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Regional trade in electricity and other energy products can be a powerful force for market integration and sustainable development. In the Arab world, there are great potential benefits from increasing electricity trade beyond its current, very low level. The potential shared value of trade in electricity in 2020–2030 is estimated at $12 billion. We can expect even greater savings, about $44 billion, from more optimal power systems operation, with a major role for gas as the main fuel for power generation, displacing expensive liquid fuels.
2018 continued to see major shifts in global energy markets and extractive industries, which were reflected in the work done by the World Bank in developing and middle-income countries. From expanding off-grid electricity projects in rural and remote areas, to announcing an ambitious $1 billion battery storage program, to a new initiative to help countries with coal mine closures, the Bank fulfilled existing commitments and announced new plans for 2019 and beyond.
Here are some highlights of the World Bank’s work in energy and extractives over the past year:
Riccardo Puliti, Senior Director and Head of Energy and Extractives at the World Bank, wrote a piece about how getting methane – which makes up 16 percent of greenhouse gas emissions -- out of energy production and use could provide a major boost to the fight against climate change.
In what is one of the largest programs of its kind in Africa, the World Bank is supporting Ethiopia’s efforts to take electricity to all its citizens by 2024 through the $375 million Ethiopia Electrification Program, which focuses on last-mile connections in addition to strengthening the capacity of the sector. The Program’s ultimate goal is to directly support new connections for over one million households in Ethiopia.
A video shows how investing in solar-powered mini-grids like this one in Ghana, is changing lives. In the towns around the Volta River, nearly 10,000 Ghanaians now enjoy uninterrupted power, which enhances security and brings new economic opportunities to these communities.
Progress is being made in closing energy access gaps in Africa and Asia. A big reason is falling renewable energy costs, which have made home solar systems, mini-grids and other distributed renewable energy (DRE) solutions a viable option for providing first-ever electricity in remote, rural areas far removed from electric grids.
For the first time ever, the number of people gaining access to electricity in Sub-Saharan Africa is outstripping population growth. More than 700,000 home solar systems have been installed in Kenya alone and another 240,000 poor, rural households are expected to be connected soon under a new $150 million off-grid project backed by the World Bank. In South Asia, progress has been ever faster.
Photo: gui jun peng/Shutterstock.com
In many parts of the world, the sharing economy is ever-present for individuals, allowing them to use personal assets—for example, houses and cars—to their fullest potential. If you plan to be away for a period of time, why not rent your space for a few extra bucks?
Such a phenomenon exists in infrastructure economics, where the level of asset utilization matters for end-cost. As more consumers use the same infrastructure more frequently, the unit cost for all consumers goes down. Recent projects combining expertise from the World Bank’s digital development and energy teams demonstrate this.
Last August, I visited Quang Ngai, a central coastal province in Vietnam, to collect data for a survey on women’s participation in resettlement activities. I expected our first meeting with the local community to be short and uncontroversial. It wasn’t.
“We, women? Our participation? It doesn’t matter. We all stay at home. We don’t care about you coming here and asking about our participation,” said one female participant. “What we do care is to know the extent to which the recommendations we make today will be addressed. We need a resettlement site with community house, trees and kindergarten as promised during the project preparation.”
That comment brought to light an important perspective, highlighting the tension between what we might expect women to want, and their actual needs.
The impacts of development-induced resettlement disproportionately affect women, as they are faced with more difficulties than men to cope with disruption to their families. And this is particularly the case if there is no mechanism to enable meaningful participation and consultation with women throughout the project cycle in general and in the resettlement process in particular.
What exactly do we mean by green growth? For us, it’s not just about riding bikes and planting trees. The Korea Green Growth Trust Fund (KGGTF) defines green growth as adopting an innovative approach toward reaching nations’ goals for sustainable development and addressing climate change. It is a framework for decision-making and a proven process for turning people’s hopes into reality.
Morocco, the host of COP22 happening this week and next in Marrakech, is an example of a country that is working closely with the World Bank and other organizations to shift its economy onto a low carbon development path.
It just submitted its official climate plan, or nationally determined contribution, NDC, where it pledges a 42% reduction below business-as-usual emissions by 2030. This is 10 percentage points more ambitious than it previously laid out, ahead of Paris, and we see the plan affecting a growing number of sectors in the economy. Morocco plans a $13 billion expansion of wind, solar and hydroelectric power generation capacity and associated infrastructure that should see the country get 42% of its electricity from renewable sources by 2020, ramping up to 52% by 2030.
Prices for most commodities, including oil, are forecast to rise in 2017 as a long period of declining prices appears to be bottoming out, according to the October Commodities Markets Outlook.
Oil prices are forecast to rise to $55 per barrel next year from $43 per barrel in 2016 as markets readjust after an era of abundant supply that outpaced demand. Energy prices, which also include coal and natural gas, are forecast to jump 24 percent in the coming year. The decision in September of the Organization of the Petroleum Exporting Countries (OPEC) to resume limiting oil production is another important factor behind the higher price forecast.
Fresh water touches every part of daily life—from drinking water and sanitation, to agriculture and energy production. Unfortunately, for nearly half of the world’s population, water scarcity is a growing issue with devastating impacts to our communities, economies and nature. In the past, countries have primarily turned to more supply-side infrastructure, including reservoirs and canals, as solutions to increasing water demands. But we can no longer build our way out of scarcity. We must find ways to do more with less, and impact investment can provide a catalyst for revolutionary changes in water management.
Water markets can be a powerful mechanism for alleviating water scarcity, restoring ecosystems and driving sustainable water management. Water markets are based upon water rights which can be bought and sold, enabling water to be transferred from one user to another. A well-managed water market provides economic flexibility, encourages water saving measures and brings a variety of stakeholders to the table to find balance between the water needs of people and nature.
The Nature Conservancy’s new report, “Water Share: Using water markets and impact investment to drive sustainability,” explores the potential for water markets and impact investment to serve as part of the solution to global water scarcity. Water markets, when paired with creative investment solutions including The Nature Conservancy’s concept of Water Sharing Investment Partnerships, can help provide a more water-secure future for cities, agriculture, industries and nature.
Most commodity price indexes rebounded in February-March from their January lows on improved market sentiment and a weakening dollar. Still, average prices for the first quarter fell compared to the last quarter of 2015, with energy prices down 21 percent and non-energy prices lower by 2 percent according to the April 2016 Commodity Markets Outlook.