Policy Dialogue Conference
The Role of Renewable Energy for Poverty Alleviation and
Sustainable Development in
A contribution to the dialogue
between EU and
European Union Energy
Initiative - EUEI
22 – 24 June 2005
Dar
es Salaam, Tanzania
Moevenpick Royal Palm Hotel
JW Meeting Notes
Objective
The main objective of the conference is to:
·
Raise awareness among high level decision makers on
the potential of renewable energy in poverty alleviation and in improving
access to energy services.
·
Provide inspiration and background information for
policymakers, investors and service providers.
Preliminary
Conference Programme
DAY 1 (WEDNESDAY 22nd
JUNE 2005)
08:00 – 09:00 Conference
Registration
Opening Session
09:00 – 09:15 Welcome
Address
Representative
of the Tanzanian Government
09:15 – 09:30 Welcome
Address by the Tanzanian Host Organisation
Estomih N.
Sawe, Executive Director TaTEDO
09:30 – 09:45 The
EC Project ‘Partners for
Dr.
Rainer Janssen, ‘Partners for Africa’ Project Co-ordinator, WIP,
Dirk Pottier, European Commission, DG RTD - INCO
09:45 –
10:00 Introductory Presentation
on the EU Energy Initiative on Poverty Eradication and Sustainable Development
(EUEI)
Representative
of the EUEI (
Session 1:
Presentation
of on-going energy policy initiatives and strategies with a focus on access to
energy and the role of renewable energy
Chairs: Estomih N. Sawe, TaTEDO and Dr. Rainer Janssen, WIP
10:00 –
10:30
Electricity consumption per capita = 84kWh/yr
Woody biomass consumption per capita = c. 1m3 or about
183 kgOe
Overall energy consumption per capita = 700 kgOe/yr
Resources:
Biomass – 33.5 Mha of forest with 23.8 Mha production
and 9,7 Mha protection / catchment forest
annual sustainable yield = 24.5 Mm3 (stacked vol e.g.
fresh weight).
15 Mt of crop residues
1.1 Mt forest residues
Animal waste: 17.5 M cattle, 12,5 M goats and 3.5 M
sheep (1998 census)
Average wind speed is 3m/s but there are areas with
annual average of >5m/s
Average solar insolation is 218 kWm2
Transport consumes 40% of the petroleum based energy
Poverty:
>50% of population lives below the poverty line
with 35.7% are unable to access all the basic needs.
Firewood accounts for about 40% of cooking energy in
peri-urban areas.
Charcoal is the most common fuel in urban areas.
90% of energy consumption is supplied by biomass.
See table comparing rich vs poor consumption of
energy.
-
poor use
about 35% of their income on energy (Kerosene and charcoal dominate)
-
the non-poor
use about 15% of income on energy.
‘We consider modern energy is having electricity’
Only the tourist regions are able to provide over 10%
of households with grid electricity. The
Pwani region which surrounds Dar is only 6% covered whilst Dar is about 55%.
Specific objectives of national energy policy:
-
to exploit
the hydro
-
to develop
utilise natural gas and coal resources
-
to step up
petroleum exploration activities.
-
to reduce
deforestation through the efficient use of biomass
-
to develop
other renewables
The parliament has approved the establishment of the
Renewable Energy Agency:
Key functions:
-
project
identification and planning
-
project
facilitation
-
technical
assistance to project developers
-
…
Rural Energy Fund
-
funding
will come from government subventions
-
donor
funds
-
levies
from the generation or sales of energy products including electricity and
petroleum goods
-
contributions
from other sources, and;
-
interest
on REF account.
Options to alleviation energy poverty based on energy
policy:
-
rural
electrification
-
energy
efficiency
-
promotion
of appropriate (environmentally sound) energy technologies (e.g. clean gas and
coal)
-
agro
forestry with multipurpose tree growing (especially biofuel trees).
Provided more detail on how to go about this;
in new policy it is clearly stated that any project
must be subject to an Environmental Impact Assessment.
The strategy is not fully developed and needs further
interaction with stakeholders.
Guliano Grassi – should consider how to establish an
industry association to help with implementation.
Peter Helm- how to generate funds- ans: 5 or 6 years
ago had generated a fund for ESCROWs based on a levy which was not used. TanRoads already charges 50shillings on each
litre of fuel sold c.f. a total cost for fuel of about Sh1000 per litre. This mechanism is now well established and so
generating funds through sur-charges is unlikely to run into trouble.
In electrification will have a mechanism to generate
the funds to pay for the costs of connection.
10:30 – 11:00 Coffee
Break
11:00 –
11:30
Brett Dawson
(Director Renewable Energy) Department of Minerals and
Opened Energy Dev Corp in CEF (2004)
Opened Designated National Authority 2005 (in DME)
….
Will work with the South African Bureau of Standards
(SABS) e.g. new standard on biodiesel and solar water heaters. Have bought a test rig from
White Paper on Renewable Energy Policy (2003) has set
a target of 10TWh by 2013 to be produced mainly from biomass, wind, solar and
small-scale hydro plus others.
-
this is
the equivalent of 4% of the estimated electricity demand of 41 539 MW in 2013.
-
1.4 Bl of
diesel (14% of 1 years consumption) replaced with biodiesel.
-
additional
to the existing 9% of biomass consumption
Subsidy Office-
The funding is based on the once off capital
subsidies. This mechanism was chosen
because did not want to encumber the treasury with long term financial drains.
Will have an open tender for a once-off capital subsidy. This approach also allows Government to
determine for each budgetary cycle the extent to which it is willing to support
renewable energy in forthcoming years.
R14.2M has been made available for 3 years.
Balance of funding through the carbon funding e.g.
PCF, CDM…
Supporting legislation:
- amendment
to the Petroleum Products Amendment Act 58 of 2003
- Fuel
levy : 30% tax reduction for liquid biofuels (now for biodiesel but should
be for any other type of RTF)
- Electricity
Regulation Bill (2005)
- Energy
Bill (2005)
The Petroleum Products Amendment:
-
it will be
a condition of a manufacturing licence or a wholesale licence, as the case may
be, that the licence…. standards important
World Bank Funding
WB is positioning itself as a ‘knowledge bank’ and not
a lending institution.
Are taking an exponential growth approach to
renewables.
-
see table
put up showing the predicted progress of renewable energy over the next 5 years
for each sector in terms of projects approved.
