RETHINKING INFRASTRUCTURE Achieving Clean Energy Access · PDF file 2019-06-28 ·...

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Transcript of RETHINKING INFRASTRUCTURE Achieving Clean Energy Access · PDF file 2019-06-28 ·...

  • Financing Climate Futures RETHINKING INFRASTRUCTURE

    Achieving Clean Energy Access in Sub-Saharan Africa Jan Corfee-Morlot (3Cs), Paul Parks, James Ogunleye and Famous Ayeni (Carbon Limits Nigeria)

  • Financing Climate Futures RETHINKING INFRASTRUCTURE

    Governments recognise that scaling up and shifting financial flows to low-emission and resilient infra- structure investments is critical to deliver on climate and sustainable development goals. Efforts to align financial flows with climate objectives remain incremental and fail to deliver the radical transform- ation needed. The OECD, UN Environment and the World Bank Group, with the support of the German Ministry of Environment, Nature Conservation and

    Nuclear Safety, have joined forces under a new initiative that provides a roadmap to help countries make the transformations in their infrastructure, investment and finance systems that are needed to make financial flows consistent with a pathway towards a low-emission, resilient future.

    For more information on Financing Climate Futures: Rethinking Infrastructure visit: oe.cd/climate-futures

    Financing Climate Futures RETHINKING INFRASTRUCTURE

    Achieving Clean Energy Access in Sub-Saharan Africa

    A clean energy revolution in sub-Saharan Africa is urgently needed to win the fight against

    energy poverty, to promote robust development and to make it more sustainable. Clean

    energy can unlock sustainable economic growth, improve human health and well-being

    and enable women and children to lead more productive lives. It will also raise human

    security and build resilience in nation states and communities. This report takes an in-depth

    look at the challenges and opportunities to provide clean energy access in sub-Saharan

    Africa. Packages of policies are needed to promote clean energy access, including electricity

    for productive uses and a full range of technical solutions – notably off-grid and mini-grid

    renewables, energy efficiency – as well as clean cooking. Innovative financing and improved

    public sector governance are essential ingredients to make markets work. Delivering on this

    golden opportunity for development requires not just more money but policy attention and

    massive political effort from both domestic and international actors

    DISCLAIMER This report was prepared as a part of Financing Climate Futures: Rethinking Infrastructure, a joint initiative of the OECD, UN Environment and the World Bank Group, to help countries deliver on the objective of making financial flows consistent with a pathway towards low emissions and climate- resilient development. It is the independent opinion of the

    authors and does not necessarily reflect the views of the OECD, UN Environment, or World Bank Group © Jan Corfee-Morlot (3Cs); Paul Parks, James Ogunleye and Famous Ayeni (Carbon Limits Nigeria), January 2019 Photo: © Simi Vijay Photography for the World Bank

  • Achieving Clean Energy Access in Sub-Saharan Africa

    31 January 2019

    by

    Jan Corfee-Morlot (3Cs) Paul Parks, James Ogunleye, Famous Ayeni (Carbon Limits Nigeria)

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    Achieving Clean Energy Access in Sub-Saharan Africa

    Abstract

    A clean energy revolution in sub-Saharan Africa is urgently needed to win the fight against energy poverty, to promote robust development and to make it more sustainable. Clean energy can unlock sustainable economic growth, improve human health and well-being and enable women and children to lead more productive lives. It will also raise human security and build resilience in nation states and communities. This report takes an in-depth look at the challenges and opportunities to provide clean energy access in sub-Saharan Africa. Packages of policies are needed to promote clean energy access, including electricity for productive uses and a full range of technical solutions – notably off-grid and mini-grid renewables, energy efficiency – as well as clean cooking. Innovative financing and improved public sector governance are essential ingredients to make markets work. Delivering on this golden opportunity for development requires not just more money but policy attention and massive political effort from both domestic and international actors.

    Acknowledgements

    The authors would like to thank reviewers for their contribution to the final report: Mark Brunet (Global Affairs, Canada), Giorgio Gualberti and Zoe Lagarde (OECD), Federico Mazza (CPI) and Ihcen Naceur (AfDB). Contributions from the IEA were also helpful, in particular for Chapter 2, where we draw heavily on the 2018 IEA Outlook; the authors would like to thank Laura Cozzi, Olivia Chen and Arthur Contrejean for providing relevant data. The authors would also like to acknowledge the detailed contributions from Rabia Ferroukhi (IRENA, on gender) and from ten different interviewees all of whom are working in the clean energy and finance field in sub-Saharan Africa; the information gathered from many of these interviews underpinned Chapter 5 on Nigeria and practical examples highlighted elsewhere in the report. Feedback was also gratefully received from another six experts joining us as panellists in a COP24 OECD side event to discuss the report’s key findings and policy implications. (See Annex D for the full list of names and affiliations of report interviewees and panellist from the COP24 side event.) Finally, the authors would like to thank the Development Co-operation Directorate team of the OECD, Berenice Lasfargues, Naeeda Crishna Morgado and Jens Sedemund, for their support in preparing the COP24 event as well as OECD Financing Climate Futures project manager, Virginie Marchal, and the German government who provided early guidance and support to allow this case study to move ahead. The authors alone are responsible for any errors or oversights in this report.

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    Achieving Clean Energy Access in Sub-Saharan Africa

    Table of Contents Executive Summary ................................................................................................................... 5

    1. Introduction ........................................................................................................................... 9 1.1. Clean energy access as a key part of the Paris Agreement and Agenda 2030 ............................ 9 1.2. Structure of the report .............................................................................................................. 10

    2. Current trends: progress and current outlook .................................................................... 11 2.1. Clean electricity access: market developments and technologies ............................................ 13

    2.1.1. Pico solar and solar home systems (SHS) ........................................................................... 16 2.1.2. Mini-grids ........................................................................................................................... 17 2.1.3. Grid expansion, reliability and decarbonisation ................................................................ 17

    2.2. Clean cooking access: market developments and technologies ............................................... 19 2.2.1. Technology and fuel options .............................................................................................. 20

    2.3. Investment needs for universal energy access .......................................................................... 21

    3. Reforming policies and institutions to raise, shift and scale finance ................................... 24 3.1. Cross-cutting policies, planning and institutions for clean energy access ................................. 24 3.2. Sector policy reforms: electricity ............................................................................................... 28 3.3. Developing mini-grids ................................................................................................................ 28 3.4. Policy reforms and tailored programmes for clean cooking ..................................................... 29

    4. Finance for clean energy access .......................................................................................... 32 4.1. Landscape of first costs, access for the poor and PAYG consumer finance .............................. 32 4.2. Role of private and domestic finance -- public and private ....................................................... 35 4.3. Official Development Finance (ODF) ......................................................................................... 36 4.4. Blended finance and public private initiatives .......................................................................... 43

    5. Nigeria: an example from the field ...................................................................................... 47 5.1. Overview of the current situation ............................................................................................. 47 5.2. Technology options and organisational structures ................................................................... 48

    5.2.1. Pico ..................................................................................................................................... 48 5.2.2. Solar Home Systems ........................................................................................................... 49 5.2.3. Mini-grids ............................................................................