Transcript Africa Renewable Energy Access Grants Program (AFREA)

Tjaarda P. Storm van Leeuwen, Adviser, World Bank
ESMAP-SIDA Energy Conference
Stockholm, Sweden
February 23, 2010
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SSA generation capacity inadequate and has been
stagnant for 20 years
Low generation accompanied by low electrification
Less than 40 percent of countries will have
universal access by 2050 (current trends)
Consumption relatively small and falling
Power shortages high:
• expensive (emergency power cost)
• negatively affect growth (loss of output)
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US$40.8 bln-power sector annual spending needs
US$11.3 bln - power sector annual spending
US$29.5 billion-power sector annual financing gap
Global financial crisis could reduce power spending
needs by 20%, with minor effect on GDP shares
Most of private sector finance relates to
Independent Power Producers
Potential efficiency gains large in absolute terms,
but not sufficient to reduce financing gap
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A: Regional scale-up of generation
capacity
Develop a new generation of large-scale,
transformative generation projects
◦ Concerted effort behind key projects – Development banks as
enablers
◦ Strengthen power sector planning taking into account
potential climate change effects
◦ Blend private sector capital and donor support
◦ Less risk averse approach to hydro
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Develop regional power pools
◦ Get key inter-connectors in place
◦ Complete institutional frameworks (regulations, system
operating agreements)
◦ Surmount political concerns on security of supply (including
via complementary national investments)
◦ Promote environmentally sustainable solution
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B: Improve functioning of utilities, in
hybrid markets
Strengthen critical planning capabilities
◦ From firefighting to foresight
◦ Sector structure: ‘hybrid market’ of incumbent utilities and
private sector participation
◦ Adapt regulatory oversight mechanisms and institutions
◦ Recommit to SOE Reform
Utility efficiency and operational improvement programs
◦ Loss reduction programs (non-technical + revenue collection)
◦ Load management / DSM
◦ Low-cost technology standards
◦ Invest to reduce cost and adjust tariffs to improve financial
viability and creditworthiness
◦ Better governance & oversight critical
◦ Major efforts on capacity building, improving efficiency and
reducing carbon footprint
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C: Access rollout through sector-wide
engagement
Increase political and financial commitment
◦ Access to modern energy expansion imperative: redirect capital
subsidies towards rollout
◦ Target public institutions including efficient lighting for
maximum development impact
◦ Develop institutional models for rural areas, including innovative
rural energy finance mechanisms to engage private sector
◦ Review strategy towards biomass and biofuels
◦ Harness technology advances including promotion of sustainable
renewable energy resources
◦ Adapt solutions to expected climate change effects
◦ Reduce carbon footprint of energy sector
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A portfolio in SSA of about of about 42 projects valued at
about US$4 billion
Regional operations, in particular regional transmission,
and renewable projects impacting several countries of
growing importance
IDA supports rural energy access projects in about 15
countries through various rural finance mechanisms
(rural energy access programs represent about 30% of
AFTEG portfolio)
AFTEG manages several trust funds which complement
its lending activities (AFREA (US$28m from
Netherlands), ESME (US$30 million from Russia) in
addition to core ESMAP and PPIAF
How Trust Funds are managed in AFTEG
ESMAP
Program Manager
AFTEG
Sector Manager
•AFTEG Adviser/Program Coordinator
•Program Officer
•Support Staff (RM, Publications Asst,
ACS)
ESMAP
Core Activities
•Bank-Executed AAA
Dutch
AFREA Program
•BankExecuted AAA
•RecipientExecuted TA &
Grants
Russian
SME Program
•RecipientExecuted
Grants
•GVEPI TA
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The Africa Renewable Energy Access Program
(AFREA) is supported by the Netherlands’
$28.75 million contribution to the ESMAP Clean
Energy Investment Framework Multi-Donor
Trust Fund
AFREA objective: Meet energy needs and widen
access to energy services in an environmentally
responsible way (Pillar 1 of CEIF)
AFREA provides essential support to AFTEG
strategic agenda to promote increased access to
modern energy in Sub Saharan Africa and is
fully aligned with the overall strategic agenda
SWAP-Investment & Policy prospectus
Lighting Africa
Biomass Energy Initiative for Africa
Africa Electrification Initiative
Solar PV Toolkit
Gender & Energy
Catalyzing New Renewable Energy in Rural Liberia
Africa Energy Access Scale-Up Plan consultations
Energy & Climate Change SWAP-Investment & Policy prospectus
Rwanda GEF Sustainable Energy Development Program
Modernizing Biomass Energy Services in Benin
Mali Energy Access for Productive Uses
Catalyzing New Renewable Energy in Rural Liberia
Lighting Rural Tanzania
Biomass Energy Initiative for Africa- 12 pilots
Lighting Africa
Renewable Energy Education Project
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Impact evaluation of Rural Energy initiatives in the Sub
Saharan African region
Increased support to Rural Energy Agencies to support
acceleration of energy access agenda
Develop hybrid solutions
Support to RE educational institutions in sub-region
Support to local energy entrepreneurs to manufacture,
assemble, maintain and distribute appropriate
technological solutions (solar, biomass and other
renewables)
Implementing sustainable biomass and bio-fuel solutions
in rural
Adaptation of renewable energy solutions to climate
change
Thank you
Tjaarda P. Storm van Leeuwen
Email: [email protected]
Tel: +1-202-458-1464