Are we approaching provision of energy in the wrong way?

I came across an article by Kamal Kapadia recently on providing energy services to rural communities and the base of the pyramid (Productive Uses of Renewable Energy: A review of four Bank-GEF projects, 2004). The article essentially states that there is a mis-guided belief that access to energy improves lives. Kapadia believes what we fail to realize is that it isn’t access to energy alone that improves lives, but rather access combined with the promotion of productive energy use that improves quality of life. The article was published in 2004 by the World Bank; four years later we continue to engage in one-off interventions.

My own work involves figuring out how to apply carbon finance to provide incentives and funding for appropriate clean energy alternatives among underserved communities. I’ve come to the same conclusion as Kapadia, but admittedly less eloquently. My conclusion is that what is lacking in the provision of energy services to the BOP is integrated development.

The way we have approached human development and poverty alleviation is still based on the belief that if we throw enough money at a problem we will be able to solve it. What I am calling an “If you build it, they will come” mentality. The problem is that this has been the standard answer for the last 30+ years. As I witness every day, poverty still exists—indeed, very much so.

I will concede that there have been isolated successes and expert studies written on this same subject, but these successes and studies only hold value if they are adapted to real world situations and replicated. Development organizations continue to work in isolation, each with a core mission or purpose. When are we going to realize that this model is flawed? That what is needed is an integrated approach to development.

Integrated development allows a series of complementary interventions to be designed at the onset of each project, each building on the one before. The model allows development to become a process and completely adaptable to geographic and cultural situations, in a sense the process becomes a collective consciousness, the whole being greater than the sum of its parts. The end outcome is that development becomes dynamic as opposed to static.

An example of a dynamic rural renewable energy program would be to create a synergy between energy provision, vocational training and micro-lending. Done in isolation each of these interventions are limited, but these interventions can expand considerably if they are done together. The first step is the provision of energy access. The next step is to create new demand and increase the potential of the individuals to pay for the service. The final step is to provide the individuals with the financial capital to productively use the energy for income generation.

The most logical approach to realize this is to link renewable energy entrepreneurs, vocational training programs and micro-finance. We need to form a virtuous circle including energy access, skills to generate alternative forms of income, and capital to put those skills into practice. The integration of the three interventions increases the sustainability of the parts, leading to the realization of the end goal, which is to improve lives.

For more information on integrated development see “Productive Uses of Renewable Energy: A Review of Four Bank-GEF Projects” by Kamal Kapadia, “Mating: A Novel” by Norman Rush and The Millennium Village Project promoted by Jeffrey D. Sachs.