More people have access to electricity, but…

May 27th, 2019, Published in Articles: Energize, Featured: EE Publishers

Despite significant progress in recent years, the world is falling short of meeting the global energy targets set in the United Nations Sustainable Development Goals (SDG) for 2030. Ensuring affordable, reliable, sustainable and modern energy for all by 2030 remains possible but will require more sustained efforts, particularly to reach some of the world’s poorest populations and to improve energy sustainability, according to a new report produced by the International Energy Agency (IEA), the International Renewable Energy Agency (IRENA), the United Nations Statistics Division (UNSD), the World Bank and the World Health Organization (WHO).

This is the executive summary of the report
Click here to download the full report

According to the latest data, the world is making progress towards achieving Sustainable Development Goal 7 (SDG 7), but will fall short of meeting the targets by 2030 at the current rate of ambition. The SDG Target 7.1 is to ensure universal access to affordable, reliable, and modern energy services (7.1.1 focuses on the proportion of the population with access to electricity and 7.1.2, on the proportion relying primarily on clean fuels and technologies for cooking). Target 7.2 is to increase substantially the share of renewable energy in the global energy mix. Target 7.3 is to double the global rate of improvement in energy efficiency.

In recent years, pronounced progress in expanding access to electricity was made in several countries, notably India, Bangladesh, and Kenya. As a result, the global population without access to electricity decreased to about 840-million in 2017 from 1,2-billion in 2010 (Fig. 1). Those still lacking access are increasingly concentrated in sub-Saharan Africa.

Fig. 1: Latest data on primary indicators of global progress towards SDG 7 targets.

Meanwhile, the population without access to clean cooking solutions totaled almost 3 billion in 2016 and was distributed across both Asia and Africa. The widespread use of polluting fuels and technologies for cooking continues to pose serious health and socioeconomic concerns.

Renewable energy accounted for 17,5% of global total energy consumption in 2016. The use of renewables (i.e., sources of renewable energy) to generate electricity increased rapidly, but less headway was made in heat and transport. A substantial further increase of renewable energy is needed for energy systems to become affordable, reliable, sustainable, focusing on modern uses.

Finally, with respect to energy efficiency, global primary energy intensity was 5,1 MJ/US$ (2011 purchasing power parity) in 2016. Energy efficiency improvements have increased steadily in recent years, thanks to concerted policy efforts in major economies, including China. However, the global rate of improvement in primary energy intensity still lags behind SDG target 7.3, and estimates suggest that improvements slowed in 2017 and 2018.

Additional effort will be essential in ensuring progress toward not only SDG 7 but also the broader Sustainable Development Agenda. In particular, SDG 7 and climate mitigation (SDG 13) are closely related and complementary. According to scenarios put forward by both the International Energy Agency (IEA) and the International Renewable Energy Agency (IRENA), energy sector investment related to all SDG 7 targets will need to more than double in order to achieve these goals. Between 2018 and 2030, annual average investment will need to reach approximately $55-billion to expand energy access, about $700-billion to increase renewable energy, and $600-billion to improve energy efficiency.

This report identifies best practices that have proven successful in recent years, as well as key approaches that policy makers may deploy in coming years. Recommendations applicable to all SDG 7 targets include recognising the importance of political commitment and long-term energy planning, stepping up private financing, and supplying adequate incentives for the deployment of clean technology options. The following sections review progress in electricity access, access to clean cooking solutions, renewable energy, and energy efficiency.

Electricity access
Thanks to significant efforts across the developing world, the global electrification rate reached 89% in 2017 (from 83% in 2010), still leaving about 840-million people without access. The progress amounts to an average annual electrification rate of 0,8 percentage points, and newly gained access for more than 920-million people since 2010. The electrification trend began to accelerate in 2015. An additional 153-million people were electrified yearly between 2015 and 2017, at an annual rate of more than 1 percentage point. However, the momentum remained uneven across regions; difficult-to-reach populations, particularly in sub-Saharan Africa, where many remain without access.

