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Rachel Kyte calls for unity on LPG for Development

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In October, Rachel Kyte, the U.N. special representative on Sustainable Energy for All described a new path toward sustainable cooking for all at the LPG for Development Summit in Marrakech organized by the World LPG Association. The video is posted by the Global LPG Partnership. http://glpgp.org/lpg-for-development-summit-marrakech/
In one notable passage, Kyte called for more unity in the clean cooking sector, long characterized by competition among variegated factions pursuing a range of cooking-energy choices. Here's the video: https://vimeo.com/242255514

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Rachel Kyte calls for unity on LPG for Development

  1. 1. CHECK AGAINST DELIVERY LPG for Development Summit Marrakech, Morocco “Think Big” October 3, 2017 Rachel Kyte Special Representative of the Secretary General for Sustainable Energy for All and CEO of Sustainable Energy for All (SEforALL) Good afternoon ladies and gentlemen. I wish the World LPG Association (WLPGA) a successful Forum and thank you to the Global LPG Partnership (GLPGP) for making today happen. I want to thank you all of you for being in this room. Because whether you realize it or not, each of you, collectively, are doing critically important work to end energy poverty and help create better, safer and more prosperous set of communities all around the world. You work on exceptional energy. I’m here to say to you that this exceptional energy is poised at the right timing to contribute to our global goals. You are part of an energy transition. Gas will be a very important part of that energy transition. And that energy transition is at the heart of the jobs, manufacturing, water services, agribusiness, health, education, all of which are at the heart of the Sustainable Development Goals. All of these goals were agreed by all countries in 2015, when the world’s leaders agreed to a set of universal Sustainable Development Goals. One of those goals – SDG 7 – calls
  2. 2. 2 for us to secure affordable, reliable, sustainable and modern energy for all by 2030. And the two most important words there are “for all.” In September 2015 in New York, 193 countries agreed to the SDGs and three months later, 195 nations signed the Paris climate agreement – committing to putting the world on a “well below 2°C” trajectory. What that agreement did was make more urgent and lifted up the global goal of sustainable energy for all to pull up the other goals. The goal of sustainable energy is really a focus on the reliability and affordability of clean energy that all will have to have access to by 2030, and by 2050 we need to decarbonize the energy system for the most part. These are promises we made to each other. The consequence is that we are involved in a transition where at the end we will have decarbonized, decentralized, digitalized energy systems that serve everyone. Now two years later, because of the careful work done by many organizations under the auspices of Sustainable Energy for All, we know through the Global Tracking Framework that 1 billion people still have little or no access to electricity, over 3 billion people do not have access to clean cooking. Some 84% live in just 20 countries in Asia and Africa – those with the largest access deficits. At this current rate of progress, only 72% of the world’s population will have access to clean fuels and cooking and technologies by 2030. So we can wait for the GDP per capita to finally get to that golden mark of $40,000 per annum and yes - everyone will have access to clean fuels for cooking. Or we can act. Last week, Sustainable Energy for All at the General Assembly together with other organizations launched a series of reports called “Energizing Finance”. We wanted to know if financial flows started to shift as result of targets, government policies and new markets. We looked at international and domestic finance, at public, private
  3. 3. 3 and development finance, what countries do with their tax base, their private investment, in equity and debt. The estimates for closing the gap in electricity are about $45 billion per year until 2030. We found that committed funds or investment are only just under half of that. It’s not disbursed and reaching people who don’t have access yet. But there is some progress. Global annual clean cooking investment needs by one estimate are at least $4.4 billion per year However, we are only able to track clean cooking investments across the high-impact countries to an average of just over $32 million a year for residential uses over 2013 to 2014. I just want to repeat that one more time. What’s needed to close the clean cooking gap is at least $4.4 billion per year and collectively, and right now, we can only track about $32 million. The data is probably not that bad, but that means that somebody is not actually tagging and tracking - which means it isn’t a priority. And we’re not even close. We haven’t yet created the markets, understood fully the importance of people’s access to clean cooking and for the technologies of clean cooking. A lot of the attention goes to the technology and not so much to the fuels. In Bangladesh, Ethiopia, Kenya and Nigeria, a first-time assessment of the cumulative cost of meeting government targets for the cooking sector for fuels and technologies by 2030 are estimated to be in the order of [$258.2 billion]. Over 95% of the cost of meeting these targets is found not in the stoves but in the fuels. Why are we spending so much more disproportionate attention to a conversation about clean cooking technologies and much less about what it takes to build vibrant markets for clean fuels for cooking? How come we don’t have the data? Let’s analyze the data and then act.
  4. 4. 4 Clean cooking and clean energy track require significantly more attention to meet international commitments by 2030. We don’t need to make the arguments again about how much better this is for children’s and women’s health and what it will do to economies when women’s time is freed up. We don’t need to go again through the opportunity of investment, jobs, and what happens to a community when clean fuels for cooking arrive. We know that people live longer, we know the incidence of disease comes down, children can go to school and women are able to work. We know that switching to clean fuels – and typically LPG, or adopting advanced combustion cook stoves that burn biomass more cleanly and efficiently – can reduce exposure to health risks. Can we shift our mindset and can we collectively act? I don’t believe this is the time for incremental solutions in this country or that country. 3 billion people can be seen as a development problem or as an extraordinary opportunity of wealth creation. It can be seen as a problem, or as “big market”. The need is urgent and there’s room for everyone to be a hero within it. There are signs of success, we can replicate from that and it’s possible to scale. We watched the example of India, and the aggression with which the Modi government went after a target relentlessly, surprising itself with the speed with which made progress. Of course, we need to understand if that progress translates into improvement of lives and health statistics coming down - the true measure of development - but this comes with time. In 2007, Indonesia introduced a kerosene to LPG conversion program, which converted 56 million households and microbusinesses by 2014. Over this same period, Indonesia’s GDP per capita also increased by about 73%. Over 2012-14, Indonesia made significant
