Developing Countries

The US position on multilateral development bank finance for fossil fuels is “pro-poor” and “pro US jobs”

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With a chronic lack of affordable, reliable energy one of the biggest obstacles to tackling poverty in the developing world, experts have come out in support of the US announcement to call for an end to World Bank restrictions on finance for new fossil fuel projects in the poorest countries.

Dan Runde of the Center for International and Strategic Studies (CISS), a Washington-based think tank specialising in international development, called the US position a “pro-poor” and “pro-US jobs”.

Africa is home to 16 percent of the global population but only produces 3 percent of the world’s electricity. 140 years since Edison invented the lightbulb, two in three people living in sub-Saharan Africa still have no access to the grid.

Yet despite the scale of the problem, international development institutions like the World Bank and the Asian Development Bank continue to impose severe restrictions on funding for fossil fuel power in the poorest countries.

According to Runde this could be about to change. He says that developing countries are determined to use their natural resources, “just as the US and other rich countries do”, and that there is significant international support for financing new fossil fuel projects.

“If Japan and the U.S. plus poor countries encourage this policy at the board level, it will happen,” he added.

Aid Expert: If we don’t solve energy poverty, Africa will become a “continent on fire”

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“Africa is literally the dark continent because so few people have the lights on. Better we sort that before it becomes a continent on fire.”

That’s the dire warning issued by Dr Sylvanus Ayeni, a Nigerian-born aid expert, who, as a former neurosurgeon, has direct experience of Africa’s energy-starved healthcare system.

The numbers are stark. Over 600 million people in sub-Saharan Africa – two thirds of the continent – currently lack access to electricity. Meanwhile populations are exploding, with the number of people living in the region expected to more than double to 2.4 billion by mid-century.

In a recent interview, Dr Ayeni said that Africa’s chronic power shortage is driving ever more young people into the arms of people smugglers or armed militias.

“When you have no power, you can’t set up factories, run hotels, do homework, keep vaccines chilled at a clinic or even pump water efficiently. In short, you have no hope of a better life,” Ayeni says.

“And with the resultant poverty and unemployment, young people have few options,” he continues.

“Why do you think millions are striking out to cross the Mediterranean while others join gangs or militia? Ask yourself what you would do if you lived in such misery.”

But time is running short Dr Ayeni warns:

“Africa is urbanising perhaps faster than anywhere on the planet, and in our cities unemployment can reach 70%, especially among the youth. If we don’t find something for these people to do, we face a bloody revolution worse than anything in history.”

For Dr Ayeni, a solution has to be delivered fast, and in a way that works for Africa. That means making use of Africa’s abundant natural resources, rather than importing renewables from abroad.

“What’s the point of spending scarce foreign exchange to import solar panels or wind turbines for oil-rich countries like Angola or Nigeria?,” he asks.

“Or to Tanzania, Botswana and South Africa with billions of tons of coal in the ground.”

UK should follow Japan on energy

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The Prime Minister of the UK, Theresa May is this week visiting Japan.

Although the continued aggression by North Korea is set to dominate, it is expected that the Mrs May and her counterpart Shinzo Abe will discuss trade between the UK and Japan.

Japan has for years been heeding the calls of leaders in the developing nations by funding fossil fuel projects in some of the world’s poorest countries.

It has been providing the latest coal fired technology to alleviate energy poverty, which improves the lives of the poor and allows developing countries to grow their economies.

This is something that has long been asked for by leaders in the developing world.

This year Former UN Secretary General Kofi Annan called for a ten-fold increase in power production in sub-Saharan Africa, telling the West that African governments must be allowed to use every available energy source.

Nigeria, where 98 million people are trying to scrape by a living in the dark, has been forthright on the need to use of its own resources.

“We have an existential need for power in this country and we have to do something about it, and we can get power from coal which we have in abundance” Nigeria’s Minerals Minister Dr Kayode Fayemi told reporters in April.

The UK should look at how Japan assists people in the developing world who do not have access to reliable and affordable electricity.

The US is also now looking to utilise modern fossil fuel technology to allow developing countries to progress and build their economies.

It is time for other countries – like the UK – to follow suit.

The US is backing calls for an end to restrictions on fossil fuels in the poorest countries

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The United States has announced it will now support developing countries’ calls to stop the World Bank restricting the funding of fuel power stations in the poorest countries.

The move will be welcomed by leaders across the developing world, who have long argued for a more pragmatic approach to bringing electricity to the 1.2 billion who live without it.
This year Former UN Secretary General Kofi Annan called for a ten-fold increase in power production in sub-Saharan Africa, telling the West that African governments must be allowed to use every available energy source. He said: “Each country needs to decide on the most cost-effective, technologically efficient energy mix that works best for its own needs”.

Nigeria, where 98 million people are trying to scrape by a living in the dark, has been forthright on the need to use of its own resources.

