Energy and Poverty Reduction: Proceedings from a Multi-Sector and Multi-Stakeholder Workshop How can Modern Energy Services Contribute to Poverty Reduction? Addis Ababa, Ethiopia, October 23-25, 2002 March 2003 Joint UNDP/World Bank Energy Sector Management Assistance Programme (ESMAP) Contents Acknowledgements.................................................................................................................v Partnership with AFREPREN................................................................................................vi Foreword ................................................................................................................................ vii Executive Summary ................................................................................................................ 1 Introduction and Background to the Workshop ...................................................................1 Where do we stand today on Energy and Poverty................................................................2 Understanding the Demand for Energy Services .................................................................5 Designing Appropriate Response Initiatives -- Framework for Country Action Plans.......8 Conclusions and the Way Forward.......................................................................................9 1. Introduction and Background to the Workshop.......................................................... 11 Introduction.......................................................................................................................11 Background........................................................................................................................12 Opening Session Speeches and Presentations ...................................................................15 Workshop Structure and Format .......................................................................................21 2. Where Do We Stand On Energy And Poverty? ............................................................ 23 2.1 Energy, Poverty, Millennium Development Goals and the Link to Poverty Reduction Strategy Papers.....................................................................................23 2.1.1 Ethiopia’s Strategy for Poverty Reduction............................................................23 2.1.2 Ghana’s Strategy for Poverty Reduction...............................................................25 2.1.3 Uganda’s Strategy for Poverty Reduction.............................................................28 2.1.4 Zambia’s Strategy for Poverty Reduction.............................................................35 2.1.5 Kenya’s Strategy for Poverty Reduction...............................................................43 2.1.5 Tanzania’s Strategy for Poverty Reduction...........................................................45 2.2 Biomass – The Energy used by the Poor...............................................................47 2.3 Session Discussions ...............................................................................................49 3. Measuring Energy Project Benefits and their Impacts on Poverty........................... 53 3.1 Impact of Energy Sector Reforms on the Poor......................................................53 3.2 Measuring the Benefits of Modern Energy use.....................................................55 3.3 Framework for the Design and Assessment of Social and Poverty Impacts.........58 3.4 Session Discussions ...............................................................................................62 4. Case Studies – Learning from Existing Projects and Programmes.......................... 65 4.1 Interfuel Substitution.............................................................................................65 4.2 Improved Stoves and Forest Management ............................................................68 4.3 Sri Lanka Off-Grid Rural Electrification Project ..................................................70 4.4 Utility Performance Improvement.........................................................................74 4.5 Multifunctional Platforms .....................................................................................80 4.6 Session Discussions ...............................................................................................82 5. Integrating Energy into Poverty Reduction Strategy Papers – A Sectoral Approach ................................................................................................. 85 5.1 Health Sector.........................................................................................................85 5.2 Education Sector ...................................................................................................87 iii 5.3 Agriculture and Water ...........................................................................................88 5.4 Small and Micro-Enterprise Sector ......................................................................90 5.5 Session Discussions ...............................................................................................90 6. Designing Appropriate Response Initiatives – Frameworks for Country Action Plans ............................................................................................................... 95 6.1 Ethiopia..................................................................................................................96 6.2 Ghana ....................................................................................................................97 6.3 Kenya.....................................................................................................................99 6.4 Tanzania .............................................................................................................100 6.5 Uganda.................................................................................................................101 6.6 Zambia.................................................................................................................103 6.7 Session Discussions .............................................................................................104 7. Closing Session – The Way Forward .................................................................... 107 7.1 Donors, NGOs and Private Sector Perspective ...................................................107 7.2 Next Steps and Closing Speeches .......................................................................108 Annex A: Workshop Agenda........................................................................................ 115 Annex B: List of Workshop Participants .................................................................... 119 Annex C: Global Village Energy Partnership............................................................. 129 Annex D: Slide Presentations...................................................................................... 133 Annex E: Sectoral Workgroup Presentation.............................................................. 221 Annex F: Country Workgroup Presentation............................................................... 243 Annex G: Participants Feedback Questionnaire: Results and Analysis ................ 267 iv Acknowledgments The Energy and Poverty Reduction Multi-Sector and Multi-Stakeholder Workshop held in Addis Ababa, Ethiopia benefited from contributions from a wide range of professionals and organizations. The workshop was designed in the context of the Global Village Energy Partnership (GVEP). It was made possible thanks to the contribution of the World Bank-UNDP Energy Sector Management Assistance Program (ESMAP), the World Bank Africa Energy Unit (AFTEG), the African Energy Policy Research Network (AFREPREN), the Kumasi Institute of Technology and Environment (KITE), and country delegations from Ethiopia, Ghana, Kenya, Tanzania, Uganda and Zambia. The role of the supporters, moderators and those who provided the logistical support set out to fulfill the need for a joint review between energy and non-energy specialists, energy users, and members of the public and private sectors, civil society, and other organizations to ensure that future energy services would encompass the specific needs of sectors and help achieve the ultimate goal of poverty reduction. Special thanks are addressed to the Hon. Philippos Wolde Mariam, State Minister in the Ethiopian Ministry of Infrastructure for his opening and welcoming remarks. Mr. M. Ananda Covindassamy, Adviser for the Africa Private Sector and Infrastructure Department (AFTPI) for his opening speech thanking stakeholders for taking valuable time off from their busy calendars to attend this three day workshop. Ms. Dominique Lallement, Manager of the Energy Sector Management Assistance Program (ESMAP) and Coordinator of the Technical Secretariat of the Global Village Energy Partnership (GVEP) for providing the background of the workshop as well as for explaining the essential role of the Millennium Development Goals (MDGs) in poverty reduction. Special thanks are also addressed to representatives from the ESMAP donors, and GVEP partners for having made themselves available to engage in a direct dialogue with the country delegations and all stakeholders. The Workshop was designed by the following team: Messrs. M. Ananda Covindassamy (AFTPI), Dominique Lallement and Laurent Durix (ESMAP), Stephan Garnier (AFTEG),