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Energy Through Synergy

Remarks at World Bank Energy Week
Agnes van Ardenne-van der Hoeven
Minister for Development Cooperation of the Kingdom of the Netherlands

6 March 2006, Washington, D.C.

Ladies and gentlemen,

Earth is the third planet from the sun. When we gaze down on it from outer space, it looks like a marble - a beautiful, blue marble. Even the most down-to-earth astronauts marvel at its majesty when they actually see it. Frank Borman, Commander of Apollo 8, once said, 'The view of the Earth fascinated me. Raging nationalistic interests, famines, wars, pestilence don't show from that distance.'

I've never been to outer space myself, but I can tell you that Frank Borman is wrong. At night, we can see the traces of human misery on Earth, even from a distance of hundreds of thousands of kilometres. While other continents light up, Africa's night is dark.

The energy gap

Africa's night is dark, because only a quarter of its people have electricity. In rural areas, this figure is less than ten per cent, more than a century after the invention of the light bulb. For two billion people across the developing world, the quest for energy is a daily struggle. These people lack the electricity to light their homes and the gas to prepare a hot meal. Women and children spend hours collecting wood, animal dung or crop residues. This takes precious time, and precious lives: the indoor pollution caused by cooking with  wood and indoor stoves leads to acute respiratory infection, the world's greatest child killer. And when we look outside people's homes, we see that the energy deficiency is also slowing down the economy and society at large. People need energy to fuel their industries, run their hospitals, transport themselves and connect to the Internet.

Ladies and gentlemen,

Energy is all over the newspapers and high on the political agenda. Let me mention just a few stories that have hit the headlines recently: the recent natural gas dispute between Russia and Ukraine, the soaring price of oil, China's hunger for resources and the nuclear disagreement with Iran. And, clearly, a recent nuclear agreement between US and India. During the recent World Economic Forum in Davos, leading energy chiefs assured the world that there is no impending energy crisis. In my opinion, they are wrong: there is an energy crisis, and it is taking place in the developing world. Investments to fight energy poverty are sorely lacking, especially in rural areas. The current energy insecurity is a matter of concern for rich countries - for poor countries it may be the difference between development success or failure. They need energy for development.

The World Bank's energy for development

Ladies and gentlemen,

I very much welcome the World Bank's energy for development program, which will be presented at the Spring meeting in April. I am glad the World Bank has committed itself to increasing its investments in energy efficiency and renewables by at least 20 percent annually over the years 2005-2009. But, important though this commitment is, it is only a first step and for development success it will not be enough. To make the most out of our money, we will need to focus on modern energy for the poor, set clear output targets and cooperate more with other development organisations, such as UNDP. The World Bank can focus on adequate investments in access to energy, while UNDP concentrates on capacity building. The extra World Bank dollars will go a long way, but not nearly far enough. For example, at least 40 billion dollars in electricity investment is needed each year to achieve the MDG for poverty in Africa.

Energy for development

Obviously, energy for development is not just a World Bank responsibility; it is a universal one. First and foremost, it is the job of the national governments of developing countries to energise their own development process. It is then up to external partners to follow suit by supporting and complementing these efforts. The world has been slow to recognise these responsibilities. After we failed to include an energy target in the MDGs, it took the World Summit on Sustainable Development to attract serious, but uncommitted, attention to the issue. After Johannesburg, I decided that it was time to move from uncommitted attention to active commitment. The Energy for Development conference that the Netherlands organised in 2004 sparked the first international commitments in this area: I pledged to provide 10 million people with modern energy services before 2015. Today I can tell you that we are well on our way to this goal, working hand-in-hand with private-sector companies and NGOs. We've already signed contracts to provide more than 4.5 million people with clean stoves in their kitchens and more than 1.5 million people with lighting in their homes. For example, the company Free Energy will provide solar energy in African countries, and the Dutch development organisation SNV is setting up biogas installations in Nepal and Vietnam.

