Concept note. High-Level Seminar: Accelerating Sustainable Energy for All in Landlocked Developing Countries through Innovative Partnerships

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1 Concept note High-Level Seminar: Accelerating Sustainable Energy for All in Landlocked Developing Countries through Innovative Partnerships Date: 24 and 25 October 2016 Venue: Conference Room C3, Vienna International Centre, Vienna, Austria Context Sustainable Energy for All, encompassing its three dimensions of access, efficiency, and renewable energy, is a key development enabler for all the pillars of sustainable development. The multidimensional impact that rapid energy transition can have is all-encompassing; it is essential for alleviating poverty, improving human welfare, protecting health, empowering women and marginalized communities, protecting the planet, raising living standards, stimulating structural transformation and expansion of trade, building resilience, creating jobs and achieving rapid and sustainable economic growth. The 32 landlocked developing countries (LLDCs) with a total population of 478 million face development challenges owing to their geographical disadvantage of lacking direct territorial access to the sea and their remoteness and isolation from world markets. Additional border crossings coupled with cumbersome transit procedures and inadequate infrastructure, substantially increase the total expenses for transport and other transaction costs. According to World Bank data, the LLDCs pay more than twice that of the transit countries for imports and exports. This ultimately affects their capability to structurally transform their economies and to achieve sustainable development. Despite the potential that sustainable energy for all has for the development of the LLDCs, the average proportion of population having access to modern energy in the LLDCs is 55% (World Bank data). However this data hides the disparities between countries; with 9 countries having reached universal access, while 8 countries are trailing behind others with an access rate lower than 20%. Furthermore there are wide disparities between urban and rural areas with urban areas having access rates that are much higher than the rural areas and there are also huge challenges in some LLDCs associated with unreliable services affected by frequent disruptive services even in urban areas. Similarly, according to the recent data by the International Energy Agency, more than 300 million people in the LLDCs or two thirds of their total population rely on traditional use of biomass for cooking. The indoor pollution resulting from biomass use kills more people, 1

2 especially young children and women, than malaria and tuberculosis and HIV-AIDS combined, underscoring the urgent need for improved access to clean and modern cooking energy. In terms of renewable energy use, the average proportion of renewable energy in the total final energy consumption is 53% for the LLDCs. In seven of these countries the proportion of renewable energy in final consumption is very small, accounting for less than 10%, which shows that there is still great potential to promote greater use of renewable energy sources. The Vienna Programme of Action for the LLDCs for the Decade (VPoA) was adopted at the Second United Nations Conference on LLDCs, held in Vienna in November The VPoA is a comprehensive and action-oriented development agenda, with an overarching goal to address the special needs and challenges of LLDCs in a more coherent manner and thus contribute to sustainable development and poverty eradication. It underscores the commitment of the international community to support the world s 32 LLDCs in dealing with challenges related to landlockedness, remoteness and geographical isolation through implementation of six priority areas that include: (i) Fundamental Transit Policy Issues, (ii) Infrastructure Development and Maintenance, (iii) International Trade and Trade Facilitation, (iv) Regional Integration and Cooperation, (v) Structural Economic Transformation, and (vi) Means of Implementation. The VPoA stresses that energy infrastructure and access to affordable, reliable and renewable energy and related technologies are critically important for modernizing information and communications technology and transit systems, reducing delays and enhancing productive capacity to achieve sustained economic growth and sustainable development. In September 2015, world leaders committed themselves to promote an equitable and inclusive global development framework, in which no one is left behind, by adopting the 2030 Agenda for Sustainable Development. The 2030 Agenda acknowledges that the most vulnerable countries, including LLDCs deserve special attention. The 2030 Agenda calls for support towards the implementation of relevant strategies and programmes of action, including the VPoA and also indicates that the VPoA is integral to the new Agenda. Sustainable Development Goal 7 (SDG 7) calls for ensuring access to affordable, reliable, sustainable and modern energy for all by SDG 7 has a multiplier effect on the achievement of all the other SDGs. The VPoA stresses some key ingredients to accelerate the implementation: partnerships related to regional, south-south and triangular cooperation, as well as between the public and private sector. To achieve the global goals on energy, LLDCs need to also ensure that national sustainable energy policies and regulatory frameworks are strengthened to ensure transition to sustainable energy and to encourage investment into the sector. The national energy policies have to define a proper energy mix and find solutions with the right mix of grid, off-grid and unconventional and innovative solutions. These actions together with strong national leadership and international support will go a long way in accelerating the energy transition at national level. Accessing finance also remains a major challenge for the energy transition in these countries and some of the LLDCs require targeted, adequate and effective financial and technical support for developing transition plans and to substantially scale up investment, including through better utilization of their domestic resources. The main constraints in accessing financing include low project preparation capacities and skills to deploy financing models that encourage blended 2

