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Energy Sector Development and

Climate Mitigation

Ajay Mathur

SenergyGlobal
New Delhi, India

Overview
Energy sector development focuses on enhancing access,
economic productivity, energy security, and environment
quality
There are a wide range of interventions in use which lower
the emissions trajectory while helping achieve these goals;

they compete with high-GHG emitting interventions

International cooperation can promote and prioritize these


mitigation options within energy sector development;

prioritization would depend on the appropriateness of the


option to a countrys current level of development

SBSTA-18
Bonn, June 19, 2004

Goals of Energy Development


Energy sector development focuses on enhancing:
access to clean energy services
1.6 billion people do not consume any
electricity, and very little kerosene or LPG
Household energy consumption is 212
kgoe/cap (compared to 651 kgoe/cap in
industrialized countries); about 25% comes
from biomass used traditionally

quality of the local environment


Indoor air pollution kills 2 million women and
children prematurely
Only 15% of cities in developing countries
have acceptable urban air quality

SBSTA-18
Bonn, June 19, 2004

Goals of Energy Development


Energy sector development focuses on enhancing:
economic productivity
Non-household energy intensity in
developing countries is 0.36 kgoe/$GDP (compared to 0.19 kgoe/$-GDP
in industrialized countries)
Competitiveness and opportunity
costs of supply expansion drive
energy efficiency initiatives

security of energy supply


Energy imports are a large fraction of
exports
Volatility in international prices leads
to macroeconomic instability
SBSTA-18
Bonn, June 19, 2004

Emissions Trajectory Reduction


could be a Co-Benefit
Emissions increases will occur due to:
Transition from traditional biomass energy to fossil fuels in the
household sector; and
Energy needs associated with the growth in the economic sectors manufacturing, services and transport

More than half of the infrastructure for the


generation and use of energy in developing countries
is yet to be built
Prioritizing interventions that promote clean energy
technologies would lead to lower emissions trajectories

These energy needs and climate mitigation


objectives - can be met through, for example:
Promotion of modern biomass technologies
Facilitating energy efficiency
Enhancing the share of renewables in the energy mix
SBSTA-18
Bonn, June 19, 2004

Promotion of modern biomass


technologies
Rural household and commercial energy needs can be
met by modern biomass technologies rather than fossil
fuels: this transition contributes heavily to emission
increases
200

India - Household Sector Emissions

Initiatives in several
Asian and African
countries
Technology adaptation,
market development,
and financing risks
are high
Adoption driven by enhancements in productivity and in
indoor air quality
180

160

Current Transition

Accelerated Modern Biomass

Million Tonnes CO2

140

120

100

80

60

Period of Intervention

40

20

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

SBSTA-18
Bonn, June 19, 2004

Facilitating energy efficiency


New investments in power, industry, transport and
building infrastructure can be substantially more efficient
than existing stock; economic growth is powering a rapid
increase in these sectors, and associated emissions
Almost all countries exhibit
declining energy intensity trends
for the economic sectors; most
countries have some initiatives to
promote energy efficiency in these
sectors
Technology integration, support,
and financing risks are high
Adoption is driven by quality and
productivity increases
SBSTA-18
Bonn, June 19, 2004

Enhancing the share of renewables in


the energy mix
Some renewables could effectively augment
commercial energy supply, e.g., wind and small hydro
A few countries have aggressive
programs to promote electricity from
renewables; many countries have
demonstration programs
Grid integration risks are high; cost
reduction is scale dependent
Adoption is driven by national goals
and remunerative tariffs

SBSTA-18
Bonn, June 19, 2004

Assess Risks & Prioritize opportunities


Separate out the use of energy in households and the economic
sectors
Energy use per capita in households will rise; however it can be partially delinked
from emissions growth
Energy use in the economic sectors will rise; however the intensity of use is
declining and the decline can be accelerated

There is a diversity of options that can meet energy-sector goals


and lower the emissions trajectory depending on the risks that can
be addressed at the current level of development
Penetration of clean technologies, especially in the household sector
Lowering energy intensity of economic activities
Creation of demand for clean energy

International cooperation through risk sharing - can promote and


prioritize mitigation options within energy sector development
GEF and CDM both provide risk sharing at the project level
SBSTA-18
Bonn, June 19, 2004

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