Pre-Conference Workshop on Clean Cooking Fuels31st IAEE International Conference

Istanbul, 16-17 June 2008

Clean Gas Delivery for Poverty Reduction

Andrew YagerUnited Nations

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Presentation Outline

Context for sustainable energy• Energy access• Millennium Development Goals

LP Gas Rural Energy Challenge• Barriers to access• Solutions (income, investment)

Alternative Gas Supply Options LP Gas Investment Facility Concluding remarks

33

Context

Sustainable energy supply is a pre-condition for economic and social development and achievement of the Millennium Development Goals (MDGs)

Investment capital required for business development (both public and private)

Capacity building for local energy service delivery (policy makers, entrepreneurs, lenders, consumers)

44

Rural Energy: Traditional Fuels

55

Access to Sustainable Energy Services

Support energy activities that reduce poverty

Promote rural energy services to support growth and equity

Promote clean energy technologies Increase access to investment

financing

66

Sustainable Energy Link to the MDGs

No specific MDG on energy However, energy is key for meeting

basic human needs• Domestic uses (heating, cooking)• Productive purposes (brick and ceramics

firing, metal working, fish smoking)• Reducing drudgery (water pumping,

grinding, milling)• Social services (health care, education)

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Fuels for Cooking

Respiratory disease from cooking on

traditional fuels kills nearly 5,000 people

daily world-wide

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Energy Poverty: Annual Deaths

Source: World Energy Outlook 2006 (OECD/IEA)

2.8

1.6

1.2 1.3

0

1

2

3

Malaria Smoke frombiomass

Tuberculosis HIV/AIDS

milli

ons

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There is a need to provide clean modern affordable energy services to reduce poverty.

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LP Gas Rural Energy Challenge Public private partnership

UN Department of Economic and Social Affairs (DESA) United Nations Development Programme (UNDP) World Liquefied Petroleum Gas Association (WLPGA)

Designed to create viable and sustainable markets for LP Gas delivery and consumption

Directly targets rural and peri-urban areas with the objective of expanding access to cleaner LP Gas

thereby contributing to sustainable energy solutions that can improve people’s lives in developing countries and achieve the MDGs

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Barriers to LP Gas Market Development

Lack of confidence for private sector investment (business development, policy advocacy)

Affordability (need cash) Availability (need roads and other

infrastructure such as electricity) Lack of consumer awareness (e.g.

fear of accidents)

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Achievements

Public private partnership established

Access to governments enables dialogue (national consultations)

Technical, socio-economic, environmental and energy access issues addressed successfully

1313

Kenya case study

Policy framework that encourages and supports investment in energy services (stability, confidence, risk)

Subsidies (government provides seed capital and guarantees for micro-finance institutions)

Tax holiday (20% VAT removed) Standards for equipment

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Turkey case study Upper middle income country Medium level HDI (MDG health and education are

least achieved) Need income generating activities to sustain

village life• Tree planting• Wood processing• Handicrafts• Agriculture, animal husbandry and products• Energy efficiency in buildings

Need long-term rural development strategy to modernize rural energy supply

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Alternative Gas Supply Options in Africa

Exploitable gaseous resources available in Africa: Small oil and gas deposits (e.g. Mozambique,

Namibia, South Africa, Rwanda, Ethiopia, Somalia, Cameroon, Congo (Brazzaville), Cote d’Ivoire, Ghana, Senegal, among others)

Dissolved methane gas in Lake Kivu (DRC, Rwanda); Lakes Nyos and Monoun (Cameroon).

Biogenic gases formed in swamps and marshes (Botswana, Niger, DRC)

Landfill gas (various countries) Gas Flaring reduction at oil and gas production

facilities (Nigeria, Angola, others) Biogas from animal, agricultural and human waste

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LP Gas Investment Facility The Facility is intended to provide pre-investment

capital:• To give entrepreneurs an opportunity to develop their

service offering • Aimed at reducing the risks associated with the

establishment of energy service delivery businesses. The donor community recognizes that working in

poor and low population density areas makes it more difficult for private entrepreneurs to sustain a profitable operation.• Therefore the United Nations partners will engage in

activities that remove barriers and enhance investor confidence by reducing risk.

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LP Gas Investment Facility (inputs)

Provide seed capital for activities that enable clean gas supply and distribution networks to develop. Specifically:• Support business plan preparation• Support local capacity development to

provide energy services• Support capacity building aimed at

sustainable market development

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LP Gas Investment Facility

The projects supported by the Facility will integrate:

1) the private sector’s contribution in service delivery and investment financing with

2) governments facilitating the enabling environment for creating new relationships and policy dialogue and

3) local NGOs providing the critical support function at the project implementation level.

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LP Gas Investment Facility

As the partnership succeeds• communities and individuals benefit

through increased access to clean fuel and energy services

• governments are able to fulfill social and economic development objectives, and

• private enterprises expand business opportunities,

resulting in a triple-win situation that is the aim of the facility.

2020

Concluding remarks

Clean affordable energy supply is needed to achieve the MDGs

There are many indigenous sources of energy

Local capacity exists to deliver energy services

Both public and private sector resources are required to develop the alternatives

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Thank you!

Andrew Yageryager@un.org

Division for Sustainable Developmenthttp://www.un.org/esa/sustdev/index.html