Fig. 2: Share of population with access to electricity in 2017.

Electrification efforts have been particularly successful in Central and Southern Asia, where 91% of the population had access to electricity in 2017 (Fig. 2). Access rates in Latin America and the Caribbean, as well as Eastern and Southeastern Asia, climbed to 98% in 2017. Among the 20 countries with the largest populations lacking access to electricity, India, Bangladesh, Kenya, and Myanmar made the most significant progress since 2010.

Sub-Saharan Africa remains the region with the largest access deficit: here, 573-million people – more than one in two – lack access to electricity. The region is also home to the 20 countries with the lowest electrification rates (Fig. 3). Burundi, Chad, Malawi, the Democratic Republic of Congo, and Niger were the four countries with the lowest electrification rates in 2017.

Fig. 3: The 20 countries with the largest access deficit over the 2010-2017 tracking period.

Progress in electrifying inner cities has been slow, and most informal settlements are still supplied through fragile distribution networks. The rural access rate of 79% in 2017 was lower than the urban access rate of 97%. To reach remote areas, off-grid solutions are essential; these include solar lighting systems, solar home systems, and increasingly mini-grids.

SDG target 7.1 calls for universal access to affordable, reliable, and modern energy services. Reliability and affordability remain challenging elements in many countries, even as the number of household connections increases. In 2017, one third of access-deficit countries faced more than one weekly disruption in electricity supply that lasted over four minutes. A basic, subsistence level of electricity consumption (30 kWh per month) was unaffordable for 40% of households in about half of these countries. Access also has a gender dimension. In key access-deficit countries analysed under the World Bank’s Multi-Tier Framework for Energy, found significant variability in household access rates based on gender of head of household.

If the rate of progress in expanding access to electricity remained at the same level as that between 2015 and 2017, universal access could be reached by 2030. However, connecting the last of the unserved populations may be more challenging than past electrification efforts, since many such populations live in remote locales or overburdened cities. A projected 650-million people are likely to remain without access to electricity in 2030, and nine out of ten such people will be in sub-Saharan Africa.

Key strategies for closing this gap will include data-based decision-making and advanced policy-planning frameworks, private sector financing, versatile solutions that include decentralised renewables, and efforts to both extend rural electrification and cope with urban densification.

Access to clean cooking solutions

The share of the global population with access to clean fuels and technologies for cooking increased from 57% in 2010 to 61% in 2017. However, because population growth is outpacing annual growth in access, especially in sub-Saharan Africa, the population without access to clean cooking remains just under 3-billion (Fig. 4). Between 2010 and 2017, the percentage of the population relying on clean cooking solutions grew by an annual average of 0,5 percentage points, though annual progress slowed in 2008. During this period, global improvements were driven by gains in the regions of Central and Southern Asia and Eastern and Southeastern Asia, which posted average annual increases of 1,2 and 0,9 percentage points, respectively. To reach universal clean cooking targets by 2030 and outpace population growth, the annual average increase in access must rise to 3 percentage points, from the rate of 0,5 percentage points observed between 2010 and 2017.

Fig. 4: Change over time in the absolute number of people with and without access to clean cooking (left axis) and percentage of the global population with access to clean cooking (right axis), 2000-2017.

Looking at individual countries, in absolute terms, India and China account for the largest shares of the global population without access to clean cooking, at 25% and 20%, respectively (Fig. 5). These two countries alone are home to 1,3-billion people without access to clean cooking solutions. Meanwhile, in six of the 20 countries with the largest access deficits: The Democratic Republic of Congo, Ethiopia, Madagascar, Mozambique, Uganda, and Tanzania, less than 5% of the population uses clean fuels and technologies as their primary means of cooking.

In most access-deficit regions, the use of wood is steadily declining, but this trend is offset by an increase in charcoal usage, primarily in sub-Saharan Africa. An inverse relationship between kerosene and cleaner gaseous fuels (liquid petroleum gas, natural gas, and biogas) has also been observed: As kerosene use declines, reliance on cleaner gaseous fuels for cooking increases. The uptake of cleaner fuels remains slow in rural Africa, in large part due to issues of affordability and supply.