IEA
-
SA is a
member and needs to
o
Regulatory
/ policy requirement
o
Gobal /
target
o
Incentive
level / schedule (capital grants and 30% duty reduction on transport fuels)
-
…
IEA projections – ethanol currently provides about
2.8% of global petroleum consumption- check units.
Obligations:
RSA are not looking at ‘obligations’ because are
worried about additionality e.g. access to CDM.
- will review this in 2008.
- see graph of renewable electricity production costs
– cost supply curve for Landfill gas, biomass e.g. bagasse, hydro, solar
thermal.
Are looking closely at biodiesel and bio-ethanol.
Are aiming at producing a ‘Biofuels Accord’. Have set fuel standards. Plant oils tested to standard.
Pricing model is being developed
Biodiesel is not a complex technology.
Are also interested in bioethanol gel as a substitute
for cooking and lighting. Are carrying
out tests to look at the efficiencies of stoves to ensure that ethanol stoves
make up for reduced energy content with higher efficiency.
-
58 Ml of
bio-ethanol – 0.5% of gasoline or 7% of paraffin market
-
-surplus
sugar (exports) would provide 6% of gasoline and 81% of domestic paraffin (IP)
market.
-
Is a large
lobby group looking at using maize for the production of ethanol but is being
considered as a short term.
Biomass and coal
DME has not looked biomass with coal in conventional
power generation
SA is not well endowed with biomass
would support if sustainable
Most attractive options are bagasse cogen and waste
residues from the paper and pulp industry.
SASOL did a test to gassify some biomass in one of
their gasifiers. Although it worked in
that it didn’t cause an major problems.
11:30 –
12:00 The Current Review Process
of
Michael
Mulasikwanda (Oscar Kalumiana), Ministry of Energy and Water Development,
Energy policy was established formally in 1994. Now it is under review in order to:
-
engage
with private sector
-
engage
with stakeholders
Are now working on the Implementation Strategy.
Draft policy will now be submitted to the Ministry of
Justice and then await cabinet approval.
In the new policy the concept of promoting biofuels
has been included.
Both biodiesel and bioethanol are included,
particularly for the removal of lead.
LPG and gelfuel have also now been included.
Also includes cross-cutting issues, including,
poverty, gender, HIV/AIDs, …
‘World oil price is alarming and could jeopardise the
whole economy.’
12:00 –
12:30 Policy and
Strategy of the Senegalese Government for the Energy Sector
Mr. Cheikh
Wade, Ministry of Energy and Mines,
More than 70% of the population ‘deal with agriculture’
Total energy consumption – 1.416 MTOE
56% biomass, 38% petroleum- have 3MWe installed PV (10
000 solar home systems which is run by private sector and is run on a
fee-for-service basis; and 11 100kWpe power stations- these projects are just
starting. Are currently training
technicians after commissioning a private operator). For 2 years this system is running well and
so the fee is assumed to be sufficient to cover the running costs.
Beginning to manufacture adequate RE equipment e.g. PV
mills.
The water sector is also being privatised and will
only be provided on a fee-for-service basis using local (from the village)
private operators.
In rural areas 80% of energy is supplied from Kerosene
(must be excluding biomass).
Women are the main users of household energy with most
women carrying 20kg wood 5km per day.
Renewable Energy Resources:
solar radiation – 5.8 kWh per day/m2
Also has a large wind potential with the coastline
(300km) offering…
Also, large potential for hydro power.
Are currently drawing up their national poverty
reduction strategy paper (PRSP)
Have established a Rural Electrification Agency.
-
Market
arrangement towards public private initiatives
-
The
concept of PREMS (Projects energetiques Multisecoriel- multi-sector energy
projects) and the launch of CIMEs (committee intersectoriel pour la synergie
entre l’energie et les autres Secterurs Strategiques).
National Strategy for the Development of Renewable
Energy for Poverty Alleviation.
Strong emphasis on MDGs.
Have carried out a survey of rural households and
their ability and willingness to pay for electricity. Are planning to use this information to set
tariffs for each ‘concession’.
-
also want
to find a solution to help rural inhabitants to get into the monthly payment
mentality.
-
how to
develop a mechanism to bridge the gap between the cost of electricity and the
ability to pay.
Are now around 12% installed capacity in rural areas.
GTZ representative asked question about the
cost-benefit analysis e.g. ‘how is
Have good experience in the use of biomass for
improving cooking and now have a Gelfuel project in the NE based around a sugar
mill. This mill has agreed to produce
ethanol for gelfuel.
12:30 – 14:00 Lunch
Break
14:00 –
14:30 Development of Sustainable
Rural Energy Strategies at District Level in
Estomih N. Sawe,
TaTEDO, Tanzania
- ‘biomass resources in rural areas are being depleted fast’
Mainly a re-hash of the presentation by Ngosi Mwihava given above.
Despite international growth in political commitment there is very little
happening on the ground. There is a need
for action at the local level.
14:30 –
15:00 The Global Network on
Energy for Sustainable Development (GNESD) - Energy, Development and
Environment issues in
Stanford
Mwakasonda, Energy Research Centre (ERC),
Type II initiative from WSSD. GNESD is facilitated by the UNEP Resource
Centre at Risoe.
Have two objectives:
- to
promote energy for poverty alleviations
- to
promote energy for sustainable development
Energy for poverty alleviation:
Market-oriented reforms have had neutral or adverse
impacts on the poor.
Power sector reforms need an explicitly pro-poor
dimension otherwise electrification of the poor is forgotten.
There is a lack of good data.
-
need to
protect (ring-fence) financing for electrification of the poor
-
sequencing
of reforms: preferably electrify the poor first, then privatise (or in
parallel)
-
If
possible make sure that the poor are represented in key decision making bodies.
RETS for poverty alleviation
-
renewable
energy is not high on the development agenda for developing countries:
-
lack of
coherent policies
-
low
stimulus for market establishment due to unattractive and unreliable conditions
for private investors.
-
RETs focus
on residential rather than on productive uses – low impact on family income.
-
lack of
knowledge by potential users.
-
there has
generally been a fragmented approach with R&D characteristics carried out
in isolation from other development challenges e.g. health, poverty, education
and regional development.
-
The role of energy in achieving the MDGs.
See matrix he put up with each of the MDGs with the
relevant energy needs for meeting them.
