World Energy Outlook 2011.pdf - Thomas Piketty

Potential barriers to scaling up the financing instruments provided by multilateral and
bilateral sources for energy access include: the significant amount of regulatory and financial
sector reforms that may be necessary to enable some countries to absorb increases in
development (and other) financing; the need to satisfy multiple criteria in order to apply
much of the available development assistance to energy access projects, particularly those
related to renewable sources and climate change; and, the reordering of development
priorities that may be required of organisations (and the governments behind them) in order
to increase the share of energy-access projects within their portfolios.
Box 13.4 International Energy and Climate Partnership – Energy+
The International Energy and Climate Partnership – Energy+, an initiative that aims
to increase access to energy and decrease or avoid greenhouse-gas emissions by
supporting efforts to scale up investments in renewable energy and energy efficiency,
is a pertinent example of the increasing international recognition of the importance of
providing modern energy access to the poor. It focuses on the inter-related challenges
of access to modern energy services and climate change, recognising that both issues
require a serious increase in capital financing. The initiative seeks to engage with
developing countries to support large-scale transformative change to energy access
and to avoid or reduce energy sector greenhouse-gas emissions. It seeks to apply a
results-based sector level approach and to leverage private capital and carbon market
financing. The Energy+ Partnership aims to co-operate with governments and to
leverage private sector investment, to develop commercially viable renewable energy
and energy efficiency business opportunities to meet the challenge of increasing
access to energy in a sustainable manner. The intention is to facilitate increased
market readiness by creating the necessary technical, policy and institutional
frameworks. The government of Norway has initiated dialogue with possible partners
to develop the initiative.
© OECD/IEA, 2011
Carbon financing
Carbon finance offers a possible source of income for energy access projects that also help
reduce greenhouse-gas emissions. The revenue is raised through the sale of carbon credits
within the Clean Development Mechanism (CDM) and voluntary mechanisms. The value of
carbon credits produced from new CDM projects reached around $7 billion per year prior
to the global financial and economic crisis. However, low income regions so far have made
little use of carbon finance mechanisms to mobilise capital for investment in energy access.
Up to June 2011, only 15 CDM projects, or 0.2% of the total, have been designed to increase
or improve energy access for households. 40
The potential for projects to serve both energy access and climate change purposes in
sub-Saharan Africa is estimated to be large, nearly 1 200 TWh (150 GW) of electricity
40. Data available at UNEP RISOE CDM Pipeline Analysis and Database at www.uneprisoe.org.
500 World Energy Outlook 2011 - SPECIAL TOPICS