By Yasemin Erboy Ruff, Senior Associate at CLASP, Co-Secretariat to the Efficiency for Access Coalition
“Energy is the golden thread that connects economic growth, social equity, and environmental sustainability.” When I first heard those now-famous words of Ban Ki-moon, the eighth Secretary-General of the United Nations and long-time champion of energy poverty issues, it was the proverbial “lightbulb moment” of my career. Having made the connection between climate change mitigation and energy access early on, I have yet to hear a more to-the-point articulation of the key role that sustainable energy — and for the majority of those who lack it, decentralized energy solutions — has to play in unlocking a range of positive sustainable development outcomes.
Just 5–7 years ago, we were making the case for a simple solar lantern being a transformative point of access to begin the climb on the “energy ladder.” Then came debates around sustainability to stop parachuting low-quality products on communities with no infrastructure for maintenance, repair, and disposal, and eventually, the “energy as a service” business model that many pay-as-you-go and rent-to-own companies active in the sector today consider their bread and butter. At the same time, support was growing for energy’s inclusion in a new global development agenda. In late 2011, a new UN General Assembly initiative, Sustainable Energy for All (SEforALL) was launched. Under the tutelage of Kandeh Yumkella, this led first to the Year (2012) and then the Decade of Sustainable Energy for All (2014–2024), and finally, the concept being acknowledged as SDG7, an integral part of the United Nations Sustainable Development Goals (2015–2030). And yet, efficiency remained the “third wheel” no one considered “sexy” enough to focus on, as often-lamented by Rachel Kyte, latest CEO of SEforALL.
Recently, the energy access community went through another sea change, this time opening up the access conversation beyond lighting — to include appliances that can be powered by distributed energy solutions. Off-grid appropriate, high-performing appliances unlock demand and provide a business case for scaling energy access efforts to allow end-users to climb all the way up the energy ladder. Hence, the ethos of “Efficiency for Access”, first launched in 2015 as an awareness-raising campaign. Now, in 2019, it is a well-established ecosystem of a 15-donor Coalition supported by a 25-member strong Investor Network, with over 10 Programme Partners to help amplify appliance-focused initiatives supporting consumer demand development, market development, technology R&D, policy development, and impacts research.
Evolving end-user aspirations and efforts to promote consumer choice and protection are driving changes in off-grid markets. When GOGLA published its first Global Off-Grid Solar Market Report in 2016, 1.2 billion people lacked access to modern energy services globally, and GOGLA members had sold an estimated 23.5 million products cumulatively since 2010. In the latest iteration of the report, the number of people lacking energy access dropped below 1 billion for the first time. Estimates from GOGLA show 245.9 million people have improved energy access as a direct result of off-grid solar lighting. The impacts are no longer limited to lighting — sales of 350,000 off-grid solar appliances were reported from July to December 2018, with TVs and fans being the most widely sold products.
Now, the narrative turns to how energy access and efficient appliances combined unlock sustainable development goals beyond SDG7 to enable economic empowerment and quality of life improvements to those at greatest risk of being left behind:
Some of the connections shown in this illustrative graphic are easy to make — let’s take a single appliance as an example. A refrigerator extends the shelf life of dairy and produce, thus reducing food waste and contributing to Goal 2: zero hunger. Refrigerators also keep vaccines and medications at the right temperature, contributing to Goal 3: good health and wellbeing. But how about Goal 1: no poverty and Goal 8: decent work and economic growth? The unassuming household refrigerator can unlock significant added income generation for its owner, who overwhelmingly chooses to use it for business purposes — to keep drinks and snacks chilled to be sold to customers during the day. In Uganda, revenue nearly doubled for entrepreneurs who had a fridge installed as part of a field test, and nearly half of customers expanded to a new product line; virtually all refrigerators sold through Global LEAP Results-Based Financing have been used for income-generating purposes. Going a step beyond, having access to a refrigerator allows women not only to generate income, but also to keep food cold and avoid having to shop at the market and cook for their family every day, meaning more freedom in terms of time and choice of activity, thus furthering Goal 5: gender equality. In her latest book, The Moment of Lift: How Empowering Women Changes the World, Melinda Gates argues that reducing women’s unpaid work just two hours per day boosts women’s participation in the labor force by nearly 20%.
In fact, each and every high-performing appliance has myriad benefits when we look closely — having access to Information Technology and connectivity facilitates Goal 4: quality education; a solar water pump not only enhances agricultural output but also delivers access to clean water sources (Goal 6: clean water and sanitation). A fan, depending on its size, can be used for indoor cooling for health benefits, or to dry produce for additional income. All efficient appliances reduce energy consumption, achieving more with less energy and other resources; therefore, they not only contribute to Goal 12: responsible consumption and production, and many reduce emissions and advance Goal 13: climate action. Solar water pumping, in particular, represents a large and low-hanging option for a more climate-friendly future: life cycle assessments indicate a potential greenhouse gas reduction of 97–98% compared to diesel pumps. In Bangladesh alone, a financing program that encourages replacement of the existing 1.2 million diesel pumps with solar pumps would reduce emissions by 10.7 million metric tonnes of CO2 annually, based on CLASP modeling. Replacing just 5% of those 1.2 million diesel pumps with solar water pumps would save close to half a million metric tonnes of CO2.
Many of the high-performing appliances mentioned here already exist; however, their market penetration in off-grid communities remains low. Affordability is a significant barrier to growth — for example, only 13% of smallholder farmers in sub-Saharan Africa can afford a solar water pump — meaning the technology rarely makes it into the hands of end-users, especially last-mile populations targeted by many off-grid efforts. To address this gap, Efficiency for Access is championing interventions to bring down costs and better understand consumer needs, including the Research & Development Fund where future rounds are expected to focus on enabling technologies and innovative business models, and the Global LEAP Awards refrigeration affordability prize.
Unfortunately, achieving SDG7 remains out of reach based on current trends: population growth still far outstrips growth in access to energy, especially for clean cooking. According to a recent report co-authored by the World Bank, an Efficiency for Access Coalition member, we are nowhere near achieving any of the goal’s targets — with an estimated 3 billion people left without electricity or clean cooking by 2030 under the status quo. If we are going to achieve SDG7 — and the rest of the SDGs — as a global community, we will need to break down silos across governments, industries, donors, and technical experts, with high-performing appliances being one of the key areas of focus in order to deliver not just connections, but sustainable energy services to the underserved at scale.
Efficiency for Access will continue to champion the uptake of high-performing appliances and their linkages to sustainable development outcomes as a conduit to bring together disparate donor and industry priorities and initiatives. As an example, next month, we will be launching our next Efficiency for Access communications campaign, this time focusing on the cross-cutting theme of Gender and Inclusivity, in service of Goal 5: gender equality and Goal 10: reduced inequality. And throughout the year, we will continue to document the impacts of access to high-performing, off-grid appropriate appliances — you can keep up to date with our latest market intelligence here.