29 June 2016 - Beijing
Rachel Kyte, CEO of Sustainable Energy for All (SEforALL), today urged the G20 group of leading economies to press ahead with implementing plans aimed at bringing energy access to millions of people across Africa and Asia.
In a keynote speech on ‘Demand and Current Policies for Energy Access’ at the start of the G20 Conference on Energy Access in Beijing, Ms Kyte said the G20’s Action Plans for energy access in Sub-Saharan Africa and the Asia-Pacific region “highlight important steps that can be taken, from policy and regulatory support, through capacity building and knowledge transfer, to the development of bankable project pipelines.”
“Placing emphasis on implementing these Plans will be critical,” she said.
G20 Energy Ministers last October adopted an Energy Access Action Plan coordinated by SEforALL to help fight energy poverty by strengthening collaboration, sharing knowledge and breathing new life into existing initiatives, with an initial focus on electricity access in Sub-Saharan Africa.
Drawn up at the request of the 2015 Turkish G20 Presidency, the plan is a voluntary collaboration mechanism for G20 members. It was drafted by SEforALL in cooperation with 15 international organizations including the African Development Bank, African Union, World Bank and International Energy Agency.
A similar Action Plan for the Asia-Pacific region, drafted by SEforALL with the UN Economic and Social Commission for Asia and the Pacific (ESCAP) and a range of other organizations, has now been prepared under this year’s Chinese G20 Presidency. It will be discussed during the G20 Energy Ministerial Meeting in Beijing on 30 June.
Holding up examples of successful models for decentralized energy access such as M-Kopa, which provides solar power to homes in Kenya, Tanzania and Uganda through a pay-as-you-go system, and the Infrastructure Development Company (IDCOL) in Bangladesh, which is optimizing private-sector engagement in developing and financing energy access, Ms Kyte said it was important to support continued innovation so that such models could be adapted to new markets and taken to scale.
“Finance flows still fall far short of what we need,” she said, adding that around $50 billion will be required each year until 2030 to ensure universal energy access – almost four times current funding.
“We need to go further, faster, to close the energy gap. And there is much we can do to spur access faster if we work together.”
Ms Kyte said policy was the “accelerant” to transform energy access: “policies that take a fresh, integrated look at decentralized and centralized approaches -- approaches that are new, different and face hurdles.”
Specifically, she said policies should support:
- integrated planning, coordination and expansion of both grid and off-grid development, addressing the power sector as a whole;
- dedicated electrification targets, and fiscal and other incentives such as exemptions on VAT and import duty that focus on specific renewable energy technologies;
- measures to address the creditworthiness of energy off-takers and immature markets, and the affordability of high up-front investments, be it for a power plant or a clean household cookstove;
- measures to improve the governance and capacity of power utilities and regulators, so that they can raise financing for new infrastructure; and
- quality standards for renewable energy equipment, such as lighting products, cookstoves or mini-grids.
Ms Kyte said many innovative partnerships, bringing together the public and private sectors and civil society, were moving this agenda forward, from ElectriFI to Power Africa, Power for All and the G20 Action Plans. These partnerships, and others, are critical to elevate best practice and streamline information.
But energy ministries or rural electrification agencies tasked with coordinating engagement face capacity and resource constraints, she added, and need support to strengthen their implementation capacity while putting the right policies in place.
Speaking to Reuters in London the previous day, Ms Kyte also highlighted the need to phase out distorting fossil fuel subsidies as soon as possible.
“With low oil prices, it is the time to do it – and the countries who are doing it now are reaping the rewards,” she said.
The Friends of Fossil Fuel Subsidy Reform, an informal group of non-G20 countries, is also encouraging the G20 to implement the commitment its leaders made in 2009 to phase out fossil fuel subsidies, and an open letter to the G20 ministers from 200 NGOs has called for a 2020 cut-off date.