The 9th Community Based Adaptation Conference (CBA9) will take place in Kenya from the 24th to the 30th April. Practical Action is a co-sponsor of this event, and is sending speakers from Nepal, Bangladesh, Zimbabwe, the UK and Sudan. On Tuesday 28th April, Chris Henderson will be participating in a session on ‘Climate Smart Agriculture’.
Agriculture is fundamental to climate change adaptation in developing countries:
- 50% of the population is employed in the agricultural sector – in the Least Developed Countries, it is 72%
- Agriculture is dependent on biodiversity and other natural resources, and is particularly vulnerable to extreme weather events
- One billion people continue to suffer from food insecurity – this is expected to rise by 15-40% by 2050 as a result of climate change
- In developing countries, women are usually responsible for collecting fuel and water, and are often dependent on natural resources for their livelihoods – they will bear the greatest burdens of climate change, and have the potential to contribute to adaptation
Technology choice is key in agricultural systems, and is never neutral. Which technologies are utilized in particular contexts will have social, economic and ecological impacts.
‘Climate Smart Agriculture’ is a broad term with relevance to all actors in the agricultural sector, from large-scale commercial farmers in the US to market vendors in Bangladesh. As such, it is being used to define diverse agricultural technologies and approaches, some of which are unsustainable and do not contribute to long-term food security or adaptive capacity.
If Climate Smart Agriculture is to be useful for smallholder farmers in developing countries, it must embody the principles of Technology Justice:
- It must be inclusive
Existing production and market systems should be modified to be facilitate equitable access for smallholders to the technologies they need to reduce vulnerability and risk, capitalise on opportunities, and improve their livelihoods, resilience and well-being.
Agro-ecology is a powerful tool for the inclusion of resource poor or otherwise marginalized farmer groups. It is knowledge-intensive rather than capital-intensive, minimizing financial outlay and the risks associated with taking loans to cover costs. By making production less expensive, agroecological approaches increase access to market systems for smallholder farmers, and in particular, women.
- It must support pro-poor innovation
Agricultural innovation in response to climate change must move beyond vulnerability reduction; policies and interventions must be designed to increase the dynamic ability of communities to respond to unpredictable climate change.
Key to appropriate innovation is user-centred design; the most effective technologies are developed in conjunction with those who will use them. Both women and men must be fully involved in the design and management of technologies and the institutions that affect their use. Knowledge and capacity-building for adaptation to climate change should integrate both scientific knowledge and the experiential, context-specific knowledge of end users.
Investment in pro-poor innovation should focus on identifying alignment between private sector interests and development objectives for mutually beneficial relationships.
- It must be sustainable
High external input, fossil fuel-based monoculture production systems are unsustainable. Agro-ecological systems generate less greenhouse gas emissions, and the diversification of crops increases the resilience of smallholder farmers to extreme weather events and climate change.
In many cases, agro-ecological production systems produce greater yields than high external input systems, particularly in unfavourable environments (e.g. here, here and here). However, agroecology is fundamentally about optimizing production for the maximum sustainable yield. The natural resource base should nto be an after thought once the maximum yield has been attained; it is fundamental to continued food production.
For further information on Practical Action’s participation at CBA9, see here
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‘’If we can make people’s livelihoods stronger and more sustainable, disasters will affect them less” (Practical Action, 2011)
Zimbabwe is prone to a number of natural hazards including droughts, storms and floods. Climate change is increasing the severity and unpredictability of these events, and the impacts are worsened by unsustainable human practices, including overgrazing, deforestation, veldt fires and poor land management. This is further compounded by pests, diseases, epidemics (especially HIV/AIDS) and economic pressures. These natural and man-made hazards affect people’s livelihood activities, and lead to hunger, extreme hardship, and loss of life.
