|Energy as a Tool for Sustainable Development for African, Caribbean and Pacific Countries (EC - UNDP, 1999, 89 p.)|
|CHAPTER 1: ENERGY AND SUSTAINABLE DEVELOPMENT|
AN HISTORICAL OVERVIEW
Throughout the history of humankind, energy has shaped development. Each major economic and social change has been accompanied by the discovery, the availability, or the exploitation of new energy sources. Although it would be reductive to write the history of development in terms of energy, the importance of energy in changing society cannot be overestimated. The first use of fire enabled humans to cook and conserve food, and provided heat and light. This change extended the human habitat, encouraged organised, cooperative hunting, and induced a more complex and stable social organisation. Some ten thousand years ago, the exploitation of animal power was an essential component of the advent of agriculture and of the ensuing stable settlements, with all their social and cultural consequences. During the Renaissance, the use of wind for navigation greatly expanded the scope of economic and cultural exchanges.
The European industrial revolution at the beginning of the 19th Century was made possible by the use of hydropower and coal as an energy source. This revolution was limited to countries with large coal reserves (such as the United Kingdom and Germany) and, due to the difficulty and cost of transporting coal, large cities were born in the vicinity of the major coal deposits. The rebirth of the economy in the industrialised countries after the second World War was made possible, and at the same time deeply conditioned by, the availability of oil: an abundant, flexible, easy to transport, and most of the time cheap, energy source.
Today, industrialised countries are on the verge of another deep change: the environmental and climatic effects of using fossil fuels at current or increased rates are unacceptable, and are adversely affecting the environment at the local, regional, and global level. The commitments enshrined in the Kyoto Protocol in December 1997, which were agreed by the industrialised countries (who are the main energy consumers and pollution producers), are a first step in the direction of a radical change which will involve not only energy systems, but also the whole approach to production processes, minimising energy and material inputs, and maximising the recycle and life-cycle analysis of products.
THE SITUATION IN DEVELOPING COUNTRIES
The situation is quite different for developing countries. A few are now undergoing a process of industrialisation, and others have achieved rapid economic growth by supplying low-cost labour to labour-intense segments of the industries (often high-tech based) of industrialised countries. Many countries, how-ever, are pre-industrial, and their main energy source is the traditional use of biomass, mostly wood and agricultural and livestock residues. Very little of this energy is supplied commercially.
With one billion people living on less than US$1 per day, two billion people without access to modern fuels or electricity, and hundreds of millions of women and children spending hours every day to collect fuelwood carry water, there is no doubt that development, and particularly the alleviation of poverty, are the main aims in the South.
None of the existing energy solutions can entirely solve these problems. Existing traditional systems do not provide the energy services that are needed, and they can create severe environmental problems such as indoor and urban pollution; contribute in some areas to deforestation and land degradation; and endanger water resources. The fossil fuel based systems of industrialised countries are often too expensive and resource-consuming to suit most developing countries, and they depend on costly infrastructure that has been built over time in the North.
The UNDP report Energy as an Instrument of Socio-Economic Development (UNDP, 1995)makes it clear that energy policies are an instrument which can be used both to promote sustainable development and to achieve integrated development goals. By making the right choices and creating favourable conditions for sustainable energy in these countries, powerful support is created for the development process.
"Energy policies are an instrument which can be used both to promote sustainable development and to achieve integrated development goals."
Although the process of globalisation and the growth of the international media has made everyone aware of the contribution of modern energy systems to affluent societies, only scraps of these systems (or the energy that they generate) are actually available in the poorest countries or among the poorer strata of population in all developing countries.
One relevant example is the so-called Green Revolution, which has made several countries in Asia and South America self-sufficient for food, or even net exporters, despite rapid increases in population. The methods used, however, needed much more energy than traditional methods (for irrigation, mechanisation, post-harvest technologies, and especially for nitrogen fertilisers), and in some cases have been accused of having negative impacts on land conservation, biological diversity, and the environment in general. Moreover, the Green Revolution has barely touched Africa, which has the greatest food deficits.
Making affordable and dependable energy services available to the poorest countries and to those on low incomes is one way to help them to develop in a sustainable way.
The Global Transition
The size and difficulty of the problem would be grossly underestimated if one did not take into account that we are also in a period of extremely rapid transition. The most striking aspect of this transition is demographic growth, which originated in a sharp decline in mortality rates, and will likely be followed only after a great delay by a corresponding decrease in birth rates. The same thing happened in 19th Century Europe, but not on such a large scale, involving most of the world, nor so rapidly. For the first time, the doubling time of the global population has become shorter than the average human life-span, and has even come close to generation time (i.e. the average age difference between parents and their children). Although population growth has begun to ease in most developing countries, indicating that stabilisation could be reached in the second half of the next century, this has not yet happened in Sub-Saharan African countries, where growth rates are the highest in the world (see p.24, The Regional Context).