  5. 5. 5 progress, raising its clean cooking access rate by more than 8% annually. Those countries that prioritize closing the clean cooking gap and who pursue policies to do so, can and do see rapid progress. Angola, Bhutan, Maldives and Peru all raised clean cooking access rates by more than 4% annually. Many countries showing improvements were also natural gas producers, which suggests that domestic availability can be an advantage. The achievements of this group of countries shows that – if the issue receives greater priority on the policy-making agenda – faster progress may be possible in future. So we know that countries can set priorities, make targets, use their talents in other areas to translate to progress. So let’s study those examples and then act. Today, energy access policies often concentrate on electricity provision but not so much on clean fuels and technologies for cooking. Let’s help policy makers prioritize access to clean cooking and recognize that investments in LPG, ethanol and natural gas for cooking require long-term, “industry-building” perspectives. This is where networks such as WLPGA and GLPGP can be essential agents of change. Let’s prioritize, let’s act. We also need to address direct polluting fuel subsidies like those for kerosene. We need consumer education campaigns that raise awareness about the health risks linked to cooking. After all, cooking is baked into cultural traditions, and these are not easy to alter – but when mothers are informed on what will make the lives of their children better, through better health, they do respond. Ladies and gentlemen. The task is to support and build vibrant markets for clean fuels. To work with governments from an industry perspective and with the development community to ensure, through what we have learned through effective social programs, conditional cash transfers and other mechanisms, that the needs of those at the very bottom
  6. 6. 6 of the pyramid will be are met with a bundle of services. Rather than trying to reach the poorest with education, health, and subsidies for clean fuel separately, we can bundle these packages. We don’t expect the market to take care of the poorest of the poor - this is going to be a public-private partnership at the very bottom of the pyramid. Private investors will need to be crowded in. It will require work with local financiers, local banks to educate about market opportunities, the introduction of appropriate consumer finance tools and products in the market. Equity and debt, work with the multilateral development banks and bilateral agencies. There is education to be done. We are talking about a big market for clean fuels, not about accumulation of small projects for cook stove models, it’s a shift in mindset. Private investors need to be crowded in, to markets they will be reluctant to enter, to a segment of population they believe is too risky, and a development challenge they may not have paid too much attention to. And you, as LPG industrial experts have significant roles to play, because we come from other areas from development and look what has worked in supply chain financing, distribution, consumption, to find new business and financial models. There is a pent-up demand of patient capital that wants to be part of the solution to allow 3 billion people to cook cleanly, and they are our potential partner for this industry further down the line. Let me give you an example. In Cameroon, the Global LPG Partnership worked with the Government of Cameroon to create the “National LPG Masterplan”. Through a designated investment committee, they prepared project investment of 403 million Euros to help reach the government’s goal of providing access to LPG for 58% of the population by 2030. This means that over a 13-year period 3.5 million new households would have access to clean cooking. That’s 18 million new LPG users. It also means that 18,000 new jobs will be created. But far more
  7. 7. 7 importantly, it means that 30,000 lives will be saved through reduction of household air pollution. It also means that every year, between 2017 and 2030, 15 million trees will be saved, 3.4 million tons of CO2 will be reduced. And $100 million of new economic activity will be created across the value chain. Every year. From now until 2030. We can do this. But we need to think bigger. I am here because I believe we can’t turn away from the data. Those 3 billion people and their economic success is a hugely exciting investment opportunity, and LPG is an exceptional part of that opportunity. I am here because the UN system believes there are threads throughout the Sustainable Development Goals that, if pulled, can propel us more quickly towards success. Imagine if we can create vibrant markets for clean fuels for the 20 countries where 84% where those 3 billion people live. We would be advancing progress on the SDGs on health, poverty, women, children, environment, deforestation, energy and climate. This partnership, together with others that are committed to this space, can actually do something that will lift up everybody in the next 5 to 7 years. Progress made to date is not good enough. I’m glad you’re in this room but we have to leave this room and do something different than what we were doing before. I have a request and an offer. My request, is that we organize ourselves better. WLGPA, GLPG, the Global Alliance for Clean Cookstoves and others, come together to one platform, one group, one coalition, present ourselves uniformly to a subsection of those 20 countries that want to move fastest and see if we can come up collectively with a plan for a vibrant market with all the financing and other pieces of the puzzle that we will need, that can set real targets in closing the gap of access to clean fuels. We can bring others to the table if we act together with a plan.
  8. 8. 8 What I offer you is support in making investment possible, marshalling the data and evidence, and benchmark the progress. We release the GTF and RISE which sets what countries have put in place to support markets and what needs to be improved to grow those markets quickly. And then we published the Energizing Finance report to track the financial date into this space. There are things we don’t know. Let’s ask different questions and if we put different people together in the room with us we will get different answers. Let’s work out what the roadmaps is for the next 5 years. We will help. And then we will convene, to create a neutral platform for the difficult conversations about what it is going to take to those countries that have the greatest access gap to make progress quickly. Finally, we tell stories of success so that LPG industry and distributors in country or company ‘x’ can see what is so transformative about what country or company ’y’ did. This is an extraordinary source of energy at the exactly right time and space. We shouldn’t be here in this moral outrage where 3 billion people have to choose between cooking a meal and the health of their children, but this is where we stand. We have the data, what know what needs to be served, we have the technologies, the resources, let’s all do it together. Thank you. * * *

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