the devastating consequences, such as respiratory diseases linked to smoke inhalation. The drudgery of fuelwood collection also falls mainly on women. While it is a greater challenge than the lack of electricity access, clean cooking rarely receives much policy attention and has long been chronically underfunded. Our Kenya and Bangladesh case studies have suggested that providing the types of clean cooking that people want can actually be costlier at the national scale than providing clean electricity. For users, a significant affordability gap remains.

While clean cooking solutions are often country and context-specific, we have identified some principles that apply universally:

  • While funding is important, clean cooking progress is being hindered by multiple barriers. To address these and to achieve scale, markets must be built holistically across demand, supply, policy, and finance.
  • Women need to be at the centre of clean cooking solutions. Consumer and entrepreneurial finance for clean cooking and fuels must be tailored to women’s needs and not increase the barriers they face. Support for the greater involvement of women in roles higher up the energy value chain is also needed. New business models and technical solutions (including electric cooking linked to off-grid solar) have begun to emerge and need to be pursued boldly. However, in the rush for ‘scalable’ solutions, we also need to find ways to reach the most challenging market segments: rural households who collect rather than buying fuel. Incremental improvements using biomass-based solutions will still be relevant here, and their progress needs to be captured and valued as steps towards the SDG.

 

Electricity – still a long way to go

Access to electricity has advanced rapidly over recent years, with the number of people without access dropping from 1.2 billion in 2010 to aro­und 840 million in 2017. The rapidly falling costs of solar PV and batteries have been major drivers. Solar Home Systems, often based on pay-as-you-go distribution models, have shown impressive growth rates over recent years. Mini-grids, in particular solar-powered ones, are also expanding, as their costs reduce.

In our case studies, we found striking differences in the levels of access between communities in the same country, highlighting the extent to which many people are being left behind. To reach the ‘last mile’, our findings suggest that:

  • Off-grid systems (a mix of mini-grids and stand-alone) would be the least-cost solution for the majority of unconnected people. However, in most countries, it is grid extension that is subsidized, while off-grid solutions are expected to be delivered by the market. This is unrealistic and requires the provision of more public funding.
  • While electricity access programmes often focus on expanding supply, it is equally important to consider the demand. Boosting electricity uses beyond household consumption and developing business opportunities based on existing mainstream agricultural livelihoods makes electrification more affordable and sustainable in the long term.

 

ACHIEVING SCALE AND INCLUSIVITY

Tackling the energy access challenge, and ensuring it meets the needs of energy-poor communities, will require a sustained effort across finance, policy, planning, and delivery. For both cooking and electricity, our research demonstrates that if the provision were to be based solely on the ability to pay, energy access would be restricted to better-off people in energy-poor communities. Even in relatively well-developed markets, there are still hard-to-reach villages and people unable to afford even the smallest solar lanterns. Finance, planning, and policies need to focus much more on reaching the ‘last mile’. This will require concerted action by all stakeholders, including international donors, national governments, private investors and developers, as well as civil society.

As we conclude this series of the PPEO, the provision of universal access remains a formidable task. Progress has been made over recent years – but much of this has focused on grid extension to those that are relatively easy to reach. With just over a decade to go to 2030, we cannot afford to lose any time. The ‘last mile’ needs to receive a much greater focus in our search for universal energy access. The PPEO series has contributed to growing evidence on the most effective ways to ensure no one is left behind in 2030. Include the voices of the energy-poor to guide priorities for national planning. Focus on the energy services people need, going beyond household supply to include requirements for threshing and grinding crops, water pumping, street lighting, and energy for businesses, schools, and clinics. Produce integrated plans for grid and off-grid, and for clean cooking.

RECOMMENDATIONS

  1. Pursue holistic approaches: Energy planning and financing need to give equal emphasis to the grid, off-grid, and clean cooking, and consider synergies between them.
  2. Address demand, not just supply: Traditional approaches have often focused on the energy supply. However, increasing demand, for example through developing productive uses of energy, is critical to the uptake and sustainability of solutions.
  3. Embrace inclusivity: Programmes need to be pro-actively designed to reach the ‘last mile’, ensuring sufficient resourcing and skilled staff.
  4. Increase public funding: There is a crucial role for public funding in reaching energy-poor people, particularly in off-grid electrification and clean cooking, which cannot be left to the market alone.
  5. Champion women’s inclusion: Gender mainstreaming is needed to ensure that the issues women prioritize are addressed and that women are empowered to participate at all levels of energy value chains.

 

CALL TO ACTION

  •  Plan

  1. Include the voices of the energy-poor to guide priorities for national planning.
  2. Focus on the energy services people need, going beyond household supply to include requirements for threshing and grinding crops, water pumping, street lighting, and energy for businesses, schools, and clinics.
  3. Produce integrated plans for grid and off-grid, and for clean cooking.
  • Finance

  1. Invest more public money in off-grid and clean cooking, developing institutional structures, expertise, and incentives to spend this money more effectively.
  2. Provide capital that meets the needs of small-scale energy entrepreneurs, especially women.
  3. Focus on making energy access affordable, linking this with agriculture and enterprise support.
  • Deliver

  1. Expand cheaper and quicker to scale off-grid renewable energy solutions, with equal focus on supply, demand, finance, and enabling policies.
  2. Empower women as consumers and entrepreneurs and pursue inclusion proactively in all programmes.
  3. Develop and enforce supportive government policies and public funding to encourage the private sector to reach the energy-poor.

Download the PPEO 2019 as your guide to plan, finance and deliver national scale energy access in inclusive ways that leave no one behind. Use this toolkit to share the PPEO 2019 recommendations with your audiences and networks, as the best way for us to achieve SDG7.

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