Pre-Conference Workshop on Clean Cooking Fuels 31 st IAEE International Conference Istanbul, June 2008 Clean Gas Delivery for Poverty Reduction Andrew Yager United Nations

Presentation Outline Context for sustainable energy Energy access Millennium Development Goals LP Gas Rural Energy Challenge Barriers to access Solutions (income, investment) Alternative Gas Supply Options LP Gas Investment Facility Concluding remarks

Context Sustainable energy supply is a pre- condition for economic and social development and achievement of the Millennium Development Goals (MDGs) Investment capital required for business development (both public and private) Capacity building for local energy service delivery (policy makers, entrepreneurs, lenders, consumers)

Rural Energy: Traditional Fuels

Access to Sustainable Energy Services Support energy activities that reduce poverty Promote rural energy services to support growth and equity Promote clean energy technologies Increase access to investment financing

Sustainable Energy Link to the MDGs No specific MDG on energy However, energy is key for meeting basic human needs Domestic uses (heating, cooking) Productive purposes (brick and ceramics firing, metal working, fish smoking) Reducing drudgery (water pumping, grinding, milling) Social services (health care, education)

Fuels for Cooking Respiratory disease from cooking on traditional fuels kills nearly 5,000 people daily world-wide

Energy Poverty: Annual Deaths Source: World Energy Outlook 2006 (OECD/IEA)

There is a need to provide clean modern affordable energy services to reduce poverty.

LP Gas Rural Energy Challenge Public private partnership UN Department of Economic and Social Affairs (DESA) United Nations Development Programme (UNDP) World Liquefied Petroleum Gas Association (WLPGA) Designed to create viable and sustainable markets for LP Gas delivery and consumption Directly targets rural and peri-urban areas with the objective of expanding access to cleaner LP Gas thereby contributing to sustainable energy solutions that can improve people’s lives in developing countries and achieve the MDGs

Barriers to LP Gas Market Development Lack of confidence for private sector investment (business development, policy advocacy) Affordability (need cash) Availability (need roads and other infrastructure such as electricity) Lack of consumer awareness (e.g. fear of accidents)

Achievements Public private partnership established Access to governments enables dialogue (national consultations) Technical, socio-economic, environmental and energy access issues addressed successfully

Kenya case study Policy framework that encourages and supports investment in energy services (stability, confidence, risk) Subsidies (government provides seed capital and guarantees for micro- finance institutions) Tax holiday (20% VAT removed) Standards for equipment

Turkey case study Upper middle income country Medium level HDI (MDG health and education are least achieved) Need income generating activities to sustain village life Tree planting Wood processing Handicrafts Agriculture, animal husbandry and products Energy efficiency in buildings Need long-term rural development strategy to modernize rural energy supply

Alternative Gas Supply Options in Africa Exploitable gaseous resources available in Africa: Small oil and gas deposits (e.g. Mozambique, Namibia, South Africa, Rwanda, Ethiopia, Somalia, Cameroon, Congo (Brazzaville), Cote d’Ivoire, Ghana, Senegal, among others) Dissolved methane gas in Lake Kivu (DRC, Rwanda); Lakes Nyos and Monoun (Cameroon). Biogenic gases formed in swamps and marshes (Botswana, Niger, DRC) Landfill gas (various countries) Gas Flaring reduction at oil and gas production facilities (Nigeria, Angola, others) Biogas from animal, agricultural and human waste

LP Gas Investment Facility The Facility is intended to provide pre-investment capital: To give entrepreneurs an opportunity to develop their service offering Aimed at reducing the risks associated with the establishment of energy service delivery businesses. The donor community recognizes that working in poor and low population density areas makes it more difficult for private entrepreneurs to sustain a profitable operation. Therefore the United Nations partners will engage in activities that remove barriers and enhance investor confidence by reducing risk.

LP Gas Investment Facility (inputs) Provide seed capital for activities that enable clean gas supply and distribution networks to develop. Specifically: Support business plan preparation Support local capacity development to provide energy services Support capacity building aimed at sustainable market development

LP Gas Investment Facility The projects supported by the Facility will integrate: 1) the private sector’s contribution in service delivery and investment financing with 2) governments facilitating the enabling environment for creating new relationships and policy dialogue and 3) local NGOs providing the critical support function at the project implementation level.

LP Gas Investment Facility As the partnership succeeds communities and individuals benefit through increased access to clean fuel and energy services governments are able to fulfill social and economic development objectives, and private enterprises expand business opportunities, resulting in a triple-win situation that is the aim of the facility.

Concluding remarks Clean affordable energy supply is needed to achieve the MDGs There are many indigenous sources of energy Local capacity exists to deliver energy services Both public and private sector resources are required to develop the alternatives

Thank you! Andrew Yager Division for Sustainable Development