Fig. 5: The 20 countries with the largest clean cooking access deficit, 2010-2017.

The business-as-usual approach will not meet the universal access goal by 2030. Based on the projections of current and planned policies, the International Energy Agency (IEA) estimates that 2,2-billion people will still be dependent on inefficient and polluting energy sources for cooking. Most of this population will reside in Asia and sub-Saharan Africa. To achieve universal access by 2030, greater use of liquid petroleum gas would be appropriate in urban areas (accounting for an estimated 92% of new connections) since population density justifies the necessary investment in infrastructure.

Meanwhile, improved biomass cookstoves, which represent 37% of clean cooking solutions, would be particularly suited for rural or more remote areas. Cleaner household energy is closely linked with other development goals, including those touching on human health, the environment, and gender equality. Universal access to clean cooking solutions would help prevent some 3,8-million premature deaths each year, primarily among women and children, from exposure to household air pollution. It would also save time spent collecting fuel (wood or other biomass) and tending fires, time that could otherwise be used for learning, earning, and social activities.

Clean cooking solutions reduce deforestation and lower climate-changing emissions. For these and other co-benefits to be realised, however, clean cooking must be integrated into national policy, by scaling up solutions, increasing public and private investment in clean cooking, and enhancing multi-sectoral collaboration. Transitioning to clean cooking requires tailored policies and programmes that focus on key barriers to the adoption of clean cooking solutions, such as their affordability, lack of supply, and social acceptability. Particularly successful programmes to date have addressed behavioural patterns, cultural norms, and regional variations. Because women are typically responsible for cooking, they often have a comparative advantage in reaching out to other users of clean cookstoves. Other success factors are enhanced multisectoral collaboration and greater public and private investment in clean cooking.

Renewable energy
In 2016, the share of renewables in total final energy consumption increased at the fastest rate since 2012 and reached almost 17,5%. Renewables are essential in the drive towards universal access to affordable, sustainable, reliable and modern energy, except for the traditional uses of biomass (e.g. for cooking) which is linked to significant negative health impacts. In 2016, the share of modern renewables (that is, excluding these traditional uses of bioenergy) in total energy consumption reached 10,2%, up from 8,6% in 2010, while the share of traditional uses of biomass declined to 7,3% from 7,9%.

Fig. 6: Change in renewable energy’s share of total final energy consumption between 2010 and 2016.

Of the three end uses of renewables – electricity, heat, and transport – the use of renewables grew fastest with respect to electricity (Fig. 7), driven by the rapid expansion of wind and solar technologies. The share of renewables in electricity consumption increased by 1 percentage point to 24% in 2016. This was the fastest growth since 1990, more than double that of 2015.

Fig. 7: Renewable’s share of all energy consumed by end of use, 1990-2016.

It was driven by three key developments: (i) drought recovery in Latin America and an associated increase in hydropower generation, (ii) China’s record-level wind capacity additions in 2015, which became fully operational in 2016, and (iii) rapid expansion of solar capacity in China and the United States. Hydropower remains the largest source of renewable electricity, accounting for 68% in 2016. It is followed by wind, bioenergy, solar, and geothermal. The share of renewables in heat remains the highest among the three end uses. That share surpassed 24% in 2016, an increase of 0,5% year on year. However, most of the share reflects traditional uses of biomass. Only 9% of heat was generated from modern renewables in 2016.

The share of renewable energy in transport remains lowest: it increased by 0,1% year on year to reach 3,3% in 2016. Biofuels constitute the majority of renewable energy used for transport in the United States, Brazil, and the European Union. Electricity generated from renewable sources also grew, linked to rail and the rapid increase of electric vehicles.

The top 20 energy-consuming countries in 2016 were responsible for three-quarters of global energy demand and two-thirds of global renewable energy consumption. In the six countries where consumption of renewables was above the global average, the trend was led by traditional uses of biomass (in India, Indonesia, Nigeria, and Pakistan), modern biomass (in Brazil), or hydropower (Canada).

