Simon Trace

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Simon Trace was Practical Action's Chief Executive Officer, 2005-2015. He was associated with the organisation during a period of strong growth and rising international recognition for its work, particularly in the area of the environment and energy where Practical Action won a number of international awards. A civil engineer by training, Simon also studied anthropology. Simon's career has principally been in community development, in the fields of soil and water conservation or water and sanitation, and he has spent time with a number of agencies, including periods of secondment to CARE and Unicef. He also spent a total of 10 years in Zambia and Nepal prior to moving to London to take up a series of positions with WaterAid, including Asia Regional Manager and Head of International Operations. Prior joining Practical Action, Simon was Strategic Development Director for the UK NGO WaterAid. Simon stepped down from the post of Chief Executive at the end of October 2015.

Recommended reading: http://www.practicalaction.org

Posts by Simon

  • Exciting times for off grid electricity in Africa

    October 29th, 2015

    This week I am at the World Energy Council congress in Addis Ababa and have had the opportunity to speak at a couple of sessions on energy access. There have been some lively and informed debates, but for me the most interesting thing (given the congress attendees are generally from the formal power sector) has been the apparent widespread acceptance that off grid distributed electricity generation will have an important part to play in achieving universal access to energy. This, I feel, represents an encouraging change in attitude amongst policy makers in recent years.

    Certainly that acceptance is in line with the thinking of major energy policy analysts such as the International Energy Agency (IEA). In 2011 the IEA suggested that achieving universal access to electricity would take 20 years and require, for sub Saharan Africa, around $18.5b of investment annually. Given that 80% of those without access to electricity at the moment live in rural areas and may not be economic to connect up to the grid in the near future, the IEA also said that around 60% of that investment, $11.5b per year, would have to be for mini grids or isolated off grid technologies if access were to be truly universal.

    energy enablesBut today others, notably the Power for All coalition of which Practical Action is a member, argue that the IEA’s figures are too conservative and that universal access to electricity could be achieved in just 10 years and at one tenth of that cost by using rapidly developing solar photovoltaic technologies.

    Certainly the viability of solar systems to provide domestic power has never been greater. The cost of solar panels has plummeted in recent years, falling 75% since 2009, while lithium batteries have become far more efficient vehicles for storing power.

    Perhaps even more importantly the power requirements of appliances have also dropped with the advent of not just LED lighting but also super-efficient fridges TVs and fans, meaning you can get much more out of a solar panel than you could even a couple of years ago. The same 40 watt solar panel that 10 years ago could power one 25 watt light bulb can today power four LED lights, a phone charger, a radio and maybe even a small colour TV.

    The size of the demand in Sub Saharan Africa (600 million people without electricity) and the falling price of the technology have combined with pay as you go approaches to consumer financing to create market based opportunities to tackle the energy access challenge using solar home systems and lights. The social enterprise Sunny Money has sold over 1.7 million solar lamps in Tanzania, Kenya, Uganda, Malawi and Zambia to date for example. Meanwhile companies such as MKOPA are using the MPESA mobile money system in Kenya, Tanzania and Uganda to allow people to buy US $200 pico solar home systems by spreading the cost over a year to 18 months in daily or weekly micro instalments. The MKOPA system provides an 8 Wp panel, 3 lights and charging for a mobile phone and a radio. Costs are around US 45 cents a day which compares favourably with typical household costs of 50 – 60 cents per day for kerosene for lighting plus typical mobile charging costs. MKOPA has grown rapidly from 60,000 customers in April 2014 to 250,000 today.

    In Tanzania, Off Grid Electric uses similar technology but operates a leasing model, selling energy as a service as opposed to ownership of the solar panels and batteries themselves. Customers receive free servicing and repairs and can upgrade to higher power systems over time by just increasing their regular payments. Off Grid Electric is adding 10,000 customers a month at the moment and heading for 200,000 customers by the end of 2015. And there are other companies engaged in the solar home system market in sub Saharan Africa including Econet Solar in Zimbabwe, Nova Lumos in Nigeria, Azuri Technologies in East and West Africa and Sun Transfer in Ethiopia and Kenya.