Practical Action has been working with stakeholders at the national, provincial, district and ward levels, implementing a Livelihood-Centred Disaster Risk Reduction (LCDRR) approach, to strengthen and diversify livelihoods, enhance community preparedness, and build capacity to cope with hazards effectively. This has involved:
- The creation of trained and active disaster management committees (DMCs) at ward, district and provincial levels
- The development, implementation and annual-review of community-based risk reduction and preparedness plans, supported by local and central government
- The development of early warning systems, now in use
- Communities trained in disaster risk reduction
- Linkages created with other stakeholders
- Knowledge and awareness campaigns conducted on risks and risk reduction strategies
- Identification and implementation of diversified livelihoods
Major outcomes from the project
a) Uptake of the LCDRR approach by other stakeholders
- LCDRR approach incorporated in Zimbabwe’s draft national disaster policy
- Zimbabwe’s National Civil Protection Unit is working to establish and build the capacity of ward-level disaster management committees throughout the country
- Other NGOs – the International Organisation of Migration, World Vision, and Oxfam, among others – have adopted the LCDRR approach
b) Enhanced organisational change
- Community-level disaster risk monitoring and evaluation structures
- Ward and district level disaster management structures with clearly defined roles
- Integration of LCDRR into the broader development process
c) Increased local innovation for building resilience
- Pest management using local resources and ethno-veterinary practices
- Increased uptake of food security and diversification options
- Increased options for veldt fire control and management
- Increased community-based awareness and sensitization initiatives
d) Empowerment of women
- More women involved in local LCDRR initiatives – increased knowledge and skills for leadership in the community
- Women elected to take decision-making positions in local development structures as a result of proven competency with DRR work
Monitoring and Evaluation
Disaster Management Committees (DMCs) formed the cornerstone of project implementation, monitoring and evaluation. At the village level, DMCs were composed of community members; at district, provincial and national levels, they were composed of NGO staff, government and private sector representatives. A number of participatory tools were used for data collection and analysis at all levels.
Planning and implementation of LCDRR activities has been effectively decentralised, but funding is still very centralised. This means that communities are still limited in what they can achieve.
- The development of risk reduction plans at community level should be linked to district and provincial planning processes for better coordination, monitoring and evaluation
- Plans must be realistic and implementable to avoid frustration of communities
- Local leadership and development structures must be fully involved in planning and implementation
- Involving all relevant stakeholders – communities, NGOs, and government in monitoring and evaluation – gives more comprehensive evaluation of project impacts, and better enable further development
Weather extremes caused by climate change are a major threat to food production in Southern Africa. The ‘Mainstreaming Climate Change Adaptation in Zimbabwe’s Extension Systems’ project provided over 8,000 smallholder farmers with innovative climate information services that allowed them to anticipate and adapt to rapidly changing climatic conditions.
The project mobilized the Meteorological Services Department (MSD) and the Department of Agriculture, Technical and Extension Services (AGRITEX) to develop and distribute tailor-made forecasts that helped farmers prepare a cushion against the effects of climate change on food production. The project achieved positive impact through collaboration with different stakeholders, including DMS, AGRITEX, and the farmers themselves. The approach is potentially sustainable given it is embedded in current extension activities, and is relatively low cost.
Improving access to climate and weather information for enhanced adaptive capacity
Practical Action has supported farmers in the three Zimbabwean provinces of Masvingo, Midlands, and Matebeleland South understand the relevance of climate information and weather forecasts. This understanding has proven a useful entry point for the introduction of conservation agriculture practices. It has helped farmers prepare for and protect against extreme weather events that erode their livelihoods, and assists them to make informed decisions about farming practices to take better advantage of productivity-enhancing technologies.
Key messages for CBA9
- National governments should support free access to analysed historical data and current weather information for small holder farmers, for better decision making. This should include investment in the establishment of local meteorological stations to enhance the availability of localised weather information
- Greater collaboration between private sector actors, government and smallholder farmers will be necessary for effective dissemination of climate and market information
- Through public and private extension services, smallholder farmers should be made aware of the effects of climate change, and should be engaged in finding solutions to this challenge. Where appropriate, this would include the adoption of technologies which contribute to their climate change resilience
Los productores de café a adaptarse al cambio climático
(English translation below)
La novena Conferencia de Adaptación Basada en la Comunidad (CBA9) se llevará a cabo del 26 al 30 de abril de 2015. En Perú, Soluciones Prácticas ha estado trabajando con las comunidades productoras de café para apoyar sus procesos de adaptación.
