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«Achieving the Millennium Development Goals United Nations Development Programme Energy Sector Management Assistance Programme World Bank The UN ...»

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Energy Services for the

Millennium Development Goals

Achieving the Millennium Development Goals

United Nations

Development

Programme

Energy Sector Management

Assistance Programme

World Bank

The UN Millennium Project is an independent advisory body commissioned by the UN Secretary-General

to propose the best strategies for meeting the Millennium Development Goals (MDGs). The MDGs are

the world’s quantifed targets for dramatically reducing extreme poverty in its many dimensions by 2015 – income poverty, hunger, disease, exclusion, lack of infrastructure and shelter – while promoting gender equality, education, health, and environmental sustainability.

The UN Millennium Project is directed by Professor Jeffrey D. Sachs, Special Advisor to the Secretary- General on the Millennium Development Goals. The bulk of its analytical work is performed by 10 task forces, each composed of scholars, policymakers, civil society leaders, and private-sector representatives.

The UN Millennium Project reports directly to the UN Secretary-General and the United Nations Development Programme Administrator, in his capacity as Chair of the UN Development Group.

Energy Services for the Millennium Development Goals Vijay Modi Professor, Department Of Mechanical Engineering and Earth Institute, Columbia University Susan McDade Manager, Sustainable Energy Programme, Bureau for Development Policy, United Nations Development Programme Dominique Lallement Adviser, Energy and Water Department, the World Bank and ESMAP Program Manager Jamal Saghir Director of Energy and Water, the World Bank 2005 United Nations Development Programme Energy Sector Management Assistance Programme World Bank © 2005 The International Bank for Reconstruction and Development/The World Bank and the United Nations Development Programme The International Bank for Reconstruction and Development/The World Bank/ESMAP 1818 H Street, NW Washington, DC20433, USA Telephone: +202-473-1000 Internet: www.worldbank.org www.esmap.org United Nations Development Programme One United Nations Plaza New York, NY 10017 USA All rights reserved Manufactured in the United States of America The findings, interpretations, and conclusions expressed in this publication are entirely those of the author(s) and should not be attributed in any manner to the World Bank, or its affiliated organizations, or to members of its Board of Executive Directors or the countries they represent. The World Bank does not guarantee the accuracy of the data included in this publication and accepts no responsibility whatsoever for any consequence of their use. The boundaries, colors, denominations, or other information shown on any map in this publication do not imply on the part of the World Bank Group any judgment on the legal status of any territory or the endorsement or acceptance of such boundaries.

ESMAP Reports are published to communicate the results of ESMAP’s work to the development community with the least possible delay. Some sources cited in this paper may be informal documents that are not readily available.

The material in this publication is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of application law. Requests for permission to photocopy or reprint any part of this work should be sent either to the Director, Energy and Water, the World Bank, or to the ESMAP Manager or to the UNDP at the addresses shown in the copyright notice above. ESMAP and the UNDP encourage dissemination of their work and will normally give permission promptly and, when the reproduction is for noncommercial purposes, without asking a fee.

The views expressed in this publication do not necessarily represent those of the member countries of the United Nations, UNDP Executive Board or of those institutions of the United Nations system that are mentioned herein. The designations and terminology employed and the presentation of material do not imply any expression or opinion whatsoever on the part of the United Nations concerning the legal status of any country, territory, city or area, or of its authorities, or of its frontiers or boundaries.

The UN Millennium Project was commissioned by the UN Secretary-General and supported by the UN Development Group, which is chaired by the Administrator of the United Nations Development Programme. The report is an independent publication. This publication does not necessarily reflect the views of the United Nations, the United Nations Development Programme, or their Member States.

Correct citation: Modi, V., S. McDade, D. Lallement, and J. Saghir. 2006. Energy and the Millennium Development Goals. New York: Energy Sector Management Assistance Programme, United Nations Development Programme, UN Millennium Project, and World Bank.

