Poverty Orientation in Energy - NGO View

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By Susanne Backer,
Forum for Energy and Development, INFORSE Secretariat

How to bring energy-sector assistance closer to contributing to poverty reduction?

The popular market-based approach leaves the needs of the poor largely unattended.

Further, ‘energy-poverty’ is not yet on the national energy agendas, therefore, it is not adequately addressed in energy-sector assistance.

Current Understanding of Poverty

Within the last ten years, understanding of poverty has broadened from a relative narrow definition based on quantifiable measures of consumption and expenditure to a more complex concept including also issues relating to energy and the structures underpinning poverty. This broader and generally accepted understanding of poverty perceives poverty as an ever-changing interplay among some of the following factors:

Poverty factors relating to insufficient income, consumption possibilities, and human development: A. Lack of access to and control over productive assets, with consequent insufficient income and coverage of basic needs; B. Lack of opportunities to exploit human potential and resources due to insufficient education and health. Poverty factors relating to power relations, and structural reasons underpinning poverty: C. Isolation due to geophysical conditions, and lack of education; D. Lack of influence on own living conditions and, thus, of potential avenues for escaping poverty, lack of rights; E. Vulnerability due to a very limited economic basis as well as to unstable natural and political environments.

Poverty is a non-static interrelation among these factors. The poor are an inhomogeneous group.

Poverty is gender-biased, putting a relatively greater burden on women and girls than on men and boys.

Understanding Energy in Relation to Poverty

This broader understanding of poverty can be transformed into a conceptual framework for understanding of energy in relation to poverty, which is described below.

A. Lack of access to and control over energy as a productive asset

· Low profitability of poor people’s economic activities;

· Limited potential for economic development;

· Low coverage of basic needs in relation to, e.g., number of hot meals and reduction of energy-intensive preparations like, e.g., pulses;

· Insufficient heating;

· Conflict over insufficient resources (biomass);

· Drudgery in relation to collection, transport, and consumption of biomass.

B. Lack of opportunities to exploit human resources due to insufficient education and health

· Unsatisfactory health and educational services;

· Time lost for educative, reproductive, or productive activities;

· Physical wear and health risks in relation to collection, transport, and consumption of traditional energy;

· Time lost for self studies and evening classes for both adult and children.

C. Isolation due to geography and education

· Unattractive market for commercial energy supply;

· Unattractive ‘market’ for political ‘vote-seekers;

· ‘Imperfect’ consumers due to lack of knowledge of alternatives and due to inability to hold politicians and suppliers accountable.

D. Lack of influence, lack of rights

· Absence of institutions and methods identifying and linking the energy interests of the poor with the national policy planning method;

· Minimum standards for energy services not identified as basis for national energy planning and policy;

· The right to a minimum and fair energy consumption not a basis for national energy planning and policy;

· Absence of public debate on national energy policy from the perspective of the poor.

E. Vulnerability due to unstable economic, natural, and political environment

· Natural disasters deprive many poor people of the most basic means of survival, including energy for cooking and heating;

· Political and social unrest transform thousands into refugees, with extremely limited access to resources, including energy.

Improved cooking stove in Nepal.

Photo by Saurab K. Shrestha, Alternative Energy Promotion Centre.

Limitations of the Market-based Approach:

The dominating trend in the energy-sector programs’ support is to work towards liberalisation of energy markets.

However, as the conceptual framework for understanding of energy, in relation to poverty shows, the market based approach has some limitations:

· The market approach will only be able to reach the poor to the extent that the productive activities and related energy needs of the poor are integrated into the cash economy.

· The market approach does not address the structural reasons and the power relations underpinning ‘energy poverty’. By avoiding the political dimension of energy poverty, energy-sector programs and assistance ‘risk’ to loose the dynamism of people’s own actions and organisations in the setting of national energy agendas.

The real challenge is to maintain the focus on getting the market right for energy demand that is part of the cash economy and, at the same time, to give sufficient focus to developing a framework that also permits poor people who are not securely integrated in the cash economy to benefit from energy-sector assistance programs. To move beyond the market-based approach and reach the poor will take strong political action, as it will not happen through the market forces.

Solar dryer drying mango in Uganda. Solar dryers open up income generating opportunities exporting dried fruit.

Photo by Youssef Arfaoui.

Overcoming some of the Limitations:

Which design elements could contribute to overcome the limitations of the current market approach in future energy-sector assistance?

Basic Energy Services

The basis for multi-and bilateral negotiations of energy-sector assistance has to be coverage of minimum-standard energy services:

· Equal access for all to sustainable, efficient, and healthy thermal heat for cooking and heating;

· Equal access to sustainable and efficient processing services for agricultural products;

· Equal access to sustainable and efficient water-pumping services;

· Equal access to health and educational services improved by sustainable and efficient energy services.

Solar steriliser in Uganda.

Photo by Youssef Arfaoui.

Capacity Development: Energy Service Delivery

Establishment of decentralised energy service centers with the following capacities:

· Participatory analysis of local energy needs in co-operation with local authorities and civil society organisations;

· Identification of social and economic activities where sustainable energy can make a difference within and outside the cash economy;

· Development of local energy plans;

· Development of community-owned and -managed energy-service delivery models in close co-operation with local authorities and CBOs.

Civil Society Participation

Facilitation of and support to Cross Sectoral Civil Society Networks in the South with the following capacities:

· Linkage between local CBOs and the national public debate on energy issues;

· Collect, document, and disseminate information on needs as well as solutions to the energy services required by the entire population, in order to provide a basis for energy-related decision making and planning;

· Provide a meeting space for energy specialists (technical and political) with CBOs, advocacy organisations, and media in order to facilitate energy-service delivery;

· Provision of high-quality inputs to the national energy agenda-setting process as well as to the donor community, in order to influence national energy policy.

More information: FED and INFORSE, Blegdamsvej 4 B, 2200, Copenhagen N, Denmark. Ph: +45-35-247700, fax: +45-35-247717, e-mail: inforse@inforse.org, www.inforse.org.