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The Potential for the Production of Bioenergy for Lighting and Cooking Using Jatropha (Jatropha curcas L. Euphorbiaceae) by Small Scale Farmers on the Kenyan Coast

Doctoral Thesis / Dissertation 2010 312 Pages

Geography / Earth Science - Economic Geography

Excerpt

Table of Contents

Acknowledgements

List of Figures

List of Tables

List of Maps

List of Images

List of Case Studies

Abbreviations

List of Appendices

Currency exchange rates

Introduction

1. Household energy consumption in Developing Countries
1.1 Biomass – cooking fuel for the poor
1.2 Kerosene - fuel based lighting for the poor

2. The importance of household energy in reaching the Millennium Development Goals
2.1 How the use of traditional biomass leads to environmental degradation
2.2 Traditional biomass and respiratory infections
2.3 Socio-economic impacts of the use of traditional biomass
2.4 The effects of fuel based lighting

3. The growing importance of Renewable Energy Technologies
3.1 The status of renewable energy technologies in Developing Countries
3.2 Increasing affordability due to reduction in costs
3.3 Growing investment in the establishment of renewable energy technologies

4. Barriers for the diffusion of Renewable Energy Technologies in Developing Countries
4.1 The need for accurate data
4.2 The importance of a conducive, institutional environment
4.2.1 Government policy interventions for the wider promotion of Renewable Energy Technologies
4.2.2 Policy impacts on rural households in Sub-Saharan Africa
4.2.3 Possible interventions in favour of rural electrification
4.2.3.1 Co-operatively managed off-grid schemes
4.2.3.2 Are rural households able to pay for energy services?
4.2.3.3 Rural Energy Service Company – overcoming initial costs and service constraints
4.2.3.4 The potential of micro-financing
4.2.4 The need for a local supply infrastructure
4.2.5 The need for quality control
4.3 Social acceptance by consumers
4.3.1 The diffusion of innovations
4.3.2 The need for technology cooperation
4.3.3 No awareness: no adoption

5. Sub-Saharan Africa’s dependency on traditional biomass and kerosene
5.1 The practicability of sustainably producing traditional biomass
5.2 The feasibility of increasing the energy efficiency of traditional biomass

6. Household energy in Kenya
6.1 Electricity, a future energy source for the poor?
6.1.1 The Rural Electrification Programme
6.1.2 Can future electricity generation meet the demand?
6.1.3 Affordable tariffs vs. unaffordable connection fees
6.2 Kenya’s potential for ‘stand alone’ renewable based power generation
6.2.1 The potential of micro-hydro power
6.2.2 The potential of wind energy
6.2.3 The potential of solar photovoltaics
6.2.4 The potential of bioenergy
6.2.4.1 Direct combustion of biomass
6.2.4.2 The potential of bio-chemical conversion
6.2.4.3 The potential of biofuel

7. Jatropha curcas L. – the potential of a multipurpose oil tree
7.1 Properties of the species
7.1.1 Medicinal value of leaves and seeds
7.1.2 Energy value of crude jatropha oil
7.1.3 Geographical distribution within Kenya
7.2 Jatropha plantations in Developing Countries and their viability
7.2.1 Agro-economical requirements
7.2.2 Environmental impacts
7.2.3 Socio-economic effects
7.2.4 Intercropping – Outgrower scheme
7.2.5 The feasibility of an international certification scheme
7.3 Overview of Jatropha activities in Kenya

8. The suitability of Jatropha for decentralized energy provision
8.1 Implementing agency and project design
8.2 The Stakeholders
8.3. Materials and Methods

9. The areas of examination
9.1 The Natural Environment
9.1.1 Geology and geomorphology
9.1.2 the Soils
9.1.3 The Climate
9.1.4 Population and ethnic groups
9.2 Economics
9.2.1 Agricultural potential
9.2.2 Land-use practices
9.2.3 The importance of tree crops

10. Household energy consumption
10.1 Energy for cooking
10.2 Energy for lighting
10.3 Perceived problems in relation to different fuel sources

11. The production – Jatropha as buffer zone and hedge plant
11.1 Community knowledge about Jatropha
11.2 The importance of buffer zones to protect indigenous forests
11.2.1 Makaya - biodiversity hot spots under threat
11.2.2 Kaya Muhaka’s biodiversity
11.2.3 The Jatropha buffer zone
11.3 Production on farms – Jatropha hedges to protect food crops
11.3.1 The viability of Jatropha for a drought coping strategy
11.3.2 Productivity of Jatropha trial areas
11.3.3 Jatropha’s economic viability as a hedge plant in Kenya

12. The processing of Jatropha seeds
12.1 Combining the production of crude jatropha oil and jatropha seed cake briquettes
12.2 Financing the expeller

13. The potential of Jatropha products for household energy usage
13.1 The need for affordable and socially accepted energy appliances
13.2 The introduction of crude Jatropha oil and Jatropha seed cake briquettes – building on households’ familiarity
13.2.1 The Akiba lamp
13.2.2 Crude Jatropha oil as a renewable alternative to kerosene
13.2.3 Jatropha seed cake briquettes as a renewable alternative to firewood

14. Trading of feedstock vs. decentralized processing
14.1 The Jatropha Value Chain
14.2 Can production meet demand - a prognosis

15. Discussion and perspectives

Cited Literature

Zusammenfassung

Executive Summary

Acknowledgements

The compilation of this Dissertation would not have been possible without the kind support and assistance of numerous individuals and organizations which I would herewith like to thank sincerely.

First and foremost I thank my research advisor Prof. Dr Wolfgang Schoop who provided guidance throughout the entire period, helping me to stay focused. I would also like to thank Prof. Dr Fromhold-Eisebith for taking over the co-reporting despite the very short notification.

The German Development Service (DED) and the United Nations Development Programme (UNDP GEF SGP) made the study possible by allowing me to combine my work as Technical Advisor with necessary research activities on the ground. In this sense, a special thanks goes to my former DED Coordinator, Mr Anton Glaeser who supported me in my decision to start this work at the beginning of 2006.

Along the way I met a lot of individuals who supported me with advice and assistance including: Mr Elias Kimaru (WWF) and the WWF-team in Mombasa and Ukunda who patiently assisted me in moving the project ahead. The impressive commitment and involvement of the Coordinators from the Community Groups, who simplified the data collection in the field, particularly Mr Mambo Mwakasimu who walked an extra mile to accommodate all necessary surveys on time.

Multiple discussions with experts were extremely helpful to gain insight into the different research topics, these were held with numerous individuals including Mrs Faith Odongo (Ministry of Energy, Kenya), Dr Gerd-Henning Vogel (DECON GmbH, Germany), Dr Evans Kituyi (University of Nairobi, Kenya), Dr Miyuki Iiyama (ICRAF, Kenya), Mr Eirik Trondson (Energy Africa Ltd., Kenya), Dr Rene Haller (Baobab Trust, Kenya), Dr Eric Martinot (Institute for Sustainable Energy Policies, Japan), Dr Sue Canney (Pipal Ltd., Kenya) and Mr Kilian Reiche (World Bank, USA).

I would like to express gratitude to Mr Ian Robertson (Agro-ethnologist) and Mrs Anne Robertson (a Botanist very involved in conservation and protection efforts of Kenya’s makaya, sacred coastal forests) both living and working in East Africa for the past 40 years. Their valuable advice after proofreading the Thesis is greatly appreciated.

I also acknowledge the support of Dr Neil Burgess (Cambridge University), Mr Rudi Drigo (FAO-Consultant), Mr Meshack Nyabenge (ICRAF, Nairobi, Kenya), Mr Craig von Hagen (UN/FAO, Nairobi, Kenya), Mr Allan Kute (World Food Programme, Nairobi, Kenya), Mrs Karyn Tabor and Mrs Kellee Koenig (Conservation International, Washington DC) and Dr Peter Macharia (Kenya Soil Survey) for providing the needed GIS-data for the different research fields.

Even though the daily project work often overlapped my research activities, it repeatedly proved to be exceptionally difficult to balance a job, a family and ‘studies’ at the same time. My wife and daughter should therefore receive my utmost thanks and appreciation for their understanding.

I’m convinced my three year old daughter, Siana to whom I dedicate this work will understand the value of it as she is the next generation to inherit this planet from us.

Finally, I would like to acknowledge the support from my brother who assisted me in obtaining literature which was hard to find in Kenya. To my parents I will always be grateful for their faith in me and their encouragement.

List of Figures

Figure 1: Global use of biomass

Figure 2: The link between poverty and electricity access

Figure 3: Residential consumption of kerosene in selected countries of Sub-Saharan Africa (2006)

Figure 4: Traditional biomass dependency in relation to development targets

Figure 5: Global firewood consumption Figure 6: Global charcoal consumption

Figure 7: Renewable energy share of global final energy consumption (2006)

Figure 8: Share of global electricity from renewable energy (2006)

Figure 9: Financial new investment by Renewable Energy Technology

Figure 10: Electricity production in Africa (2004)

Figure 11: New financial investment in Renewable Energy Technologies, 2002-2008 (globally, in US$ billion)

Figure 12: Interrelated barriers of Renewable Energy Technologies in Developing Countries

Figure 13: Impact of a chosen technology on the population in Developing Countrieson

Figure 14: Independent Power Producers’ investments in Sub-Saharan Africa

Figure 15: Off-grid, Hybrid Power System based on renewable energy

Figure 16 The Innovation Decision Model

Figure 17: Possible government-led interventions for rural electrification

Figure 18: Possible conversion routes and energy end-use appliances to increase the efficiency of biomass

Figure 19: Energy consumption of the population in Kenya

Figure 20: Major energy sources for cooking in Kenya’s urban and rural areas

Figure 21: Major energy sources for lighting in Kenya’s urban and rural areas

Figure 22: Reform steps in Kenya’s Power Sector

Figure 23: Households’ electrification levels in Kenya

Figure 24: The forecast of electric power generation in Kenya (2008-2018)

Figure 25: Average daily radiation measured at 15 meteorological stations in Kenya

Figure 26: The cogeneration process

Figure 27: Sugar cane production of six major companies

Figure 28: The Jatropha plant

Figure 29: Current and potential usage of the Jatropha tree and its products

Figure 30: Size of Jatropha projects on a global level (2008)

Figure 31: Jatropha project schemes and project ownership on a global level (2008)

Figure 32: The Jatropha System

Figure 33: Msambweni average rainfall over the past 21 years (1986-2007)

Figure 34: Yearly deviation from mean rainfall at Kinango

Figure 35: Monthly deviation from mean rainfall at Kinango

Figure 36: Decline of local maize production in Kwale District

Figure 37: Time spent collecting firewood in the research area

Figure 38: Impact on the development of kerosene prices for rural and urban households in Kwale District

Figure 39: Summary of the energy use patterns in rural and urban areas

Figure 40: Productivity of Kaya Muhaka buffer zone in relation to the national average

Figure 42: Households’ perceptions of the Akiba lamp

Figure 43: Substitutes for lighting during kerosene shortage

Figure 44: Economic activities requiring illumination

Figure 45: Ranking of importance of household activities requiring lighting

Figure 46: Average lighting time needed for household activities

Figure 48: Meal combinations among households

Figure 49: Comparison of firewood to Jatropha briquettes in the Muhaka Kitchen Test

Figure 50: The Jatropha Value Chain

List of Tables

Table 1: Projection of woodfuel consumption in main developing regions

Table 2: Renewable energy promotion policies in Developing Countries

Table 3: Costs of buying and refilling different sizes of LPG cylinders in Kenya

Table 4: Typical energy service requirements in the form of electricity for off-grid populations in Developing Countries

Table 5: Overview of community managed small hydropower stations in Kenya

Table 6: Feed-in tariffs for electricity produced from renewable energy sources in Kenya

Table 7: Physical properties of selected plant oils, kerosene and diesel oil

Table 8: Interviewed groups and sample size/socio-economic survey

Table 9: Interviewed groups and sample size/social acceptance survey

Table 10: Average monthly expenditure (December 2007) on lighting needs for non-grid connected households in Kwale District

Table 11: Ranking of perceived problems of different energy sources

Table 12: Threatened species of Kaya Muhaka and their global importance

Table 13: Heating value of Jatropha seed cake compared to woodfuels

Table 14: Comparison of Jatropha seed trade and the use of CJO as a substitute for kerosene

Table 15: Collection time of biomass and kerosene compared to Jatropha seeds

List of Maps

Map 1: Traditional use of biomass and the electrification levels in Developing Countries

Map 2: Balance of supply and demand of woodfuel in East Africa

Map 3: Kenya’s main power sources in relation to population density

Map 4: Arable land under food and cash crops in Kenya

Map 5: Location of original Jatropha growing areas in Kenya

Map 6: Global Jatropha growing areas and the size of projects (2008)

Map 7: Jatropha cultivation within Kenya in comparison to food/cash crop regions

Map 8: Areas of examination within Kwale District

Map 9: Prevalent soil in the research areas in relation to the topographic features and geological formations

Map 10: Average annual rainfall in research areas

Map 11: Population density in Kwale District

Map 12: Geographical distribution of ethnic groups in relation to project areas

Map 13: Agro-ecological zones in relation to land-use

Map 14: Remaining closed canopy forests and extent of woodfuel trade in Kwale District