    The sorts of partnerships involved here are different from traditional power sector arrangements. Relatively small private sector companies or social enterprises are putting innovative technology packages together. They are partnering up with either mobile phone companies to use mobile money or networks of local distributors to use prepaid scratch cards similar to those used for mobile air time to manage micro credit payments, sometimes directly and sometimes via a 3rd party micro finance institutions.

    But there are a couple of challenges to taking this model to scale.

    The first is access to working capital to scale up. To date most companies have used grant finance or equity from impact investors to cover the costs of product development and inventory. But these sources of funds are limited and commercial finance is needed. There are some signs that this is happening – both MKOPA and Off grid Electric have recently raised funds in the market. But that needs to rapidly increase.

    For this to happen though a second challenge has to be met – the need for a supportive policy and regulatory environment. Governments need to clearly signal SHS as part of the national energy plans. The playing field needs to be levelled by dealing with subsidies on kerosene – the principle competitor. Other boosts to the market such as import duty holidays or VAT tax breaks on renewable energy equipment have been shown to help. And the enforcement of quality assurance standards for products and consumer rights are also important to ensure markets are not spoilt by low performing equipment.

    It’s also questionable though whether commercially delivered solar home systems alone can truly deliver universal energy access (as opposed to universal access to electricity). They cannot deliver sufficient power for the most intensive household energy application – cooking. And it’s doubtful that they can deliver affordable mechanical power at a household level for productive use and livelihood creation.

    LPG has to be one possible solution for cooking. It’s not green, but it reduces indoor air pollution to safe levels and can make significant enough reductions in GHG emissions to qualify for carbon financing from the voluntary carbon trading market. Practical Action has some interesting experience of working with women’s groups, LPG suppliers and carbon brokers on stoves programmes in North Darfur in Sudan for example. Other more renewable options include biogas or ethanol as clean cooking fuels.

    Off grid energy for productive use – particularly mechanical power for applications such as milling, water pumping, machine workshops, etc remains a challenge. In terms of renewables, the technology required tends to be at the communal rather than household level (microhydro powered mini grids for example) or much larger solar installations and affordability issues then play a factor in making this level of energy access available universally through commercial channels. Public funding support rather than pure market based solutions has to then be a consideration in this case to support the establishment of rural livelihoods and economic development.

    But, in conjunction with clean cookstove programmes and public financing contributions for energy for productive use, the pay as you go solar home system can play a major role in achieving universal energy access, perhaps at a much faster rate that we initially envisioned.

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  • The SDGs – flawed yes, but still a powerful vision of a possible future

    September 23rd, 2015

    SDGsThis week heads of state, the Pope, the UN Secretary General and a range of dignitaries meet at the United Nations Sustainable Development Summit in New York. They are meeting to launch the new Sustainable Development Goals (SDGs) that set a vision for 2030 for human development and environmental sustainability. The SDGs range from commitments to end poverty in all its forms and reduce inequalities, through to more sustainable industrialisation and peace and justice. The 17 SDGs replace the 8 Millennium Development Goals (MDGs) that were agreed at the turn of the century as a vision for progress to 2015. The Guardian does a good summary of the SDGs as well as how they relate to the old MDGs.

    There are reasons to be cynical about what goal setting of this nature can achieve. Firstly there is the track record of progress against the MDGs themselves, which is patchy. You can see a good summary by the UN of achievements as of 2104  here. In short, some good progress was made across Asia, Latin America and North Africa, but most of the MDGs were not met in Sub Saharan Africa.

    More fundamentally there is the question raised by Duncan Green in his From Poverty to Power blog about how much goals of this nature actually influence behaviour of governments at a national level. As Duncan puts it do we really think that “Chinese decision makers leap out of bed every morning asking themselves ‘how can I achieve the MDGs’?”

    And finally you have to wonder whether some of the metrics used to measure progress against the goals really say anything meaningful (or indeed whether the data can always be trusted – a criticism of some reporting against the MDGs).

    Despite these reservations, I am a supporter of the SDGs for 3 reasons:

    Firstly, standing out against the miasma of bad news and dire predictions for the future that forms our daily media diet, they provide an alternative and positive vision of a possible future. A view that was built at least in part on a very large global conversation around “the future we want”.

