The Energizing Finance series is an in-depth primary research and analysis by Sustainable Energy for All (SEforALL) and partners that examines supply and demand for finance across two key areas of energy access: Electricity and Clean Cooking.
This year's publication: Energizing Finance: Missing the Mark 2020 is just released and the report found out that financial disbursement to energy access continues to significantly lag behind commitments.
As matter of bringing the topic to the public's attention, I put a birds eye view of key highlights below for Ethiopia, one of the High Impact Countries, HICs, in the report:
- Countries like Congo (DR) and Ethiopia, where 95 percent of the population lacks access to clean cooking, attracted less than 1 percent of the annual investment they needed.
- Electricity – Required investment and tracked electricity access investment (USD million, per annum)
1956 required investment Vs 137 tracked investment
- Clean cooking - Required investment and tracked investments (USD million, per annum)
191 required investment Vs 0.9 tracked investment
- The distribution of finance committed for clean cooking access across HICs in 2018 is disconcerting, with 92 percent of public finance in 2018 concentrated in Bangladesh and Kenya alone.
Ethiopia attracted only USD 0.9 million in 2018 in contrast to the USD 191 million it needs annually to provide its entire population with access to clean cooking solutions
- Estimated carbon finance flows for clean cooking projects in the mandatory and voluntary markets (VER), by destination country (USD million)
Ethiopia registered only 0.1 while Ghana achieved a USD 4.7 annually,
My Take Away
While the access deficit is huge, the financing for energy access both for electricity and clean cooking is meager. Further reform of the energy sector, enhanced financial commitment and faster execution of programs and projects is critical to realize the stated goals of reaching every Ethiopian household by 2025.
A tailored policy support in tandem with the burgeoning digital transformation strategy, new business models can help address the energy access needs of millions of households in the country while creating the needed jobs to the growing youth population. Ethiopia has become one of the few last frontiers in access to energy challenge, and there are whole lot of opportunities and solutions tested anywhere else that can be applied in Ethiopia. It just needs open mind and convenient business environment.