Map 15: Cattle density and forest location (kaya) in Kwale District

List of Images

Image 1: Charcoal trade in Kenya

Image 2: Micro business centre profiting from micro hydropower

Image 3: Kerosene lanterns commonly used by fishermen on Lake Victoria

Image 4: Fishermen with solar based lighting on Lake Victoria

Image 5: Distribution of Solar House Systems by Grameen Shakti in Bangladesh

Image 6: The Kenya ceramic jiko and the traditional metal jiko

Image 7: Traditional Tortilla Stove

Image 8: Drying corn in China and Kenya

Image 9: Traditional earth kiln in Kenya

Image 10: Biogas plant at Kibunga Hills (Kenya Coast)

Image 11: Location of Gibe III in Ethiopia and Lake Turkana

Image 12: Affect of 2008/09 drought on small hydropower generation at Tungu Kabiri at Mt. Kenya

Image 13: Biogas plant at Kilifi

Image 14: Agro-ecological zones in Kwale District

Image 15: Woodfuel use in Kwale District

Image 16: Jatropha tree as grave marker at LIMA

Image 17: Ecotourism at Kaya Kinondo

Image 18: Bush Pig (Potamochoerus larvatus)

Image 19: Measures to protect farmland from bush pigs

Image 20: A live-fence of Jatropha

Image 21: Jatropha trial areas

Image 22: The Bielenberg Ram Press

Image 23: Hydraulic Piston Press

Image 24: Kaya Kinondo Financial Service Association

Image 25: A traditional way of using the Jatropha seed for lighting

Image 26: The second generation Protos cooker and a wick based cooker

Image 27: Kerosene lamp compared to Akiba lamp at Muhaka Centre

Image 28: The Akiba lamp in use

Image 29: Jatropha buffer zone at Kaya Muhaka

List of Case Studies

Case study 1: ‘Smart-subsidies’ for smart energy solutions

Case study 2: Electrification in urban areas of Africa

Case study 3: Community managed mini-grid in Kenya

Case study 4: No solar-based lighting for fisherman at Lake Victoria

Case stud y 4: Renewable Energy Service Companies in South Africa

Case study 5: Grameen Shakti, long-term credits with combined service

Case study 6: The Kenya Ceramic Jiko

Case study 8: The rural firewood stove in Kenya

Case study 10: The impact on Kenya’s Rural Electrification Programme

Case study 11: Can geothermal contribute to meet the increasing demand?

Case study 12: Solar Home Systems in Kenya

Case study 13: The potential of cogeneration in Kenya

Case study 14: Kenya’s experience with ethanol production – a review

Case study 15: Kaya Kinondo Ecotourism Project

Case study 14: The changing role of the makaya

Abbreviations

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Abbildung in dieser Leseprobe nicht enthalten

Abbildung in dieser Leseprobe nicht enthalten

List of Appendices

I Agreement

II Questionnaire: Household Survey Part I

III Questionnaire: Household Survey Part II

IV Interview with Elders

V Interview with NMK/CFCU Coordinators

VI Interview with Private Sector

VII Summary Agro-ecological zones

Currency exchange rates

US$ 1 = Ksh 76 (unless stated otherwise in the document)

US$ 1 = TZS 1339

Introduction

The majority of the rural population and the urban poor in Developing Countries (DCs) are likely to remain heavily dependent on traditional biomass to meet daily energy needs for cooking, and kerosene for lighting, in decades to come. The reasons for this is the lack of affordable (costs), available (distribution) and acceptable (traditionally and culturally) alternatives. Rural Electrification Programmes (REPs) in these countries are often poorly implemented and would not even have a great impact as electricity is commonly not used for cooking due to high tariffs and cultural preferences. Renewable energy projects are still too expensive with heavy reliance on external technologies/expertise and often lack acceptance by rural communities. Hence they are in most cases not suitable for wider distribution unless profoundly subsidised by government and/or donors. Energy efficiency projects (e.g. energy saving stoves) which are predominantly used in urban households do have a positive short-term impact on household expenditure and the preservation of natural resources. The expected increase in population size is however believed to outpace the sustainable supply of biomass hence tremendously increasing the pressure on natural resources (e.g. forests).

The continuous and extensive usage of traditional biomass in low efficient end-use appliances by rural and urban households leads to an increase in environmental degradation, gender inequality, health implications for users and significant green house gas (GHG) emissions. In this sense none of the development targets set by the international community, the Millennium Development Goals (MDGs) as well as major environment conventions (UNFCCC, UNCBD and UNCCD) can be reached without a provision of clean and renewable energy.

While traditional biomass is the most common source for cooking in DCs, fossil fuel based energy, predominately illuminating kerosene (henceforth termed kerosene), is the main source for lighting. This source of energy is used by the majority of rural households as well as the ‘non-grid’ connected urban households. Although lighting is a substantial part of the household’s energy mix it has up to date been largely ignored by the international community as well as national governments.

In contrast with traditional biomass, kerosene is a commodity which is not available in most DCs and therefore needs to be imported. Securing the continuous supply of kerosene poses a heavy burden on end-users, predominately belonging to low-income classes, as well as national governments, which are losing valuable foreign currency. The global decline of fossil fuel resources combined with a possible carbon tax and simultaneously a decrease in subsidies in user countries will lead to a future increase in the price of fossil fuels to the extent of not being affordable for the majority of the population in DCs. The impact would be severe as lighting is crucial for business as well as educational activities in these countries hence severely affecting the economies and deepening the poverty.

The introduction of modern bioenergy for lighting and cooking using non-edible oil seeds from Jatropha and other oil crops for oil and seed cake production could be a long term solution for a sustainable decentralized household energy provision. Jatropha as perennial plant is easy to embed in existing cultivation methods with the crude oil being used directly in modified energy devices for lighting, and with the Jatropha seed cake as a by-product, used as bio-briquettes for cooking. Introduced in the form of the Jatropha System (JS) the tree has the potential of not only improving living standards and reducing environmental degradation, but also protecting highly threatened biodiversity hot-spots from over-exploitation as well as farmland from browsing and wild animals. Any step in the system can be locally performed. The JS offers a more environmentally sustainable and more socially responsible introduction than its establishment in form of large scale industrial Jatropha plantations for liquid biofuel. The latter takes place in a growing number of DCs and is increasingly related to the destruction of biodiversity and the competition over arable land used for food crop production.

The aim of this study is to show the potential as well as the barriers when introducing the JS as an alternative energy source to rural households. The research is based on a UNDP GEF SGP funded pilot project which was conceptualized by the author and supported by the German Development Service (DED), the World Wide Fund (WWF), various government institutions and local communities. The project was implemented in Kwale District at the Kenyan South Coast between 2006 and 2010.

The feasibility of introducing the JS to provide energy to rural households in the form of lighting (Jatropha crude oil) and cooking (Jatropha seed cake briquettes) has to date not been scientifically examined in a comprehensive manner. Current and past research efforts concentrate almost exclusively on the end-use of crude vegetable oil as fuel for cooking. For that purpose cookers that can operate with crude vegetable oil were designed, manufactured and have already been distributed to rural households in selected DCs. Although such cookers like the PROTOS, which was developed by Bosch and Siemens Home Appliances Group in cooperation with the University of Hohenheim, have proven to work very efficiently under laboratory conditions it is questionable whether the cookers’ price, design, operation and resulting lack of social acceptance will allow a sustainable introduction to wider rural areas in DCs. Even if such cookers would be adapted to suite the respective local conditions, other questions such as the environmentally sound production of the required feedstock and its economical transformation into usable energy products remain open.

The study therefore not only looks into the aspect of socially accepted end-usages of Jatropha energy products, but also into other aspects that are crucial for the sustainable introduction of an entire Jatropha value chain. In this context the author poses three main research questions: 1. Production: Can rural households sustainably introduce the JS and produce sufficient seeds in the research area in view of given farm sizes and energy need? 2. Processing: Can the seeds be efficiently processed by community members in a sustainable and decentralized manner? 3. Usage: Would households accept the new energy source as a substitute for kerosene and traditional biomass?

Guided by these main questions the author undertook different empirical studies and field trials: Firstly, the likelihood of households making a fuel switch was determined by a comprehensive survey evaluating the current energy usage with all related socio-economic and environmental concerns. This step was followed by different field trials targeting the diverse levels of the possible Jatropha value chain: The tree’s capacity to provide sufficient seed material was established by monitoring the production of feedstock in the different project areas. For that purpose Jatropha trial areas were established and monitored in three different agro-ecological zones. On the processing level an oil expeller was designed taking different criteria of sustainability into consideration. A prototype of this manually operated machine was then manufactured and tested locally. For the last level of the chain, the usage of the final energy products, Everett Roger’s model for the diffusion of innovations (Rogers, 2003) was applied to design a lamp that could not only operate on crude Jatropha oil but which would also encompass a high degree of social acceptance by rural households. The degree of acceptance was determined by a household survey that followed, capturing the households’ perceptions of the design and operation of the new energy-end use appliance. The heat efficiency of Jatropha seed cake briquettes which were simultaneously produced while pressing oil was finally tested and compared to that of firewood. The usage of briquettes would allow households to continue using traditional cooking devices and therefore to keep their cooking habits rather than introducing new technologies such as plant oil cookers. As aforementioned such technologies are normally too costly and complex in use and generally lack social acceptance, hampering their sustainable introduction to rural households.

The core result is that modern biomass in the form of crude plant oil and briquettes could be a low-cost and socially accepted way for providing energy to households, in a decentralized manner. The suggested Jatropha value chain builds on resources, technical know-how and familiarity that are already available within rural communities. It therefore has the advantage of minimal external technology requirements and maintenance in comparison to other renewable energy sources such as solar, wind or biogas. The dependency on external sources is one of the main reasons for a high project failure rate when introducing RETs to rural areas in DCs, as discussed in this document.

Although the results of this study are extremely site specific, the general theme of using bioenergy crops such as Jatropha for the provision of household energy in DCs is universal. In this sense the overall concept can serve as a possible approach in mitigating the inevitable current and future household energy shortfalls in DCs.

1. Household energy consumption in Developing Countries

Energy is pivotal for all aspects in life and has therefore always been a central point of attention, especially in times of shortage and rising energy prices, global warming and the pursuit of energy security. Despite this importance, household energy services[1] in Developing Countries (DCs) have so far been given relatively little attention (GTZ, 2008; IEA, 2006; UNDP GEF SGP, 2006b).

Although oil provides the greatest quantity of energy, traditional biomass[2] is still the widest used fuel per capita. While during the 19th century the population in Industial Countries (ICs) has gradually shifted from using biomass, to introducing coal and later petroleum, the majority of the population in DCs still heavily relies on biomass sources to cover their basic energy requirements (Odingo, 1981:103; UNIDO & REEP, 2008:7.20). The most important energy need in DCs is cooking, the oldest activity of mankind which also takes the biggest share[3] of total primary energy consumed (IEA, 2008a:177; Kammen et al. , 2001:8).

Because traditional biomass is classified as a renewable source of energy one could argue from an energy perspective that households in DCs are ‘greener’ than households in most Industrialized Countries (ICs). If biomass is produced in a renewable manner and the combustion done in an efficient way then this might even be the case. However, traditional biomass, in particular woodfuel, is often not harvested sustainably and is used in low-efficient end-use appliances with negative economic and environmental impacts as well as severe health implications (Barnes & Floor, 1996; Goldemberg & Coelho, 2004; Smith, 2002). In this sense cooking in DCs is not only an essential need but also a ‘chore and threat to lives’ (WHO, 2006).

The other most important household energy need is lighting. Particularly for the rural as well as the urban poor population in DCs, lighting needs are rarely met by electricity from the national grid due to high costs for consumer and supplier. Fossil fuel based lighting in the form of kerosene[4] has become the most common lighting source used by these households. Most of the DCs have to import the fossil fuel which poses a heavy economic burden on their foreign exchange as well as on the households’ budgets. In turn the high kerosene prices as well as fluctuation in supply forces many households to reduce their lighting hours which has a negative impact on educational and economic activities.

The following chapters analyse the importance of biomass for cooking, and fossil fuel for lighting in rural and poor urban households in DCs and the effect on the environment, economy and health.

1.1 Biomass – cooking fuel for the poor

In view of climate change and energy insecurity, biomass is increasingly gaining importance as a renewable source for the generation of bioenergy[5] on a global scale. However there are significant differences in its use between DCs and ICs. Many countries belonging to the Organization for Economic Cooperation and Development (OECD) primarily convert a variety of biomass into modern energy services[6] in a sustainable manner for commercial purposes (Parikka, 2004). In contrast, DCs use it most commonly to cover basic household energy needs in a largely unprocessed[7], inefficient and often non-commercial manner (Goldemberg & Coelho, 2004). Furthermore the use of biomass and other renewable energy sources in ICs is essentially driven by environmental factors supported by regulatory frameworks, while traditional biomass is the sole source of available energy for the survival of households in DCs and is generally poorly regulated (Jacobsson & Johnson, 2000:638).