“We have an existential need for power in this country and we have to do something about it, and we can get power from coal which we have in abundance” Nigeria’s Minerals Minister Dr Kayode Fayemi told reporters in April.

Like Kofi Annan, Dr Akinwunde Adesina, head of the African Development Bank, has also urged his Western counterparts to take a more balanced approach: “Africa must develop its energy sector with what it has. Endowed with many different energy sources – both renewable and conventional – Africa needs a balanced energy mix.”

Leaders of developing countries and western experts have long argued that the West got rich on fossil fuels, so it cannot in good conscience deny cheap and reliable power to the poorest nations. Latest figures show that the United States generates two thirds of its electricity from fossil fuels. And this winter it will use more of that power on Christmas lights than everyone in Tanzania – homes, businesses and hospitals – consumes all year.

Current World Bank chief Jim Kim has himself acknowledged that Africa’s vast power deficit is a kind of “energy apartheid” and that fixing it will require pragmatism.

“If some people have taken a position where we say no coal, no nuclear, no hydro, then we’re really not serious,”.

The UN has reported that levels of electricity consumption have barely improved in Africa since the year 2000. The World Bank was set up to help starving and war-shattered countries provide for their people and stand on their own two feet, but in recent years progress has gone backwards, with the number of people in sub-sahraran Africa without access to electricity increasing by millions a year. America’s new stance is a welcome shift. Other countries should follow the US lead.

Energy hypocrisy: Hydro-powered Germany tells Tanzania it can’t have a new hydroelectric dam

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Germany has told Tanzania it should not be building a new hydroelectric dam, despite Tanzania having some of the worst rates of electricity access anywhere in the world.

The planned 2 gigawatt dam at Steiglers Gorge about 60 kilometers southwest of Dar-es-Salam, would increase Tanzania’s electricity generating capacity by 150 percent. In a country where 36 million people – two thirds of the population – still don’t have electricity access, this would be a massive boost to jobs and living standards.

Tanzania’s President Magufuli recently signed an agreement to bring in technical experts from Ethiopia, which is putting the finishing touches to Africa’s largest hydro-project, the Grand Ethiopian Renaissance Dam on the Nile.

However Germany’s ambassador to Tanzania has said that President Magufuli must “reconsider” his plans, citing the environmental impact that Steiglers Gorge would have on a surrounding game reserve.

It’s another example of a rich Western country telling an African nation it can’t use its own natural resources to develop. Germany currently consumes 7000 kilowatt hours of electricity a year per person, compared to just 99 kilowatt hours per person for Tanzania. And as Germany itself has 11 gigawatts of its own hydro-power installed, it’s also deeply hypocritical.

Those who say “let them use wind and solar” ignore the importance of baseload power. As Germany well knows, wind and solar on their own can’t provide the round-the-clock power that a modern economy needs. It’s why baseload sources of energy like gas, coal, nuclear and hydro are so important: you need a base of guaranteed electricity to smooth out the variations in wind and solar production.

Tanzania argue that claims of irreversible damage to the reserve are groundless, since the Steiglers Gorge project would cover just 3% of the total game reserve area.

“Come rain, come sun, Stieglers Gorge hydroelectric dam must be constructed,” President Magufuli. “We are not going to listen to people who speak about impacts on environment without facts on the grounds.”


If the West is serious about solving energy poverty it should follow Japan’s lead

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While Western countries drag their feet on energy poverty, Japan has just stepped up to the plate. The island nation has pledged $6 billion to help sub-Saharan Africa achieve universal electricity access.

The Japan-Africa Energy Initiative will see $6 billion invested in electricity for homes, schools, hospitals, farming, industry and clean cooking.

This matters because two thirds of people living in sub-Saharan Africa still don’t have access to electricity, which experts say is essential for helping them escape poverty. For the difference modern energy can make, just take cooking. The indoor air pollution caused by using solid fuels like wood and charcoal for cooking is estimated to cause 4.3 million premature deaths a year.

Crucially, Japan has said it will take a balanced and pragmatic approach, focusing on a low-cost energy mix that includes renewables and conventional fuels. In particular, the Japanese have offered to supply African countries with its own advanced high-performance coal plants.

This attitude stands in stark contrast to the World Bank, which has restricted funding for fossil fuel projects, even though developing countries insist they desperately need cheap baseload power that can operate at all times of the day.

With China also investing billions in African power projects, it’s increasingly clear that if the West isn’t willing to help low-income countries achieve their energy ambitions, others will.

African Development Bank Chief: “Only terrorists prosper in the dark…Africa must develop its energy sector with what it has”

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The head of the African Development Bank has warned that Africa’s energy poverty risks driving more young men into the arms of extremists.