Foreword The world has an unprecedented opportunity to improve the lives of billions of people by meeting the Millennium Development Goals (MDGs), the international community’s time-bound and quantified targets for addressing extreme poverty in its many forms. At the request of UN Secretary-General Kofi Annan, the UN Millennium Project has identified practical strategies to meet the MDGs, emphasizing the need for scaled-up investments in health, education, and infrastructure, alongside efforts to promote gender equality and environmental sustainability.





A common finding of the ten Task Forces of the UN Millennium Project has been the urgent need to improve access to energy services as essential inputs for meeting each MDG. Without increased investment in the energy sector, the MDGs will not be achieved in the poorest countries.

Under the leadership of Professor Vijay Modi of Columbia University, the Project has collaborated with ESMAP, UNDP, and the World Bank to prepare Energy Services for the Millennium Development Goals. The report underscores the strong links between energy services and achieving the MDG outcomes and puts forward a practical strategy for providing improved energy services to the world’s poor. As a major contribution to our understanding of how to achieve the MDGs, the authors propose quantitative and time-bound energy targets for low-income countries and derive goal-oriented strategies for meeting them.

This report has been prepared by a group of leading experts who contributed in their personal capacity and volunteered their time. I am grateful for their thorough and skilled efforts, and am certain that this report will make an important contribution to achievement of the Millennium Development Goals. In particular, I hope that developing countries will find the report helpful as they prepare their first MDG-based development strategies. I recommend it to anyone who is interested in how energy services contribute to the achievement of the Goals.

Jeffrey D. Sachs Director UN Millennium Project November 2005 Contents Foreword

Acknowledgements

Executive Summary

Key Recommendations

Structure of the Report

CHAPTER 1: Meeting the MDGs—The Energy Challenge

The Importance of Energy Services

Where are the Energy Poor?

Meeting the Energy Challenge

National Strategies to Achieve the MDGs

CHAPTER 2: Energy and the MDGs

Growth and Income Poverty Reduction (MDG Target 1)

Hunger (MDG Target 2)

Education (MDG Target 3)

Gender Equality (MDG Target 4)

Health (MDG Targets 5–8)

Environmental Sustainability (MDG Target 9)

Water Supply and Sanitation (MDG Target 10)

Summary

CHAPTER 3: MDG-Compatible Energy Services and Targets..................35 Types of Energy Access Needed

Setting Energy Targets for Meeting the MDGs

vi Contents CHAPTER 4: Strategies and Technology Options for Meeting the Energy Targets

Energy for Cooking

Electricity for Urban and Peri-Urban Areas

Modern Energy Services for Rural Communities

Energy Technology Options and the Environment

CHAPTER 5: Implementation Challenges

Challenges Facing Energy Institutions and Systems

Integrate Energy Planning and Implementation into a National Strategy

Be Flexible in Energy Planning

Design Effective Regulatory Framework

Reduce Costs through Financing Mechanisms and Subsidies................68 Enhance Human Capacity through Education, Training, and Research

Address Regional and International Issues

CHAPTER 6: Conclusion

Appendices

I. MDG and Energy Workshop (1 October 2004) Participants..............75

II. Computing Annual Per Capita Costs of Meeting Energy Goals:

The Example of Kenya

III. Providing Energy Services for the MDGs: Assessing Needs and Planning for Scaling Up

References

Acronyms.......... ………………………………………………………………99 Boxes

1. What are energy services?

2. The 10 key recommendations of the UN Millennium Project............14

3. The impact of energy on women’s lives in rural India

4. Factors that influence the cost and efficacy of energy services in urban and rural areas

5. Energy efficiency

6. LPG subsidies in Brazil: 1973–2003

7. Diesel-powered multifunctional platform (MFP) in Mali

8. Gains possible in a transition to electricity:

An example from Kenya

Contents vii

9. Electricity services in Urambo Village, Tanzania

II.1 The geographic disaggregation factor

Figures

1. World map of electricity use per capita by country

2. Number of people (actual and projected) without electricity, 1970–2030, by region

3. Percentage of households using traditional biomass fuel, by country

4. Commercial energy consumption and GDP, 2000

5. The share of energy sources to the energy consumption of 100 developing and transition countries, by poverty levels and energy type