The traditional use of biomass in DCs still outweighs the more sophisticated use of this energy source in the western world (Figure 1). Almost 50% of biomass is being used in form of woodfuel by over 52% of the global population (2.4 billion people) due to a lack of alternatives (UN Energy, 2007:1; UNIDO & REEP, 2008:10.9; IEA, 2006:420-421). The high consumption of biomass by households in DCs is also reflected in global energy statistics where it accounts for around 14% of the total global energy use, thus making it the 4th most important source of energy after oil, coal and gas (Demirbas, 2003:219).

Figure 1: Global use of biomass

Abbildung in dieser Leseprobe nicht enthalten

Compiled by author

Source of data: Demirbas (2005)

Note: the data used is from the year 1995. The chart does not include additional biomass sources commonly used on a rural household level in many DCs, e.g. cow dung and crop residues. Over 90% of the global woodfuel production and consumption takes place in DCs (Whiteman et al. , 2002:42; Parikka, 2004:614). The World Health Organization (WHO, 2006), estimates that 2 million tons of traditional biomass is burned daily, mainly to cover the cooking needs of households.

Traditional biomass is commonly referred to as the energy for the poor[8] as it is easily accessible at low or no costs[9] and because it can be used without expensive conversion devices (Karekezi et al. , 2004). As a general rule, the poorer a country is, the greater the reliance on traditional biomass. As illustrated in Map 1, the highest number of countries dependent on traditional biomass is located in Africa where the low-grade fuel provides over 70% of primary energy use (Ludwig et al. , 2003:23). Even the majority of households (approximately 91%) in Nigeria, a major oil producing country, still depend on traditional biomass to cover their daily energy needs (UNIDO & REEP, 2008:1.6).

Governments of DCs and the international community have so far had little success in attempts to mitigate households’ dependency on biomass as discussed in Chapters 4 and 5.

1.2 Kerosene - fuel based lighting for the poor

Most DCs are characterised by low rural electrification levels and a high concentration of electricity networks in urban areas. The main reasons for this development are; village settlement patterns[10] resulting in large geographic areas with low population density, low electric load-factors, and high connection costs[11] which meet low purchasing power by rural as well as urban poor households (Aluanga, 2008; Bailis et al. , 2005a; Karekezi et al ., 2004; Kirubi et al ., 2009; Kituyi, 2004; Rural 21, 2008). Further, national public expenditure in DCs have in many cases been used primarily to upgrade rural infrastructures like roads, health centres, schools and telecommunication networks but seldom covered energy services (Wolde-Ghiorgis, 2002:1103). The power sector reforms that have taken place in many DCs over the past ten years seem to have only worsened the situation due to drastic tariff increases as well as an even stronger reliance on imported fossil fuel (Chapter 4.2.2). Even with the introduction of cross-subsidies[12] (e.g. in form of a lifeline tariff[13] for poor households) the majority of rural and urban poor households remain unconnected mainly due to the high, mostly un-subsidised connection charges which can rise to over US$ 600 (World Bank, 2008; Kimani, 2009). Small scale, Renewable Energy Technologies (RETs) such as solar photovoltaics (PV) or hydropower that are used as an alternative to grid electricity supply, face various financial as well as non-financial barriers for a wider dissemination as discussed in Chapter 4.

Map 1: Traditional use of biomass and the electrification levels in Developing Countries

Abbildung in dieser Leseprobe nicht enthalten

1) rural population without electricity (in million)
2) urban population without electricity (in million)

* HS - Household, SF - Solid Fuel

Compiled by author

Source of data: World map shape file provided by UNEP (2008), electrification rates: BMZ (2008) and IEA (2006), percentage of households using solid fuel: WHO (2006)

Electricity supply therefore still remains confined to the privileged urban middle class, upper income households, and the commercial and industrial sector (UNIDO & REEP, 2008:2.13). The International Energy Agency (IEA) assumes that globally approximately 24% of the urban population and 67% of the rural population (a total of 1.64 billion people) have no access to electricity (IEA, 2006). The numbers are significantly higher when considering that many households have in fact only intermittent access to power due to frequent and prolonged power outages (IEA, 2008).

Figure 2: The link between poverty and electricity access

Abbildung in dieser Leseprobe nicht enthalten

Source: IEA, 2002

As illustrated in Map 1, the majority of un-electrified households (80%) are located in South Asia and SSA. With only 23% of its population electrified as a whole and 83% of un-electrified rural households, SSA has the lowest electrification rates in the world (Karekezi & Kithyoma, 2004:20). Similar to the dependence of poorer households on biomass, there is a strong correlation of un-electrified households and poverty as illustrated in Figure 2. While the number of un-electrified people is expected to decline[14] in most DCs including East Asia, North Africa, Latin America and the Middle East to 2030, they are expected to continuously rise in SSA[15] (UNECA & UNEP, 2007). The rise goes in line with the projected trends of a number of people living below the US$2 per day poverty line and is expected to reach over 650 million (half of the SSA’s population) by 2030 (IEA, 2002:378). In other words SSA will remain the only region in the world whose population without electricity will increase in the next two decades.

Figure 3: Residential consumption of kerosene in selected countries of Sub-Saharan Africa (2006)

Abbildung in dieser Leseprobe nicht enthaltenCompiled by author

Source of data: Provided by IEA, 2008

As aforementioned, kerosene is the most common lighting source for households without access to electricity. For most households the ordinary wick-based kerosene lamp is the commonest appliance used for lighting (Mills, 2002:4; Image 28). The use of such kerosene lamps is not only restricted to rural areas but is also commonly used by the 24% of urban households who do not have access to electricity (Karekezi et al ., 2008:42). Even households connected to the national grid use kerosene lamps as a back-up during frequent power outages (IEA, 2002:382). One could compare this situation to that of industrialised countries during the 19th century, when kerosene for lighting became the main source of growth for the international oil industry (Anderson, 1993:296). The only difference with today’s situation in DCs is that other energy sources are available, e.g. renewable based technologies, but those face too many barriers for a wider adoption (Chapter 4).

As in the use of biomass, the consumption of kerosene for lighting per capita might be marginal but it is significantly high when combining all users. According to Mills, household fuel-based lighting is annually responsible for the consumption of 77 billion litres of kerosene at a cost of US$ 38 billion (US$ 77 per household) (Mills, 2005a:1263). Figure 3 illustrates the kerosene consumption of selected African countries in 2006. Besides the few oil-producing countries such as Angola, Cameroon and Nigeria, the rest of the SSA countries need to import crude oil for refining or already refined kerosene and have to; “[…] bear the brunt of the vagaries in both price fluctuations and disruptions in supply” (Peter et al ., 2002:512).

2. The importance of household energy in reaching the Millennium Development Goals

‘‘No country has ever reduced poverty without investing substantially in energy. Energy is central to all human development goals. You cannot have water provision or education or health without energy” ( Anna Tibaijuka, executive director of UN Habitat, in: Nieuwoudt, 2007).

The impact of extensive use of inefficient, inconvenient and low-cost traditional biomass sources for cooking is manifold, ranging from environmental degradation, decrease in economic productivity, and gender inequality to health damage. It therefore affects most of the Millennium Development Goals[16] (MDGs) set up to combat poverty, hunger, disease, illiteracy, environmental degradation and discrimination against women (Modi et al ., 2006). It also affects the successful implementation of International Environmental Conventions (IECs), particularly the United Nations Framework Convention on Climate Change (UNFCCC), the United Nations Convention to Combat Desertification (UNCCD) as well as the United Nations Convention on Biological Diversity (UNCBD).

The impact on fuel-based lighting is predominantly of an economic nature as the cost of kerosene that a poor rural or urban household has to carry is far greater[17] than electric lighting (Mills, 2002). The high price consequently leads to educational and economic shortfalls due to limited lighting hours (Woldemariam, 2004:249).

Figure 4: Traditional biomass dependency in relation to development targets

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Compiled by author

Note: The impact of kerosene (e.g. MDG 1 and MDG 2) is not reflected in the diagram.

As illustrated in Figure 4, none of the aforementioned development goals can be reached without mitigating the dependency on traditional biomass and substituting it with more sustainable, cleaner and cheaper alternatives (with regard to high opportunity costs related to fuel gathering). In this sense the provision of sustainable alternatives become a prerequisite for most of the MDGs and IECs. Although not being part of the eight MDGs, the UN

Commission for Sustainable Development has acknowledged the importance of accessible sustainable energy services in order to reach the goals in later published documents[18] (UNCSD, 2009). During the World Summit on Sustainable Development (WSSD) in Johannesburg in 2002, the participating parties for the first time considered energy as a human need on par with other basic needs such as clean water, sanitation, shelter, food, etc.

Despite this development and the high importance of household energy as a prerequisite in order to reach the MDGs and IECs, it has received extremely little attention[19] and funding compared to other development topics such as HIV/Aids, poor sanitation, water, etc. (GTZ, 2008; IEA, 2006:444).

2.1 How the use of traditional biomass leads to environmental degradation

As discussed in Chapter 1.1, the main source of energy for cooking in most DCs is woodfuel. Its use is often related to degradation of the environment due to unsustainable harvesting. It has however been proven that it is too simple to link an increase in woodfuel consumption to deforestation and a general ‘woodfuel crisis’ (Woodfuel Gap Theory) as commonly assumed during the oil crisis in the early and late 1970s (Barnes et al ., 1999; FAO, 1981 & 2008b). One of the main reasons is that most of the firewood is collected from woody sources outside forests that regenerate themselves (Karekezi & Kithyoma, 2004; Mahiri & Howorth, 2001).

However when distinguishing between urban and rural areas, as well as separating current and future consumption patterns between charcoal[20] and firewood, a different rather worrisome scenario occurs. Woodfuel, particularly charcoal has already become merchandised[21] ; a commodity that is widely traded especially around densely populated areas, often resulting in the sustainable supply being outstripped by the demand (Barnes et al ., 2005; FAO, 2006; GTZ, 2008).

Due to a broader knowledge, the FAO has revised its former (from the 1990s) ‘misleading trends’ in woodfuel consumption (Whiteman, et al ., 2002:41) which were basically linked to

the country’s assumed consumption patterns and its expected population growth presented in a simplistic linear model (FAO, 1981). The most recent projection is more diverse, as a range of influential socio-economic and cultural factors on household energy consumption were taken into consideration, for example; a) the supply site of woodfuel, (i.e. urbanisation rates and deforestation reduces access to firewood but increases the demand in charcoal), b) the household as the consumer (e.g. increase in income that is to some extent[22] associated with a fuel switch to modern fuel), c) cultural aspects (e.g. preferences to cook with certain energy end-use appliances and fuels), as well as d) other consumers, e.g. restaurants, bakeries and public buildings (Arnold et al. , 2006; Mahiri & Howorth, 2001). The results show a very diverse picture for the different regions of the world (Table 1). The overall woodfuel consumption in much of East and Southeast Asia has significantly declined since the 1980s in comparison to a slow rise in South America. This development is expected to continue in the next two decades. The decline is mainly due to the result of the expected economic growth, enabling households to switch to more modern sources of fuel such as Liquefied Petroleum Gas (LPG), kerosene and electricity (FAO, 2008b:39; Goldemberg & Coelho, 2004:712; IEA, 2008a:178). Africa however shows a different trend with a significant rise in woodfuel consumption in the next two decades at a rate close to the population growth (Arnold et al ., 2006). When differentiating between firewood and charcoal it can be observed that the consumption of firewood is expected to decline[23] drastically in Southeast Asia while it will steadily rise in Africa (Figure 5). The consumption of charcoal is expected to increase particularly in South America and Africa. The latter has the sharpest increase in consumption which is expected to almost double between the years 2000 and 2030 (Figure 6).

In other words charcoal is expected to increase its status as the main fuel for cooking among the urban poor, particularly in SSA (Girard, 2002:30). Worldwide the latter has the highest urban growth rate at close to 5% (Karekezi & Majoro, 2002:1015) with rural poverty, natural disaster, war, etc. being the main drivers for rural-urban migration flows (FAO, 2008b).

Table 1: Projection of woodfuel consumption in main developing regions

Abbildung in dieser Leseprobe nicht enthalten

Source: FAO, 2001

Abbildung in dieser Leseprobe nicht enthalten

Source: FAO, 2001

Due to a general stagnation in the economies of most African countries the number of ‘urban-poor’ is expected to increase linearly with migration levels (IEA, 2002:377). This so-called ‘urbanization of poverty’ will consequently increase the dependency of the urban poor on affordable and available energy sources, mainly in the form of charcoal. Besides being one of the cheapest fuel sources in urban areas, charcoal for cooking has additional advantages for the users, including; stable prices[24], low smoke levels during combustion, reduced risks of dangerous flames and long storage possibilities without decomposition (AFREPREN, 2005:23; Arnold et al. , 2006:601; SEI, 2002; UNIDO & REEP, 2008:2.22; Van der Plas, 1995).

