New Energy Access Reports – November 2016

Financing India’s Clean Energy Transition, Bloomberg New Energy Finance

This report examines the recent growth across India’s off-grid, small energy grids, rooftop solar and utility-scale renewable energy segments and looks at challenges in their future growth, including financing trends.

Total annual investments in utility-scale projects crossed the $10 billion mark last year. The Indian government’s “175GW renewables by 2022” target includes 135GW of utility-scale projects. This implies that cumulative capacity would have to increase more than three times between 2016 and 2022, from 39GW in 2015 to 135GW, requiring investment of nearly $100bn (an average $14bn/year).

Indian project developers are trying to meet this capital requirement through various means, including increasing borrowings from multilateral organizations and issuing green/masala bonds. While Securities and Exchange Board of India is still finalizing the modalities for the formation of quoted infrastructure investment trusts (similar to US yieldcos), Indian renewable energy developers are already planning to list assets adding up to $1.3bn under this mechanism.

AEEP Energy Access Best Practices 2016, the Africa-EU Energy Partnership (AEEP)

This report is a compilation of 24 project case studies and programs on access to clean energy in Africa, implemented by the four members of the Energy Access work stream under the Africa-EU Energy Partnership (AEEP): The Alliance for Rural Electrification (ARE), the African Association for Rural Electrification (CLUB-ER), Practical Action and Strathmore Energy Research Centre (SERC).

The publication draws upon experiences from the private and public sectors, as well as from NGOs and research institutions and showcases the latest innovations with a unique focus on renewable energy projects in Africa. A vast portfolio of projects using different technologies such as bioenergy, small hydro, PV and wind energy are covered in the publication. It aims to support and incentivize decision-makers to continue improving framework conditions for the implementation of business models based on renewable energy solutions while enabling project developers and financiers to further boost the quality and quantity of rural electrification projects.

Mini-grid Sizing Guidebook, GIZ

This handbook has been developed as part of a series of handbooks on mini-grids. After the publication of handbooks on site selection (“Where shall we put it?”) and licensing (“How do we license it?”) this handbook on load assessment and mini-grid system sizing is the third publication in the series.

While the first two handbooks focused on the Kenyan context, this handbook is applicable to all the various geographical contexts where mini-grids can be implemented. Practical knowledge has been drawn from the authors’ experience in mini-grid implementation in sub-Saharan Africa. Most of the content of this handbook has general validity for load assessment and system sizing. However, the methodology for the actual sizing  is based on the approach of the mini-grid builder, an online tool developed by GIZ ProSolar in 2015, based on the experiences made with load assessment and system sizing of a pilot solar-hybrid mini-grid in Talek, Narok County (Kenya).

Making Power Affordable for Africa and Viable for Its Utilities, World Bank

This study outlines how Sub-Saharan Africa’s struggling power utilities can be financially viable and at the same time make electricity access affordable for the poor. It looks at utility financial statements in 39 African countries, spending data in 22 household surveys, and power tariffs in another 39 countries.

It suggests several ways of recovering the cost of supply and making electricity affordable, which include:

  • Improving operational efficiency. If utilities could reduce combined transmission, distribution, and bill collection losses to 10 percent of transmitted electricity, deficits could disappear in one-third of the countries.
  • Increasing tariffs in most cases. In the remaining two-thirds of the countries studied, the funding gap cannot be bridged solely by eliminating operational inefficiencies, and tariff increases are likely needed. Small and frequent tariff increases may find wider acceptance, as long as electricity access is reliable.
  • Installing individual metering. Balking at the high, upfront cost of connection, poor households tend to share one electricity meter. That often makes them ineligible for subsidized rates. Individual meters in poor households can help utilities target subsidies better.
  • Installing prepaid meters that would benefit both utilities and customers. For low-income households, the ability to pay in small increments helps align electricity payments with income flows, while utilities are guaranteed payments upfront.
  • Sharing connection costs. The first priority in increasing access to electricity is to make the initial connection affordable to the poor. One option is to share the costs across all electricity users, including large- and medium-size firms.

While connecting to the grid is a solution for all urban Africans and many rural ones, the study also acknowledges that rural electrification is essential.  Mini and off-grid electricity, especially from sources like solar, offers increasing potential to electrify homes in many rural areas of Sub-Saharan Africa.

The study makes extensive data available, and enables countries to compare themselves against their peers on basic performance indicators.

Proven Delivery Models for LED Public Lighting, ESMAP

The synthesis report summarizes the crosscutting findings from six case studies – from Guadalajara and Quezon City, and cities in India, Canada, and the United Kingdom – which document experiences, challenges, and solutions encountered in implementing six different LED lighting delivery models – ESCO, super-ESCO, joint procurement, public-private partnership, lease-to-own, and municipal financing. These findings include key roles played by governments in ensuring successful LED lighting programs, ranging from setting the right policies to establishing an ESCO with a mandate to implement energy efficient programs while transforming the market.

