Europe’s chance to help light up Africa
Energising poverty reduction in Africa
Contents
Executive summary ....................................................................................... 3 1 2 Introduction.................................................................................................... 6 Access: the African energy crisis .................................................................... 6 Energy and poverty in Africa .......................................................................... 6 Commercial energy in Africa .......................................................................... 8 Kenya case study ........................................................................................ 11 3 Treatment of energy in recent policy documents on Africa ............................ 13 Commission for Africa .................................................................................. 14 New Partnership for African Development energy strategy ........................... 15 4 European funding for energy in Africa: quantity and quality .......................... 17 GVEP approach ........................................................................................... 18 5 Reforming energy delivery in Africa .............................................................. 19 Affordability, accessibility, availability, sustainability ..................................... 19 ACP-EU Energy facility – Europe’s chance to help light up Africa ................. 20 6 Recommendations ...................................................................................... 21 References .................................................................................................. 24
This paper is part of a project funded by the EC under its Public Awareness funding line (B7-6000). The project website can be found at www.africanvoices.org.uk
Europe’s chance to help light up Africa: energising poverty reduction Practical Action 2005
2
Executive summary
Energy is crucial in battle to tackle Africa’s poverty …
Over the centuries energy has helped transform and underpin human development. It lights our schools, cooks our food, heats our homes, keeps our hospitals running, fuels our industries and transports us near and far. So pervasive is energy in our lives that we generally fail to notice its importance. Energy is vital to modern living. Energy is also vital if we are to achieve the Millennium Development Goals of halving poverty rates and improving health. Energy is needed to increase productivity and create jobs. It is needed to safely store medicines, light homes for evening study and to reduce the world’s greatest child killer, acute respiratory infection – an infection caused to a great extent by cooking on solid fuel in poorly ventilated homes. Yet energy has long been the missing element in plans to transform Africa and tackle its people’s chronic poverty. Without substantial support Africa’s energy crisis will not be turned round. As the world’s largest aid donor the European Commission and the individual member states could have a major role in stimulating Africa’s energy revival.
Africa is the world’s least connected continent yet exports more commercial energy than it consumes …
Africa has a great deal of under-exploited energy sources, both non-renewable and renewable. Despite this potential Africa has the world’s lowest per capita consumption of energy. More than a century after the invention of the light bulb only 23 per cent of people in sub-Saharan Africa have access to electricity. In the rural areas where the vast majority of Africans live 92 per cent of people has no electricity. Without a dramatic turnaround the number of Africans living without electricity will steadily increase. By 2030 there will be 650 million Africans living without electricity compared with the 509 million today. Per capita energy consumption in sub-Saharan Africa has been in decline. Between 1990 and 1997 average per capita consumption fell from 695 kilograms of oil equivalent (kgoe) to 410 kgoe. Africa’s paradox is that though it desperately needs energy for economic growth and poverty reduction it is a net exporter of commercial energy. Africa produces 7% of the world’s commercial energy, but only consumes 3% of commercial energy.
Africans depend on biomass that places huge burden on poor people …
There is a high level correlation between poverty and the amount and quality of energy consumed. Poverty condemns the vast majority of people in sub-Saharan Africa, 89 per cent, to rely on biomass (wood, animal dung or crop waste) for their main energy requirements, cooking and heating. This places a huge burden on poor women and children. Many women in rural sub-Saharan Africa carry 20 kilograms of
Europe’s chance to help light up Africa: energising poverty reduction Practical Action 2005
3
fuel wood an average of five kilometres a day. But a greater burden is on their health and the health of their children. Worldwide 1.6 million people die from lengthy exposure to excessive levels smoke in their homes from cooking fires. A quarter of all these deaths occur in Africa.
Aid to energy is minimal and the emphasis is on boosting economic growth not poverty reduction …
International development aid to energy in Africa has been minimal. According to the Organisation for Economic Cooperation and Development (OECD) only 4 per cent of total aid to Africa is spent on energy. Aid and international finance is currently focused on large-scale supply of energy at national or regional level, or the export of energy resources. There is almost no focus on delivery of energy services to the rural or urban poor. The New Economic Partnership for Africa (NEPAD) and the Commission for Africa focus on the financing of large-scale power projects. Energy has not been high on the agenda for European Union’s aid to Africa, accounting for less than 5 per cent of European aid since 1990. The focus of the aid that has been provided has been large-scale infrastructure.
Africa does need energy to stimulate growth but it also needs energy for poverty reduction …
While Africa undoubtedly needs modern energy to stimulate economic growth, the majority of the population will be bypassed without a significant effort to reach them. The vast majority of people in sub-Saharan Africa live in rural areas and many of these people do not live villages but in scattered homesteads. Getting power to these people will prove exorbitantly expensive through conventional grid extension schemes. Often conventional grid and fuel distribution networks, especially those driven by commercial gain, do not reach the majority of rural areas. In addition, few utilities or fuel suppliers will supply informal, and often illegally placed, slums with power or commercial fuels. Efforts at finding appropriate solutions to the energy problems in rural areas, where the majority of the poor live, are hampered by inadequate attention at the national policy level to rural development generally and energy in particular. Poor people’s priority energy need is for cooking, heating and lighting. They also need energy to improve their incomes through small-scale industries and food processing. Energy is also needed to improve the public services they rely on, such as refrigeration for health clinics and the pumping of water both for irrigation and domestic use.
Europe’s chance to help light up Africa: energising poverty reduction Practical Action 2005
4
Meeting these needs and reversing the downward trends in African economies and access to modern energy will depend on: • • Affordability – bringing the cost of energy within the reach of more people Accessibility – increasing capacity to address poverty in the region; the identification and mobilisation of resources to provide modern energy services; meeting huge imbalances between supply and demand; shifting energy consumption from biomass Availability – making African energy resources more available to African populations Sustainability – reducing dependency on unsustainable biomass.
• •
The new European Commission aid fund for energy needs to be clearly poverty focussed if it is to meet the needs of the energy poor …
Without attention to distribution of energy resources, the majority of rural people and many urban dwellers could remain ill served for many decades. It is essential that alongside the drive to upgrade and expand Africa’s energy supply there is an equally strong need for this supply to be inclusive of all African people. One new opportunity for resourcing energy delivery is the proposed ACP-EU Energy Facility under the 9th European Development Fund (EDF). This would provide €250 million for African, Caribbean and Pacific (ACP) countries to ‘sharpen the focus and visibility of the energy and poverty agenda’. The fund, to be managed by the EU Energy Initiative, will support rural electrification, decentralised energy systems, increased use of renewable energy and enhanced energy efficiency. Europe has the chance to help make a huge difference to Africa’s energy poverty. It is imperative that Europe seizes the chance to ensure that this facility sets poverty reduction and sustainability targets and that the modalities of the fund are pro-poor. Africa’s poor cannot afford to be ill served once more by another generous gesture that by passes their needs.
Europe’s chance to help light up Africa: energising poverty reduction Practical Action 2005
5
Practical Action,