Strong policy support and the increasing cost-competitiveness of solar photovoltaic (PV) and wind technologies are projected to bolster the deployment of renewable electricity across all regions. However, according to long-term scenarios developed by both IEA and IRENA, global renewable energy consumption needs to accelerate substantially to ensure access to affordable, reliable, sustainable and modern energy for all.

Despite remarkable progress over the past decade, renewables still face persistent financial, regulatory, and sometimes technological barriers. Policies have focused on renewable electricity so far, and fewer countries have implemented policies for renewables use for heating and transport. To foster an enabling environment, it is important that various policies work in tandem to integrate renewables into energy systems and directly support their deployment in all end uses. To ensure that the renewables-based energy transition is inclusive in all respects, gender considerations need to be mainstreamed in energy sector policies, education and training programmes, and private sector practices.

Energy efficiency

Rates of improvement in global primary energy intensity, defined as the percentage drop in global total primary energy supply per unit of gross domestic product, were more sustained in 2010-2016 (falling by more than 10%) than they had been in 1990-2010 (Fig. 8). Global primary energy intensity was 5,1 MJ/US$ (2011 US$ at purchasing power parity) in 2016, a 2,5% improvement from 2015. Yet this lags behind the annual rate of improvement to 2030 targeted by SDG 7.3, which now exceeds 2,7% and it is estimated that further declines in the rate of improvement have been observed in 2017 and 2018, with the rate of improvement in 2018 falling to a mere 1,3%.

Fig. 8: Compound annual average growth rate of primary energy intensity, 2010-2016.

To realise the significant cost savings to be gained from improved energy efficiency, more needs to be done. Concerted policy efforts, technology change, and changes in economic structure will contribute to improving global primary energy intensity. Recent progress has been more sustained than historical trends. In 2010-2016, the annual rate of primary energy intensity improvement accelerated in 16 of the world’s 20 economies with the greatest energy demand. China saw the most significant improvement, with India, Indonesia, Japan, and the United Kingdom also recording strong progress.

Energy intensity has decreased at varied rates across end-use sectors. Progress has been fastest in industry and passenger transport, where the average annual rate of improvement exceeded 2%. Rates of efficiency improvement in the services, agriculture, and residential sectors exceeded 1,5%. Freight transport lagged slightly behind, but a changing policy landscape following the implementation of fuel economy standards for trucks in the United States, Canada, Japan, China and India, as well as proposed standards in Europe signals potential change in the coming years.

The rate of improvement in global primary energy intensity is also influenced by supply-side factors: Chief among them efficiency in fossil fuel generation and reductions in the losses incurred in the transmission and distribution of electricity. Fossil fuel electricity generation has become steadily more efficient since 2000: The efficiency level reached nearly 40% in 2016. Meanwhile, the modernisation of electricity networks in the world’s largest electricity-generating countries, including China and India, has reduced transmission and distribution losses.

Looking ahead, improvements in energy intensity are likely to fall short of the SDG 7.3 target, leaving a large portion of potential benefits unrealised. Given current and planned policies, energy intensity improvements are projected to average 2,4% per year between 2017 and 2030.

Fig. 9: Growth rate of primary energy intensity by period, target rate for 2016-2030, and potential for 2017-2030 in IEA sustainable development scenario.

In the IEA’s Sustainable Development Scenario, in which cost-effective energy efficiency potentials are maximised, the rate of intensity improvement between 2017 and 2030 reaches 3,6%. This highlights that it is still possible not only to meet but even to exceed SDG target 7.3. Key efforts that governments can undertake to realise this potential include strengthening mandatory energy efficiency policies, providing targeted fiscal or financial incentives, leveraging market-based mechanisms, and disseminating high-quality information about energy efficiency. The spread of digital technologies will also create new ways to harness efficiency improvements through improved devices and business models.

This is the executive summary of the report
Click here to download the full report

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