As opposed to firewood, charcoal comes almost exclusively from forests, dense woodlands and as mentioned earlier, through commercial channels (FAO, 2008b; Girard, 2003). Especially in SSA the expected increase in charcoal consumption combined with unsustainable production methods is expected to lead to a significant increase in deforestation, the loss of biodiversity and serious bottlenecks in the sustainable supply to urban households (Arnold et al. , 2006:602; Barnes et al ., 2005:8; ESD, 2005:16; Ezzati & Kammen, 2002:825; FAO, 2008b:71; IEA, 2008a:177; Karekezi, 1992:55).

Image 1: Charcoal trade in Kenya

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The effect that increased charcoal production has on the environment is considerably higher than that of firewood. Due to poor conversion efficiency in charcoal production a household consumes up to four times more wood when cooking with charcoal than with firewood (Van der Plas, 1995). For instance a household in Kigali, Rwanda consumes an average of 0.6 kg of charcoal per day (1.75 tons per year) which is over three times the amount of firewood consumed by rural households (AFREPREN, 1994). Furthermore, entire trees are felled for the production of charcoal whereas firewood is most commonly collected in the form of branches[25]. Unfortunately the charcoal production in nearly all African countries is unsustainable (Chapter 5.1). In Kenya for instance only 20% of the wood for charcoal production is harvested sustainably (GoK, MoE, Kamfor Company Ltd., 2002) leading to heavy degradation of the country’s dryland savannah woodlands and rangelands in arid and semi-arid regions where indigenous trees are harvested unsustainably for charcoal making (UNEP, 2006b).

Although the effect of firewood consumption is assumed to be less severe than charcoal’s on the environment, there is still growing evidence that trees are increasingly being cut down in areas of high demand where the scarce resource becomes a commodity (FAO, 2008b:21; Girard, 2002:31; Mahiri, 2003:168; Mbaiwa, 2004:185; Ngugi, 1988:169). Factors indicating the decline of firewood sources, hence the degree of degradation, are; a) the increasing distance households have to cover to collect it, b) the number of households who purchase it from markets and, c) increasing firewood costs (Kituyi, 2004:1049). Scarcity of firewood can not only be observed in urban areas but also increasingly in rural areas[26] where the decline of natural resources leads to a significant shortage of firewood (Barnes & Floor, 1999:252).

An FAO study[27] (FAO, 2006) undertaken in selected African countries demonstrated that a total of 59.2 million or 41% of the population in these countries already face medium-high to high shortages in available woodfuel (Map 2). The deficit areas are most commonly concentrated in and around urban areas where the demand is high.

Map 2: Balance of supply and demand of woodfuel in East Africa

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Source: Drigo, based on FAO’s results (2006)

Note: Ethiopa was not part of the survey. Areas with high woodfuel deficits are mainly densely populated with high poverty rates, and areas where woodfuel is used for commercial activities, e.g. the large deficit around Lake Victoria could be due to the additional usage of firewood for drying fish (Wilson, 1993). Riedmiller (1994) estimates that 45 tons of firewood is burnt monthly at one beach landing site (Wichlum Beach) for fish drying purposes on Lake Victoria.

The deficit in some areas might even be higher because the study has not separated the ‘freely accessible’ woody biomass stock from that located in restricted areas of access, e.g. fenced off private land, gazetted forests, national parks, etc.; “Formal and informal privatization of land holdings is reducing the area of [common pool resources] CPR” (Arnold et al ., 2006:603). Moreover the study assumes a Mean Annual Increment (MAI) of woody biomass of 2.5% under “ normal” conditions. This normality in natural rehabilitation of degraded areas of woody biomass is often not given due to human interference, e.g. grazing on de-forested areas or agricultural land expansion or felling of trees in excess of regeneration (Mahiri & Howorth, 2001:206; Arnold et al ., 2006:602), hence the MAI could be lower than indicated.

Further, the above map does not reflect the woodfuel supply zones which often extend deeply into rural and forests areas. Woodfuel is in many cases transported several hundred kilometres until it reaches the urban customers. For instance, charcoal for Dakar in Senegal is produced in Casamance which lies several hundred kilometres from the capital (FAO, 2008b:26). In Sudan, the transport distance from charcoal producing centres in the Blue Nile Province to the capital Khartoum is around 470 km (Mugo, 1999:19). There are even signs of a possible charcoal export from places in Tanzania (Bagamoyo) to the Middle East (Mwampamba, 2007:4231). Not surprisingly the actual ‘woodfuel supply zones’ for African cities often incorporate large parts of the countries. The woodfuel supply zone for the urban and peri-urban population of Arusha and Moshi in Tanzania for example incorporates 52% of the country’s surface, in Khartoum it is even 62% (FAO, 2008b).

In some countries, e.g. Burundi and Rwanda, the deficit of woodfuel has already reached a nation wide scale. Different studies[28] support the FAO’s findings on the increasing shortages of woodfuel particularly for the production of charcoal in the surveyed region (ESD, 2005; Karekezi et al ., 2004a; Mwampamba, 2007).

A combination of different factors such as lack of policy enforcement to protect forest areas, a lack of clear land tenure and exploitation rights as well as unsustainable harvesting and production methods accelerate the depletion of trees. Introduced protection efforts of governments in most countries are generally regarded as insufficient due to inadequate assignment of resources to enforce these policies (FAO, 2008b:20).

This development does not only threaten future availability but also the affordability of household energy in urban as well as rural areas as costs of woodfuel energy are likely to rise with an increase in demand and decrease in supply (Ejigu, 2008:152; Laichena & Wafula 1997:223). Unlike DCs where the shortage of woodfuel has already led to a general transformation to a cheap alternative, e.g. coal used for cooking in China, most African countries will increasingly depend on low grade fuels (e.g. agricultural residues, cow dung etc.), expensive foreign imports and the introduction of subsidies to cover their households’ future energy needs.

2.2 Traditional biomass and respiratory infections

Even when harvested in a sustainable and renewable manner, traditional biomass is not GHG neutral due to additional non-CO2 based greenhouse pollutants such as methane (CH4) and nitrogen dioxide (N20) that is released into the atmosphere[29] (Smith, 2002:1847). The latter, often referred to as products of incomplete combustion (PIC), commonly occur due to the usage of low-efficient cooking devices. The PIC can cause serious health risks because traditional biomass is commonly burnt indoors or in partly enclosed cooking areas with inefficient ventilation. A range of carbon monoxide related chemicals including benzene, butadiene, formaldehyde, polyaromatic hydrocarbons, etc. can lead to acute lower respiratory infections (ALRIs) (Smith, 2006). A WHO comparative risk assessment report (WHO, 2005) estimates that annually a total of 1.5 million pre-mature deaths, 4000 per day, are caused by sicknesses related to indoor air pollution (IAP) (IEA, 2006:425). In other words there are more people dying worldwide from ALRIs than from malaria.

The most vulnerable to ALRIs and other sicknesses caused by IAP are women and children who are closest to the fire when the pollution is highest (Ezzati et al. , 2000:578). Although the exposure to stove emissions has intense peaks of short duration, e.g. when fuel is added or moved, the cooking pot placed or removed and food is stirred, there is constant exposure even at night during the stove’s smouldering period (Ezzati & Kammen, 2002:817-818). The latter affects the entire household when sleeping areas are close to the kitchen.

The most common diseases caused by IAPs are pneumonia among children under five years of age and chronic obstructive pulmonary disease (COPD) among adult women (Bailis et al ., 2005a:101). An estimated 800,000 children die every year due to underlying causes of ALRIs making IAPs the primary cause of morbidity and mortality in children under the age of five years worldwide (WHO, 2006:20). Therefore ALRIs are responsible for more deaths than malnutrition, diarrhoea or childhood diseases (Kammen et al ., 2008).

If no corrective measures are put in place, the total number of deaths caused by ALRIs is expected to reach close to 10 million by the year 2030 (Bailis et al ., 2005a:98). This figure could be considerably higher when including other health implications that are believed to be triggered by IAPs. Although only few studies are available there is growing evidence that exposure to IAP increases the risks of tuberculosis, asthma, cataract, low birth weight and peri-natal mortality (WHO, 2005; WHO, 2006).

If complete combustion of biomass would take place in an efficient cooker, only carbon dioxide (CO2) and water (H2O) would be produced and both would not be harmful to the user nor the environment (Bhattacharya & Salam, 2002:306). The use of such improved cookers can reduce ALRIs by over 20% in infants and children (Ezatti & Kammen, 2002:815-826).

However, as discussed later, the adoption of new technologies such as improved cooking appliances by rural as well as urban households depends on a variety of financial as well as non-financial factors (Chapter 4.3).

2.3 Socio-economic impacts of the use of traditional biomass

Besides traumatic affects on the families, the increase in sicknesses and deaths caused by IAP has a substantial impact on the countries economies due to a generally reduced productivity. The World Bank estimates economic losses that are directly linked to the aftermaths of IAP of up to US$ 350 billion per year, or 6% of the DCs’ Gross National Product (GNP) (World Bank, 2000).

In addition to being the most vulnerable in terms of sicknesses caused by IAP, women and girls in DCs have the burden of constantly supplying the household with biomass (especially firewood) for cooking (Day et al. , 1990:89). Particularly in areas experiencing high scarcity of firewood the collection becomes a hard, time consuming and even dangerous[30] task. In most cases women have to carry their heavy load over long distances by foot to their homes. In SSA-countries an estimated average of 20 kg per person is carried over an average distance of 5 km (IEA, 2002:366; IEA, 2006:428). The average time women and girls spend for collecting firewood in SSA is estimated at between 9 to 12 hours a week (UNDP, UNDESA; WEC, 2000:70). In areas of high firewood deficits the distance travelled and time spent can however significantly increase. In the Sahel rural people have to travel an average of 15 to 20 km in order to gather their cooking fuel (Davidson & Sokona, 2001:8).

Understandably these tasks leave little time for women and children to engage in other, more productive activities, such as agriculture and/or the education of children (UNEP, 2006a:448). Moreover many girls are withdrawn from school to support their mothers in collecting wood and to cook for the family, resulting in lifelong damage to their literacy (IEA, 2006:428; UNDP & GTZ, 2005:5). A decline in woodfuel resources has also an impact on other household members due to fewer or faster cooked meals as well as limited provision of safe drinking water resulting in an increase in sicknesses and deaths (Arnold et al ., 2006:604; FAO, 2008b:9).

2.4 The effects of fuel based lighting

Adequate lighting during the evening and night is crucial for pupils’ education[31] and also the general productivity of people and enterprises (Rajvanshi, 2003:437).

Households have to pay for their lighting needs as opposed to firewood used for cooking which is still available for ‘free’ in most rural areas. A large percentage of the household’s total income, 10-15% is spent on lighting because of the high price of fossil fuel and the energy appliances’ (kerosene lamp) low efficiency (Kammen et al ., 2008:348; Davidson & Sokona, 2001). For very remote households the expenditure rate can even reach up to 30%[32] of their income (IEA, 2002; WB/IFC, 2007:18). Even when subsidised by the government, kerosene costs in rural areas are still more expensive (up to 300%) than in urban areas, mainly due to transport costs as well as the involvement of traders and middlemen (World Bank/IFC, 2007:18). When lighting is used for commercial purposes the expenditure increases often significantly, e.g. fishermen in Kenya frequently spend half of their income on kerosene as it is additionally needed for fishing activities at night (World Bank/IFC, 2007).

Besides being an expensive lighting source, kerosene has negative effects on air quality and human health. Some governments and authors believe that smoke from kerosene has similar effects on the human respiratory system as has burning wood (GoK, MoE, 2009; Deaton Steal, 2008). Furthermore, the use of ‘unsafe’ lighting appliances when burning kerosene has caused severe burns among thousands of children annually and is the main reason for devastating house fires (World Bank/IFC, 2007:14). Due to a lack of affordable alternatives, options to reduce these negative effects on households are minimal. While some households convert back to charcoal or firewood, others try to reduce their kerosene consumption whenever the price rises (Nakaweesi, 2008; Chapter 13.1.3).

3. The growing importance of Renewable Energy Technologies

The development of RETs has grown rapidly in recent years, replacing conventional fuel based technologies within four distinct sectors; power generation, hot water and space heating, transport fuels, and rural (off-grid) energy (REN21, 2008). RETs are finally not only perceived as just a niche technology but also as a future insurance for clean, safe and secure energy provision for mankind, with great potential to meet future energy requirements (UNEP, NEF, 2009:22).

The renewables’ share of the world final energy consumption is estimated at 18% out of which the biggest portion is still covered by traditional biomass. The more sustainable ‘new renewables’[33] only contribute 2.4% of the global final energy consumption (Figure 7) and only 3.4% to the global generation of electricity (Figure 8). Despite their small contribution, the use of new RETs has rapidly been expanding on a global scale, surpassing all predictions, even those made by the RET industry itself (REN21, 2009). “It is this group of technologies that is projected to grow the fastest in the coming decades […]” (Martinot et al. , 2007:206).

Figure 7: Renewable energy share of global final energy consumption (2006)

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Source of data: REN21, 2008

Figure 8: Share of global electricity from renewable energy (2006)

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Source of data: REN21, 2008

The increasing importance of new RETs is also reflected in annual growth rates of between 20% and 60% in new investments since 1995 (REN21, 2008). Between 2007 and 2008 wind energy had the highest level of investment whereas the solar sector enjoyed the largest gain (with US$ 33.5 billion) of investment, resulting in a growth rate of 49% (Figure 9).

