Household energy, water vulnerability in Tajikistan and Kyrgyzstan : What have we learned?

1. Household energy, water vulnerability in Tajikistan and Kyrgyzstan: What have we learned? Ben Slay Senior economist UNDP Bureau for Europe and CIS Third Inter-Agency Conference on Regional Coordination and Compound Risks in Central Asia 14 April 2011

2. Presentation overview • Focus on Tajikistan, Kyrgyzstan • Two key questions: • “After the winter”: Is the glass half full, or half empty? • “Perfect storm”? • “Gradual improvement”? • Role of donors/international community? • “Policy advising feast versus implementation capacity famine”? • Focusing on what works, scaling up • Provide some answers from: • Yesterday’s preliminary event • New research results • Possible future directions

3. From “slow onset crisis” to . . . • “Perfect storm”? • Weak economies • Poor infrastructure • Poor energy, communal, public service delivery • Resistance to higher tariffs • Ineffective social protection • Corruption  governance issues • Socio-political crisis (Kyrgyzstan 2010) • Or signs of hope? • We survived the winter: because it was mild?

4. Energy consumption: Some improvement in 2010 Kyrgyzstan (2007 = 100) Sources: State statistical agencies, UNDP calculations.

5. Household energy, communal services inflation rates: High, but falling Tajikistan: Annual average inflation rates. Kyrgyzstan: Annual average inflation rates.

6. Other signs of hope • Kyrgyzstan: • Big improvements in water levels in Toktogul HPP • Collection rates in electricity sector have improved • Fuel and Energy Sector Transparency Initiative • Better energy sector regulation, corporate governance • Civic engagement • Tajikistan: • New generation capacity (Sangtuda 1) • New transmission capacity (South-North high tension line)

7. Poverty and household access to energy: New data and data issues • New official household survey data are available for Tajikistan, Kyrgyzstan • UNDP poverty and social impact assessments • On energy, communal service sectors in Kyrgyzstan, Tajikistan • Available on conference website • But: • Survey data do not always correspond to production and sales data provided by energy companies • Survey data on household expenditures do not always agree with national income accounting data on consumption expenditure • Survey data not always internally consistent • Major survey data gaps on household access to communal services remain

8. Link between grid connections, electricity supplies is broken in Tajikistan . . . Average monthly household electricity consumption (kWh) Share of households using electricity Source: State Statistical Agency

9. . . . And in Kyrgyzstan Shares of households reporting electricity cut-offs

10. Affordability: How much household spending on energy is too much?

11. Kyrgyzstan: Share of energy in household spending seems low . . . What revolution??

12. . . . While in Tajikistan, it seems very (too) high? Share of household expenditures devoted to energy, 2009 data. Source: State Statistical Agency.

13. What do people heat with? In Kyrgyzstan—electricity and coal (especially the poor) Shares of household energy spending on energy sources (2009) Source: National Statistical Committee

14. In Tajikistan: Much greater reliance on firewood (and dung) Source: State Statistical Agency

15. Energy, water, and social policy • Two key questions: • Can social policy mitigate household energy and water insecurities? • Is social policy become better targeted? • Answers: No, and no • Household energy insecurity can be reduced by: • Off-grid small hydro, other decentralized renewables • Energy efficiency • Household water insecurity can be reduced by: • Reforms of communal services, local governance • Rural water, infrastructure projects financed by central, local government budgets, donors

16. What is to be done? Two key questions for the international community • What does this research tell us? • “Policy advising feast with an implementation capacity famine?” or “Let’s identify what works and scale it up”?

17. What does this research tell us? • Evidentiary basis for understanding household energy vulnerability much better . . . • . . . But there are still many open questions: • Are the shares of household expenditures devoted to energy correct? • Support for national statistical offices? • Independent surveys, based on comparable methodologies? • Willingness to pay? • What are the implications of different composition of energy use? • Tajikistan: sustainable forestry? • Kyrgyzstan: social, environmental implications of coal?

18. Emerging lessons from Tajikistan’s experience with small hydro • Key obstacles: • Low electricity tariffs • Weak national capacity for construction, maintenance of small hydro facilities • Regulatory/legal lacunae • Why should Barqi Tojik buy expensive, risky electricity from small hydropower plants? • But—progress has been made: • Legal framework for feed-in-tariffs now in place • Trust fund for renewable energy can play “market maker role”

19. Thank you very much! Бoльшoe Cпacибo!