En la amazonía Peruana, el ecosistema tropical forestal lluvioso o selva alta aloja a más de medio millón de familias vinculadas a pequeñas fincas productoras de café. Ellos viven y trabajan en condiciones de fragilidad y cada vez mayores signos y efectos del cambio climático con sequías o frecuencias y picos de intensidad de lluvias y enfermedades como la roya haciendo que, a nivel del país, en toda la franja tropical lluviosa se pierda más del 40% de la producción de café.
En efecto, el cambio climático ya está presente en la vida de las comunidades de nuestra selva alta o llamados bosques de neblina. Por ello, Soluciones Practicas el año 2012-2013 hizo una investigación de escenarios de Cambio Climático en la Región San Martín. Determinó que el año 2050 la temperatura se incrementará entre 1.0-1.2 oC y, como consecuencia de ello, las áreas de producción de café seguirá subiendo a zonas más altas de las montañas. Lo que implica más agricultura migratoria, quema, deforestación y desequilibrios hidrológicos y de servicios ambientales de estos bosques, si no se proponen medidas de adaptación y otras apropiadas para la gestión del territorio.
Como una propuesta para adaptación a estos cambios climáticos, el 2013 Soluciones Practicas ha impulsado con más fuerza un proyecto con enfoque agroecológico que venía desarrollando en años previos. Este esta basado en un trabajo desde los saberes locales y la adaptación de tecnologías sencillas con participación de productores organizados en comités o comunidades, promotores agroforestales líderes formados, técnicos del proyecto y del gobierno local. Ellos han implementado fincas cafetaleras con 8 tecnologías integradas y sinérgicas que comprende el modelo agroecológico-agroforestal multiestrato.
Las ventajas de este modelo de adaptación basada en comunidades se ven reflejadas en tangibles beneficios económicos, ambientales y sociales. Incremento de la productividad e ingresos de los productores en más del 100%, alta calidad de taza del café, reforestación de áreas degradadas y aguas limpias además de mejora en el empleo y autoempleo familiar consiguiendo bosques productivos y sostenibles en las comunidades tropicales. No menor interés es el despertado mediante un proceso de diálogo y vinculación con actores del mercado usando el ‘Participatory Market Systems Development’, con lo cual, se ha logrado más interés de compra y mejores precios del café por las empresas.
Estas ventajas, con los respectivos documentos e informes de las evidencias son discutidos y difundidos en los diferentes eventos y escenarios del desarrollo, la propuesta tiene una buena acogida y es motivo de visita de productores, gobiernos de otras regiones, empresas privadas, cooperación, etc. Todo ello, trabajado en la perspectiva de su replicación y niveles de escalamiento del modelo agroecológico.
Coffee farmers adapt to climate change
The 9th Conference on Community Based Adaptation (CBA9) will take place from 26th to 30th April 2015. In Peru, Soluciones Practicas (Practical Action Latin America) has been working with coffee communities to support their adaptation processes.
In the Peruvian Amazon, the rain forest or tropical high forest ecosystem is home to over half a million families linked to small coffee farms. They live and work in conditions of fragility and increasing signs and effects of climate change, with droughts, intense rainfall, and diseases such as rust, so that at the country level, the wet tropical belt experiences a 40% loss of coffee production.
Indeed, climate change is already present in the life of the communities in our high or ‘cloud forest’ areas. Therefore, from 2012 to 2013, Soluciones Practicas conducted an investigation of climate change scenarios in the San Martin region. It found that by 2050, the temperature will increase by 1.0-1.2 oC and as a result, areas of coffee production will continue to shift to higher mountain areas. This implies more shifting cultivation, burning, deforestation, and loss of the hydrological and environmental services these forests provide, if adaptation measures are not proposed and other appropriate land management techniques are not implemented.
As a proposal for adaptation to this climate change, Soluciones Practicas has promoted an agroecological approach that has been developed over several years. This is based on local knowledge and adaptation of simple technologies, involving producers organized in committees or communities, agroforestry promoters, trained leaders, project technicians and local government. They have implemented coffee farms with 8 integrated and synergistic technologies, which together comprise a multilayer agro-agroforestry model.