Figure 9: Financial new investment by Renewable Energy Technology

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Source: UNEP & NEF, 2009

The main drivers that propelled the investment in renewables so dramatically over the past five years are still at work despite the financial downturn. Besides climate change, energy insecurity and the assumption of higher fossil fuel prices, it is the established public support in form of long-term policy arrangements (e.g. feed-in tariffs, renewable portfolio standards, building codes, efficiency standards) that keep this sector growing (UNEP, NEF, 2009).

The IEA expects the share of renewables (including modern biomass but excluding traditional biomass) to increase to around 10% in 2030 (IEA, 2008a). A higher share could be possible but will depend strongly on enhanced political commitments as well as immediate action by all governments (IEA, 2008c:15).

3.1 The status of renewable energy technologies in Developing Countries

“The potential role of renewable energy technologies (RETs) in transforming global energy use, with focus on sustainable development and increasing the welfare and health of the global poor, is enormous” (Ezzati et al., 2004:403).

The interest in RETs by governments in DCs was initially sparked by the oil crisis in the early and late 1970s (Karekezi, 2002:1059; Karekezi & Kithyoma, 2004:30). The United Nations Nairobi Conference, held in August 1981 in Kenya on New and Renewable Sources of Energy[34] (UNCNRSE) was the first international initiative for the wider dissemination of RETs and strategies in DCs and other countries in order to meet the shortfalls caused by the oil crisis.

Unfortunately a large part of the government’s interest and support diminished quickly once the energy crisis subsided (AFREPREN, 2005:38-39). Moreover, most renewable energy activities initiated during that time were limited to research and development, and to a few disjointed pilot projects (Davidson & Sokona, 2001:7).

In recent years a combination of factors have drastically revived the interest in renewables as alternative energy sources for the heavy dependency on centralized large-scale hydro or conventional thermal-based power generation in DCs. The two most dominating factors are the increase in fossil fuel prices and a change in climate causing drought-induced generation capacity shortfalls of large hydropower stations (AFREPREN, 2004b). As illustrated in Figure 10, African countries are especially affected by the aforementioned as they rely heavily on large-scale hydropower and thermal-based power generation to cover the rising energy needs of the population.

Figure 10: Electricity production in Africa (2004)

Abbildung in dieser Leseprobe nicht enthalten

Source of data: UNIDO & REEP, 2008

Note: The figure above does not include cogeneration, back-up power plants and other off-grid generators. The contribution of co-generated power is quite substantial in Mauritius where more than 40% of its power is generated from using bagasse (REEP et al ., 2007). Geothermal is solely used in Kenya (a very small percentage in Ethiopia) and nuclear power solely by South Africa. The remaining countries largely depend on thermal and hydropower. Approximately 80% of the available power capacity is installed in South Africa (46%) and North Africa (34%) (EC/JRC, 2008:12).

Other factors contributing to the increasing interest in new RETs are; a) limitations in extending the national grid to rural areas, b) the drastic decrease in costs, especially for small-scale RETs, and c) the fact that unlike in ICs, markets for renewables in DCs are newly emerging and capital investment efforts are far from reaching saturation levels[35] (Anderson, 1997; Pandey, 2002; WFC, 2009). A number of DCs have recognised the importance of RETs to meet the energy needs of households in rural areas and have introduced legal and regulatory frameworks, mostly in the form of subsidies, to support the introduction of the new technologies (Chapter 4.2.1).

DCs already produce and use an impressive amount of renewables, e.g. biofuel[36] (45% of the global share), geothermal power (50% of the global share), solar hot water systems (70% of the global share), as well as installed solar PV (over 50% of the global share) (Cabré, 2007; REN21, 2007; Wamukonya, 2007; Peter et al ., 2002).

3.2 Increasing affordability due to reduction in costs

The so-called decentralized domestic micro-generation technologies (DMGT)[37] as well as small decentralized renewable based off-grid systems are believed to play an increasingly important role in providing modern energy services (EC/JRC, 2008; WFC, 2009,). They offer a viable alternative to conventional energy sources due to their decentralized nature in power or heat generation and supply, as well as their lower investment costs[38] (Mapako & Mbewe, 2004:5). These systems have also become increasingly competitive by comparison with fossil fuel based energy sources due to a decline in production costs initiated by technological progress[39]. In particular solar PV in the form of solar home systems (SHSs), micro-hydropower, biomass power e.g. methane utilization (biogas) or even small wind turbines are already cost-competitive with conventional forms of electric power (Espey, 2001:560; Martinot et al ., 2002:321; Painuly, 2001:74; UNIDO & REEP, 2008:6.7). In very remote areas they are even seen as the most cost-effective solution, particularly in the long term, by taking their total life cycle costs[40] into account (EC/JRC, 2008, G8 Energy Task Force, 2001:17, Gross et al ., 2003:111). The World Bank estimates that solar PV would be economical for communities with more than 45 households and if the distance to the grid is more than 11.5 km (World Bank, 2008).

By contrast large-scale centralized RET infrastructures are often still perceived as more expensive but only because of an absence of economic mechanisms taking environmental cost of burning fossil fuels, energy security risks and price volatility costs into account (Elliot, 2000:270; EEA, 2004:10).

3.3 Growing investment in the establishment of renewable energy technologies

An increasingly enabling environment for the introduction and/or expansion of RETs in the energy mix of DCs has been made possible by the deregulation and privatisation of the energy sub sector combined with concrete long-term policy incentives supporting investment in RETs. This development triggered the inflow of foreign capital and the engagement of private investors (Pandey, 2002) leading to a continuous growth of RETs investments in most DCs (UNEP, NEF, 2009).

Despite the global financial crisis the DCs’ share of total global investment[41] in new RETs increased by 5% between 2007 and 2008, whilst investment in ICs during the same period fell (UNEP, NEF, 2009:15). As illustrated in Figure 11, new financial investments in RETs have grown steadily since 2002 in all regions of the world. As from 2004, Africa and the Middle East have for the first time experienced a low but constant foreign investment in RETs. The investments are mainly undertaken by independent power producers (IPPs)[42] attracted by the liberalisation of the power sector in the respective country and the opportunities of carbon financing through tools established in the Kyoto Protocol (KP).

The KP was introduced by the UNFCCC[43] as a political response to increased concerns on the global effects of climate change (Martinot et al ., 2002; Karekezi, 2002).

Figure 11: New financial investment in Renewable Energy Technologies, 2002-2008 (globally, in US$ billion)

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Source: UNEP, NEF, 2009

Note: The largest shares (US$ 82.3 billion) in renewable energy investment in 2008 were in ICs. DCs and those in transition followed with US$ 36.6 billion. In 2008 China had the highest investments (US$ 15.6 billion) in Asia, mainly in wind energy schemes and biomass plants; in addition the country also became the world’s largest PV manufacturing base, exporting 95% of its production. India followed with US$ 3.7 billion for various technologies (wind energy, biomass and small hydro) and Brazil’s sugar cane ethanol industry accounted for almost all renewable energy investment in Latin America receiving US$ 10.8 billion. Investments in Africa remained comparatively low at only US$ 1.1 billion (UNEP, NEF, 2009).

The rural and urban poor population in DCs, who have the highest need for cheaper and cleaner energy sources, does not necessarily benefit from the increase in new investments in RETs. They still remain vastly dependent on donor support and programmes or projects initiated by governments and/or development agencies.

The largest source of funds for introducing renewable energy in the developing world is provided by the World Bank Group and the Global Environment Facility (GEF, 2005). Although donor based RET investments in DCs has continuously expanded in recent years, from US$ 500 million in 2004 to about US$ 2 billion in 2008, it is still a comparatively small contribution with regard to the private investments (REN21, 2009:14).

4. Barriers for the diffusion of Renewable Energy Technologies

in Developing Countries

Despite cost reductions, increased technological efficiency and the establishment of donor supported funding mechanisms over the past 30 years, the diffusion rate of RETs as an alternative energy source in DCs (particularly in rural areas) remains surprisingly low (Pandey, 2002:102; AFREPREN, 2005:38).

Figure 12: Interrelated barriers of Renewable Energy Technologies in Developing Countries

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Source: adapted from Wilkins 2002.

Note: ‘Cultural and behavioural barriers’ have been added by the author as they are significant problems that arise when introducing and/or disseminating modern energy technologies.

The reasons are a variety of interrelated and often overlooked or often even ignored factors (Figure 12). It becomes increasingly apparent that: “A purely technological ‘solution’ to the problem is doomed to little success if it does not take into account the economic, legal and many other aspects that reflect the complexity of a society” (Cabré, 2007:13).

The following chapter explains the numerous financial as well as non-financial barriers for the wider adoption of RETs in DCs.

4.1 The need for accurate data

Before selecting, investing and successfully introducing RETs in DCs, a comprehensive data compilation is required; comprising energy consumption patterns, socio-economic conditions, natural conditions (e.g. wind, sun, water, biomass etc.) as well as cultural preferences. The data is not only crucial in order to identify the least cost supply option but also to choose the most socially accepted one (Chapter 4.3). Without this knowledge, attempts to introduce RETs will be prone to fail right from the start (Hosier & Sharma, 2000:83).

For instance, the economic viability of small hydropower[44] (SHP) stations that provide electricity to a mini-grid does not only depend on the topography of the chosen site but also the distance to the demand centres, as well as the willingness and ability of customers to pay for the energy services, in particular ‘anchor customers’[45]. Other renewable sources, e.g. solar, wind and, to a certain extent also hydropower are of intermittent character, restricting their use to the availability of the power source when the energy can not be stored. A certain area might for example only have consistent wind speeds during a limited period of the year and require a hybrid solution (Ezzati et al ., 2004). Comprehensive feasibility studies are therefore crucial in determining what kind of energy is most viable for the chosen area.

Despite the importance of such data, SSA countries in particular, lack even the most basic statistics on rural energy consumption and the availability of natural resources (FAO, 2008b). The reasons range from high transaction costs of essential feasibility studies[46], to the shortage of national experts to undertake the studies as well as government interests in more large-scale investments in conventional energy, e.g. electricity and petroleum (Kammen et al ., 2008:349; Kituyi, 2004:6; UNIDO & REEP, 2008:6.15; Wamukonya, 2003:1285).

4.2 The importance of a conducive, institutional environment

The institutional ‘arrangement’ for the introduction and dissemination of RETs comprises government structure and policy, civil society as well as research institutions. Of particular importance is the provision of an enabling environment of legal, policy and regulatory frameworks in favour of RETs. Introduced by governments, the aforementioned can provide a coherent focus to the collaboration between national and local government agencies, domestic and international businesses as well as the donor community in order to widely promote the introduction of RETs in DCs (G8 Renewable Energy Task Force, 2001:34).

The general interest in policies to improve energy efficiency and to boost the role of RETs on a global scale has grown primarily due to energy security reasons, high energy prices and the implications of GHG emissions, especially in OECD countries, as well as the creation of ‘green jobs’ (Espey, 2001:557; Gross et al ., 2003:120; IEA, 2006:165; UNEP, NEF, 2009:57).

Figure 13: Impact of a chosen technology on the population in Developing Countrieson

Abbildung in dieser Leseprobe nicht enthalten

Compiled by author

The driving factors of particular importance to governments in DCs are; a) the fluctuation in supply of fossil fuel, b) disruption in large-hydro power used for electricity generation, c) the need for foreign currency to import fossil fuel, d) the increasing demand for energy, and e) development targets, e.g. reduction in the dependency on traditional biomass (Peter et al ., 2002:512; UNDP, UNDESA, WEC, 2004:33-34; Vine, 2005:695). As opposed to ICs, socio-economic benefits and cost advantages are therefore often more important drivers for DCs than environmental concerns and climate change (UNIDO & REEP, 2008).

Especially when introduced in a centralized manner, power generating costs using renewable energy (large scale) are still perceived as considerably higher than for well established conventional fuel. This is particularly the case for the initial investment costs[47]. Further, as most of the established electricity markets in DCs are designed for conventional, centralized power plants with a strong lobby, RETs would have little chance of reaching economy of scale without strong public support (NREL, 2006). As Hermann Scheer, General Chairman of the World Council for Renewable Energy points out: “Don’t leave the job to the market. A fair market requires equal market conditions, but these currently do not exist: trillions in subsidies were and still are being spent on nuclear and fossil energies, directly or indirectly” (Mendonça, 2007, Foreword). In other words without government interventions in form of effective legal frameworks and policies to promote RETs (e.g. price regulations, obligations or trade norms) a major shift to RETs in DCs is unlikely to take place (Hosier & Sharma, 2000; Sawin, 2004). Moreover the vast majority of rural households in particular would require long term governmental support, e.g. in form of subsidies to introduce DMGTs (Figure 13).

4.2.1 Government policy interventions for the wider promotion of Renewable Energy Technologies

Governments have a range of regulatory possibilities to promote RETs and modern fuel options in their countries. Like in ICs, policies that promote renewables in DCs have mushroomed in recent years with regard to needs, circumstances and natural resources (Gross et al ., 2003).

