Source/Author : Fraunhofer
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A proposal for extending the Multi-Tier Framework for monitoring the SDG7.
The Sustainable Development Goals and the productive use of electricity
In 2016, the United Nations (UN) adopted 17 sustainable development goals (SDGs) within the framework of the UN Agenda 2030. Of the 17 SDGs, the SDG7 aims to ensure universal access to affordable, reliable, sustainable and modern energy for the entire world population and to increase the global share of renewable energy and the level of energy efficiency. Enhanced access to electricity for productive uses especially is also expected to catalyse an increase in welfare and economic development across all sectors, as it constitutes a key element for job creation and increased added value.
In this context, productive use of electricity can be defined as the utilisation of electricity for activities which generate a monetary value or, based on a broader definition of the term, contribute to an enhanced productivity or increased welfare of the affected population (Kapadia 2014, Brüderle and Bodenheimer 2011). This may involve a broad range of activities such as water pumping in agriculture, water purification, processing of agricultural products, preservation or refrigeration of goods, manufacturing of durable products or provision of various types of services. Therefore, productive uses go beyond the consumption of electricity for private household applications. However, a clear separation between productive uses and household use of electricity is difficult, especially if small family-run businesses or productive activities in the informal sector are concerned. Therefore, there is a fuzzy transition between the utilisation of electricity in households and by commercial businesses or service providers in developing and emerging countries.
Economic growth and climate and energy strategies
Along with economic growth, developing and emerging economies face the formation and expansion of commercial activities and energy-intensive industrial sectors, which may lead to significant increases in greenhouse gas emissions. Economic development, the creation of jobs and the increase of welfare for the population have a high political priority, especially in developing and emerging countries. However, economic growth and increased purchasing power, the expansion of infrastructures and the emergence and extension of commercial and industrial uses of electricity are generally related to an increased energy demand. This inevitably leads to growing greenhouse gas emissions if no strategies for developing a clean and sustainable energy supply are implemented at the same time.
Especially the industrial sectors of developing countries show a remarkable growth rate, e.g. a compounded average annual growth rate of 6.1 % in non-OECD countries compared to 1.1 % in OECD countries in the timeframe 2000-2017. Further, non-OECD countries have a substantially higher energy intensity, i.e. energy consumption per unit of value added, in comparison to OECD countries. This again becomes particularly apparent when looking at the industrial sector: with 0.2 koe/$, non- OECD countries use almost twice as much energy as OECD countries, with 0.08 koe/$.
These figures highlight the significant impact that the growing productive use of electricity in developing and emerging economies can have on global CO2 emissions and emphasise the need for an integrated framework for monitoring and managing the access to sustainable electricity sources in these countries.
The present monitoring framework for SDG7
The progress towards reaching the SDG7 is currently monitored based on a Multi-Tier Framework (MTF) for assessing the electricity access conditions on the national level. Although separate matrices exist for the assessment of energy access for households, public and productive uses, so far, the focus of the MTF has been mainly on the electricity needs of private households, for example, for the provision of lighting, clean cooking solutions or basic communication services such as mobile phone charging.
Regarding the definition of the metrics for the tiers for assessing electricity access, the MTF for productive applications is based on the same assumptions concerning
connection power and daily available capacity as defined for households (see table below). For the five tiers describing the levels of energy supply for productive applications, the MTF further assumes that tiers 3-5 successively meet the requirements of commercial activities and that in tier 5, electricity access does not cause significant issues for productive activities (Bhatia et al. 2015).
However, considering the connection power and daily capacities defined for the tiers, it becomes evident that the present monitoring of the attainment of SDG7 mainly places emphasis on the fulfilment of the basic needs for the use of private household applications and does not allow for a systematic and comparable assessment of electricity access conditions for private and productive uses.
Goal of this study
Considering the above, it is the goal of this study to review the present methodology for monitoring the SDG7 targets and to develop an approach for monitoring access to electricity which also considers the significant role of productive uses of electricity in developing and emerging economies. By adding to a better understanding of the electricity access needs of a broader range of user types (including households as well as commercial and
industrial applications), the results further aim to support the implementation of sustainable energy strategies, i.e. the development of energy supply solutions which are needs-oriented and at the same time sustainable. Thus, the developed framework can be used as a tool for energy planning to safeguard that, as a basis for economic development, the requirements of various types of productive users of electricity can be met while at the same time being consistent with climate change strategies.