15:00 –
15:30 REEEP Southern African
Secretariat
Mr Sibusiso
Mimi, Renewable Energy and Energy Efficiency Partnership, AGAMA.
Partnership has two policy networks:
- SERN
promote integration of energy efficiency, combined heat and power and
renewable sources into the energy supply systems.
- REIL
ensure that new and existing international treaties take into account in
international law…
Key policies: Policy and regulations (see two points
above), plus two others…
15:00 –
15:30 Alleviating Poverty
through the Provision of Local Energy Sources
Dean Cooper,
Parallax – Sustainable Development solutions,
See
pdf of presentation: but also A4 handout.
- is this
the COOPENER project with Phil Mann? Includes
Started 1st June 2005 and will last 32
months
Funders- EU, DME, DST-
Focus on urban and peri-urban households
2 renewable energy centres.
Should be replicable in other southern African
countries.
General process includes a ‘needs assessment’ by
asking the stakeholders.
Have also developed an ‘exit strategy’ for
continuation after the end of the project.
Some areas worked on include LPG/ kerosene safety
GVEP –
-
6 business
plans under GVEP 1 with GVEP 2 to be developed.
What is the potential of renewable energy for poverty
alleviation?
For anything to be sustainable, then it has to be
commercially viable.
Local economic development.
RE not in isolation.
Financing- how to finance is the key question. E.g.
link to the environment (CDM). Public /
Private sector partnerships (need investment on both sides). Possibly learn from
Cost effective distribution (transport can be a killer
quite literally). Integrated Energy
Centres (IECs) is a method for decentralising the provision of energy services.
Share African experience (forum?)
Have seconded one of their directors to SA gov to work
for GVEP. E&Co to help assess and
provide business support. PACE
(promoting access to carbon equity) how to bundle CDM projects.
Switch on energy services is based in KZN and provides
a community service.
15:30 – 16:00 Coffee
Break
Session 2: Best Practice actions (Part 1)
Chairs: to be invited
16:00 –
16:30 Cooking Energy in
Godfrey A. Sanga, TaTEDO, Tanzania
Typical consumption varies per capita from 11.5 to 49MJ/day for cooking energy.
Energy transition results in the consumption of modern fuels increasing and
a decrease in consumption of cooking energy per capita. Resulting the ‘Energy
Ladder’
Also change in fuel choice.
Dar project- (projector failed and so had to use the paper presented).
See section 2.0 of the paper (hardcopy A4)
Charcoal dominates the supply of fuel in Dar.
Also interesting iformation about cooking energy requirements in India
16:30 –
17:00 Employment Generation and
Poverty Alleviation through Wind Powered Water Pumping – A Private Sector
Experience from
Mike Harries,
Bobs Harries Engineering Ltd.,
Family company is Kijito
3 or 4th generation Kenyan farming family.
Have developed a wind powered water pump over the last
30 years and was based on the Fraenkle machine (from
Have now sold about 350 turbines, mostly in
They make and build all the machines in their factory
in
With wind systems need very specific and careful
planning but well implemented systems can pump from over 100m down.
the
Are developing wind speed maps. With low wind speed
being 3m/s, medium 4m/s and high 5m/s.
Best wind regime is in Marsabit desert in
Have developed the wind pump to supply 50 to 80% of
water needs.
Machines are designed so that a maximum of 10% fail
over 25 years.
Make six different machines – costing (installed) –
between KS0.5M to KS1.5M (KS80:US$). US$6k to US$18k.
17:00 –
17:30 Solar PV Rural
Electrification Lessons from
Maxwell
Mapako, Energy Research
See
pdf of presentation: - gave a comparison of the 4 PV projects BUN was involved
with in
17:30 –
18:00 Renewable Energy for
Sustainable Development in
Dr. Salimata Wade, ENDA, Senegal
See pdf of presentation:
This project is based on an agro-forestry approach linking food with energy
(for cooking) and carb on sequestration.
Project is based in a prei-urban area.
Possibly large rural area too along coastal zones.
It uses fast growing hedge rows to protect the field’s soils from
wind-prone erosion and to encourage water penetration and reduce
evapo-transpiration. The fields are
irrigated using drip irrigation sytems using the underground water reserves
present in this region.
Senegal is experiencing a continued drying of its climate. The first big drought hit the counry in 1972
and since then rainfall has been declining.
(data shown from 1940 to present).
Now wood is coming from 600km to Dakar whereas 50 years ago it would come from
50km away.
Farmers now achieve average yields of 20t/ha and sometimes up to 50t/ha
with for example tomatoes.
Senegal Agricole is a huge progamme designed by ENDA-Syspro which designed
this project. This concept is now
accepted by the government and will lead to the sequestration of some 4.5
million tronns of carbon over a five year period or 16.5 Mt CO2eq. This figure represents 5 times the annual GHG
emissions from Senegal.
18:00 –
18:30 Small Capacity Bioenergy
Complexes for Decentralised Energy Production in African Countries
Dr. Giuliano
Grassi, European Biomass Industry Association (EUBIA)
See
pdf of presentation:Gave a pre-talk on the inputs on bioenergy to G8.
-
the input
highlights the importance of bioenergy in development.
-
need for
standards for international trading
-
bioenergy
meets all the requirements for meeting the challenges of climate change and
African development.
The Russian Fed has requested that the 2006 Intl
Biomass Energy Conference will be held in
Pelletisation is the critical technology.
Micro-distilleries can be manufactured at the scale of
1 million to 10 million litres per year.
18:30 –
19:00 Small Hydro and
Development – The Experience of ITDG
Teodoro
Sanchez, Intermediate Technology Development Group (ITDG),
See
pdf of presentation: and A4 hardcopy.
DAY 2 (THURSDAY 23rd
JUNE 2005)
Session 2: Best Practice actions (Part 2)
Chairs: to be invited
08:00 – 08:30 Sustainable Charcoal Production and Marketing in
Stephen N.
Mutimba (smutimba@esda.co.ke
www.esda.co.ke), Energy for Sustainable Development (ESD) AFRICA, Ltd.,
I Arrived late
Environmental Recommendations:
State land needs to be allocated for sustainable
charcoal production. Landowners are
supportive of this model.
Buffer zones: for sustainable charcoal nee to
introduce between protected forests and game reserves
Need to use more efficient charcoal kilns. At the moment they are at most 10% efficient.