The advantages of this model of community-based adaptation are reflected in tangible economic, environmental and social benefits. Productivity and income of farmers has increased by more than 100%; coffee quality is higher; degraded areas have been reforested, and water quality has improved. Employment and self-employment prospects have improved, and communities are using the forest in a productive and sustainable way. No less interesting is the process of dialogue between market players which has been facilitated using a Participatory Market Systems Development approach, leading to better access to coffee export markets.
Reports documenting evidence generated by this project have been discussed and disseminated at various different events. The project has been well received, stimulating visits from producers, governments in other regions, private companies, and cooperatives. This model therefore offers an excellent starting point for taking agro-ecological adaptation to scale.No Comments » | Add your comment
The 9th Community-Based Adaptation conference (CBA9) will take place in Nairobi, Kenya from 24-30 April, 2015. Organized by the International Institute of Environment and Development, and co-sponsored by Practical Action, the conference will bring together development practitioners to discuss current challenges and opportunities facing community-based adaptation to climate change.
The challenge of climate change adaptation
Climate change will exacerbate the global challenges we face: delivery of basic services, providing enough food for a growing and urbanizing population, and responding to increasing natural disasters. The impacts of climate change will be difficult to predict; however, it is clear they will be unequally distributed. The poor and the marginalized, particularly women and girls, will bear the greatest burdens.
It is vital that adaptation funding is targeted to benefit those who will find it hardest to respond. Adaptation must move beyond vulnerability reduction to building long-term adaptive capacity, empowering communities to make livelihood decisions in the face of unpredictable climate change.
To take adaptation to scale, we must re-vision the role of the private sector. Development practitioners must facilitate equitable market access for those living in poverty, and inclusive, pro-poor technological innovation that benefits both smallholders and private investors.
Technology choices affect communities’ adaptive capacity
Technology choices made by farmers, planners, policy makers, research and the private sector to enable or promote agricultural adaptation to climate change are not neutral. Choices between different technologies and systems of governing these technologies have consequences for access (inclusivity), sustainable use (choices available for future generations), and resilience.
As a sector, agriculture is particularly vulnerable to extreme weather events and climatic change, and in developing countries it employs over 50% of the population. Therefore, agricultural technology choices will have a huge impact on food security and economic development. If agricultural adaptation is to be beneficial for smallholder farmers in developing countries, technology choices must improve adaptive capacity and maintain the natural resource base upon which livelihoods depend.
Key messages for CBA9
- All actors – government, civil society, private sector – must recognise that technology choices are not neutral and have consequences for adaptive capacity, inclusivity, and sustainability
- Communities must be re-engaged in analysis, planning and innovation in response to climate change
- If community-based adaptation is to be effective, it must utilise both indigenous knowledge and experience and climate information and forecasts, with acknowledgement of what we do not know about the future
- The gendered impacts of climate change and the additional burdens it will place on women and girls must be placed centre stage
- We need to re-vision private sector involvement in community-based adaptation to take it to scale – this will require access to markets for products and inputs, and mutually beneficial relationships
Practical Action will be sending representatives from Bangladesh, Nepal, Peru, the UK, Sudan and Zimbabwe to CBA9, who will present a selection of Practical Action’s community-based adaptation projects from around the world (posters here, under ‘Key Publications‘). They will also facilitate several interactive learning sessions on a range of key issues, including the use of climatic information, the role of the private sector, and Climate Smart Agriculture.No Comments » | Add your comment
It was drizzling when we drove to the biogas electrification project site. Going through the maze of roads, it took us 45 minutes from Narayanghat, the main market in the Chitwan district, to reach there.
Chitwan, in the southern plains in Nepal, is home not only to the magnificent royal Bengal tigers and one-horned rhinoceroses but also a happening trade hub. Regarded as the country’s poultry capital, with the establishment of Nepal’s largest milk industry, Chitwan is seeing a wave of innovation in agriculture sector.
