26 September 2007
Energy is vital for development. It is essential to fuel industry and power infrastructure. At the same time, access to energy is a key indicator of human development. It is necessary for basic services such as domestic heating, lighting and food preparation, and for the delivery of food, fresh water, education and healthcare.
Despite this, an estimated 20% of the global population is without domestic electricity. Still more people rely on non-commercial biomass. In many areas, industries, schools and hospitals are at the mercy of sporadic power supplies and regular power outages. Yet a survey by the African Development Bank showed that 28 African countries spend more than 10% of their total import bill on oil.
At the same time, the use of fossil fuels like coal and oil is changing the climate in ways that will most disastrously affect the poorest people in the poorest countries. It would be a tragedy for these people and nations, and for the globe, if the development of the developing world were based on fossil fuels, as was the development of the richer nations.
If equitable and sustainable development is to be achieved, and standards of living to which populations aspire or have grown accustomed maintained, then innovative technology will be needed to achieve energy efficiency and provide clean, renewable sources of energy.
Business is playing a growing role in bringing energy solutions to lowincome populations, an activity that represents an important business opportunity. It was this realization that motivated the creation of the Global Village Energy Partnership (GVEP).
Launched in the wake of World Summit on Sustainable Development in 2002, GVEP was created to transform the manner in which the development community tackles access to energy and to promote social and economic development in urban and peri-urban areas in developing countries through facilitating access to modern energy solutions.
Based in London, GVEP is registered under the UK Charities Act. It receives funding from governments and international development agencies and works in partnership with private sector companies, including EDF and Shell.
After an initial four-year period spent looking at policy issues, GVEP has moved to implement its energy policies through building energy supplies and infrastructure. Specifically, the organization is involved in the development of products and services in collaboration with its partners, including partner project pipelines, the development of actor mapping, bundling of small projects, for example carbon offsets, and building expertise in monitoring and evaluation.
The GVEP partnership operates within a business culture and is active globally. It has initiated projects in Latin America and Asia, where it is involved in building energy supply chains, working with local companies on the delivery of energy solutions, and investing in small and medium enterprises (SMEs).
In Africa, using a US$ 30 million grant received from the Russian Federation, GVEP has been providing business development assistance, using funds to make grants to SMEs, and financing energy producing and consuming SMEs.
Recently, GVEP has been investigating the possibility of engaging in microfinance, a move inspired by the need to reduce high transaction costs. This project is still in its infancy and GVEP is currently exploring the need to link with banks as depositories for funds.
GVEP has agreed to form a strategic partnership with the WBCSD to explore energy solutions in poorer regions.
The partnership plans to scale up its project activities and to concentrate on SME development and capacity building. It will also work to bring donors and the private sector together to increase the number of cofinancing projects.
Public-private partnerships are becoming an increasingly popular mechanism to provide energy solutions in developing countries. As part of its Ecomagination program, GE has partnered with USAID and the Indian government in a project to bring clean and affordable electricity to rural communities in India.
It is estimated that 56% of the 700 million rural inhabitants lack adequate and/or reliable power supplies. The two-year pilot project, launched in January 2006, seeks to provide four village clusters in India with access to clean energy through GE power generation technologies that use biomass, wind and solar resources. The project is concentrating on smaller power units rather than large power plants.
USAID pledged to provide US$ 600,000 to fund this program, while GE will provide US$ 2.7 million in direct and indirect funding through its network of experts and other partners. Experience gleaned from these pilot projects will help identify and scale up successful rural electrification models, thereby helping the Indian government honor its pledge to provide “power for all by 2009”.
Similarly, BP has been investigating the use of “base of the pyramid” approaches to market products to low-income customers. BP and partners have recently developed a cooking stove that integrates a liquefied petroleum gas and biomass burner for low-income Indian homes. The aim is to reach 3 million households by 2008. BP plans to distribute the appliance through local suppliers, creating business opportunities while providing cheap and affordable energy products to low-income families.
Despite this, an estimated 20% of the global population is without domestic electricity. Still more people rely on non-commercial biomass. In many areas, industries, schools and hospitals are at the mercy of sporadic power supplies and regular power outages. Yet a survey by the African Development Bank showed that 28 African countries spend more than 10% of their total import bill on oil.
At the same time, the use of fossil fuels like coal and oil is changing the climate in ways that will most disastrously affect the poorest people in the poorest countries. It would be a tragedy for these people and nations, and for the globe, if the development of the developing world were based on fossil fuels, as was the development of the richer nations.
If equitable and sustainable development is to be achieved, and standards of living to which populations aspire or have grown accustomed maintained, then innovative technology will be needed to achieve energy efficiency and provide clean, renewable sources of energy.
Business is playing a growing role in bringing energy solutions to lowincome populations, an activity that represents an important business opportunity. It was this realization that motivated the creation of the Global Village Energy Partnership (GVEP).
Launched in the wake of World Summit on Sustainable Development in 2002, GVEP was created to transform the manner in which the development community tackles access to energy and to promote social and economic development in urban and peri-urban areas in developing countries through facilitating access to modern energy solutions.
Based in London, GVEP is registered under the UK Charities Act. It receives funding from governments and international development agencies and works in partnership with private sector companies, including EDF and Shell.
After an initial four-year period spent looking at policy issues, GVEP has moved to implement its energy policies through building energy supplies and infrastructure. Specifically, the organization is involved in the development of products and services in collaboration with its partners, including partner project pipelines, the development of actor mapping, bundling of small projects, for example carbon offsets, and building expertise in monitoring and evaluation.
The GVEP partnership operates within a business culture and is active globally. It has initiated projects in Latin America and Asia, where it is involved in building energy supply chains, working with local companies on the delivery of energy solutions, and investing in small and medium enterprises (SMEs).
In Africa, using a US$ 30 million grant received from the Russian Federation, GVEP has been providing business development assistance, using funds to make grants to SMEs, and financing energy producing and consuming SMEs.
Recently, GVEP has been investigating the possibility of engaging in microfinance, a move inspired by the need to reduce high transaction costs. This project is still in its infancy and GVEP is currently exploring the need to link with banks as depositories for funds.
GVEP has agreed to form a strategic partnership with the WBCSD to explore energy solutions in poorer regions.
The partnership plans to scale up its project activities and to concentrate on SME development and capacity building. It will also work to bring donors and the private sector together to increase the number of cofinancing projects.
Public-private partnerships are becoming an increasingly popular mechanism to provide energy solutions in developing countries. As part of its Ecomagination program, GE has partnered with USAID and the Indian government in a project to bring clean and affordable electricity to rural communities in India.
It is estimated that 56% of the 700 million rural inhabitants lack adequate and/or reliable power supplies. The two-year pilot project, launched in January 2006, seeks to provide four village clusters in India with access to clean energy through GE power generation technologies that use biomass, wind and solar resources. The project is concentrating on smaller power units rather than large power plants.
USAID pledged to provide US$ 600,000 to fund this program, while GE will provide US$ 2.7 million in direct and indirect funding through its network of experts and other partners. Experience gleaned from these pilot projects will help identify and scale up successful rural electrification models, thereby helping the Indian government honor its pledge to provide “power for all by 2009”.
Similarly, BP has been investigating the use of “base of the pyramid” approaches to market products to low-income customers. BP and partners have recently developed a cooking stove that integrates a liquefied petroleum gas and biomass burner for low-income Indian homes. The aim is to reach 3 million households by 2008. BP plans to distribute the appliance through local suppliers, creating business opportunities while providing cheap and affordable energy products to low-income families.