Coffee producers are making charcoal and currently get
more money from charcoal.
Fast growing trees are also being used.
Are working on standards and guidelines to establish a
charcoal producers levy. ‘Charcoal
producers are tired of corruption and so are ready to pay for the (proposed)
levy’.
As long as charcoal is being produced poorly, even
with demand side management , the environment will still be damaged.
Questions:
GG- why not use agricultural residues for charcoal
production (as is happening in
200 000 people are involved in charcoal production in
TZ [probably a similar number of people involved in the production of efficient
stoves]
Ans:
People prefer charcoal and because it is a private
sector (small scale) activity, residues are unlikely to be used. [not sure if
he understood Guiliano’s point which was that can make charcoal briquettes from
residues].
There is a presidential decree banning the production
of charcoal [but not the sale], so if city councils provide permits to sell the
charcoal then all they need to do is get the charcoal to the market and this is
where the corruption comes in.
The number of people using charcoal is increasing and
so can’t just abandon using charcoal.
The minister of the environment is supporting a
gradual switch from charcoal.
08:30 – 09:00 The Kakira Sugar Works Bagasse Cogeneration Project in
Mr. Farhan
Nakhooda, (mgrpfyn@imul.com) Kakira
Sugar Works (1985) Ltd., The Madhvani Group,
See
pdf of presentation:See ppt presentation and A4 hardcopy.
This would
make an excellent ‘policy case study’ for CARENSA.
Grow cane on 7500ha and another 3500 small holder
farmers adding a further ??ha.
Produce power for irrigation and have steam prime
movers for the mill tandems.
Generate about 600t of non-used bagasse (dry) per
day. At the moment it is burnt in the
field.
Presently use 20 bar boilers with some originating in
the 1960s.
Presently generate about 4MWe.
Because of Amin the owners were forced to leave
Still by 0.7MWe per day for infrastructure.
Now want to:
Expand cane area under small-holder production to
10kha. Total small-holders will be 6000.
Mill capacity to 5000tpd?
Have now chosen a 60Bar boiler and a 20MW turbo-alternator
with 7MW for 24h/d.
Government would not agree to 7MW for 24 hours per day
but only for the 6 hours of peak demand.
But this meant that the plant would only be used at
25% capacity.
Revised plan:
back to 20BAR boiler mainly in order to incinerate the
bagasse. This at least reduced the
emissions from the open field burning.
This was credited under the GEF funding.
Need 5MW internal and 3MW for irrigation.
Gov would not accept the need to buy and sell power
from the grid and therefore had the usual problems in that they would sell at
base rate but would have to buy back at commercial rates.
Took 17 months from Sept 1992 to sign the power purchase
agreement.
Utility did not understand the issues of a private
power producer.
Government came back and said that they in fact needed
more power.
Now have a 45Bar boiler and have bought a 3MW. Have now agreed to sell 10MW instead of 6MW
but could go up to 16MW.
The new power house cost them US$1M which has the 3MW
turbine and a new 16MW turbine. Will now
be on-stream in 2006 but if had accepted the original proposal then would have
been on-stream in 2001.
Also have 2.5MWe stand-by diesel generator.
Have a 10year power purchase agreement with a further
5 year option.
Government wants to buy electricity at 4.5?cents per
kWh but he knows he can ‘sell’ the electricity to his other industries at less
than he would have to buy it from the utility.
09:00 –
09:30 Social Development through
Outgrowers, Schools and Hospitals - The Private Sector Kilombero Business
Linkage Program
Denis
Tomlinson, Illovo Sugar Ltd., South Africa
Outgrower yields are in the region of 30 to 40 t/ha on
the estate are looking at 60 to 80 t/ha.
Cane payments system linked to loan repayments e.g.
the mill pays the grower via the bank, so the bank can intercept the payments
against the loan.
Improved land tenure system- not fully implemented at
the moment. The mill used GPS system
coupled to aerial surveys to map the individual concessions precisely.
Illovo had to borrow the money required to help
re-habilitate the farms on the international markets and so took the risk of
currency fluctuations etc until the local banks were able to take over and
change the loans to a shilling basis.
Outgrowers are targeted to increase cane production
from 125k to 800kt/yr.
IFC funding was central to the success of the
Kilombero Business Linkage Ltd. programme.
4200 ha up to 5400ha now with c. 3500 outgrowers.
Kilombero Sugar Company had an additional 800ha of
land which they were willing to provide at ‘peppercorn’ rate to be provided
into a Trust Farm. In 2004 about $50k
surplus put back into the community which is mainly being used to develop the
infrastructure. This fund is projected
to increase to $200k in 2005.
In 1998 /99 outgrowers were delivering 72kt
2005/6 they will deliver 612150t. Need to check that
this is outgrower produced and doesn’t include the estate cane.
In 2003, this outgrower programme was providing about
$10M and it is now about $15M.
The Secondary School that was put in by Illovo is now
going to be privatised to be run by the community.
In the near future will develop the cogen potential of
the mill.
Questions:
09:30 –
10:00 Poverty Reduction
Potential of Energy Crop Production (Sweet Sorghum, Jatropha) for Liquid
Biofuels
Prof.
Main drivers:
Jobs
EU Sugar
reform
Need to
stop using lead in petrol in southern
See presentation:
Recommendations:
Sweet Sorghum
- selection
and development of adapted cultivars especially for Region III
- Need
to use irrigation
- ?
- Use
of recommended fertilisers and pesticides
- evaluating
appropriate population density- thicker stems could be problematic for
small scale growers
- production
of at least two seasons per year.
This would raise annual yields to 40t/ha.yr
10:00 – 10:30 Coffee
Break
Session 3:
Financing the provision of sustainable energy
services from renewable energy
Chairs: Prof. Yamba and Stephen
10:30 –
11:00 SIDA Cooperation on Rural Energy with
Kjell Larsson, Swedish International
Development Cooperation Agency (SIDA),
2nd presentation- hydro case study:
A new
company has been contracted to carry out the payment collection process (Network
Solutions?)
SIDA will continue to provide
support for Tanzania Energy Centre (see presentation on 1st day am).
SIDA are not providing direct subsidies to PV but provide
‘facilitation’- need ESCO for Solar PV as in
PPP for hydro power development in TZ- small scale initiative with
private farmer and small developer.