    Secondly it’s a view around which action can be galvanised. Duncan may well be correct in saying national policy makers don’t jump out of bed thinking about the MDG’s, but that doesn’t mean they have had no influence. Access to clean water supplies was included as a specific outcome for MDG 7 for example and my sense over the past 15 years has been that that increased focus on what progress was being made, which in turn influenced allocations made for rural water supply infrastructure by donors and national governments. Progress on addressing access to water over the past 15 years has been relatively good, albeit there is still some way to go. In contrast, access to energy was not included in the MDGs and consequently much less scrutiny of progress was visible (until the recent UN sustainable energy for all initiative). As a result of the lack of interest in the sector there was a relative dearth of funding for the comparable decentralised community managed infrastructure needed to provide rural communities with electricity.

    Thirdly, however imperfect they are, the MDGs and now the SDGs can provide a handle for civil society to hold both national governments and the international community to account. They are a statement of intent that can be held up as a mirror to reflect back how actions have measured up to rhetoric. They are a tool for us to use should we choose to.

    There remain reasons aplenty to be cynical about the SDGs. But I still welcome them. In a cynical world they are a statement not just of hope but of intent. And as such they have the potential to reflect back to us all on the effectiveness of our efforts to find a just and sustainable future for everyone on the planet.

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  • 50 years working for Technology Justice

    August 30th, 2015

    On 29 August 1965, an article was published in The Observer entitled “How to help them help themselves” written by Fritz Schumacher the distinguished economist with support from his close friend Observer editor, David Astor. In it Schumacher pointed out the inadequacies of aid based on the transfer of large scale, capital-intensive technologies and argued for a shift towards “intermediate technologies”, based on the needs and skills possessed by poor people themselves. This article helped shape the future of development.

    It clearly caught the imagination of  readers judging by the following Sunday’s letters, leading Schumacher and his associates to create an ‘advisory centre’ to promote the use of efficient labour-intensive techniques in the developing world.  The Intermediate Technology Development Group, now known as Practical Action, was born.  donkey plough 1998

    Schumacher went on to write “Small is Beautiful – A Study of Economics as if People Mattered”. This was published in 1973 and, along with Rachel Carson’s book “Silent Spring”, helped to kick start the modern environmental movement. Schumacher was voted the second most influential environmentalist of all time in a Guardian readers’ poll in 2006 (with Carson at number one).

    From the outset the Group pioneered the idea of participative technology development, where people are engaged directly in the development of technical solutions to problems they face. Typical examples have included:

    • Working with small farmers in Darfur in Sudan to develop a plough that could be pulled by donkeys in the 1970’s – the only potential draught animal available locally – massively increasing the area of land that could be cultivated by farmers who had previously only used hand tools such as the hoe
    •  Building local capacity to manufacture turbines in Nepal in the 1980’s, which subsequently allowed over 2000 micro hydro-electricity projects to be built across the country, providing electricity for the first time to hundreds of thousands of people.
    •  More recently, introducing techniques that allow farmers who have lost their land due to river erosion in Bangladesh to continue to produce food using floating gardens in the monsoon and techniques to cultivate crops in the barren sands of dry river beds for the rest of the year.
    •  Providing an online enquiry service for people who want to harness technology for development that, last year, answered over 60,000 individual requests for advice and saw over 1.6 million downloads of technical information from its websites.

    Fritz Schumacher and David Astor believed strongly both in development aid and the role technology could play in lifting people out of poverty. But they wanted assistance delivered differently, in a way that helped people help themselves. They also saw the need for a different form of technology, human in scale, that allowed a form of economic development ‘as if people mattered’.  50 years on, Practical Action still practices the same philosophy of Technology Justice, arguing for access to the basic technologies essential for a minimum standard of life for the 2 billion people currently living in poverty and for a shift in the focus of technological innovation away from consumer wants to the two great challenges of our time – eliminating poverty and providing a sustainable future for life on this planet.

    Readers of the Observer and The Guardian have been supportive of the organization over the years, giving generously to Christmas appeals in 2006 and 2013. Thanks to them, Fritz Schumacher and David Astor, we can continue to show that technology holds the answer to many of the world’s problems and has the power to transform lives.

     

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  • Duck rice, water wheels and electricity from cow manure

    July 30th, 2015

    This is my third blog from Nepal, written at the airport in Kathmandu waiting for my flight back home. It’s always great to visit our programmes and catch up with our staff. Here in Nepal people are gradually picking up again after the earthquakes and life seems to be getting back to normal, at least for those who were not too badly affected by the events of April and May. Our staff all seem in good heart and very busy.