“645 million people in Africa have no access to electricity: 137 years after the invention of the light bulb,” Dr Akinwumi Adesina said in a speech earlier this month.

“To be very frank and direct, only terrorists prosper in the dark.”

Dr Adesina was speaking at the launch of the Japan-Africa Energy Initiative, which will see Japan share its technology and expertise in the coal sector as part of the African Development Bank’s drive to achieve electricity for all by 2025.

Dr Adesina also had a clear message for those Western countries that insist sub-Saharan Africa can survive on renewables alone:

“Africa must develop its energy sector with what it has. Endowed with many different energy sources – both renewable and conventional – Africa needs a balanced energy mix.”

He made the point that African countries will still need baseload power for schools, hospitals, offices, manufacturing plants and factories, which can only come from fossil fuels, nuclear or hydro.

And for once it appears that the international community is listening. Japan is making $6 billion available for exactly this kind of balanced approach, while the US is calling on the World Bank to end its restrictions on funding for fossil fuels.

Perhaps the message is finally getting through.

US treasury to help promote universal electrification

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Affordable, reliable and cheap electricity is essential in improving people’s lives and allowing countries to develop.

A recent World Bank report highlighted the importance of access to reliable electricity for rural development.

However, World Bank rules currently prevent funds being used to fund fossil fuels in developing countries.

Across Africa, 620 million people lack access to reliable electricity and now leaders in the West are realizing that to change this, urgent action needs to be taken.

The US treasury has recently said that it will act to ensure that multilateral banks support universal access to “affordable, reliable, sustainable and clean energy.”

The Treasury also said it would “help countries access and use fossil fuels more cleanly and efficiently”.

This news will be welcomed by political leaders in the developing world. Leaders like Sheikh Hasana in Bangladesh and energy Minister Piyush Goyal in India have previously criticised the West’s stance over fossil fuels and stated that their countries.

Sheikh Hasana has defended the rights of her country to use fossil fuels for development saying: “We have to provide energy to our people. I have to develop our country. If you cannot develop the economic conditions of your people than how will you save our people?”

Developing nations will continue using all types of fuel to provide electricity and to help development. The US treasury’s bid to help developing countries to use fossil fuels in the cleanest way possible can only be a good thing.

Zambian Energy Minister: Solar is not reliable “and let’s not shy away from talking about it”

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Zambia’s Energy Minister David Mabumba has said that solar is not reliable enough to meet his country’s needs.

Asked by a reporter from the Southern Times, if solar energy was “a reliable source of power” for the southern African country, Mr Mabumba replied:

“No, it is not reliable and let’s not shy away about talking about it. It’s just a stop gap measure. The challenge is that when there is cloud cover, generation drops down meaning there will be a bit of unreliability in terms of the power we get from solar.”

Mr Mabumba said that his country is highly reliant on the mining sector – Zambia is a major producer of the copper used in the world’s electrical devices – and that on its own solar cannot generate the power needed for this energy hungry industry:

“You cannot say that miners can rely on solar for their operations.”

This is a view shared by many energy ministers in emerging economies, who have repeatedly called on the West to recognise that “baseload” (i.e. continuous) power is needed to develop their industries and public services.

At the Paris Conference in 2015, for example, Indian Energy Minister Piyush Goyal told the West:

“The people of India want a certain way of life. They want jobs for their children, schools and colleges, hospitals with uninterrupted power. This needs a very large amount of baseload power and this can only come from coal.”

Like India, Zambia has also invested in baseload power, bringing 300 megawatts of coal power online and connecting to the Southern Africa Power Pool, which allows surplus electricity to be piped in from neighbouring countries. But with 5% of Zambians in rural areas having access to electricity, there is much more to do.

Tanzania commits to electricity expansion

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Tanzania’s Prime Minister, Kassim Majaliwa, said he wants a majority of Tanzanians to have electricity in the next few years, as he outlined his energy strategy this week.

Only a third of Tanzanians currently have electricity access, leaving 36 million people without. Investors have long complained that a lack of reliable power is one of the biggest obstacles to doing business in East Africa’s second largest economy.

Solar power has helped bring small amounts of electricity to people in some rural areas, as an intermittent, small-scale energy source it has failed to attract the factories and industry and that Tanzania needs to thrive.

This is why the country is now embarking on a major programme of baseload power generation, focusing on large-scale power stations that can operate 24/7.

“We want our country to have sufficient and affordable power to guarantee the operations of factories which will be built,” Mr Majaliwa said, speaking at a new gas plant, Kinyerezi II, in Dar es Salaam.

Tanzania has rich coal and natural gas resources, and is determined to use both to bring cheap and reliable electricity to its people.

At a laying of the foundation stone for the new plant, Tanzanian president John Magafuli said he wants to get to a point where the country generates enough reliable power to sell the surplus to neighbouring countries, just like countries do in Europe.