-
PV Market
development
-
business
development support to PV companies
-
Solar
network.
-
…
Songea Rural electrification project, southern TZ.
In order to extend the grid are looking at a balance between hydro power
and the careful use of Nat. Gas.
Willingness to pay - TSh10k
(US$10) per month is ‘quite reasonable for a household.’
11:00 –
11:30 CDM as Source of Financing
for Renewable Energy Services
Steve Thorne,
CDM is a complex instrument but they have learnt a
great deal from implementing a couple of projects in 4 countries (now have 3 in
RSA).
SSN were set up to establish two projects in each of
the following countries:
Poverty reduction focus now- but to facilitate this
via GHG mitigation
Will work in the 4 original countries, plus
CDM project activity cycle:
Design->Validation/registration->certification…
They are currently at the Validation stage and not yet
been implemented.
In two cases, validation has been completed or
conditionally validated.
- Mondi
Biomass (replace one coal power production unit with biomass (30.2 MW))
- Mondi
Gas turbine
- Belville
South Reduced landfill gas to industry replacing LSO/..
- Kuyasa
project (small scale…). Insulated ceilings, solar water heated, Compact
Flourescent lights and associated infrastructure.
Mondi biomass avoids 122000 tCO2e/yr (valued at 7Euro
per tCO2) and has a NPV for the CDM component which is greater than the CAPEX
requirement.
See financing slide for the Kuyasa project – have
carried out monitoring of insulated versus non-insulated housing and then the
impact of using solar water heating.
-
the CDM
funding is only a small part of the total funding required of about R24M.
-
this
project has been validated and is the first project in
Markets:
1.
compliance
(CERs)
2.
Verified
(VERS)
3.
Offset
(VERs – specific occasions e.g. a world summit)
4.
Gold
Stnadard (high quality CERS)
5.
Incremental
cost (GEF not market)
Prices have gone up from $3.5 per CER, bilateral procurements Euro
8/CER. VER can have a variety of prices.
Buyers are multiple and a spot market is still to come.
If you need funds you can sell CERs forward at discounted rates.
Underlying finance is the big issue.
Unfortunately, Sustainble Development is not monetised. (see ans to my
question below).
To maximise benefits: choose your projects and your investors and time
your transactions.
Questions:
Guliano – what might be the benefits of shipping the biomass from Dg
countries to Annex I countries. However,
the question is more fundamental – do developing countries want to grow biomass
for Developed world?
The sustainable development – gold standard used all three pillars to
make sure that they were all not negative.
‘Development dividend’ – climate change community – how to do you give
value to this. Willing to introduce me
to the main thinkers in this area.
The Prototype Carbon Fund – have been critical of the fund. However, this fund has allowed the beginning
of ‘deal flow’. The Durban Landfill
example is a good example of how this was not very sensitive to the bottom-up
issue. Mentioned the ‘Biofund’… The
carbon funds have possibly played most of their role as the market is now
establishing.
11:30 –
12:00 The
Wisdom
Ahiataku-Togobo, (wtogobo@yahoo.co.uk)
Ministry of
V good
speaker on energy policy.
Have no real fossil fuel resources (have some natural
gas reserves but are not commercial).
The major source of electricity supply is hydro- 60 to
85% of elec provision. Depends strongly on the water levels in the dams.
Diesel provides 53% of petroleum consumption. LPG and
Kerosene…
Biomass and charcoal accounts for well of 97% of
energy used for cooking in the rural area.
LPG provides about 25% in urban areas.
Kerosene provides 82% of lighting in rural areas. (see graph).
Strategies for subsidising kerosene in rural areas led
to people buying it all up and mixing it with transport diesel which led to a
real shortage of kerosene in the rural areas!
The Self Help Electrification Programme (SHEP)
communities within 20km of existing 11/33KV grid lines acquire their own
Remote off-grid institutions an distant communities,
strategy is to support the initial investment cost of solar PV systems.
In 2003, initiated a study on the productive uses of
electricity. Funded entirely from
Energy Fund:
There is a levy of USc0.06/l on gasoline, kerosene and
… This is used help fund things like
roads, ?
Rural electrification access has increased from 478
communities in 1990 to about 3500 in 2004 (65% access).
LPG consumption has increased from 5200t to 68000 t in
2004.
There is now 1.1MWp from PV in 2002
Lifeline fee of US$2 /? is paid by PV users and gov
subsidises the rest.
Levies become unpopular with the rich minority in
urban areas through the use of levies and therefore needs careful management.
Where levies are fixed in terms of absolute value it
makes it difficult to increase in the future.
It is better to use a percentage basis with automatic adjustment.
Average user price for electricity is about
7.8cents/unit. a 1.5% red levy =
US$24.78M/yr
US15M can supply 14k rural homes with solar home
systems and can maintain 50k homes or could establish 15MW wind turbine capacity.
Have established biogas digesters (household and
village level) – the village level project which produced electricity does not
make economic sense and so is not being replicated.
12:00 –
12:30 Renewable
Energy in Electricity Supply Concession Schemes (Case study:
Dr. Amadou Sow, Agence Sénégalaise d'Electrification Rurale (ASER),
Senegal
See
pdf of presentation:In 2003 12.5% of rural households had access to an electricity
service.
8 PV
plants are being installed (from 1 to 40 kW capacity)
2684
public lighting systems
PV
installations for 662 community systems.
The new Senegalese objectives are to expand rural electrification and a
large number of PV installations (need to see the presentation to get the
details.)
New energy law (No 98-29, 14Apr 1998) which allowed for the
liberalisation of the electricity sector.
Poverty
alleviation is a ‘major implementing axis’.
12:30 – 13:30 Lunch
Break
13:30 – 14:00 Innovative
Approaches in current World Bank Energy Portfolio for African countries
Pablo
Rosenthal-Brendel, The World Bank
African strategy of WB:
1. facilitate energy inclusion in the PRSP and
outcomes-based CAS.
2. include in PRSCs and other programmatic lending
instruments. more emphasis on analytical
work to inform-interventions. SILs to be used as platforms to prepare
institutions and policies
3. leverage cross-sectoral linkages to achieve
country-level outcomes
3. actively promote cooperation with development
partners to scale up both programs and impact.