The foundation for wider public support to introduce or increase the share of RETs in the national power supply was primarily laid down through power sector reforms which began in many DCs over 30 years ago (Nyoike, 2002:990; Pandey, 2002:100; World Bank/ESMAP, 2000:103). Unreliability of power supply, low capacity utilization and availability, high transmission and distribution losses, deficient maintenance and low returns were the most important driving factors behind the reforms (AFREPREN, 2002; AFREPREN, 2005; Anderson, 1997; Bacon, 2001). So far the liberalisation of the power sector in most countries has contributed to restructuring (unbundling) the former state-owned utility and privatising power generation with increased involvement of IPPs. In 2002 a total of 25 DCs introduced regulatory frameworks allowing IPPs to generate and sell power to utilities under power purchase agreements (PPA) (Martinot et al ., 2002:334).

In combination with the reforms a number of DCs have introduced renewable energy targets as a sign of commitment to increase the share of renewables in their national energy mix. China and India were the first two DCs to propose such targets and were followed by another 33 (pers. comm., Mr Eric Martinot, Lead Author of the REN21 Renewables Global Status Report, 5th July 2009). Most set targets reflect on the percentage share of renewable energy in the country’s primary energy and/or electricity production within a certain timeframe (REN21, 2008).

A range of supportive policies, mostly based on the use of subsidies[48], were introduced in order to reach the targets (Table 2). Examples range from a decrease or removal of value added tax (VAT) on RET equipment (Duke et al ., 2002:481; GEF, 2008:17), long-term tax holidays for renewable power plants (UNIDO & REEP, 2008:9.24) as well as price subsidies for RETs (Chaurey et al ., 2004:1697). Despite this positive development, most subsidies in place in DCs still seem to favour fossil fuels (Case study 1) and are often solely investment-based (Table 2). The latter can contribute significantly to the wide adoption of RETs, but it does not however ensure their long-term performance. Although price subsidies on RETs in India have for example spurred the largest wind power industry in DCs: “Many wind turbines were reportedly not operating at all, with no efforts made by their developers to repair them” (Martinot et al ., 2002:334). Another example is in China, where large scale PV generation stations were successfully installed but are not functioning anymore due to a lack of incentives for a long term performance (Wang & Qiu, 2009:2185).

Table 2: Renewable energy promotion policies in Developing Countries

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Source: REN21, 2008

Note: After the author’s personal consultation with Dr Axel Bree, Policy Officer of the World Future Council on the 13.07.09, Kenya, Mauritius and Pakistan were added to the new adopters of FIT schemes.

Similar to OECD countries, particularly in Europe[49], a small number of DCs have started introducing long-term incentive schemes for renewably based power generation. The intention is to provide security and favourable market conditions for private companies investing in RETs, especially IPPs. The most commonly used tool is the provision of long-term tariff systems commonly known as ‘feed-in-laws’[50]. This rather new regulatory instrument for DCs has already proven to be the most successful support mechanism to accelerate the deployment of renewable electricity in ICs (IEA, 2008c). FIT policies have more advantages[51] than other market-based policies (e.g. ‘Renewables Portfolio Standards’ - RPS[52] ).

India was the first country to establish FITs followed by Sri Lanka, Thailand, Brazil, Indonesia, Nicaragua, China and Turkey (EC, JRC, 2008:18).

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4.2.2 Policy impacts on rural households in Sub-Saharan Africa

Despite power sector reforms[53] and changes in regulatory frameworks that take place in many SSA countries, very little has in fact changed for the vast majority of the rural population living without access to electricity. Reforms that aim at improving the performance of former state-owned utilities seem to have resulted in an even stronger emphasis on the well established centralized petroleum and power sub-sectors which serve only a small part of the urban population (Journal of Cleaner Production, 2007:163; Case study 2).

Figure 14: Independent Power Producers’ investments in Sub-Saharan Africa

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Compiled by author

Source of data: Karekezi et al ., 2004a

Note: RETs include wind, bagasse based cogeneration and geothermal power generation.

So far only three SSA countries[54] have introduced sufficient incentives in form of FITs to accelerate private investment in the generation of renewable based energy (Table 2).

The lack of government commitment to renewables became visible in a 2005 survey by the African Energy Policy Research Network (AFREPREN, 2005): Out of the nine surveyed African countries[55] only two had clear policies to support RET development with specific targets and significant budgetary allocations. Hence, most activities related to RETs in many African countries are still being implemented ‘ad-hoc’ and in a ‘policy-vacuum’ (Karekezi & Kithyoma, 2004:30).

Due to the lack of favourable regularity frameworks, the vast majority of the international[56] IPPs operating in liberalised markets of SSA keep on investing in centralized large-scale and fossil based schemes from which only a minority of the DCs’ population benefit (Wamukonya, 2003:1276-1277; Karekezi et al ., 2004b:41). At the same time the number of IPPs generating power from renewables constantly declines as revealed in a recent UN study (UNECA & UNEP, 2007). The government continuously supports this development as the large-scale capital-intense IPP engagement seems to invariably attract the politically connected rent-seeking class (Karekezi et al ., 2004a:42; UNIDO & REEP, 2008:4.22; Eberhard & Gratwick, 2005).

It should be emphasized that even if more countries would adapt market-based incentive schemes such as FITs it is highly unlikely that it would lead to an increase in number of grid connections in rural areas. The reason is that price and quota setting policies are most commonly used to increase the share of renewables into the existing grid with grid operators being obliged to connect the power producers (WFC, PACT, 2007). In this sense the support of a pricing-policy might be suited to the well-established grid infrastructure in ICs but not for most DCs which are characterised by limited grid access. As described earlier, grid operators do not naturally invest in such expansions due to low return of investment with only small percentages of households who can actually afford the high connection fees (WB/IEG, 2008:22; Wamukonya, 2003:1277; Reiche et al ., 2006:10).

FITs and other market-based support policies which are meant to increase the share of renewables in a nation’s power supply will therefore contribute little to reach the 1.6 billion people who still do not have access to electricity.

Although there are different concepts[57] for policy based incentives in support of renewable rural electrification, they have so far not been tested in any country or region (EC/JRC, 2008).

Abbildung in dieser Leseprobe nicht enthalten

4.2.3 Possible interventions in favour of rural electrification

“Just as some Developing Countries are bypassing construction of telephone wires by leaping directly to cellular-based systems, so too might they avoid building large, centralized power plants and instead develop decentralized RET systems” (Ezzati et al., 2004:404).

The possibility to mitigate the generation and distribution of centralized electricity as a ‘legacy of the developed world’ (UNIDO & REEP, 2008:6.7) in order to provide more households with electricity lies in the introduction or enforcement of policies that support the establishment of decentralized (stand-alone), renewable mini-grids (serving tens or hundreds of users) or isolated systems, e.g. DMGTs serving just one or two households (Figure 15).

Mini-grid systems already exist in many countries but are predominantly fossil fuel based, powered by diesel generators (Kirubi et al ., 2009; World Bank/IEG, 2008). In many Asian countries[58] the systems are typically operated by village-based small-scale electricity providers. In other regions, particularly in SSA countries, the mini-grids are typically run by utilities (GoK, MoE, REA, 2009). High costs of fuel transportation[59], difficulties in accessing spare parts as well as technical support often result in high tariffs for users when systems are privately operated or a heavy reliance on cross-subsidies when systems are owned by utilities (Wamukonya, 2007, EC/JRC, 2008).

Figure 15: Off-grid, Hybrid Power System based on renewable energy

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Source: WFC, 2009

A change over to renewable options in order to power such decentralized systems would in many cases be a more cost-effective and environmentally sound solution. The European Union (EU) confirmed the aforementioned by comparing a life cycle analysis of renewable-based with fossil fuel-based mini-grids in three different countries, Gambia, Ecuador and Mauretania (EC/JRC, 2008). Other studies have come to the same conclusion: “Wherever resource availability and favourable site conditions are given, electricity supply options based on wind turbines, hydropower or biogas engines are the least cost supply option for base load need in rural electrification schemes […]” (GoK, MoE, REA, 2009:122). In Kenya for example, the investment cost of a diesel generator was estimated at US$ 800 per kW, almost half of the estimated US$ 1,500 per kW for hydropower. Although the initial cost (investment costs) of a diesel generator is less, the long-term running costs can reach US$ 11 per kW, whereas for hydropower the running costs are close to zero (Mbuthi, 2003).

The key question is how governments in DCs can accelerate the establishment of renewable based off-grid solutions and at the same time ensure low tariff costs for consumers. The following two chapters elaborate on the existing and already tested institutional concepts to support the establishment of renewable-based mini-grids in various countries with different levels of success.

4.2.3.1 Co-operatively managed off-grid schemes

The most common attempts by policy makers to ease the establishment of mini-grids in rural areas, is by introducing ‘light handed’[60] and simplified regulations[61] in order to reduce costs as well as time barriers.

For that purpose an increasing number of DCs simply remove license/permit requirements, as well as regulated tariffs for schemes operating below a certain load size[62], e.g. under 1 MW (Kirubi et al ., 2009). This step has already accelerated the establishment of decentralized hydropower based mini-grids in marginalised rural areas of India and Nepal (Kammen et al ., 2008; UNDP GEF SGP, 2003b; Martinot et al ., 2002; Karekezi & Kithyoma, 2002:1084; Banerjee, 2004). A number of African countries including Kenya, Uganda, Namibia and Zambia have recently followed this path (UNDIO & REEP, 2008:8.7).

The introduction of light handed and simplified regulations has particularly opened the door to a stronger community involvement (e.g. village electricity committee or cooperatives) by introducing and managing off-grid systems. As most potential community-based, off-grid electricity providers do not have ‘deep pockets’, the time consuming and costly regulations have often been one of the biggest barriers for engagement in mini-grid activities in addition to the high investment costs[63].

The advantage of community owned and managed mini-grid schemes are manifold as they support local capacity development (local technicians and management teams), create employment (micro-business, maintenance of system), reduce levels of theft[64] and ensure that generated money remains within the area. The involvement of communities also ensures a greater acceptance and hence sustainability[65] of the introduced technology: “The more that local communities are integrated into the decision making process and the more ownership they develop, the more sustainable the project will be” (Reiche et al ., 2000:60).

Another crucial advantage of a community-owned mini-grid is the ‘self-regulation’ of the tariffs charged. Because the customers are also the owners, the introduced tariffs (often in the form of a flat rate or membership fee) are not based on profit but are used to maintain the operational system (Reiche et al ., 2006). This allows the introduction of a mini-grid without subsidies after the initial installation costs have been met (often with a high contribution of the communities (Case study 3). In contrast, a mini-grid operated by a private company is normally based on cost-reflective tariffs, which means a full-cost recovery as well as profit margin by monopoly pricing (Mazzoni & Isaac, 2005:35). The latter is often unaffordable for the majority of the rural households and consequently the development of such privately operated mini-grids would only be concentrated in ‘upper-market’ rural areas if at all (WB/IEG, 2008:22; Davidson & Sokona, 2001:13-14).

Regrettably, community managed off-grid systems in DCs are still rarely found (Rao & Ravindranath, 2002). Even though policies are in place supporting the development of mini-grids (e.g. by removal of license requirements and fees), the often high investment costs still have to be met[66]. The latter also includes a ‘social overhead investment’ consisting of training local technicians and managers, and a general capacity building within the community as: “[…] the technology itself is unsustainable unless accompanied by effective follow-up services and maintenance support” (Chaurey et al ., 2004:1694). Hydropower plants usually have a long lifetime (up to 100 years) with low maintenance requirements therefore the required capacity on the ground can be met with little training of selected community members and little financial input for needed spare parts (Mbuthi, 2006). The Tungu Kabiri project for instance: “[…] built the capacity of the local communities to construct, maintain and repair a micro hydropower system” (GTZ, 2009b). In contrast, technically more complex systems, like solar PV or wind turbines would not only require a more sophisticated technical expertise on the ground but also the availability of spare parts[67]. Both requirements are difficult to meet in rural areas as trained technicians might for instance leave the low-profit community scheme for better employment opportunities in urban areas, and spare parts on the other hand might often not be available (Lemaire, 2007, UNIDO & REEP, 2008:11.19).

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4.2.3.2 Are rural households able to pay for energy services?

As illustrated in the previous chapter, it has been proven as insufficient to simply facilitate the dissemination of electrically based RETs without either training the users on operation and maintenance or by providing appropriate afters-sale services in order to ensure the long-term performance of the established systems (Rao & Ravindranath, 2002:69). Although governments and donors might in many cases be able to support the provision of energy as a product through introduced price-subsidies, they; “[…] are rarely able to provide the technical support required in maintaining the systems” (Karekezi & Kithyoma, 2002:1084). In particular donor supported RET projects often compromise sustainability due to the need for short-term quantitative-based results (Birdsall, 2005; Wolde-Ghiorgis, 2002). In practice RETs are therefore often simply ‘donated’ to communities without considering aspects of long term performance (Martinot et al ., 2002; Nieuwenhout et al ., 2001; Mbewe, 2004).

