Enabling Environments Switching Energy Access ON or OFF ?

1. Enabling EnvironmentsSwitching Energy Access ON or OFF?

2. Definitions of Enabling Environment • Practical Action: Critical factors and trends that shape the market-chain environment and operating conditions but may be amenable to change. • World Bank: A set of conditions - often inter-related - that impact on the capacity of citizens and civil society organizations to engage in development processes in a sustained and effective manner, whether at the policy, program or project level. • United Nations: A set of interrelated conditions (such as legal, bureaucratic, fiscal, informational, political, and cultural) that impact on the capacity of development actors to engage in development processes in a sustained and effective manner.

3. How factors are generated • These factors are generated by: 1] Structures (infrastructure, national and local authorities, research agencies, etc). 2] Institutions (policies, regulations, cultural practices, etc) that are beyond the immediate direct control of economic actors in the market-chain.

4. Why study Enabling Environments? • Charting this environment can help actors understand the trends that are affecting the entire market-chain, and examine the powers and interests that are driving change or keeping the status quo. • This knowledge can help determine avenues and opportunities for change, such as realistic action, lobbying and policy entrepreneurship.

5. Example – Mali Jatropha Electrification External Funding for SHGW/FACT Conducive National Energy Policy Supportive regulation and local authorities Enabling Environment High World Energy Prices Subsidies on Capital Costs Tax Exemption Farmers (326) Market Chain Actors and linkages Residential market (247) Potential agriculture market (fertiliser) Businesses (e.g. battery chargers) Jatropha primary producers Co-ops (CVPPs) (33) Generation & sales of electricity (ACCESS) Jatropha producers’ co-op (CPP) Social market (health centre, school) Input supply (seeds, plants) (MFC) Supporting services Contractual arrangements (MFC) Equipment (Dutch power plant, local press) Training on jatropha cultivation (MFC) Technical support (MFC and FF) Accounting support (MFC)

6. Main Enabling Environment Factors • PA’s experience has shown the benefit of identifying the following Enabling Environmental factors: 1] Market Demand: i.e. price, quantity, quality and timeliness of energy supplies required by energy users 2] Transformation Activities: i.e. cost of producing, processing, storing and moving energy 3] Transaction Activities: i.e. costs associated with energy delivery – contracting, securing finance, legal recognition, quality assurance.

7. Main Enabling Environment Factors Enabling Environment Official Corruption Trade Standards Market Demand Tax & Tariff Regime Land Rights Business Regulation Transformation Activities Infrastructure Cultural Issues Financial Access Quality Assurance Institutions Consumer Trends Transaction Activities Market Actors Supporting Services

8. Important Energy Enabling Environments

9. Important Energy Enabling Environments

10. FAO-PISCES Energy Case Study Examples • Common factors found in enabling environment: 1] Positive • World energy prices • Tax exemptions and government incentives • Supportive government policy and legislation • Consumer demand 2] Negative • Lack of financing • Lack of infrastructure, standards and regulations • Requirement for land ownership

11. FAO-PISCES Energy Case Study Examples

12. Further Work? • Develop a comprehensive list of Energy Enabling Environments factors that relate to energy access for the poor • Develop strategies for improving the Enabling Environment to support the increase of energy access for the poor rather than stifle it • Which Enabling Environments are the priorities for change? Influencing policy, financial environment, training?

13. Thank you! www.practicalaction.org www.practicalactionconsulting.org