5. Develop more robust measures/indicators of outputs
on country results
6…
Learning from experience and innovative approaches
through ESMAP and through RPTES and GVEP
Key lessons:
- the
private sector will ‘come to the party’
- strong
government commitment is key
- systematic,
clear and transparent approach preferred by private sector
- flexibility
and innovative thinking is needed in creating incentives
- System
seems to be working- RE Board approved subsidy, regulator approved tariffs
- Carbon
finance (PCF) an incentive for transaction.
Public Private partnership and Multi-sectoral
partnerships need to be brought together.
14:00 –
14:30 African Rural Energy
Entrepreneurship Development (AREED) Initiative in
Lema,
See Biomass Energy Tanzania ltd example.
Showed a couple of examples of AREED sponsored
projects
14:30 –
15:00 Africa
Development Bank Activities
Alois Mhlanga,
ADB
Private
sector- biomass, wind and ?? are the key sectors considered.
Overveiw
of the FINESSE programme and funding allocated so far.
- presentation was a bit rushed.
Questions:
North Africa has obtained 20times the amount of
funding c.f. other regions of
ans: the bank can only operate from national requests
and so this represents the nature of the national requests for funding that
have been received.
Question: much of the funding seems to have been spent
on raising capacity and awareness in ADB- is there a way for groups to approach
the bank or should they await the ADB to come knocking?
ans: will carry out specific country assessment
plans. First convincing the ADB task
managers that renewable energy has a role to play in development.
question: Senelwa- why is only 5% of the funding
supplied to biomass energy when 90% of the continents energy comes from
biomass- why are we biased against what we use?
ans: don’t find biomass in the PRSBs or even
renewables… Are now working in ADB to
try to get renewables into the PRSBs or CDBs.
14:30 –
15:00 Financing
Instruments and Tools to support SMEs and Project Developers from the
Sustainable Energy Sector in
Volker
Krauth, BASE, Germany
15:00 –
15:30 Opportunities offered by the European Commission, including the proposed
‘Energy Facility’ and other Instruments
Dirk Pottier,
EUEI or the EC Delegation in
The EUEI is not a legal framework that has been well
defined- it is only a political declaration and emerged from a statement from
the previous head of the commission, Mr Prodi.
DG-Res- A EU priority research area opened up to research
entities …
‘Time is ripe for a major EU investment in delivering
the WSSD commitments particularly in energy.’
In response the commission suggests and ACP-EU Energy
Facility based on the following principles:
- budget
of 220MEuros
- ownership
by Developing Countries
- Ability
to attract additional funds from banks and private sector
- close
collaboration with member states e.g. parallel financing
- Innovative
approach with focus e.g.
Activity
Area 1: delivery of energy services
- provide
financing to delivery oriented projects that improve energy access for
people living in rural and peri-urban areas and remote islands (will
probably be between 20 to 40% of the 120MEuro)
- Creating
enabling environment (20% of funding)
- Facilitating
large investments – e.g. cross-border connections, NEPAD priorities and is
expected to mobilise significant additional investment in renewable
energy.
- Facilitation
of workshops
- policy
dialogs
Immediate follow-up- there are chances for immediate
follow-up for: further development of specific proposals and partnerships for
EUEI pipeline e.g. through SIDA for TZ – see presentation above.
May be operational in late 2005, and by early 2006
there will be calls for proposals emerging, although all still being worked
out. Budget on Forests in Developing
Countries.
Include energy in the 10th EDF (from 2008).
Developing countries should respond
15:30 – 16:00 Coffee
Break
Session 4: The way forward…
This session will exchange
views and look forward, with a focus on the following topics:
- Suggestions and recommendations for energy
related policies supporting poverty alleviation and sustainable
development in
·
Stimulation of public-private partnerships for the
delivery of energy services for poverty alleviation, including the role of
renewable energy
16:30 –
16:45 SADC Policy Concept on Farming for Energy for Better Livelihoods in
Hamimu Hongo;
Stefan de Keyser (t.b.c.), SADC,
Ten Reasons to Farm for Energy:
- Rural
Job creation and food security
- reduction
of oil imports, savings on FOREX
- Huge
market; without SPS nor IPR
- Comparative
advantage near equator
- Improve
SADC energy production capacity
- Diversification
of economy
- Reduction
in air pollution
- improved
soil conservation
- resistant
to climatic vagaries
- politically
inspiring project
Questions:
Why Kigoma for first project in TZ- this area has 6500 ha of palm in the
country and the TZ gov has also had focus on development activities in this
area.
Why did they also choose sunflower which is used for human food? Sunflower is being used to provide interim
oil supplies before the palm reaches maturity and can supply sufficient oil in
about 3 to 5 years.
TZ government is providing some help.
Price of Jatropha oil is currently on the market at about TSh2000 c.f.
the price of diesel which is currently less than TSh1000 per litre?
Chairs:
Stanford Mwakasonda, Maria Morales
16:00 –
16:15 Introductory Statement
Representative
Tanzania
16:15 – 16:45 Introductory Statement
Bioenergy and
Sustainability: Measurements and Markets
Dr.
Jeremy Woods,
16:45 –
18:00 Discussion Round – The Way Forward…
Moderators: Dr. Jeremy Woods,
Aim for 4 or 5 policy
recommendations.
Possible examples????:
II. A pan-African evaluation of policy options is needed to
assess which policies work and which don’t
III. Practical recommendations: encourage capital subsidies –
discourage running cost subsidies
IV. Governments
should prefer renewable energy options where possible
V Update PRSPs (Poverty Reduction Strategy Papers) to include
renewable energy / bioenergy specifically….
VI. establish national level stakeholder platforms
2. Areas emerging from the presentations and
discussions:
2.1 Policy
-
barriers
-
cross-subsidies
(transparent pricing structure)
-
use of
levies on fossil fuels – not on fixed price basis (must be percentage basis)
o
where is
this money managed?
-
capacity
-
regulation
-
standards
-
Exclusive
focus on technology neutrality is dangerous and can’t be reconciled with
incentives.
-
incentives
and signals (particularly long term) are very important
o
need to
bridge the gap between the real price of provision and the ability/willingness
to pay – in Ghana don’t subsidise the end user but the means of getting the
energy to the users.
2.2 Industry
(stakeholder) forums
-
how to
establish and how to set standards (quality control v. imp)
-
How to get
the understanding that the basis for evaluation has changed dramatically over
the last 12-24 months
-
oil prices
will get increasing volatile and are unlikely to fall below $35/bbl. Gas same story.