Adding to the list of innovations is the biogas electrification project being run at the Livestock Development Resource Centre of the Annapurna Dairy Producers’ Cooperative (ADPC). The project, supported by Practical Action, boasts of being the first in Nepal to generate electricity for commercial use from biogas.
— Achyut Luitel (@achyutluitel) October 10, 2014
A small scale study on bio-electrification through agricultural and livestock waste was carried out by students of Kathmandu University earlier, producing electricity to light 9 LED lights, each of 5 W.
When I reached the site, Bodh Raj Pathak, the vice-president of the cooperative, drenched in the rain, was waiting for me to show the centre.
— Sanjib Chaudhary (@sankuchy) February 27, 2015
The first thing he did was to switch on the system. He then one by one switched on the bulbs and fans. For a technology loving person like me, it was a real pleasure – all were working as if they were running from regular electricity.
The gas generated from the dung of 85 cows is enough to generate electricity that can run a generator of 5kW load continuously for 8-9 hours, according to Pathak. Few months ago the centre had more than 100 cows. Some of the cows were sold to the community people on demand.
The cows at the Dairy produce a trailer of cow dung daily that goes into the digester for biogas generation. There are two inlets and two outlets.
“Currently, only one inlet is being used and it works for 8-9 hours,” said Pathak. “If both the inlets operate, it will produce electricity for 16 hours.”
The process is simple – the dung, urine and water are mixed into a concoction. The mixture is then fed through the inlet to the chamber. The gas generated is passed through a filter to get rid of the precipitates and then to the generator that produces electricity.
Right now the Dairy is using the electricity for light bulbs, fans, water pump and a chaff cutter. The gas is also being used to cook food for six staff at the Dairy.
The Dairy has plans to utilise the biogas for pasteurisation of milk. Right now it is saving Rs. 30,000 – 35,000 rupees per month in fuelwood. After the full utilisation, the Dairy will save around Rs 100,000 (USD 1000) per month.
However, the slurry, a precious fertiliser has not been well managed. It was left to dry in the open. Pathak told me that they have plans to dry the slurry and package it as organic fertiliser.
Looking at the outputs of the pilot project, the prospects are promising in spite of the dismal data of electricity contributing to the total energy consumption and use of biogas in Nepal.
According to the Water Energy Commission Secretariat (WECS) Energy Sector Report 2010, electricity contributes only 2% to the total energy consumption by fuel types in Nepal. As per Alternative Energy Promotion Centre, the government apex body for the development and promotion of renewable energy, there are more than 300,000 biogas plants in Nepal.
— Manjeet (@manjeetdhakal) July 3, 2014
In Nepal, cooking and lighting are the main purposes biogas has been mainly used for, amounting to 80% and 20% respectively. The successful biogas electrification in Chitwan has opened doors for using biogas to produce electricity and scaling up the technology at the cooperatives throughout Nepal.
While 1.3 billion people are still living in darkness with no access to electricity and 2.7 billion still cook over open fires, replication of innovations like biogas electrification will help us move from a state of technology injustice, to find a way to remove the barriers that now prevent poor people from using the technologies they need for the most basic of services.
With technical details from Ganesh R Sinkemana
A small technology that brought light to Hasina Begum
Ms. Hasina Begum, aged 30, is from Kalikapur village of Atulia Union Council (UP) under Shyamnagar Upazila of the South-western coastal Satkhira district. This is an area prone to climate change and climatic extreme events such as increased salinity, sea level rise and cyclones. She is a widow and very poor, with no one earning in her family. She lost her husband two years back and has two children- one girl studying in class VI and one son studying in class III in local school.
Because of her poverty, she was selected for the support of Solar Home System (SHS) at her house by the climate change adaptation project of Practical Action Bangladesh with support from Asian Development Bank, along with 19 others in four local villages.
Kalikapur is known as ‘poultry village’, and the use of SHS is common. In the last two years (mid-2010 to 2012), there has been a tremendous increase of coverage of SHS in the village with support from different NGOs, which, can be considered as Technology Justice, since SHS is becoming popular in the off-grid area, where there is no grid electricity. However, the people of the grid area have been accessing electricity services with high government subsidy. So, SHS, comparatively, with its high cost for the extreme poor is obviously not right from a Technology Justice point of view.
