Center for Effective Global Action

We find that electricity use and access are strongly correlated with economic development, as theory would suggest. Despite large empirical literatures and suggestive case evidence, there are, however, few methodologically strong studies that establish causal effects on an economy-wide basis. There is some evidence that reliability of electricity supply is important for economic growth. We propose that future research focuses on identifying the causal effects of electricity reliability, infrastructure, and access on economic growth; testing the replicability of the literature; and deepening our theoretical understanding of how lack ofavailability of electricity can be a constraint to growth.

Countries dependent on oil and mineral exports are often advised to diversify their economies, yet surprisingly little is known about how this can be done. This paper reviews the recent literature on diversification in resource-dependent states and suggests it has been constrained by missing and inconsistent data, and a reliance on diversification measures that are relatively uninformative for resource-rich states. It then uses an improved measure of export concentration from Papageorgiou and Spatafora to document three empirical patterns over the last half-century: the divergence between oil-producing states and non-oil states; the reconcentration of exports in most oil and mineral producing states since 1998, caused by the boom in commodity prices; and the heterogeneity of the oil producers, marked by greater diversification in Latin America and Southeast Asia, mixed performances in the Middle East, and greater concentration in Africa and the former Soviet Union. While change in the former Soviet Union was spurred by large new discoveries, the diversification failure of all oil- producing states in both North and sub-Saharan Africa is striking, and stands in contrast to the region’s non-oil producers. The paper concludes with a research agenda for deepening our understanding of this issue.

This paper addresses the role of governance of urban areas in shaping energy use in LICs and MICs, from the perspective of the poorest and disadvantaged. Urban dwellers in LICs and MICs often access electricity  through irregular, patchy and informal connections which are frequently considered illegal. This situation is closely linked to how urban areas develop in LICs and MICs, often with weak urban governance and little control, resulting in what is termed‘informal settlements’ and slums. Studies of urban infrastructure in LICs and MICs have tended to concentrate on water and sanitation networks, with comparatively very limited attention being paid to access to electricity. The paper reviews the literature that exists on access toelectricity in urban areas in the Global South, and draws on experiences in other urban infrastructures that may provide lessons towards improving such access for the poorest and disadvantaged.

Large scale renewables raise new challenges and provide new opportunities across electricity systems. This paper considers the barriers faced by large scale renewables in electricity systems in Sub-Saharan Africa and South Asia. We review the current state of knowledge in relation to grid-connected renewables. This paper then explores key issues in electricity systemstructure, the main challenges to the uptake of renewables, and the various existing fiscal and policy approaches to encouraging renewables. We also highlight possible ways moving forward to ensure more widespread renewables deployment.

When developing electricity systems, generation and grid have been separately planned and demand has generally been assumed passive, estimated using aggregated approaches. However a variety of design, technology and regulatory solutions are available in modern power systems for a more tailored approach to power system development, which may hold great promise for low income countries to leapfrog towards sustainable and decentralised energy delivery. Monitoring of power systems from generation to load, PMUs, on-site storage, DLR, OLTC, direct load control or innovative network topologies including micro- and mini-gridscan reduce total costs, increase asset utilisation and modify the optimal phase-in of investments along a planning horizon. These allow for new planning approaches and more holistic phase-in of generation and networks. This paper reviews the scientific literature and best practice databases, providing a state-of-the-art perspective on the technical options,costs, benefits and barriers to deployment of a progressive build-up of power infrastructure.

Effective energy policies rely on credible and comprehensive national energy data systems, in developed and developing economies alike. Smart system technologies will play a central role in the clean energy transition—including applications in smart homes, factories, transport systems, and renewable electricity grids—and their ability to compile and communicate point-of-use energy data presents new opportunities for improving national energy data systems. This paper reviews the growing importance of energy data systems for energy policy in the developing country context, identifies key characteristics a national data system needs to have in order to be robust and viable, discusses the potential role of smart system technologies in national energy data systems moving forward, and recommends several future research areas to better understand their potential, and in developing countries in particular.

Recent literature on the effectiveness of donor programmes points to the importance of understanding the political context within which reforms are taking place. A body of evidence is now emerging suggesting that programmes that are more flexible and iterative are often more successful in achieving their objectives than programmes that adopt a more rigid, linear approach to reform and recent experiments with projects that “think and work politically” appear to show promising results.

The characteristics of the power sector makes reform intensely political in almost all countries and donor projects have sometimes failed because of an inability to navigate the local politics of reform. This paper reviews what is known about how donors have taken politics into account in designing and implementing power sector reform programmes in Sub-Saharan Africa and South Asia. It illustrates the challenges which donors have faced with reference to case studies of donor attempts to support power sector reform in Tanzania and in the Indian state of Orissa. The paper draws on documentary evidence from the major donors to the sector in each country as well as a set of qualitative interviews with experienced project supervisors. It concludes with a set of recommendations for further research designed to provide insights on how best to design and implement power sector reform programmes given the political context in which they are working.

This paper identifies the key features of successful electricity market designs that are particularly relevant to the experience of low-income countries. Important features include: (1) the match between the short-term market used to dispatch generation units and the physical operation of the electricity network, (2) effective regulatory and market mechanisms to ensure long-term generation resource adequacy, (3) appropriate mechanisms to mitigate local market power, and (4) mechanisms to allow the active involvement of final demand in a short-term market. The paper provides a recommended baseline market design that reflects the experience of the past 25 years with electricity restructuring processes. It then suggests a simplified version of this market design ideally suited to the proposed East and Western Sub-Sahara Africa regional wholesale market that is likely to realise a substantial amount of the economic benefits from forming a regional market with minimal implementation cost and regulatory burden. Recommendations are also provided for modifying the Southern African Power Pool to increase the economic benefits realised from its formation. How this market design supports the cost-effective integration of renewables is discussed and future enhancements are proposed that support the integration of a greater share of intermittent renewables. The paper closes with proposed directions for future research in the area of electricity market design in developing countries.

Modern forms of energy are an important driver of economic growth, and providing access to cheap, reliable energy is an essential development objective. However, in future that energy will have to be low- and ultimately zero-carbon. The transition to zero-carbon energy systems is unavoidable if global climate change objectives are to be met, and although the speed of decarbonisation may differ it has to happen to varying degrees in all countries. This paper reviews the economics of greenhouse gas mitigation in developing countries. It reviews the literature on how climate change mitigation in the energy sector may affect economic growth and development; sets out empirical findings about trajectories for energy intensity and emissions intensity (which together with GDP determine emission levels) and analyses options for and barriers to effective decarbonisation policies. We conclude by identifying research gaps.

This paper provides an overview of market-oriented power sector reforms in Sub-Saharan Africa, South Asia, and Latin America over the past twenty-five years. The role of political economy contextualities in driving, constraining or otherwise influencing power sector reform is explored through a review of the essential literature. Though this literature is considered to have considerably expanded the scope of understanding around power sector reform and development, political economy research in the area is found to be lacking in methodological coherence and theoretical substance. Future efforts are needed to systematically bring together the array of insights, methodological approaches and recommendations in this literature, as well as better bound, differentiate and systemise political economy research in the area going forward. Two initial frameworks are advanced through this paper in relation to this dual research imperative.