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Inclusive and Equitable access to

energy

Suresh ShresthaMOICS

Government of Nepal

SAARC Workshop

Participation of Private Sector in Overcoming

Energy Poverty in SAARC Member States 29-30 Aug, 2019

Dambulla, Sri Lanka

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Energy Divide in the world between

Rich and Poor

Urban and Rural

Rich benefitting more

Urban benefitting more

SDG 7

access to affordable, reliable,

sustainable, and modern energy

for all

Unequal flow of energy

Poor

Women

Excluded groups

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74 per cent people are dependent predominantly on solid

biomass fuels for cooking applications (Nepal)

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Less access to electricity and reliance on traditional use of biomass for cooking

✓High cost associated with grid extension (sparse population density) ✓High up-front cost associated with renewable energy technologies ✓Limited capacity of households to pay ✓Energy service affordable, conversion technology may not✓ Limited effectiveness of the subsidy policies✓Consumer behavior

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Energy

Poverty is

GENDEREDWomen are responsible for fetching fuel

Significant time and effort in collecting fuels

No time for education and employment

Dependence on traditional fuel ( biomass )

Indoor air pollution

Detrimental impact on health

Women experience energy poverty

more severely than the men

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No access to electricity

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Women and girls in rural areas spend long time

collecting firewood for cooking

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❑Cleaner cooking fuel, Improved health (smoke)❑Operation of health facilities (health, reproductive health)❑Lighting, Girl’s schooling, reading time❑Street lights, security

❑Improved cooking, appliances, time saving, income generation❑ Lighting, extended working day, income generation❑Energy enterprises❑Access to information (Radio, TV)

Modern Energy for Gender Equality

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NO Energy

Less Earning

Less purchasing

power

Less affordability for Energy

Energy Poverty: Vicious Cycle

Women

Excluded Groups

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Limited participationStudy on Energy projects6 districts66 technicians 66 Men0 Women

Low ownership20% for improved cooking stoves,33% for biogas plants,15% for solar home systems,

and4% for improved water mills

Promote the participation of local

communities and institutions

in decision-making in the energy sector

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LOGO HREEnabling Policy Environment

Public Private Energy

Partnership

Private Investment

Equitable Energy AccessSustainable Energy for

All

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Electricity for all INSERT

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Human Effort

Fuel CollectionImpacts from smoke

Education

Health

Productivity

Public safety

Gender

Providing connection to

electricity (grid or off-grid)

bring benefits?

Access to quality, affordable,

reliable & safe energy can change

lives!!

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Adequate investment in energy

infrastructures and technologies

is a must for alleviating energy

poverty.

Lack of adequate investment in energy

infrastructures and services

Lack of InvestmentSDG 7

SE4All

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Large Hydropower

Decentralized RETS

Public Sector

Investment

•Nepal Government’s own source

•Grants

•Credits from multilateral

development banks

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Public Investment in decentralised RETs (NPR in million)

8.5%

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Public investment in grid hydropower sector (NPR In Million)

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Private Sector Investment in Energy Sector (NPR in million)

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Concentration in small and large scale hydropower

Largely led by domestic capital

Foreign investment is yet to be materialised at a significant scale

In the rural , largely concentrated in stand-alone, household level installations such as SHS, ICS and biogas

Private sector investment is largely dependent on access to finance

40 per cent of the total investment from private sectors in the RE sector as equity and credit from the banks

Private Sector Investment

Policy focused on

leveraging private sector investment

by providing subsidy, tax rebate

Monetary policy requires the FIs to mandatorily invest

in RE

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Investment requirement for achieving SE4ALL goals (NPR in million)

BAU A significant investment gap (of USD 10 billion) in

energy sector to achieve the SE4ALL goalsPractical Action Nepal

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Barriers to Private Sector Investment

Small scale of operation, high risks and not attractive investment for the financing institutions

Insufficient preparation of projects leading to uncertain development cost and high risks

Consumer non-repayment and difficulty in recovering the investment as a result of low volume of revenue

Complicated procedure for loan application, high interest rate and low valuation of land in the rural area as collateral

There are high perceived project risks such as: Low level of demand and productive end useLow ability to pay of users

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Replacing polluting diesel

pumps for fish farming

Ms. Bhundi Chaudhary, 47 year old Tharu women entrepreneur, fish farmer

Fill fish pond and irrigate 13 kathha farm using 5 HP Diesel pump

Rs, 8500 per month for operating the pump for 3-4 hours every alternative day

Installed 750 Wp solar pumping system that opertes 0.8 Hp DC pump

Total system cost Rs. 3,50,000 with three year service

Incentive of Rs. 1,44,000 was offered by Winrock Intenational for being first adopter

Upfront payment Rs. 60, 000 and Rs. 1,46,000 on installment for three years (Rent to

own business modality by SunFarmer Nepal

EMI of Rs. 4055 only.

Auto operating system- saved time utilized in farming.

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Lete, the village nested among the Mt. Dahulagiri

55 years old Ganga Kumari Sinjali has to suffer a lot due to unreliable electricity supply and

experiences limited and unpredictable supply and voltage fluctuation from the local grid.

Being compelled to darkness, her utmost stress was that her children too couldn’t complete

their homework on time.

Has to buy kerosene for lighting.

On April 2016, with access to credit/loan of NPR 40,000 under Cleanstart Project from

Nirdhan Utthan Bank; she was able to purchase the solar lighting system. Two 20 Wp solar

panels on her attic roof with a two-year loan tenure were connected

“My Son can complete his

homework at night.”

-Ganga Kumari Sinjali

Lighting Lap of Mt. Dhaulagiri

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When women have clean and affordable energy,

Their families are healthier, safer and more productive

Invest in women for clean energyEmpower WomenGive them new technologiesScale up women entrepreneurship