The report also highlights distinct approaches cities can take to mitigate technical, financial, and performance risks and emphasizes the importance of strategically engaging stakeholders, such as international partners, local utilities, and non-profit groups, as lighting programs advance.

Climate Investment Opportunities in Emerging Markets: An IFC Analysis, IFC

This report shows that the historic global agreement on climate change adopted in Paris helped open up nearly $23 trillion in opportunities for climate-smart investments in emerging markets between now and 2030.

IFC’s study, based on the national climate-change commitments and underlying policies of 21 emerging-market economies, representing 48 percent of global emissions, identifies sectors in each region where the potential for investment is greatest. This includes:

  • East Asia and the Pacific: green buildings—where China, Indonesia, the Philippines, and Vietnam show a climate-smart investment potential of $16 trillion.
  • Latin America and the Caribbean offer the next largest opportunity—particularly in sustainable transportation, where the potential for investment in Argentina, Brazil, Colombia, and Mexico is about $2.6 trillion.
  • South Asia: Opportunities are mostly seen in climate-resilient infrastructure, where $2.5 trillion of opportunities exist in India and Bangladesh.
  • Sub-Saharan Africa represents a $783 billion opportunity – particularly for clean energy in Cote d’Ivoire, Kenya, Nigeria, and South Africa.
  • Eastern Europe, with its biggest markets – Russia, Serbia, Turkey, and Ukraine – shows a combined investment potential of $665 billion, mostly in energy efficiency and new green buildings.
  • Middle East and North Africa: the total climate-investment potential for Egypt, Jordan, and Morocco is estimated at $265 billion, over a third of which is for renewable-energy generation, while 55 percent ($146 billion) is for climate-smart buildings, transportation, and waste solutions.

The report also points to important government action to enable the full scale of investment opportunities in these markets.

Beyond Coal: Scaling up clean energy to fight poverty, ODI

This report dismisses claims that the developing world needs coal to catch up with the West, as the cost of renewable energy installations has dropped to the level that makes the cleaner choice viable.

The report refers to countries such as India and China that have been building new coal-fired plants in the past decades to cover growing demand for electricity. Both of those countries, the report said, have witnessed a massive increase in health problems related to breathing polluted air.

From the job perspective, the researchers believe, renewables make more sense, as they provide more high-skilled better-paid opportunities than coal plants. Small-scale solar and wind power installations supplying clean renewable electricity to particular communities would be the best choice for most countries.

The report recommends governments to stop subsidizing coal use and construction of new coal-fired plants as soon as possible. Instead, the focus needs to shift to renewables. The global community should provide support that would enable the developing countries to deliver on commitments of the Paris climate change agreement.

Energy, Climate Change and Environment: 2016 Insights, IEA

The historic Paris Agreement on climate change sets the course for a fundamental transformation of the global economy over the next decades. The Agreement’s overarching goal of limiting global average temperature rise to “well below 2°C” will entail profound changes in the global energy system. Achieving the deep cuts in global carbon emissions that this vision requires is no small task given the enormous challenge of implementing – and eventually exceeding – current country climate pledges. This publication examines key sectors, technologies, and policy measures that will be central in the transition to a low-carbon energy system. It also looks at building climate resilience in the energy sector, and the use of tracking tools and metrics to monitor the progress of energy sector decarbonisation. Finally, it provides global energy and emissions data, including interregional comparisons and in-depth analysis for ten regions.

This report offers a comprehensive review of the status and trends in the region’s renewable energy development. It highlights Latin America’s wealth of knowledge, draws key lessons, and outlines findings to support the continued expansion of renewables for power generation, transport and other end uses.

Renewable Energy Market Analysis: Latin America, IRENA 

The study reviews and analyses renewable energy policies across all uses, which feature among the most innovative in the world. These policies, coupled with recent renewable energy technology cost reductions and broader energy drivers such as energy diversification and climate change, have played a decisive role in the rapid uptake of renewables in the region. The report also assesses the framework for finance and investment in the sector. While specific characteristics vary from country to country, success depends on some common attributes, including access to affordable finance for renewables.

While the report aims to provide insights for policy makers and energy professionals in the region, it also outlines valuable lessons from Latin America for the rest of the world. Along with recommendations on creating the essential enabling conditions, it highlights the widespread socio-economic benefits of the transition to renewables.

The executive summary is available in English or Spanish.

Gender-Based Violence in Humanitarian Settings: Cookstoves and Fuels, Global Alliance for Clean Cookstoves

This white paper reviews the evidence on the relationship between gender-based violence (GBV) and fuel collection in humanitarian settings and then highlights the gap in knowledge on the impact of adoption of clean cookstoves to reduce the risk and incidence of GBV in humanitarian setting. It makes a case for why further research and evaluations are critical to better understand the impacts that clean and efficient cookstoves and fuels have on reducing GBV.