6. Time spent (in hundreds of hours) and the transport burden (measured in tones per km), in Tanzania, per person per year, disaggregated by gender and tasks

7. Unlocking local capital by bringing the grid closer

8. Variation in total three-phase, medium-voltage line cost (labor and materials) for selected countries

Tables

1. Number of people relying on traditional biomass for cooking and heating in developing countries, 2000

2. GDP per capita, energy consumption, and poverty in selected countries, with emphasis on sub-Saharan Africa................ 19

3. Important linkages between energy services and the Millennium Development Goals

4. Urban and rural dimensions of energy use in selected sub-Saharan African countries

II.1 Estimated annual national and per capita costs of energy interventions in Kenya

II.2 Data and assumptions supporting intervention cost estimates in Kenya

III.1 Estimates of MDG-compatible modern-cooking-fuel consumption levels

III.2 Estimates of MDG-compatible electricity consumption levels............90 Acknowledgments The following have assisted in the preparation of this paper by making substantive contributions and comments as well as providing data. Douglas Barnes (ESMAP); Fatih Birol (Chief Economist, IEA); Gilberto Jannuzzi (Universidade Estadual de Campinas, Brazil and International Energy Initiative); Stephen Karekezi (AFREPREN); Jeffrey D. Sachs and Guido Schmidt-Traub (UN Millennium Project); Minoru Takada, Laurent Coche and Andrew Yager (UNDP).

The authors express their gratitude to Edwin Adkins (Earth Institute, Columbia University) and Alice Wiemers (UN Millennium Project) for their invaluable assistance in preparing this report.

The authors would like thank workshop attendees and participants: Kathleen Abdallah (UNDESA); Moncef Aissa (STEG, Tunisia); Harriette Amissah-Arthur (Kumasi Institute of Technology and Environment, Ghana);

Laurent Coche (UNDP); Amadou Diallo (Yéelen Kura, Mali); Yassine Fall (UNIFEM/UN Millennium Project); Cahit Gurkok and Pradeep Monga (UNIDO); Melessaw Shanko (Megan Power, Ethiopia); Griffin Thomson (US Department of State); and Robert Watson (the World Bank); who provided insight and guidance. The authors would also like to thank Kirk Smith (Universty of California, Berkeley); Don Melnik and Robin Sears (Center for Environmental Research and Conservation, Columbia University); Marc Levy and Deborah Balk (CIESIN, Columbia University); Macartan Humphreys (Columbia University); Klaus Lackner, David Nissen, and Jem Porcaro (Columbia University); Majid Ezzati (Harvard University); Sebastian Morris (IIMA); Pepukaye Bardouille and Antony Bugg-Levine (McKinsey); Robert Williams and Eric Larson (Princeton University); Marco Quinones (Sasakawa Foundation); Chandrika Bahadur (UN Millennium Project); and Albert Wright (UN Millennium Project, Task Force on Water and Sanitation); for x Energy Services for the Millennium Development Goals fruitful discussions. The findings, interpretations, and conclusions expressed herein are entirely those of the authors, and should not be attributed in any manner to the organizations they represent.

Executive Summary The Millennium Development Goals (MDGs) are the international community’s bold commitment to halving poverty in the world’s poorest countries by 2015.

While some of the world’s poor countries have seen tremendous success in poverty reduction over the past decades and are on track to achieve the MDGs, many others are lagging. This report specifically addresses the role of energy services in meeting the MDGs in the lagging countries. Energy services refer to the services that energy and energy appliances provide. Such services include lighting, heating for cooking and space heating, power for transport, water pumping, grinding, and numerous other services that fuels, electricity, and mechanical power make possible. The core message of the report is that energy services are essential to both social and economic development and that much wider and greater access to energy services is critical in achieving all of the MDGs.



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