After the problem of ‘bird flu’ in the last year, poultry raising significantly decreased in the area. The only entrepreneur of the village gives work of karchupi (hand knitting on dresses- salwar, kamij and orna, mainly) to the village women. Hasina also receives some work but not sufficient. However, it helps her in earning to maintain her family to certain extent.
Hasina received a solar home system in April 2012. The system included one 12 volt battery, one solar panel, two bulbs and a control meter along with wire, switch board and other relevant equipment. Her children’s interest in studying has greatley increased, since the SHS provides more light and is more convenient than traditional kerosene kupi. They now study even after dinner. Hasina herself also has been able to increase her work capacity by carrying on working up to midnight, when there remains pressure of work that she could not perform in the day time because of household work. Earlier, she could work only in the day time.
So, the SHS has created opportunity of work for longer hours, specially, at night in solar light and scope of earning higher income to maintain her livelihood. Hasina receives wages for karchupi work on each set of dress amounting Tk.200-400. The wage varies based on the amount of work on the dress. SHS has increased her work speed and almost doubled her working hours. She informed us that she can perform her work in six days now, which would have required 12 days earlier prior to the installation of SHS. She is happy with the SHS. Beside longer working scope and income earning aspects, the SHS has increased her security also, since the solar lights lighten the entire room and around and encourage her children to study as well. Earlier, she would feel insecure in the dark of the night. She is a pretty woman and lives alone with her two young children. Having a SHS at home is considered to be the matter of social status as well, in the rural context.
The SHS has brought multiple benefits to Hasina and her family – she has the opportunity to work for longer, she can earn a higher income, her children can study and her security and social status have improved.
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Using Mogli MRV+
Over the years our Low Smoke Project in North Darfur has proven successes as well as meeting beneficiaries’ expectations. This project illustrates the fruitful partnership between Practical Action, Women Development Association Network (WDAN), and Carbon Clear Company to facilitate access to LPG for poor households .We are using a revolving fund system to encourage using a clean energy source and reduce the consumption of fuel wood in urban Al-Fashir. This partnership has achieved great outcomes worth mentioning whenever the opportunity arises.
- 7000,+ stoves in use in El-Fashir
- First carbon credit project in Sudan
- First Gold Standard project to use LPG
- Improved access to modern energy
- Reduced indoor air pollution
- Strengthened local delivery infrastructure
- Strengthened communities
- Reduced regional deforestation of approx 80 kg wood/ 30 kg charcoal per household each month
- Cuts in carbon emissions of approx 4t/CO2e per stove-yr
A key factor of success is good planning to monitor project activities and proper distribution of roles and responsibilities among partners. The following flow chart summarizes monitoring activities:
As seen above local networks are responsible for completing surveys for example (Kitchen Survey Questionnaire about 4\A4 papers for 40 households every 3 months – Usage Survey Questionnaire 1\A4 paper – Leakage Assessment Questionnaire 2\A4 papers for 100 households). Practical Action staff in Al-Fashir collect all the questionnaires, translating them from Arabic to English, scanning all hard copies, and using SPSS for analysis to prepare first draft report. Then the draft report is shared with Practical Action head office in Khartoum for comments. Finally, after Carbon Clear in UK performs its role as mentioned in flow chart, the report will be sent to the Gold Standard Foundation who will issue carbon credits.
This monitoring mechanism is effective in a small project but it’s time consuming. Our project now seems to be expanding to rural areas in North Darfur. That’s why it’s time for a technological platform through which monitoring activities can be done faster.
Mobile Data Collection solution (MDC) works effectively in this case. In end of 2014 MOGLI MRV+ has been used by our staff in Darfur as system runs on Android mobile devices and tablets and functions Online or Offline. Allows our staff to collect, share, and visualize geographically tagged data in real-time “GPS CAPTURE”. It can be linked with Flicker and upload pictures at the moment captured. Moreover, it provides Mobile Signature and Multi-language function.