-
Coal- how
to reconcile with environmental reality (Climate Change)- need to compare
‘clean coal’ prices with renewable energy prices unless countries want to base
their economic plans on an unsustainable footing.
2.3 Financing
-
capital
costs versus running costs – environmental pricing (essential if sustainability
is to be incentivised). How to
incentivise innovation (huge potential for
2.4 End
users
-
Energy
efficiency (also for suppliers)
-
Stakeholder
involvement – very important with bioenergy
Closing Session
18:00 – 18:30 Policy
Dialogue Conference - Summary and Conclusion
Technical Tour (FRIDAY 24th
JUNE 2005)
The participation in the Technical Tour organised in the framework of the Partners for
Africa Policy Dialogue Conference in
Technical Tour: Visit of the Kilombero Business
Linkage Program (KBLP) implemented by the Kilomero Sugar Company Ltd. (KSCL)
Time:
08:00 – 15:00
Location:
Kilombero Sugar Company Ltd., Kidatu
Organiser:
Illovo Sugar Ltd.
This technical tour will serve to gain insight in the
KBLP which has assisted outgrowers and SME service providers, and thereby
provided support for social development within the remote and poor Kilombero region of
Kilombero Business Linkage Program
The Kilombero Sugar Company Ltd (KSCL), the largest
sugar manufacturer in
In line with Government strategies and the national
sugar development program, KSC has begun developing a strong Outgrower
community that will be self-sustaining and will ultimately supply up to 1
million tonnes of sugar-cane to KSCL to support their planned expansion from
72,000 tonnes to 200,000 tonnes of sugar by the year 2010. US$ 2.7 million of
the social investment has been in Outgrower development through technical and
financial support and infrastructure development.
The
Government of Tanzania has a progressive approach to the development of the
Agricultural sector, recognising its importance within the Tanzanian economy in
the plight to eradicate poverty within the country.
The recently published Sugar Act and the formation of
the Sugar Board support and promote initiatives incorporating the development
of the local communities as a partnership with major investors into the sugar
industry to underpin the national plan for
To facilitate this community and industry growth, KSC has
identified a number of business linkage programs that will help in the
development of local SMEs and to create sustainable development and business
opportunities for the local community in the region and support the development
of the Outgrower community in line with the opportunities created by the
investment and expansion program of KSC.
EU Energy Initiative for Poverty Eradication and
Sustainable Development
In order to respond to the unmet
needs for energy services to meet the Millennium Development Goals, the
European Union developed the EU Energy Initiative for Poverty Eradication and
Sustainable Development (EUEI). The Initiative was launched at the World Summit
on Sustainable Development (WSSD) in September 2002. It demonstrates the
commitment of EU Member States and The European Commission to supporting
improved access to sustainable energy services for poverty alleviation in
developing countries. Through the Initiative, the EU proposes to work with
developing countries towards creating the necessary conditions in the energy
sector to achieve their national economic, social and environmental objectives,
and address poverty issues, in particular by maximising energy efficiency,
including the more efficient use of fossil fuels and traditional biomass, and
increasing the use of renewable energy.
Activities implemented under the Initiative are driven
by the needs and priorities of the participating developing countries. The EC
and EU Member States invite developing countries and other stakeholders to
become part of the Initiative and to participate in the further development and
implementation of partnerships at the national and regional level. By creating
partnerships that focus on energy and poverty, the Initiative aims to:
·
raise
political awareness among high level decision makers
·
clarify
and promote the need for energy services for poverty reduction and
sustainable development
·
stimulate
coherence and synergy of energy related activities
·
attract
new resources (capital, technology, human resources), e.g. from the private
sector and civil society.
More
information on the EU Energy Initiative is available at the web site
www.euei.org.
The PARTNERS FOR AFRICA
consortium
In this action, the
consortium has a high level of expertise and high quality contacts in
Sub-Saharan Africa and
·
WIP-ETA Consortium (WEC), Germany/Italy. (Co-ordinator)
·
·
SEI,
These players lend particular
strength to this project through their experience in the coordination of the
global energy and development networks:
·
LAMNET (www.bioenergy-lamnet.org)
·
CARENSA (www.carensa.net)
·
Sparknet (www.sparknet.info)
These networks deal with local, national and international energy and
development issues. These interdisciplinary networks support international
dialogue and action fora, bringing together key actors and stakeholders from
the energy, biomass and development sectors.
The African consortium members are highly experienced and have an
established reputation in the fields of renewable energy and development from a
wide range of past projects and collaborations. They are:
·
·
ENDA,
·
CEEEZ,
Contacts
for further information:
WIP – Rainer Janssen / Maurice Pigaht, rainer.janssen@wip-munich.de
/maurice.pigaht@wip-munich.de
ETA – Silvia Vivarelli,
silvia.vivarelli@etaflorence.it
ITDG – Teodoro Sanchez, Teodoro.Sanchez@itdg.org.uk
SEI – Francis Johnson / Maria Morales, francis.johnson@sei.se / maria.morales@sei.se
ILLOVO – Denis Tomlinson, dtomlinson@illovo.co.za
ENDA – Salimata Wade, salywade@ucad.sn / energy2@enda.sn
CEEEZ –
Joanne
Dokambe? (
-
one
of the reasons why biofuels may not feature strongly in the papers. These papers originate from the funders who
have different priorities.
Alois
Mhlonga:
-
there
is a need to look critically as to what mechanism is required and what happens
on the ground.
-
used
the mobile phone market as an example and that policy should not limit what
should happen on the ground
WB Rep:
-
the
PRSP and the CAS comes only from the originating countries
-
the
donors recompiled the PRSPs but did not alter the content.
Benny Mwenda
-
only
those organisations dealing in energy see that energy is related to poverty.
-
in
??
-
the
previous PRSP did not mention energy for TZ.
The new PRSP does mention energy as a priority
-
now
working on document on high impact technologies and how energy can help achieve
the MDGs
Cheikh Wade
(Senegalese)
-
the
problem is that the paper is not managed by the minister in charge of energy
-
WB
have organised a meeting to sensitise the government to the energy issues.