Interestingly, although most rural households cannot afford the high up-front purchase or installation costs of RETs without subsidies (Case study 4), they would however in most cases have the ability and willingness to pay for the system’s operation and maintenance costs. From a global perspective it is estimated that households in DCs without access to electricity spend on average US$ 20 billion per year on candles, kerosene and batteries to cover their basic energy needs (Sawin, 2004:22). Instead of spending this money on unsustainable and inefficient solutions, it could be used for energy services derived from renewable, more efficient and even cheaper energy sources.

There are a range of indicators that households not only have the means but are also willing to pay for more efficient energy services. A World Bank study on the introduction of solar PV in 12 countries[68] revealed that low-income households in the rural areas who typically pay US$ 3-15 per month on energy (kerosene, candles, battery charging and disposable batteries), are willing to use this money for more modern energy services if the initial high installation costs are met (Martinot et al., 2001).

There are even cases where customers willingly pay more for solar electricity than they had previously paid for kerosene, candles and batteries, due to the better quality of light (Ellegård et al ., 2004:1254). This rather unexpected behaviour contradicts a very common technocrat vision that people invest only to save capital (Dias et al. , 2004:1342). Other factors such as convenience as well as quality of energy services can be more important to households.

In this sense the ability and willingness by many rural households in DCs to pay for energy-related services could be an incentive for private companies to invest in rural areas if high upfront costs to install the RETs would be met by e.g. investment subsidies.

The following chapter demonstrates a way in which both the high-up front costs for consumers and the long-term needed operation and management services for the more sophisticated RETs (e.g. solar PV) can be provided for in a very innovative way.

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4.2.3.3 Rural Energy Service Company – overcoming initial costs and service constraints

Rural Energy Service Companies (RESCOs) are private companies or NGOs that offer energy services to rural households. By doing so RESCOs seldom sell the RETs to potential users but rather ‘rent’ it out at a monthly, semi-annual or even annual[69] user fee (depending on the system’s size). In other words the initial investment (e.g. cost for a SHS) is not borne by the final users but by the RESCO which in most cases receives financial support from the government or donor agency.

The concept which is commonly referred to as ‘fee-for-service’ or ‘utility model’ (Ellegård et al ., 2004:1252) was for the first time introduced during the late 1990s to various countries i.e. Zambia, Argentina, Dominican Republic, Togo, Benin and Cape Verde (Mapako, 2004; Mbewe, 2004; Ellegård et al ., 2004; UNIDO & REEP, 2008; Martinot et al. , 2001). Depending on the concept, the fee paid by users could include the full cost of maintaining the system (including spare parts) and a small part of the system’s capital costs, as well as a profit for the implementing RESCO (Mbewe, 2004:142). Experiences have shown that a fee for PV systems by an external company (‘fee-for-service scheme’) could be introduced for only US$ 6-7 per month covering direct maintenance costs as well as replacement costs of batteries, controllers and lights (Martinot et al ., 2000:10).

Governments are increasingly supporting the RESCO model by introducing regulated monopoly based ‘energy-service concessions’ to eligible companies. The concessionaires are selected through competitive tendering and are obliged to cover household energy needs in a specific geographic region over a certain period of time (Martinot et al ., 2001:44). In most cases the government offers support in form of long-term (up to 20 years), often donor supported, credit facilities (Mbewe, 2004:142). Such a long-term commitment by the government is crucial as pay back times against the companies investments are long due to the relatively low user fees. Case study 5 gives a scenario from South Africa where a lack in long term commitment by the government severely affected the RESCO’s performance.

[...]


[1] An energy service is the end-use ultimately provided by an energy carrier (AFREPREN, 2004a:2).

[2] The term ‘biomass’ includes not only organic matter produced as a result of photosynthesis but also municipal, industrial and, animal and plant waste material (Demirbas, 2005:171). The UN applies the term ‘traditional biomass’ whenever the fuel is used in an unsustainable, inefficient and health damaging form (UN-Energy, 2007:6). Traditional biomass is mainly wood, charcoal and agricultural residue/dung (AFREPREN, 2004a:14).

[3] Throughout Africa low income households are the biggest consumers of primary energy in form of biomass of which 90-100% is used for cooking (Davidson & Sokona, 2001).The reason for the high energy share used for cooking not only in Africa but also in China and India, is the absence of other energy demands (except for lighting) and the low efficiency of energy conversion appliances (Sathaye & Meyers, 1985). Other heat and heat-related services provided by traditional biomass are space heating, crop drying, agricultural processing, etc. (REN21, 2007:35).

[4] Kerosene or paraffin is defined as; “Light petroleum distillate that is used in space heaters, cook stoves, and water heaters and is suitable for use as a light source when burned in wick-fed lamps” (AFREPREN, 2004a:13).

[5] In OECD countries biomass transformed into solid, liquid or gaseous forms of biofuel is predominately used for the generation of bioenergy which can be divided into electricity generation and the generation of heat or a combination of both (Jacobsson & Johnson, 2000; FAO, 2004).

[6] ‘Modern energy’ refers to high quality energy sources, e.g electricity and petroleum products (AFREPREN, 2004a:3).

[7] There is a conversion process involved when producing charcoal, however due to inefficient conversion routes described in Chapter 5.2, charcoal often does not count as a ‘modern’ energy source.

[8] The ‘poor’, as defined by international agencies such as the World Bank, UNDP, UNEP and OECD, are people living on less than US$ 2/day. National definition of ‘poor’ can however vary between countries. In Argentina for instance, a family that earns US$ 240/month (based on four persons receiving US$ 2/day) is not considered a poor family (Karekezi et al ., 2005).

[9] It should be highlighted that there are often very high opportunity costs or economic and educational opportunity losses related to the use of traditional biomass due to increased collection times in areas of low woodfuel availability. Moreover health costs (respiratory infections due to inefficient use of traditional biomass) as well as environmental costs (forest degradation) also occur in many cases.

[10] In the year 2000, World Bank and UNDP calculated an average cost of between US$ 8,000 and US$ 10,000 per km to extend the national grid to rural areas. In difficult terrain the costs were even estimated at up to US$ 22,000 (WFC, 2009:12). The rural population in East and Southern Africa is significantly more difficult to ‘connect’ to than households in West Africa due to the dispersed nature of homesteads (Karekezi & Kithyoma, 2004:21).

[11] Consumers in most countries have to pay the full connection cost to the national grid at once resulting in a significant entry barrier for low-income earning households in rural areas (AFREPREN, 1998:13).

[12] Cross-subsidies enable a transfer from richer sections of a community to poorer. The introduction of cross-subsidies as a tool to extend electricity to the poor is however only feasible in countries with existing high electrification rates where industries, as well as high-income customers can contribute (World Bank, 2008).

[13] A lifeline rate is defined as; “[…] a cross-subsidy that enables the poor who use minimal services to pay a lower price than wealthier households using higher levels of service” (World Bank/ESMAP, 2000:62).

[14] Despite this positive development, the IEA assumes that the number of people without access to electricity will still be 1.4 billion (some 17% of the world’s population) by 2030 due to continuing population growth and low electrification rates (IEA, 2006:157).

[15] With no new policy interventions and average connection rates from the past ten years, the IEA estimates that it would take nearly 80 years to electrify SSA (IEA, 2002:377).

[16] The MDGs, initially known as the International Development Goals were first compiled during the 1990s. In September 2000 they were adopted by 189 UN member states through the Millennium Declaration.

[17] There are three distinct factors that explain why the poor spend more on energy, i.e. fuel-based lighting and traditional biomass; a) dependency on low-quality fuels that burn less efficiently, b) fuel is purchased in small quantities at the end of a chain of small distributors resulting in higher retail prices, and c) energy subsidies are largely captured by high-income groups, e.g. lifeline tariff on electricity (Karekezi & Majoro, 2002:1019).

[18] The UN Millennium Project has for example adopted a target to reduce the number of households using biomass as their primary cooking fuel by 50%, by 2015 (Modi et al ., 2006).

[19] Only three quarters of the accessible 80 MDG country reports even mention the term energy (UNDP GEF SGP, 2006b:13).

[20] According to the FAO’s Unified Bioenergy Terminology (UBET) charcoal can be defined as solid residue derived from carbonization, distillation, pyrolysis and torrefaction of firewood (FAO, 2004).

[21] The term ‘merchandised’ in the given context is used when third parties are involved in, e.g. transport or marketing of woodfuel (FAO, 2008b:69).

[22] The increase in income does not always automatically lead to a ‘fuel-switch’ as highlighted in Case study 2.

[23] The expected decline in firewood consumption in Southeast Asia and the minor increase in Latin America should not hide the fact that the number of people remaining dependent on firewood will be considerably high with 1700 million and 70 million users by 2030 respectively (IEA, 2002).

[24] The Charcoal Potential in Southern Africa research project (CHAPOSA) analyzed trends in deforestation and forest depletion in areas supplying three urban centres of SSA, namely: Lusaka (Zambia), Dar-es-Salaam (Tanzania) and Maputo (Mozambique). The research concluded that the price of charcoal has remained stable in the surveyed cities over the past decade (SEI, 2002).

[25] A single urban household in Kenya for example requires up to 3.5 tons of trees being felled to cover the annual charcoal needs (Kammen et al ., 2001).

[26] A survey conducted by Wamukonya in Kenya in 1993 revealed that rural households in Nyeri (Central Province) had to purchase 70% of the firewood, spending 15-35% of their income, while ten years earlier firewood was still freely available for collection in sufficient quantities (Wamukonya, 1995:447). This development can also be increasingly observed in other parts of the country and is largely linked to the issue of land tenureship. Previous open land which was freely accessible is increasingly fenced off due to the registration of land and the transfer to private ownership. Other former public land is gazetted and/or already cleared for cultivation (Kituyi, 2004; Mahiri & Howorth, 2001; Mahiri, 2003; Ngugi, 1988). While in 1981 only 47% of all firewood in Kenya came from farmland it was over 80% in 2004 (Kituyi, 2004:1053). Hence especially households with no secure land tenure as well as households owning only small parcel sizes increasingly face problems in covering their energy needs.

[27] The study included ten African countries namely Rwanda, Kenya, Egypt, Burundi, DR Congo, Eritrea, Somalia, Sudan, Tanzania and Uganda. Different indicators were used to highlight areas of potential deficit or surplus of woodfuel such as average estimated national consumption of firewood and charcoal by rural settlements and urban dwellers (year 2000) in selected territorial units (minimum spatial level = 5 arc-minute grid cells), the quantity of remaining woody biomass stock (FAO Land Cover Classification System data (2000) & field data from various sources) and the average annual sustainable supply capacities.

[28] One example: a nationwide survey in Kenya (ESD, 2005) revealed that the biggest problem for charcoal producers (estimated 200,000) is the increasing lack of available trees needed to meet the demand of 2.5 million consumers. The consumption of charcoal in Kenya has risen by over 220% within the past two decades (Bailis et al ., 2005).

[29] An estimated 61% of GHG emissions in SSA originate from burning wood (Deaton Steel, 2008:21). GHG emissions occur during the production as well as consumption stage. Combining the emitted CO2 and other greenhouse gases (e.g. CH4) in one single index, the burning of traditional biomass in commonly used traditional energy appliances emits up to four times more GHG into the atmosphere than fossil fuels such as kerosene (WHO, 2006:22-23).

[30] Women and girls who collect firewood are most vulnerable to cuts, animal bites, falls, back injuries as well as psychological damage caused by sexual attacks (IEA, 2006:428; UNDP, UNDESA, WEC 2000:49).

[31] Different studies suggest that there has been an improvement in children’s school performance when sufficient lighting is available to study at night (Mbewe, 2004; World Bank/ESMAP, 2003).

[32] Households in the lowest income earning bracket in Malawi (less than US$ 25 per month) for example spend 33% of their total income on energy (G8 Renewable Energy Task Force, 2001:28).

[33] The term ‘new renewables’ includes solar energy for heat and power, wind energy for mechanical and generation of electric power, modern biomass for electricity and heat production, geothermal energy for power generation and heat, and small hydropower. Excluded is large scale hydropower and traditional biomass (REN21, 2008).

[34] The first global conference of its kind called for international action in research, planning, investment and dissemination of new technologies (Forsyth, 1999:64). The main outcome was the adoption of the Nairobi Programme of Action (NPA) which provided the initial framework for a concerted action on five energy related policy areas: 1. energy assessment and planning, 2. research, development and demonstration, 3. transfer, adaption and application of mature technologies, 4. information flows, and 5. education and training (Rao & Ravindranath, 2002:60).

[35] It is expected that over 50% of the increase in global energy consumption will come from DCs due to continued economic and population growth (97%) of the anticipated population growth until 2030 will take place in DCs (Peter et al. , 2002).

[36] Although the term agro-fuels might be more representative for especially large scale industrial production of energy crops, the term biofuel is used throughout this study due to its correspondence with the terminology used by most DCs.

[37] A micro-energy technology is an energy generating technology that is installed in individual households (Sauter & Watson, 2007:2771). Examples are solar home systems (SHSs) for the generation of electricity but also improved small-scale biomass conversion technologies (IBTs) for the generation of heat (e.g. energy saving cook stoves or biogas). Although the energy used per micro-energy system appears to be marginal its importance lies in the large number of end-users that the systems can serve (Karekezi, 2002:1062).

