Climate change and clean energy challenges and opportunities in addressing Africa’s growing energy n

International Business Forum at World Bank-IMF annual meetings 2007

23 October 2007 | Minutes

Moderated by: Günther Taube, director, regulatory framework, good governance and economic policy, InWEnt Capacity Building International, Germany

Rajendra K. Pachauri, chairman of the Intergovernmental Panel on Climate Change (IPCC)

  • Energy among poor communities has been neglected. It is a missing MDG
  • We still haven’t come to understand the nexus between energy and poverty, for example, if rural electrification continues at its current rate in Bihar state in India it will take 240 years to provide access to its population.
  • Meeting the basic energy needs and adaptation needs of Africa is our highest priority
  • Our energy challenges are: For cooking: the growing scarcity of fuel wood; Health: Millions of people are dying from air pollution from domestic wood fuel; For agro-processing: small producers need to keep their produce cool. Otherwise it will not keep on the way to market and they have to sell it at a low price
  • We need institutional innovation, and must involve NGOs, the private sector and cooperatives. A policy framework is needed
  • We need to train and create the right capacity.

Jamal Saghir, director, energy transport and water department, World Bank

  • Electrification lags behind. Business as usual is not an option.
  • There is a legacy of underinvestment in the power sector. Most utilities are inefficient. We need to go off-grid.
  • We need to tackle capacity constraints and skill shortages.
  • Countries need to factor climate risk into their planning.

Daudi Migereko, Minister of energy and mineral development, Uganda

  • Climate change is critical to the African continent. The capacity to generate sufficient supply can not be attained because of climate change issues
  • Uganda is in the midst of an energy crisis, as is Tanzania and Ghana. Uganda could not generate sufficient hydro electric supplies due to a fall in the water levels of Lake Victoria
  • They need to intensify policy actions. They should disseminate information, popularize renewable energy, biofuels and carbon capture and storage. Also more should be invested in aforestation. Currently fire wood and biomass is still the most affordable fuel for many people.
  • Currently the policy framework is weak. Energy is not being used or generated efficiently. Bureaucracy and red tape cause excessive transaction costs. They are affected by the rising price of oil.
  • The private sector needs to get more involved. Uganda carried out major reforms and spent a lot of money in the hope that the private sector would invest. This has not been successful. So far, private sector-based projects have failed to take off. Internal resource mobilization is needed.
  • Energy needs to be extended to rural areas, but in a selective manner where it will have a multiplier effect. We need to create employment in rural areas

Bert Koenders, Minister for development cooperation, The Netherlands

  • The World Bank is increasing its contribution to renewable energy and energy efficiency
  • We need to ensure that energy and climate are directly linked to the MDGs
  • Access, development and climate need a balance. The Clean energy investment framework needs to tackle these goals
  • Emerging activities in biofuels. Sustainable ways of producing and consuming and certification processes. Biofuels can be an opportunity for the poor. How can we pull in the business sector? The private sector expects the public sector to set up a regulatory framework
  • The Dutch government has been working with Philips, designing products for a low income population
  • IDA and climate funds are important
  • Energy infrastructure is weak, it has a lack of maintenance and modernisation.
  • The Netherlands, UK and WB are preparing a study to present in Bali about what adaptation means. However, adaptation funds are political.

Marcos Sawaya Jank, President UNICA, the São Paulo sugar cane agroindustry union, Brazil

  • As a result of ethanol there has been an 80 per cent reduction in carbon dioxide in the urban areas of Sao Paulo and Rio.
  • Myths about ethanol: that sugar plantations are destroying the Amazon. This isn’t true. It doesn’t fit well there, particularly because of the rainy season. Also logistically it is difficult to transport the fuel from the Amazon to the coast. Mostly sugar cane is produced in the Savannah lands of the south.
  • The introduction of mini-ethanol mills would be a good way to spread ethanol to other parts of the world.
  • They are negotiating with Nigeria, Benin and other countires about biofuel production

Discussion points

  • Antonio Hill from Oxfam urged that more financial flows for adapation are needed.
  • Daniel Mitler from Greenpeace stated that carbon capture and storage is not yet a viable solution. The energy revolution needs to be non-nuclear, non-CCS and non-biofuels. We need a massive upscaling of renewables and a phase out of fossil fuels.
  • Heidemarie Wieczorek-Zeul pointed out that her party has been pushing renewables since 1998. However she said that we have to remain in fossil fuels in order to ensure that they become more efficient.
  • Rajendra K. Pachauri explained that the price of carbon is extremely important. Greater research and development is also needed and technologies have to be adapted for local application. BP is working on jetropha plants with small farmers.
  • Marcos Sawaya Jank responded that the distribution network of liquid fuels is in the hands of oil companies. Petrol stations need a timetable to introduce bio fuels.
  • Jamal Saghir agreed that a breakthrough in technology is needed and that we have to push the private sector.
  • Daudi Migereko asked how African governments and development finance providers could overcome bureacracy and red tape.
  • A representative of the Global Environment Facility pointed out that regulatory frameworks for renewable energy in Africa is not possible at the moment because incentives are still very much on fossil fuels. Until we tackle this we won’t win. Such issues should be included in the World Bank’s poverty reductions strategies.