Dean Cooper
-
Parallax
– wants avoid point 4 (don’t say shoulds and where possibles)
-
point
2 – talks about pan African options – assessment of implementation that is
actually going on. Find the successes
and replicate this
-
Financing:
infrastructure has to be financed e.g. should talk about matching private
sector investments with public / national financing / and international
financing
Wisdom
Togogo
-
takes
govs to influence the role of renewable energy in policy
-
should
get this for a specifically for ministers
Max Mapako
-
issue
of perception of the ownership of the PRSPs and even the energy policy
-
policy
making process should be locally funded so that it is owned by the country
Steven
Mtemba (
-
important
to bring government into these for a
-
need
to find a way to move forward if the gov doesn’t want to come
-
petroleum
and electricity has taken over the current agenda. But when talk to the private sector they
really would like to be involved in biofuels.
E.g. the Mumias sugar mill would really like to develop their ethanol plant
but gov doesn’t want to listen.
-
the
PRSPs don’t really mention energy and may be difficult to change this.
-
If
go to WB there are other pockets for funding but changing a government document
will be difficult.
How to
involve the Government
Brett
Dawson (DME RSA)
-
would
like to see a policy decision is a formal partnership between African
governments
-
why
don’t we use our own machines in the form of plants e.g. agriculture
Maurice
Pigat (WIP)
-
how
to lobby government is not easy and is very different between the different
countries
-
another
way is to deliver this statement from the PfA network.
Guliano
Grassi
-
encourage
the demonstration of the different technology chains e.g. identify the typical
technologies that could be useful for most of the country
-
negotiate
a private public partnership
Maria
Morales (SEI)
-
each
of the sectors need energy e.g. education, health, but do these sectors know
how much energy is required
Margaret
Oweno (
-
Solar
is available and is already on the point of use- why can’t the governments of
Steve
Thorne
-
gave
up on policy a long time ago – its just a shopping list
-
we
are playing into the wrong corner – we need to tax fossil fuels more.
-
are
competing with a powerful lobby e.g. the oil industry
-
perhaps
the best way forward is to look at it from the service angle
-
plea
to focus on learning
Senelwa (
-
organisation
of BEC (Biomass Exporting Countries)
-
we
have a lot of land and know how to grow crops
-
how
to get the half a billion people plus.
Up to 70% of land is lying idle which with a little push, people are
going in a growing acacia which is growing better than the alternatives
Enning
Folger? (Tanesco)
-
first
look at the production of energy and then find the demand
-
Transport
is a basic sector which needs energy also agricultural processing
Denis
Tomlinson
- there is
an opportunity to use the funds that are going to be made available through the
debt relief
Dr Munyinda
-
need
to broaden the range of crops that can be used by biofuels. The minister for agriculture in
James Ngeleja
(National Environment Management Council)
- the TZ
PRSP has managed to bring the issue of energy into them.
Wisdom Ahiataku-Togobo
(Ghana Ministry of Energy)
-
donors
could insist on a share of renewables in whatever they fund
Dean Cooper
(Parallax)
-
say
to G8 that Africa and Climate Change are happening right now and need to look
at renewable energy as a tool for addressing this – in fact climate change was
happening yesterday (Bond…)
-
implementation
is the way to achieve this without
-
Farhan
Nakhooda (Kakira Sugar
-Check on
the poverty alleviation debt relief –
- this
could be part of the mechanism
Michael
Mulasikwanda (Zambian Dept. Energy)
-
if
the ministry of energy is required to submit a section into the PRSP it would
need to make a consultation process
-
Donors-
from the experience in
Pablo
Rosenthal-Brendel (World Bank)
-
WB
cannot even give the impression of imposing conditions on its funding or will
be an outcry
-
need
to develop interest in government and develop win-win solution e.g. what does
the ministry of finance want
Theo
Sanchez
-
when
talking of small isolated communities then are talking of small schemes
-
The
example of the Ugandan sugar mill trying to negotiate to sell power to the
utility. This is because there is not a proper legal framework
-
Rural
energy requires the adjustment of the legal framework to allow entrepreneurs to
get into the business
-
Capacity
building
-
lots
of examples of affordable and reliable technologies and projects
Cheikh Wade
(Senegalese Min of Enegy and Mines)
- Energy
can not be a sector for the PRSPs – it can be a catalyst for all of the MDGs
-
suggest
that we look at platforms to share experiences on all aspects of renewable
energy
-
how
do we share information
-----------------------------------------
Draft Statement:
- Renewable
energy systems provide a practical and substantial opportunity for African
countries to combat poverty, develop sustainable energy supplies and work
towards meeting the MDGs
- The
use of renewable energy to provide these critical services that underpin
the MDGs must be reflected in the Poverty Reduction Strategy Papers (PRSPs)
and CASs?:
·
in
many cases renewable energy technologies provide the only realistic[JW1] option for providing these
services, particularly in poor rural areas.
·
technologies
such as wind, solar (PV and thermal) and biomass energy[1]
need support to gain sufficient market share to become economically self-sustaining.
- There
is now a vast bank of experience, as highlighted by Partners’ for
·
to
this end, it is important that the African countries develop realistic but
challenging targets for implementation of renewable energy systems,
·
a
clear framework is required to ensure that the setting of these targets is multi-technology,
fair, transparent and sustainable,
·
establish
a multi-national African mechanism to efficiently share experience on good
practice, policies and successful implementation / projects.
- The
potential for international trade is regarded as an opportunity to help
develop these sectors which must seized urgently. This is particularly the case for
bioenergy systems where excess valued-added biofuels could be produced
from under-utilised and under-invested land. It is important that African countries
do not simply sell the raw biomass abroad but develop the industries for
converting the biomass into value-added biofuels[JW2] :
·
the
international trade in value-added biofuels will require the development and
implementation of internationally recognised standards and regulation systems,
·
international
mechanisms for this already exist e.g. IEA Task 40 and international assurance
schemes for fair trade, quality assurance and sustainability assurance (e.g.
ISEAL, FSC, etc) and must be exploited for the development of a sustainable
bioenergy sector.
- The
agricultural systems of
·
freed
from current constraints, it is estimated by a number of authoritative sources
that African agriculture could provide a very significant share of the future
world’s energy without competing with food production or exploiting land in
protected areas.
·
in
fact, it is believed that the production of energy from the land would raise
food production too.
1st
draft comments from:
Denis T
Dirk P
Maurice
Rainer
Cheikh Wade
Salimata Wade
-------------------------------------------------