Other global indicators have changed at similar or even greater speed than population growth, among them the consumption of finite resources and the emission of pollutants into the environment, driven not only by the increase in population but also by its increasing affluence, particularly in the industrialised countries. Again, for the first time in history, the effects of human activities on the global environment are no longer negligible with respect to the effects of natural phenomena.
It is only by compounding the difficulties intrinsic in energy provision with the depth and speed of the transition which is taking place that one can fully appreciate the magnitude of the challenge in front of us. We shall see in Chapter 2 (p.19), for example, how even a supreme effort may not be enough to avoid a situation where in the next twenty or thirty years even more urban dwellers in Sub-Saharan Africa will be without access to modern energy services.
The changes taking place in the cultural domain are just as intense. The number of "cultural objects"(which in anthropological terms constitutes a measurement of cultural wealth, in lieu of considerations of value) increases with a doubling time comparable with, or shorter than, generation time: for the first time, on the global scale, acquired new knowledge has become prevalent over accumulated knowledge transmitted from one generation to the next.
Sustainable Energy on the International Scene
Being a horizontal factor, energy was not singled out as a separate subject in the discussions of the United Nations Conference on Environment and Development in Rio de Janeiro in 1992, but it was reflected in the ensuing Agenda 21, where references to energy were made in several different chapters (most notably in Chapter 9 on atmospheric pollution). Energy has acquired an increasing focus in the work of the UN Commission on Sustainable Development and a key position within the work of the Framework Convention on Climate Change. Also, in the consideration of energy issues at the United Nations General Assembly Special Session on sustainable development, held in June 1997 (UNGASS, 1997), it was agreed to devote the 2001 session of the Commission on Sustainable Development (CSD 9) to energy and transport problems.
Energy has been considered either explicitly or among other economic and social activities in all the major UN Conferences since Rio: the UN Conference on Population and Development (Cairo - 1994), the Global Conference on Sustainable Development in Small Island Developing States (Barbados - 1994), the Social Summit Programme of Action (Copenhagen - 1995), the Fourth World Conference on Women and Development (Beijing - 1995), and the UN Conference on Human Settlement HABITAT II (Istanbul - 1996). These conferences, each from its own particular angle, have shared a common vision of sustainable development and have dealt with energy and its impacts on sustainability. They have consistently called for increased energy efficiency, the dissemination of renewable energy technologies, technology transfer, and legislative and institutional change to create an "enabling environment" for sustainable energy. The positions which emerged through these important events concerning the role of energy for sustainable development are analysed in some detail in the UNDP report Energy After Rio: Prospects and Challenges (Reddy et al., 1997).
In the past, institutions providing development finance have allocated a significant proportion of their funds to energy programmes, both through loans and, to a lesser extent, grant finance. While bilateral and multilateral grant financing has increasingly targeted sustainable energy initiatives, soft loan assistance remains supply-side dominated (see Annex I). Between 1993 and 1997, The World Bank, Asian Development Bank, African Development Bank, Interamerican Development Bank, and European Investment Bank together provided around US$6 billion annually in finance to the energy sector, of which around 3% was in support of sustainable energy projects. The picture is much the same for the energy sector lending of bilateral soft loan institutions. However, the improving viability of sustainable energy technologies and an increased awareness of environmental concerns has prompted development finance institutions to launch a number of in-house initiatives and to intensify technical support in order to increase lending for sustainable energy projects.
Although grant funded activities benefit from lower levels of financial support - in 1996 the 15 EU Member States and Canada, Japan, and the United States provided US$810 million in grant financing for all energy sector assistance - these are increasingly used to support sustainable energy initiatives. The retrofitting and rehabilitation of conventional power plants, energy efficiency, promotion of renewable energy and capacity building have become common features of bilateral cooperation programmes. Where previously energy initiatives were usually funded through a sectoral approach, energy activities now increasingly aim to address over-reaching development goals, such as the eradication of poverty, sustainable development, and protection of the environment. Indeed much experience with renewable technologies has been gained where these have formed component parts of projects in "non-energy" areas, e.g. in providing energy services for rural health clinics. Another significant source of financing for sustainable energy is the Global Environment Facility, which, since its inception in 1991, has provided US$280 million in support of renewable energy projects and US$190 million in support of energy efficiency projects.
"The retrofitting and rehabilitation of conventional power plants, energy efficiency, promotion of renewable energy, and capacity building have become common features of bilateral cooperation programmes."
Unfortunately the lack of a coordinated and coherent approach among the international development community has limited the effectiveness of assistance in the past, and has sometimes hindered the emergence of fragile new markets.