Commission on Sustainable Development

Ladies and gentlemen,

In the wake of the conference, the European Commission set aside 220 million euros to fight energy poverty; its brand new infrastructure fund will also contribute to this. Now others will have to rally to the cause. The next two sessions of the Commission on Sustainable Development are a test of everyone's commitment. To other donor countries I say: follow our lead and put forward concrete output targets. To the oil-producing countries, I say: why not let your ODA percentage rise with the oil price and spend that aid on energy for development? If there ever was a niche for you in development cooperation, this is it. To the governments of developing countries, I say: the Forum of Energy Ministers of Africa has set an excellent example with its clear objectives, such as doubling the use of modern energy before 2015 and including energy in all national development strategies. I invite the Forum to participate in the follow-up to the Energy for Development conference, and I would strongly encourage it to intensify cooperation with the African Development Bank and with NEPAD.

By improving political stability and good governance, NEPAD is helping to attract the private sector. Companies normally aren't very eager to invest in countries where pipelines may be tapped and where property may be expropriated. But I am sad to say that commitment from the private sector has not been what it should be even in countries where governance is generally good, such as Ghana, Mali, Tanzania and Uganda. On the positive side, I can say that the World Business Council on Sustainable Development is one of our strategic partners in the follow-up to the Energy for Development conference. What we need from the business sector is not business as usual - what we need is investment in modern energy for the poor and investment in clean energy for the future. And remember, you are not alone: public-private partnership is at the heart of the vision of Johannesburg. As of the beginning of this year, I made it easier for Dutch companies and their counterparts in poor countries to forge such partnerships. Of course, there will always be risks, but since when has that stopped any entrepreneur?

Ladies and gentlemen,

The next two CSD sessions are not just a test for the participants, but also for the Commission itself. We now have a chance to show that CSD is not just another talking shop. If this commission of universal participation can produce some action-oriented results, the G8 will have something to work with this summer in St Petersburg, where energy is at the top of the agenda. I am glad that the G8 has asked the World Bank for leadership. But why not ask the G8 itself to show leadership? In any case, I hope that the CSD will benefit from our Energy for Development conference and adopt the concrete actions we came up with. Let me briefly outline them for you. First, widening access to energy services for the poor, for example by establishing power distribution entities with viable mixes of urban and rural power markets. Second, enhancing environment and health performance, for example by taking account of climate change when developing energy policies and strategies. Third, ensuring sound energy policy and energy sector management, for example by establishing mechanisms for civil society to participate in energy sector decision-making and market design and implementation. And fourth, increasing investments in the energy sector in developing countries, for example by ensuring that the cost of meeting energy demand is eventually borne by energy users through cost-recovery tariffs.

Ladies and gentlemen,

Don't worry, I won't read out all the concrete action points we identified at our Energy for Development conference. There are copies of the outcome document available for everyone here. Pick one up, and take it along to CSD. I am counting on a well-attended CSD session - with the participation of not just environment ministers, but also energy ministers from poor countries and development ministers from rich ones.

I am also counting on a focused discussion: let's not step into the sustainable development trap of connecting everything with everything else. Let's focus squarely on energy; this subject alone embraces more than enough sustainability issues. In my opinion, energy efficiency and renewable energy deserve priority. Unfortunately a big push towards renewables is not realistic in the short term. Let's not forget that, even when every one of the 2 billion energy poor gain access to modern energy, global carbon dioxide emissions will only rise by one per cent. Climate change is not an argument against energy for development. Slowing climate change requires reducing emissions by rich countries, not withholding modern energy from the poor. Countries that have chosen the road of technology investment instead, such as the US and China, have a responsibility to tell the world about their results. Is it working, and if so, is it working fast enough? To speed up our progress towards a clean future, the private sector could also invest more research efforts in the application of renewables, in close partnership with the academic world. We're all in this together, for better and for worse. We have only one planet - that beautiful blue marble.

Ladies and gentlemen,

Cooperation is the key word. Right now, it's too little, but not yet too late. To energise the MDGs, we must find synergy between poor and rich countries; between the World Bank and the UN; between the private and the public sector; between you and me. Energy through synergy.

When I fly home in the evening after visiting Africa, I often stare out of the aeroplane window. Staring into the dark African night, knowing that many children out there can't flick a switch to light up their rooms and do their homework. It doesn't make me sad; it makes me want to work harder. Better to light a candle than to curse the darkness, says an old Chinese proverb. It's time to update this saying: better to install a light bulb than to curse the darkness.

Thank you.

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