[38] The modular nature of most small-scale RETs allows them to be introduced incrementally and makes them particularly suitable for poor households (UNEP & REEP, 2007:2.27).

[39] The unit cost for RETs (and many other technologies) decreases with increasing experience, a process referred to as learning curve (also known as progress curve, experience curve or learning by doing curve) (McDonald & Schrattenholzer, 2001). Over the past 15 years the cost of wind energy equipment has for example declined by one third and the cost of solar PV has dropped by more than 60% (BMZ, 2008:28; Wamukonya, 2007:10). The IEA expects a continuous decline in the cost of all technologies except geothermal and on-shore wind power (IEA, 2008a:163-164), while the German Federal Ministry of Environment, Nature Conservation and Nuclear Safety (BMU) expects the cost of most RETs to, “[…]fall below those of conventional energy within the next two decades” (BMU, 2007). An increase in fossil fuel prices and/or a carbon tax would make RETs competitive at an even earlier stage.

[40] Lifecycle costs consist of the initial capital costs, future fuel costs, future operation and maintenance costs, decommissioning costs and equipment lifetime (Beck & Martinot, 2004).

[41] The total global investment also includes research and development funding and venture capital for technology and early-stage companies.

[42] IPPs are defined as privately owned companies that produce electricity and sell it for a profit to the national grid or to a distribution utility (AFREPREN, 2004a:19).

[43] One of UNFCCC’s major political tools is the KP which was negotiated in 1997 and entered into force on the 16th February 2005. The KP established specific and binding GHG reduction targets for all ratifying ICs. The DCs and those in transition are believed to benefit from the KP’s Clean Development Mechanism (CDM) as it allows ICs to meet their emission targets by investing in GHG reduction projects in DCs (Kammen et al ., 2001:26; AFREPREN, 2005:44).

However, the impact of the CDM on RET projects in DCs has so far been rather disappointing because; a) a high share of projects (30% of all credits) aim at destroying, refrigerant and land-fill gas and not at introducing RETs (Wara, 2007:595; Van der Gaast et al. , 2009:231), and b) only 7 of 135 developing nations established 68% of all CDM projects in 2008. Africa has by far the lowest number (2.8%) of CDM projects with most of them concentrated in South Africa (UNFCCC, 2008). The reasons for this being; lack of expertise, high transaction costs and the low capacity of the DC’s private and government sector institutions that identify, design and implement the project (Van der Gaast et al ., 2009:231; Wamukonya, 2007:10).

[44] Small hydropower also referred to as ‘mini’, ‘pico’ or ‘micro’ hydro usually has a capacity of less than 10 MW (UNEP & REEP, 2008:2.17). In the East African framework small hydropower is classified as follows: Pico hydro (schemes up to 5 kW), micro hydro (from 5 kW up to sometimes 1 MW), mini hydro (operationally between 1 MW to about 5 MW), (Mbuthi & Yuko, 2005).

[45] The so called ‘anchor customers’ for example small businesses would be able to pay for the bulk of the power supplied.

[46] In many cases there is also no guarantee that the early ‘pre-investment’ in detailed feasibility studies will be fruitful (AFREPREN, 2006:30).

[47] Although initial investment costs might be considerably lower for conventional fuel based equipment, the often unknown, much lower operation and maintenance costs of renewable technology as well as the social and environmental benefits would make it a more profitable option in the long run.

[48] Possible energy subsidies introduced by the government can range from; a) direct financial transfers (grants or preferential loans to producers and grants to consumer), b) preferential tax treatments (rebates or exemptions on tariffs, producer levies/duties, tax credits, accelerated depreciation allowances on energy supply equipment), c) trade restrictions (quota, technical restrictions and trade embargos), d) energy-related services provided by the government (direct investment in energy infrastructure, public research and development), to e) regulation of the energy sector (demand guarantees and mandated deployment rates, price controls, restricted market access), (EEA, 2004:10).

[49] “Europe currently leads the world in most areas of renewable development, including investment, installed capacity, industry size, policy action and use of policy targets” (Martinot et al ., 2007:207).

[50] Feed-in-laws reflect an obligation which is placed upon utilities to accept all renewably generated power by independent producers and to pay a guaranteed price according to the technology type. This process may be financed through subsidies, a levy on electricity or borne by the utility and passed onto the consumer (Gross et al ., 2003:120-121). The fixed, minimum price (tariff) is generally higher than the regular market price and will be paid over a specific period of time, e.g. 15-20 years (Cabré, 2007:69).

[51] FIT policies are generally; a) easier to administer and enforce than quota systems (e.g. RPS, see below), b) tend to favour smaller companies, c) promote the development of a domestic renewable manufacturing market, and d) secure the investment by the power producers (Sawin, 2004; Espey, 2001). Moreover, due to the current presence of only few supply companies (in many cases only one), especially in African countries, it seems very difficult to create a viable liquid green certificate market. India has overcome the problem by simply introducing a quota system without green certificates. The state utility is obliged to purchase a minimum percentage of renewables that vary according to the priorities of each regional state (UNIDO & REEP, 2008).

[52] The RPS also known as a renewable ‘obligation’ is a quota-system based on legislatively mandating retail suppliers, grid companies, distribution companies or consumers to meet a specific percentage share of electricity generated from renewables. The producers of renewable electricity receive credit-in form of ‘Green Certificate’, ‘Green Labels’, or ‘Renewable Energy Credits’ which can be tradable or sellable. The trade of certified certificates gives the electricity supplier the possibility to meet their targets without directly purchasing renewable electricity (Wiser et al ., 2005:239). As opposed to feed-in-laws, the RPS intends on encouraging competition among renewable developers for contracts with retail electricity suppliers who would choose the least cost option (Espey, 2001).

[53] Many of the undertaken reform steps have worsened the poverty situation among the rural and urban population as sharp increases in electricity tariffs (often more than 100%) have led to more power disconnections than new connections (Wamukonya, 2003; Chaurey et al ., 2004; Journal of Cleaner Production, 2007). Electrification, as a major step toward envisaged reforms, has therefore become a ‘forgotten child’ (Reiche, 2006:37).

[54] In March 2008, Kenya introduced FITs for wind power, biomass energy and small hydropower generation (Njiraini, 2009c). Geothermal and large hydropower are not part of the FIT scheme as they are considered as already competitive without financial support mechanism (Mendonça et al ., 2009). Besides technology specific tariffs, the remuneration for hydropower and biomass generated power differs for firm and non-firm renewable electricity generation (WFC, 2009). The newly introduced FITs quickly sparked an increasing interest by IPPs to invest in renewable power production. Six IPPs for instance showed interest in generating 500 MW from wind energy. The feasibility studies are currently being carried out (WFC, 2009:23). However as the tariff scheme includes capacity limits for each installation and for the overall installed capacity, only up to 150 MW of installed wind capacity is allowed (Mendonça et al ., 2009). Furthermore, the hydropower company, Power Tech Solutions plan to build three mini-hydro power plants (UNEP & NEF, 2009:54).

Uganda has only recently introduced FITs on hydropower and co-generation (pers. comm., Mr Tuzinde, Electricity Regulatory Authority of Uganda, 16th September 2009). In Mauritius IPPs benefiting from a single technology FIT already generate 40% of the country’s electricity supply by using co-generation (REEP et al ., 2007).

[55] The surveyed countries include Rwanda, Ethiopia, Tanzania, Uganda, Eritrea, Djibouti, Sudan, Kenya and South Africa.

[56] It should be highlighted that an exclusive involvement of international companies (operating as IPPs in most DCs) often hampers the development of local, technical expertise hence increasing the DC’s dependency.

[57] The Joint Research Centre of the European Commission (EC/JRC) has proposed different ways to modify the standard FITs for mini-grid applications (Chapter 4.2.3) using a so called regulated purchase tariff (RPT), which can be summarized as: 1. Feed-in tariffs under regulated service concessions: rural energy service companies charge the final consumer below the generation costs at a fixed, affordable price. The incurred losses will be compensated for by the local Energy Development Agency which is financed by the local government, 2. Feed-in tariffs for IPPs: a local Distribution System Operator (DSO) distributes the power to the communities using a regulated tariff. The IPP receives additional revenue sources from the governmental electricity authority, and 3. Feed-in tariffs for power producers who simultaneously consume electricity (EC/JRC, 2008).

The crucial question is how to finance such schemes as available resources (e.g. in form of cross-subsidies or especially set aside funds) are often limited in size (cross-subsidies) and time (donor supported funds) (UNIDO & REEP, 2008:2.14; Wamukonya, 2003:1278).

[58] Cambodia is one example where rural electrification enterprises (REE) run small second-hand diesel generators that provide village households with a few hours of electricity for a tariff (Reiche et al ., 2006).

[59] Delivery of fuel to remote areas might not even be possible due to poor road infrastructure during the rainy season (GoK, MoE, REA, 2009:13).

[60] ‘Light-handed’ regulations can be defined as “the regulatory agency’s deliberate action to either ‘ignore’ or make less stringent provisions for a player or group of players” (UNIDO & REEP, 2008:9.11). In many cases a simple authorisation by the government (e.g. Ministry of Energy) for the power generation and distribution became a sufficient legal requirement to set up a mini-grid scheme.

[61] ‘Overregulation’ is a general problem that occurs throughout different sectors in poorer DCs. It opens doors to bribery and is extremely time consuming, e.g. a business in Australia takes two days to start, but 203 days in Haiti and 215 days in the Democratic Republic of the Congo (Reiche et al ., 2006:18).

[62] With the new Energy Act operational in Kenya since July 2007 for example, renewable energy systems not exceeding 3 MW (if operated in hybrid mode the oil fired component should not exceed 30% of the total capacity) are allowed to operate in any areas of the country without a license (GoK, MoE, RED, 2008).

[63] A good example is Bolivia, where prior to year 2000, all operators of isolated mini-grids needed to obtain a formal concession from the national electricity regulator. As most of the mini-grid providers were co-operatives, they had to first change their legal status into private companies and fulfil strict reporting requirements and technical standards. The cost thereof was in most cases higher than the actual benefit of providing electricity to households in the respective rural area. The government has recently changed the regulation by allowing the cooperatives to maintain their legal status, and is discussing the option of lowering the reporting and technical requirements for mini-grids serving less than 2000 users (Reiche et al ., 2006).

[64] The level of power theft reached 40% in DCs and posed a major barrier to the installation of power equipment (e.g. cables) in rural areas (Mills, 2005a:1263; Sawin, 2004:26).

[65] Major development agencies such as UNDP acknowledge the importance of engaging communities in order to encourage a sense of ownership for the sustainability of projects; “If there is no feeling of community involvement or ownership, then failure rates of equipment and theft are likely to be high.” (UNIDO & REEP, 2008:7.34). Projects that are highly subsidised by donor agencies often have high failure rates, e.g. a village in Peru without electricity received 100% subsidised SHSs, a return visit by the implementing agency a few years later found that many households had sold their systems (World Bank/ESMAP, 2000:64). Another example is in India, where only five years after installation most of the state-financed solar PV facilities were damaged by the owners who reportedly failed to develop a sense of ownership as the equipment was delivered for ‘free’ (Martinot et al ., 2002:330). The same attitude was observed in other countries whenever SHSs were simply donated to rural households (Nieuwenhout et al ., 2001:462).

[66] Only a few countries support rural cooperatives in meeting the investment costs for RETs by specially introduced funds (Chaurey et al ., 2004:1695). In most countries however, the establishment of mini-grids is not possible due to a lack in subsidies, especially when covering the initial capital costs to set up the scheme (Reiche et al ., 2006). Although still rare, an increasing number of countries try to use a combination of private sector and CDM funding for renewable off-grid projects. In Kenya for example the JPMorgan ClimateCare Company that deals with carbon-offset projects has committed itself to supporting community managed small-hydro power projects in return for carbon-emission reductions (Mbogo, 2009).

[67] The shortage of well trained local technicians has become a bottleneck for solar energy applications in China (Wang & Qiu, 2009). In Kenya a community managed hybrid wind-solar project in Tsagwa Village came to a stand still when one of the wind turbines stopped functioning. Only when the donor organization finally agreed to pay for the transport and repairs did the operation commence (author’s own observation).

[68] The projects were undertaken in the following countries; in Asia: Sri Lanka, China, India, Indonesia, Bangladesh, and Vietnam, in Africa: Cape Verde, Benin, and Togo, and in Latin America : Dominican Republic and Argentina.

[69] As the majority of rural households are engaged in farming they would only be able to pay a monthly fee in certain seasons (post harvest). In some cases where households are too poor to pay for the whole amount of user fees, the government provides subsidies, e.g. the RESCO model in Argentina (Nieuwenhout et al ., 2001).

[...]

Details

Pages
312
Year
2010
ISBN (eBook)
9783640722174
ISBN (Book)
9783640722358
File size
16.3 MB
Language
English
Catalog Number
v159624
Institution / College
RWTH Aachen University
Grade
Cum Laude
Tags
Kenya Energy Energie

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