    I was pleased to be able to talk technology and innovation with colleagues while I was in Nepal, and see some examples of it on the ground during field visits. Here’s a taster; although I’m pretty both of the following two examples have been blogged on by others, I can’t resist!

    Ducks doing their stuff in a rice field

    Ducks doing their stuff in a rice field

    Duck rice (or rice duck, depending on your view point!). Practical Action believes in an agroecological approach to food production. That means finding ways of helping smallholder farmers boost production and maybe create surpluses for sale without having to resort to expensive and unsustainable inputs such as chemical fertilisers, pesticides and herbicides. This initiative is a great example of such an approach. The practice was originally seen by one of our staff during a visit to Japan, so he thought he would try it out here. Two ideas are involved. Firstly, planting rice in lines and a greater spacing than normal. Farmers in Nepal generally plant rice seedlings out in paddy fields in a random pattern and quite close together. Counterintuitively, spacing rice seedlings further apart increases the yield as the plants have more room to grow. Introducing small ducklings to paddy fields provides an added bonus, provided the lines are far enough apart to let the ducks swim around. The ducks graze on weeds and eat insects and pests while at the same time depositing their guano in the water, fulfilling the functions of fertiliser, weed and pest control without a dose of chemicals in sight! This is the third year we’ve been trying this out and 1000 farmers have now adopted the technique. Rice yields are up an average of 13% and incomes up 50% (because the ducks are ready to sell to market by the time the rice is harvested). Very simple but very effective.

    Bio gas being cleaned (green cylinder) and then fed to generator

    Bio gas being cleaned (green cylinder) and then fed to generator

    Bio gas from cows has been blogged on many times on this website. But at one dairy cooperative farm in Chitwan District we’ve gone further and, by using a simple device to remove the sulphur and moisture from the biogas, we’ve been able to use it to fuel a generator to produce electricity top run a milking machine and lights. The cooperative is also taking gas from the plant to heat a boiler which produces the steam used to pasteurise the milk, saving thousands of Rupees a month as a result of not having to buy of firewood.

     

     

    Water wheel irrigation pump under test

    Water wheel irrigation pump under test

    And third and finally, we’re testing out a new low lift water pump in the West of Nepal for irrigation. The pump is basically a modern waterwheel designed to be tethered in river and lift water from the river up to 20 metres into a storage pond, from which it can be sent by pipe to sprinklers or drip irrigation systems for high value vegetables and winter crops.

    Three inspiring uses of technology or technical knowledge in our Nepal programme!

     

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  • Update on the Nepal earthquake response

    July 27th, 2015

    This is my second blog during my current visit to Nepal. I came back to Kathmandu this afternoon after visits to projects in Chitwan district (down close to the Terai region of Nepal which abuts the plains of northern India) and to also see some of the earthquake response work we have been doing in Gorkha District in the middle hills. I will stick with the earthquake work for this blog and then return to the other projects for a later one.

    Damage to old royal palace in Kathmandu

    Damage to old royal palace in Kathmandu

    Walking and driving around Kathmandu this evening it’s difficult to spot the evidence of the impact of the April and May earthquakes. At first sight things seem pretty normal and, truth be told, apart from some cosmetic cracking of surface finishes, most modern concrete framed buildings seem to have survived and coped well with the earthquakes. Bhimsen Tower, a notable landmark next to the Central Post Office in Kathmandu is missing – but the rubble has already been cleared away, so all that you notice is literally, that it’s not there anymore! On the Tundikhel (or parade ground) there are only a few left of the hundreds of tents that people sought shelter in in the immediate aftermath of the first earthquake. You have to dive into the narrow lanes of Assan, the old part of town before things become a little more obvious. Many of the old houses and shops here have temporary props installed to hold up the front walls and in a couple of cases buildings appear to lean at alarming angles. But its only when you get to the main Durbar Square that you see some really significant destruction, with many temples damaged, including the Kasthamandap, one of the most famous, completely destroyed, and large scale damage to the old royal palace (see photo).