To know more see this video on YouTube :https://www.youtube.com/watch?v=OyVfKFstJWQ
MOGLI MRV+ SAVES TIME, BRINGS TRANSPARENCY & INSTANT ACCESS TO DATA.No Comments » | Add your comment
This is my second post from Abu Dhabi, where I have been attending the World Future Energy Summit as a guest of the Zayed Future Energy Prize. For the second year running Practical Action was shortlisted for this prestigious $1m prize in recognition of our work on helping poor people in the developing work access clean energy (we finished runners up again in case you didn’t see my last blog!).
One of the recurrent themes of the conference sessions I have attended over the past week on energy access has been finance. I have written in this blog before about the general lack of funding for energy access, particularly off grid technology. The International Energy Agency (IEA)[i] has estimated that, if we are to achieve universal access to energy services by 2030, around 64% of the additional finance required will have to be invested in off grid systems, for example solar home systems or local mini grids powered by generators or renewables such as solar, wind or micro hydro. But there’s little evidence that much investment is going anywhere except into the traditional areas of big power stations and extensions to the grid, neither of which is expected to provide much benefit to those in remote rural areas who lack electricity at the moment. The Sierra Club, a US based environmental NGO, carried out an analysis of the major development banks energy lending portfolios for example[ii], which showed that the World Bank and the Inter-American Development Bank did best, with 25% of their lending on off-grid infrastructure (but still way off the 64% figure needed according to the IEA). At the other end of the scale, the Asian Development Bank had only 7% of its portfolio invested in off grid and the African Development Bank 0%!
But there is another type of finance gap now appearing. In addition to the general lack of availability of funding it’s also becoming apparent that there is a real affordability gap in the model currently being promoted by the development banks, donor agencies and sector specialists.
What this year’s Zayed Future Energy Prize winners MKOPA and runners up SELCO have been doing brilliantly in Kenya and India has been developing viable businesses to make solar lighting available at a cost which is increasingly affordable to those on low income – solar lanterns for households on US$ 1 -3 per day income and small solar home systems that can run 3 or 4 lights, charge a phone and maybe even run a small TV or radio for those with an income of as little as US $3 -5 a day.
But this is not yet energy access in the real sense. If we start layering in the energy services people really need to make a difference to their livelihoods – maybe refrigeration to preserve food or mechanical power for productive use (grinding, milling, pressing, drying or storing crops, pumping water etc), the power requirements go up dramatically, way beyond the capacity of current affordable solar home systems to supply.
This is where larger capacity communal mini grids come in, and there was much talk about these at the World Future Energy Summit. But the recurring motif in those discussions was the need for a business model that would bring in private investment to finance mini grids because “public subsidy was never going to be sufficient”. The problem is there are two enormous holes in that argument:
Hole 1: The idea that mini grids are financially attractive investments in their own right. The reality is that there is a massive gap between what would need to be charged as a tariff to recover costs and what poor people have at their disposal to spend on energy services. A recent report from the Lawrence Berkeley National Lab, University of California[iii] covers this ground nicely. It estimates the basic electricity needs of rural household for full energy access at around 80 kilowatt hours per month (based on using a fan, 4 LED lights, a small TV, a small refrigerator and the equivalent of 4 hours a day of power for a mechanic device such as a small irrigation pump or equivalent). Using an assumed cost of around $0.24/kwh (which is quite optimistic for small mini grid type supplies) that comes to a monthly cost of at least $20 per household if full cost recovery is required. Typically low income households spend around 10% of their income on energy (50% of which is on cooking fuel). This translates to budgets available for electricity of around $7.50 per month for households on $3 – 5 per day and less than $1.5 per month for the extreme poor on $1 a day or less. These figures from the University of California are very rough, but they serve to make an important point. The costs of mini grids would have to reduce by at least 60 to 90% to make the tariffs affordable for the poor but still keep the systems as viable investments for private capital.
Is it any wonder the banks can’t find investors to take out loans for mini grids?
