Challenges facing developing countries include sufficient affordable energy, but opportunity seen in focusing on new, renewable sources
Geneva, 12 May 2009 - The global credit squeeze, which makes energy supplies more difficult to obtain; concerns about carbon emissions and their effects on the climate; and potential declines in conventional oil reserves mean that the world, and especially developing countries, are facing serious obstacles in improving living standards and expanding their economies, UNCTAD´s Trade and Development Commission was told by a series of experts today.
The day-long discussion of "Energy-related issues from a trade and development perspective" focused on matters of supply and on the potential for the world´s poorer nations to find opportunities in the coming demand for renewable forms of energy.
Jeremy Leggett, Executive Chairman of Solar Century (United Kingdom), opening the debate by video link, reviewed concerns about when peak oil production may be reached - a matter of great importance for global energy supplies, and lending urgency to the search for viable renewable sources.
Mr. Leggett said the international community should call for, and achieve, greater transparency in oil reserves. Steps also should be taken internationally to combine efforts to deal with declining oil supplies with efforts to cope with climate change, he said. And he termed it necessary to accelerate new "green deals" that encourage advances in renewable energy.
Meeting even current demand is difficult. UNCTAD Secretary-General Supachai Panitchpakdi, in opening the week-long commission session on Monday, said some 1.6 billion people, mainly in Asia and sub-Saharan Africa, lack access to electricity, and some 2.4 billion do not have access to modern fuels for cooking and heating. Energy demand will continue to increase; projections are that trade in oil will double by 2030 and trade in natural gas will triple over the same period. Expenses also will rise: by 2030 it is estimated that US$22 - 27 trillion will be needed in the energy sector for extraction and development of the power industry and related infrastructure. About half this investment will occur in the developing world.
In addition, climate change is rapidly becoming a more prominent challenge. Some 64% of electricity worldwide now comes from the combustion of fossil fuels which add to greenhouse-gas emissions.
Mr. Supachai said, however, that these challenges should also be looked at as opportunities for developing countries. Investment, planning, and research should be applied to making rapidly expanding energy supplies in such nations cleaner, more efficient, and ultimately -it is hoped - less expensive as technology advances. Promoting clean and energy-efficient industries and infrastructure also could make developing countries more attractive as investment locations, he said, and progress in renewable energy could heighten their global competitiveness. Even during the current global financial crisis, he said, it is imperative to find the financing to achieve progress in developing affordable renewable energy.
Other speakers at the morning session included Salvador Namburete, Minister of Energy of Mozambique, who described his country´s plans to establish a viable domestic market for biofuels - noting that, if well managed, such a system would have the added benefit of encouraging entrepreneurship and providing steady income and employment in rural areas. Motivation for greater production of biofuels included unpredictable, volatile swings in world oil prices; the country´s need for greater energy security and reduced dependence on imported fossil fuels; and the mitigation of global warming through the use of a clean energy source, Mr. Namburete said.
Rouben Indjikian, of UNCTAD´s Special Unit on Commodities, gave an overview of energy´s relation to trade and development, noting in part that extensive international cooperation is needed to cope with such trade-and-development matters as greenhouse-gas emissions, transparency in energy markets, and development assistance aimed at affordable and reliable energy supplies for less-developed countries and the poor.
Claudia Vieira Santos, Head of the Division for New and Renewable Energy Resources of Brazil, summarized her country´s energy strategy, noting that most electricity generation comes from hydropower. She described national plans for expanding agricultural supplies of biofuel while protecting food supplies and the environment.
Peter Wooders, Senior Economist of Climate Change, Energy and Trade of the International Institute for Sustainable Development (Switzerland), reviewing the morning´s discussion, said the picture looked better if one shifted from the perspective of oil supply declines in the future to the potential of developing renewable, more environmentally friendly sources of energy.
Jean-Francois Casanova, President of Strategic Risk Management (France), spoke at the afternoon session, saying that despite the global recession and tight credit conditions, it is a good time for investments in solar energy, as related prices are low, and new investments in clean energy can be expected to follow economic and market growth over time. State supports such as financial incentives for attracting investments that promote renewable energy technologies are a good approach, he said, and recently have been undertaken by several countries.
-Ing. Matthias Vetter, Head of Group for Off-Grid Power Supply for the Fraunhofer Institute for Solar Energy Systems (Germany), said recent advances in renewable energy technology for rural electrification in developing countries include small photovoltaic powered battery systems to provide lighting for homes; small hydropower stations that can power rural communities or groups of homes; and combination systems that are fed into electrical "mini-grids" and employ such elements as photovoltaic cells, wind, and hydropower. Costs for photovoltaic technology can be expected to decline, Mr. Vetter said.
Arthur Weyns, Vice President for Global Affairs of Philips Consumer Lifestyle (Netherlands), described a woodstove developed by the firm to enable poor families to cook meals more quickly and cleanly. The stove uses 50% less firewood and produces almost no smoke, giving women more time for other productive work and reducing indoor air pollution and resulting health problems. Mr. Weyns also reviewed a joint venture by Philips and Lesotho to produce an energy-saving lamp, contributing to development of an electronic industry in Southern Africa and providing an energy-efficient product useful for consumers in the ll country of the Southern Africa Development Community (SADC). The project grew out of an UNCTAD effort to identify new and dynamic sectors for expanding production in developing countries.
Mothae A. Maruping, Ambassador of Lesotho to the United Nations and other international organizations at Geneva, the Philips-Lesotho project was very welcome, in no small part for its creation of employment. It also was helping to diversify the country´s productive abilities and promoting the diversification of markets. The energy-saving qualities of the lamp made it environmentally friendly and economical, helping families with their expenses and leaving more resources for other economic growth. The region, as a result of establishment of this form of electronic production, also would become more attractive for future investment. One lesson of the current global crisis was that regional cooperation, such as that undertaken by the SADC, was a way to support and protect small economies, Mr. Maruping said.
Gianluca Sambucini, Project Manager for Global Efficiency 21, of UN-ENERGY, said activities of the multi-agency effort include assessing the cost-effectiveness of energy-efficiency measures; rationalizing energy decision-making; monitoring economic, financial, and political barriers to energy efficiency projects; and supporting the quick development of renewable sources as a way of sustainably reducing "energy poverty."
And William Jay Palladino, of Energy Pact Foundation (Switzerland), said the foundation served as a clearinghouse and a discussion centre on renewable energy efforts and looked forward to working with UNCTAD and developing countries on issues of energy development and sustainability.