    In Gorkha it was a bit like that too. I managed to visit one village development committee area (similar to a ward or a parish in the UK in terms of size) where we have been working – Ashrang. At first it was difficult to get a sense of the scale of the impact. There were occasional piles of rubble where houses had been, but generally most structures seemed to be OK. And where the buildings were modern and concrete framed that generally was the case. But many of the traditional stone and mud mortar houses that looked ok at first sight were clearly not OK after a more detailed view. Some had serious cracks that left them unstable and vulnerable to collapse whilst others, on closer inspection had sound facades but when you went around the back you could see entire walls missing.

    In the immediate aftermath of the first earthquake Practical Action, with support from Christian Aid and the help of our local partner Goreto, was involved in distributing relief materials (tarpaulins for shelter, water purification tablets, blankets and food) across 17 village development committees (VDC’s) in Gorkha and Dhading Districts.

    The disaster response as a whole has now moved on to a second phase of providing temporary shelter that will help people survive the monsoon. Proper rebuilding will only start once the monsoon is over. We are coordinating our effort with the local government and other NGOs and have been allocated two VDCs in Gorkha and two in Dhading to work on. Again with Christian Aid and Goreto, we’ve trained over one hundred men and women across these areas to build simple temporary shelters that are earthquake proof and helped over 1700 households get access to building material such as corrugated iron sheet to help with this construction.

    The remains of Khadanada Dhakal's house

    The remains of Khadanada Dhakal’s house

    Khadanada Dhakal, aged 79, is one example. Khadanada lives on his own as his daughter is married and his two sons overseas studying. His house was completely destroyed by the earthquake but, using material recovered from the debris and new corrugated iron sheet, we’ve managed to put something together that will provide adequate shelter for the rest of the monsoon.

    Achyut Luitel (Regional Director Practical Action) talking to Khadanada Dhakal outside his temporary shelter

    Achyut Luitel (Regional Director Practical Action) talking to Khadanada Dhakal outside his temporary shelter

    We’ve also restored water supplies and put some solar charging stations where there is no electricity to help people charge mobiles and keep communications working. And we’re in the process of assessing the status of latrines across the 4 VDC’s with a view to repairs to ensure safe sanitation.

    At the moment we are drawing up plans for how we want to be involved post monsoon in the reconstruction phase. Most likely it will be through trying to help with the design of the new houses that will have to be built to ensure they are a bit more resilient to future earthquakes.

     

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  • Leaving Practical Action – reflections, from a Kathmandu hotel room, on the last 10 years

    July 24th, 2015

    October this year will mark the completion of 10 years for me as Chief Executive of Practical Action. It has been a huge honour, joy and privilege for me to occupy this position and to work with such a fantastic and dedicated group of staff across the world. I remain enormously enthusiastic about Practical Action’s mission, the idea of technology justice, and all of our work.

    It’s my belief however that organisations need to refresh themselves from time to time and that 10 years is long enough for an individual to be in a CEO position. I therefore confirmed some time ago to our Chair, Helena Molyneux, that I would not seek to renew my current 5 year contract when it expires this October. This is not a recent decision for me, as I made the then Chair Stephen Watson aware of my position when I signed my current contract back in 2010. Although Helena and the Trustees were kind enough to let me know I could continue in place if I wished, I have continued to believe that this is the right course of action and so did not change my mind.

    One advantage of flagging the intention so early on is that we have managed to chart a smooth transition to the installation of a new CEO. As you can see in elsewhere on this site, after a very thorough search and recruitment process Paul Smith Lomas, our current International Director, has been appointed as my successor and will take over the reins at the start of November. I think the Trustees have done a great job managing the recruitment process and have made a great choice in the candidate they eventually picked. Paul brings a huge amount of experience of the development world and is a strong strategic thinker as well as being hugely passionate for our cause. I know he will lead Practical Action well.

    I’m writing this blog in a hotel room in Nepal, having just stepped off the plane for what I think will be my last overseas visit for Practical Action. I’m here to check up on how our staff are doing after the earthquakes in April and May of this year. I will also be visiting some of the post-earthquake relief and rehabilitation work we have been involved with in the district of Gorkha, one of the worst hit. Coming in from the airport today I only saw one building that had been damaged by the earthquakes. Strangely it was completely flattened – just a pile of brick, concrete and twisted reinforcing bar, but surrounded by buildings apparently untouched. I know though that there was a lot of damage to some of the older buildings in the centre of the city that my ride today didn’t go near. My taxi driver was from Dhading District, one of the other areas most heavily affected and he told me that his house, and all the houses in his village, had been totally destroyed. Given the scale of the disaster I think it will be difficult to meet someone who has does not at least know a friend or relative has been affected in some way. I will update my blog during the coming week as my visit continues.