Hole 2: The idea that there simply isn’t enough money in the world to make public subsidy viable. We are told that there is no possibility that public finance could be used to close the gap because there simply isn’t enough to go around. But at the same time, the IEA tells us that currently more than $500 billion[iv] is being put into public subsidies for fossil fuels every year (with others such as IRENA putting the figure much higher at as much as $1900 billion in 2011[v]). So the fossil fuel industry is being kept on a massive publicly funded life support system while the poor are told that the off grid systems they need to access a basic level of energy services can only ever be provided through private investment.
Conventional wisdom abhors subsidy, but in Bangladesh, where the most successful solar home system programme to date exists with around 4 million households supplied, provides a great example of how subsidy can work, making technology affordable and getting markets moving and costs down. According to a World Bank study[vi], the Bangladesh programme started off with an average subsidy of around 25% per unit in 2004, reducing to less than 10% by 2013. The interesting thing there was that the cost to the consumer for a system was less in 2013 than it was in 2004, despite the reduction in subsidy. Why? Because technology got cheaper and the scale of the programme drove innovation and cost reductions that, together, exceeded the reduction in subsidy over the same period.
It seems time for the development banks, donors and the energy sector as a whole to take a long and really honest look at the financial models being proposed to ensure universal access to energy. Its time to face up to the reality. Private capital and good business models are definitely needed. But universal access to energy (not just for light but energy for the productive uses that will help people work themselves out of poverty) will not be achieved without public finance playing a very significant role to close the affordability gap as well.
[ii] Sierra Club / Oil Change International 2014, Failing to Solve Energy Poverty: How Much International Public Investment is Going to Distributed Clean Energy Access?
[iii] LIGTT, Institute for Globally Transformative Technologies at the Lawrence Berkeley National Lab, University of California, 2015, 50 Critical scientific and technical breakthroughs required for sustainable development – Energy Access pp 26 – 29.
[iv] Bloomberg, Nov 112, 2014 Fossil Fuels With $550 Billion Subsidies Hurt Renewables
[vi] World Bank (2013) The Benefits of Solar Home Systems – An Analysis from Bangladesh Policy Research Working Paper 6724, page 103 Comments » | Add your comment
I am writing this in Abu Dhabi, where I am attending the World Future Energy Summit as a guest of the Zayed Future Energy Prize. For the second year running Practical Action was shortlisted for this $1m prize in recognition of our work on helping poor people in the developing work access clean energy.
Today was the day for announcing the winners and, unfortunately, I have to report that it was also the second year in a row that we didn’t win the prize! However, given out of nearly 600 organisations considered for the award this year, only 30 made it as finalists (and only 5 in our category of non-profits) I think we can all be very proud of getting so far and the deep respect for our work that these 2 nominations in a row implies. Coming on top of Practical Action winning UNFCCC Momentum for Change awards in both 2013 and 2014 for its work on climate change, these nominations show just how much attention our work is getting internationally at the moment.
The very worthy winner of the Zayed Future Energy Prize for non-profits this year was an organisation from the Philippines called “Litre of Light” that converts plastic bottles into sky lights and solar lanterns and I’d like to offer my sincere congratulations to them. Congratulations also to MKOPA, the innovative Kenyan solar home system providers that use credit payments via mobile phones to help people afford solar lighting and who won the SME category. Panasonic won the large company category whilst ex US Vice President Al Gore was also recognised with a life time achievement award for his work raising awareness of climate change. You can see information on all the winners here and the other finalists (Practical Action included) here.
As was the case last year, the finalists represented 30 really positive stories about people demonstrating how things could be different and how renewable energy is the future in many different contexts. It was also interesting to hear this message repeated over and over again in the opening ceremony for the World Future Energy Summit itself. Solar photovoltaics are, it seems, increasingly becoming cost competitive with conventional sources for power generation. One example given was a very recent contract let for a 200 MW solar park in Dubai at a cost of just under 6 US cents per kwh – one of the cheapest renewable projects ever and around 3 cents per kwh cheaper than gas! What was also interesting, particularly given this conference is taking place a major oil producing region, was that there seemed to be consensus amongst today’s speakers that renewable energy was a technology whose time had come and that even the current falling oil prices were unlikely to make a difference to that position.
I will be the conference for the rest of the week, speaking at a couple of side events, and will report back on anything else of interest I see.No Comments » | Add your comment