3 finance to attract more funds; private and public, domestic and international. In addition, lack of organizational reform in power utilities hampers the energy sector transition in various LLDCs. Inadequate infrastructure for electricity generation, transmission and distribution, particularly in rural areas, poses another severe restriction to achieving the targets. Further, the lack of human capacity and access to technology at affordable rates prevents the full exploitation of renewable energy sources in LLDCs. Strengthened partnerships between all stakeholders, the private sector, academia, civil society, communities, are necessary to address the above mentioned challenges and to accelerate the achievement of the goals of sustainable energy for all. In particular, partnerships can provide technology transfer, financial and capacity building support, and knowledge and sharing of best practices and lessons learned to enable the LLDCs to achieve SDG7. Partnerships involving a regional integration approach can lead to regional projects that can create bigger opportunities to attract larger investment and trade in energy for the benefit of the LLDCs. Given the varied endowment of natural resources in LLDCs, the regional energy projects have a great potential to speed up the use of renewable energy and access to modern energy. Objective The objective of this seminar is to take stock of the achievements made by the LLDCs in achieving sustainable energy for all, identify existing drivers and remaining barriers for the scaling-up of renewable energy and energy efficiency markets, industries and innovation, review the effectiveness of the current regional and international support and partnership frameworks and suggest priority actions and practical solutions to strengthen implementation capacities of LLDCs. The seminar shall provide a platform to exchange best practices and the development of adapted solutions to overcome remaining barriers (e.g. policy and regulatory, institutional, financial, technical, capacity, knowledge, awareness). It will focus on ways that multistakeholder partnerships could support the LLDCs to help them overcome the specific challenges that they face in achieving the objectives of sustainable energy for all. The first day of the conference will be dedicated to presentations providing important information on the status of sustainable energy for all in the LLDCs, the key achievements and challenges, best practices, lessons learnt, the role played by partnerships (national, regional and international levels, private sector and others) and provide suggestions on how partnerships could be strengthened to meet the needs of the LLDCs. This information will form useful background material for the participatory group discussions. The second day will be dedicated to the workshop where the various experts will discuss key issues and priority actions in working groups. The key recommendations will be included in an action-oriented work plan. The discussions will be organized in line with the following priorities which reflect the different levels of partnerships in the VPoA (national, regional, international, public-private). 3

4 Thematic areas for Group Discussions Priority 1 National strategies to achieve global goals on sustainable energy This thematic group discussion will take stock of the national energy policies and coherent implementation strategies together with the assessment of the achievements made and challenges faced in pursuing its goals. The session will also discuss the progress made in sustainable energy infrastructure development in LLDCs and in improving energy access, efficiency and renewable energy, identify the specific challenges experienced, share best practices on policies and technologies and how they can be replicated, and suggest ways in which partnerships can be strengthened to support the LLDCs to achieve SDG 7. Priority 2 Financing sustainable energy transition in LLDCs Accessing finance remains a major challenge. To address the financing gap at the national level, domestic resource mobilization and private sector engagement have to be scaled-up with appropriate and innovative instruments. Blended finance will be crucial in accelerating the energy transition in these countries in areas where the market does not reach. The use of ODA to leverage other sources of development finance, particularly for preparing bankable projects, creating enabling environment and channeling stable and increased long-term private capital to the energy sector has to be enhanced. The session will also discuss Climate Finance and the Global Climate Fund, with presentations from some representative LLDCs. Priority 3 Building Innovative Partnerships For LLDCs to succeed in their efforts to achieve sustainable energy for all, international cooperation and partnerships are essential. For rapid energy transition a multi-stakeholder approach is needed that includes all the players from off grid, mini-grid and to on-grid, private sector, local development banks, local investment pools to civil society and different line ministries. All actors should pull their respective strengths together to ensure rapid progress. The group will discuss how to enhance partnerships with the private sector including public-private partnerships, both at home and abroad, for developing energy infrastructure, accelerating energy access, accessing technology, enhancing efficiency and promoting renewable energy. Priority 4 Enhancing regional cooperation Regional and sub-regional cooperation or integration plays an important role in addressing the specific problems of LLDCs including integration of networks and markets, enhancing system flexibility, harmonization of policies and regulatory frameworks, regional power pooling and energy trade and establishment of regional projects. The group will discuss ways to enhance regional level partnerships and identify flagship projects. Expected Outcomes a) Stronger partnerships between the LLDCs, development partners, the private sector and civil society actors to achieve SDG7 targets in LLDCs. 4

5 b) An action-oriented work plan with key recommendations on how partnerships and initiatives at national, regional and international levels can be harnessed to contribute towards accelerating sustainable energy for all in LLDCs and the implementation of the VPoA and the 2030 Agenda for Sustainable Development. Organizers This seminar is jointly organized by the Government of Austria and the United Nations Office of the High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States (UN-OHRLLS) in collaboration with UNIDO, and Sustainable Energy for All (SE4ALL). Participants The meeting will bring together senior officials from: 32 LLDCs; Transit developing countries; Development partners; UN and international organizations; international financial institutions, Regional, and sub-regional organizations; power pools, regional renewable energy and energy efficiency associations, Private sector; NGOs and experts or practitioners on the ground who can share experiences and best practices. 5