    Sitting in my Kathmandu hotel room and reflecting back over the past ten years with Practical Action I can only feel immense pride in what our staff have achieved in that time. We’ve grown – doubled in size in fact in terms of income – which has allowed us to open new programmes of work in India, Malawi, Rwanda, Bolivia and, most recently, francophone West African. As a result, our direct impact has also grown to the extent that we now touch the lives of more than a million people a year in some way.

    But we have also been able to expand our indirect impact very significantly over the same period. Our knowledge services have been perhaps one of the most dramatic examples of this expansion – 121,000 technical enquiries were answered by us and our partners in 2014/15, 50,000 more than the previous year alone. In the same year 1,600,000 downloads of technical information were made from our websites across the Group.

    And our policy influence has also increased dramatically. We’ve built a global reputation as a leading authority on helping poor people get access to basic electricity supplies and clean cook-stoves. We are on steering groups at the United Nations and the World Bank and advise national governments on energy policies. Our annual Poor People’s Energy Outlook report has become so influential in the sector that the UK DFID has just agreed to put £840,000 towards securing the next 4 issues. In disaster risk reduction our reputation is such that we are seen as the innovation partner in an international programme on building poor people’s resilience against flooding that includes organisations that dwarf us in size, such as the Zurich Insurance Group and the International Red Cross. And in field of urban sanitation we are now building a strong reputation on pit latrine waste disposal in countries such as Bangladesh, Kenya and India to the extent that, even as a new player in India we have been asked to advise not just the State Government in Orissa (where we have a programme of work on the ground) but the National government too.

    But what will always remain special for me, as far as Practical Action is concerned, is that through all that growth we have managed to hold on to a core philosophy, grown out of the ideas of Schumacher’s Small is Beautiful and now encapsulated in the concept of Technology Justice. It’s a vision of how the world could be different: more just, more equitable, more sustainable. A world where everyone has access to the technologies they need to enjoy a reasonable standard of living and where achieving this for the current generation does not impede future generations’ ability to do likewise. It’s a vision but not a pipe dream. And if I wished anything for my successor, apart from heaps of good luck and success, it would be that, whatever happens to the organisation, that vision of a technology just world remains at the centre of Practical Action’s work over the coming 10 years. There is a movement for technology justice to be forged and Practical Action has much to offer that movement in terms of leadership.

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  • Controversial report on financing energy access from the UNSE4ALL

    May 20th, 2015

    I’m writing this blog while sitting in the very impressive surrounds of the UN General Assembly Hall in New York on the 3rd day of this year’s UN Sustainable Energy for All (UNSE4ALL) annual forum. It’s great to see so many people gathered in one place to discuss the goals of universal access to energy, a doubling of the amount of renewable energy in the global energy mix and a doubling of the rate of improvement in energy efficiency. Although there is a long way to go, the UNSE4ALL initiative has genuinely accelerated interest in these issues in the last couple of years and has galvanised investment and developed really innovative ways of transparently tracking progress against these goals through what’s known as the Global Tracking Framework.

    energy enablesPractical Action has lent its full support to UNSE4ALL and continues to believe ensuring its success will be a critical contribution to both fighting poverty and achieving a sustainable future for everyone on the planet. But sitting here today, listening to a debate on how we find the necessary finance to achieve the goals, something worries me about the assumptions behind some of the calculations for funding needs for universal energy access. In 2011 the International Energy Agency (IEA) annual World Energy Outlook produced a detailed analysis of the funding needs to achieve universal access by 2030. Critical to that analysis were the assumptions about how far extensions to central electricity grids would be the answer to providing energy for those who do not have it at the moment and how much off grid solutions (such as solar powered lights, solar home systems, independent mini grids powered by renewable energy or diesel generators etc) would play a part. The IEA analysis concluded that total investment in energy access would need to range between around $30 billion a year over the period 2010 to 2015 to around $55 billion a year over the period 2026 to 2030. During that period the proportion of that investment that would need to be made in off grid technologies would need to rise from around 25% at the start to over 50% by the end. That is a really important conclusion as it says that we need a transformation of the energy sector with a huge emphasis on building capacity for an investment in off grid solutions such as solar power, micro hydro electricity, biogas etc. That is very different from where we are today, with the vast amount of investment just going into the grid.

    So why am I worried? Because, the UNSE4ALL’s Finance Committee has just published a report that contradicts this analysis (without providing any information on why different assumptions were used to the IEA). According to this new report off grid technology will only need to account for 15% of total annual investment (as opposed to the IES’s estimate of between 25% and 50%). Why does this matter? Because it takes the pressure off governments and the development banks to redirect finance to where it’s needed – to deliver off grid solutions for those who have no access to electricity now. It’s effectively a green light for business as usual – more money is needed yes, but just for the traditional energy sector. It’s a huge disappointment to see UNSE4ALL publishing a report that so dramatically contradicts the IEA’s earlier analysis without either recognising that contradiction or explaining the rationale behind it.

     

     

     

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  • Time for a bit of passion

    February 13th, 2015

    It’s St Valentine’s day tomorrow – 14th February. It’s a day for romance, when lovers express their love for St. Valentineeach other by presenting flowers, exchanging gifts, and sending Valentine cards. According to Wikipedia the day was first associated with romantic love 700 years ago in the High Middle Ages, “when the tradition of courtly love flourished”. In today’s highly commercialised world though it’s probably more about passion, expensive gifts and the consumption of large amounts of chocolate!

    I wanted to use St Valentine’s day to talk about passion. Not passion for a lover, but passion for our cause. Those who know me will know I am a very logical person and like to build up arguments based on evidence. And we like to think that Practical Action has an authoritative voice that speaks from real experience on the ground.  We are able to articulate rational arguments when we advocate for changes in the policies and practices of others. But on top of the evidence and the rationale arguments we will always need passion if we are going to be heard and if we want to change the world.

    Passion can take different forms. We can be passionate in our anger, but also passionate in our enthusiasm and joy. We need to harness both forms. We need to be angry, and we need the rest of the world to be angry, about the technology injustices that exist today:

    • 22104the fact that billions of people still don’t have access to the basic technologies they need for a reasonable standard of life,
    • the fact that the world still doesn’t put enough effort into technology innovation to solve the problems of poverty and environmental sustainability,
    • the fact that we still allow the use of technologies that damage the lives of others now or in the future (think fossil fuels and climate change for example).

    But we also need to be passionately enthusiastic about the possibilities of what can be done. About how our work on the ground today is changing people’s lives. About how our learning is being taken up by others through changes in policies and practices. About how Technology Justice is not just an impossible dream but something that is both achievable and would result in a better world for everyone.

    We need our logic and our rationale arguments. Practical Action’s great reputation is based on our ability to argue from a strong evidence base. We talk from experience about things we know.

    But we need passion too. Sometimes we just need to take a stand, to argue not just from the evidence but also from the passion that comes from a belief in what is right and what is wrong. We have a great cause – Technology Justice. And we have great people – staff, trustees, and supporters – who form an organisation we can be truly proud of. All the ingredients we need I think!

    So, whether or not you celebrate the occasion, let’s all use the excuse of Valentine’s day to inject a little bit of passion into our work. Especially if you, like me, are normally a bit more comfortable with logic and analysis!

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  • Energy Access – Why the current financing model will fail

    January 22nd, 2015

    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!).

    DSC00206 (1)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.

     

    [i] IEA 2011, Energy For All, Financing access for the poor, page 25

    [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

    [v] IRENA sourced from: LEVELLING THE PLAYING FIELD AND SAVING MONEY WITH

    RENEWABLE ENERGY

    [vi] World Bank (2013)  The Benefits of Solar Home Systems – An Analysis from Bangladesh Policy Research Working Paper 6724, page 10

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  • Competition finalists show way forward for renewable energy

    January 19th, 2015

    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.

    Zayeed2

    Receiving finalist certificate from Chair of judging committee and former President of the Republic of Iceland, HE Olafur Ragnar Grimsson

    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.

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