Energy is fundamental to economic growth and environmental sustainability. Access to affordable, reliable and sustainable energy is vital to ending extreme poverty and promoting shared prosperity. Modern energy services can help improve the quality of life for millions around the world and underpin progress in all areas of development.

Around 1.1 billion people worldwide still live without access to electricity – most of them in Africa and Asia -- which has an impact on children’s education, public safety, services, and job creation. Another 2.8 billion rely on wood or other biomass for cooking and heating, resulting in indoor and outdoor air pollution that causes about 4.3 million deaths each year.

The World Bank’s engagement in the energy sector is aimed at supporting developing countries to secure the affordable, reliable and sustainable energy supply needed to end poverty and promote shared prosperity. We assist countries to pursue environmentally, financially, fiscally and socially sustainable energy sector development.

The Sustainable Energy for All (SE4All) Initiative, co-led by the World Bank, aims to accomplish three goals by 2030: universal access to electricity and clean cooking fuels; doubling the share of renewable energy in the global energy mix, and doubling the improvement rate of energy efficiency.

These goals form the basis of the Sustainable Development Goal (SDG) on energy, or SDG7. Energy is interconnected with all of the other SDGs, and recognizing these linkages is pivotal to implementing them. With the historic Paris agreement to tackle climate change in place, it is now time to act. And delivering on SDG7 is a cornerstone of that objective.

The World Bank is working with several countries to help achieve this. In doing so, we aim to take a long-term holistic approach, emphasizing the need to build strong financial, operational, and institutional frameworks for sustainable energy systems. We also seek to foster private sector participation and investment; embrace a multi-stakeholder, inclusive approach to the development of energy projects and to acknowledge and reflect individual country circumstances.

Last Updated: Sep 22, 2016

Expanding access to modern energy services is a cornerstone of the World Bank’s energy objectives, as laid out in the Bank Group’s Energy Sector Directions Paper. 

Climate change presents enormous challenges and opportunities for development, making it essential that energy and climate challenges be tackled in an integrated way. To that end, the WBG is working to help countries strengthen their climate resilience and adaptive capacity,

delivering affordable and efficient energy in a low-carbon manner and in a way that is consistent with their national and global climate commitments.

Countries vary greatly in their ability to transition to sustainable energy sources and in some cases, natural gas is an important bridging or transitional fuel.  Gas is often the least-cost means of providing a flexible source of electricity when demand and supply fluctuate. The World Bank is helping countries develop national and regional gas markets and, where it makes economic sense, use natural gas as an alternative to coal and biomass.

In countries with low energy access, the priority is providing affordable and reliable energy. Grid, mini-grid, and off-grid solutions are pursued, while engagement in cleaner cooking and heating solutions is expanding.

The WBG supports development of energy systems based on lowest-cost options with an emphasis on renewable sources such as hydropower, wind, solar and geothermal, while also promoting energy efficiency. Projects support achievement of universal access to electricity and modern household fuels, as well as improved utility performance and sector governance.

We are scaling up efforts to improve energy efficiency, and support all forms of renewable energy. The WBG is helping countries develop national and regional gas markets and where it makes economic sense, use natural gas as a lower-carbon energy source. We also focus on long-term energy planning, and promote market solutions—supported by the right policy, regulatory and contractual frameworks—to increase the leverage of our financial resources.

The World Bank also supports strategic technical assistance initiatives through global partnerships and trust funds such as the Energy Sector Management Assistance Program (ESMAP) and the Global Gas Flaring Reduction Partnership (GGFR).  These initiatives include the SE4All Technical Assistance Program to help countries reach the 2030 goal of universal energy access, the Global Geothermal Development Plan, Lighting Africa, Lighting Asia, Renewable Energy Resource Mapping, Energy Efficiency Guidance Notes and the Energy Subsidy Reform Technical Assistance and Delivery Facility.

We also recognize the global challenge of balancing energy for development with its impact on climate change and strive to help client countries realize affordable alternatives to coal power. There has been no WBG financing for “greenfield” coal-fired power plants since 2010.

Last Updated: Sep 22, 2016

World Bank Group energy financing, including IBRD, IDA, IFC and MIGA guarantees, has amounted to $61 billion since 2010, of which over $24 billion was for energy efficiency and renewable energy projects.

In FY16, WBG financing in the energy sector totaled $11.5 billion. Of that amount, about $2.9 billion was for renewable energy and energy efficiency projects and programs.

Energy Access:

About 43,000 households got electricity through grid extension and off-grid renewable energy sources in Laos through the Lao Rural Electrification Project, taking access levels from 15 percent in the mid-1990s to about 90 percent today.

In Nepal, the Village Micro Hydro project has resulted in more than 1,000 small, local hydropower plants being built and run by communities in 52 districts to meet energy needs and power economic development in rural areas.

In Indonesia, about 6,000 households got access to clean cooking thanks to the Indonesia Clean Stove Initiative results-based financing pilot.

Energy Efficiency:

The World Bank is providing financial and analytical support for a $104.3 million Green Energy for a Low-Carbon City project in Shanghai, featuring energy efficiency and renewable energy measures in buildings, clean energy from renewable and natural gas and energy-efficient vehicles and public transport. Similar initiatives are under way in eight other Chinese cities. China has embarked on one of the most aggressive energy conservation campaigns in the world—the energy efficiency market is estimated to be around US$75 billion.

In Mexico, with climate finance and Global Environmental Facility support, the World Bank helped implement a program for replacing over 25 million inefficient light bulbs with compact fluorescent light bulbs, and almost two million old refrigerators with new, highly efficient ones, all targeted to low-income households. 

ESMAP also provides assistance to city governments, such as Da Nang in Vietnam, to develop their energy efficiency options, and serves as a knowledge clearinghouse for best practices on energy-efficient urban development.

Renewable Energy:

The WBG launched Scaling Solar, a “one-stop shop” for governments that want to attract private investors to build large-scale solar plants, but lack the purchasing power of bigger emerging markets where strong competition has driven down solar prices to virtual parity with oil, gas, and coal-fired electricity. Scaling Solar includes a package of technical assistance, templates for documents, pre-approved financing, insurance products, and guarantees that take the guesswork out of whether a solar project is viable and bankable for both governments and investors. In June, Zambia set a new price record for utility-scale solar-generated energy in Africa at 6 cents/kWh with the support of Scaling Solar.

With the support of Climate Investment Funds, Morocco launched the first phase of the largest concentrated solar power (CSP) plant in the world. When fully operational, the plant will produce enough electricity for more than one million Moroccan households.

$1 billion Development Policy Loan for Egypt is the first in a programmatic series of three such loans. One of the main objectives of this loan is to ensure sustainable energy supply for the country through private sector engagement.

Implemented as a public-private partnership, the solar home system (SHS) program in Bangladesh is currently installing over 70,000 SHS every month, making it the fastest growing program of its kind in the world. Three million systems have already been installed with support from the Bank and other development partners, providing electricity to 18 million people in the country.

The Bank is also helping boost geothermal power generation capacity in South Sumatra and North Sulawesi in Indonesia, with the aim of adding 150 MW of capacity.

Extractive Industries and Energy

Power of the Mine: A Transformative Opportunity for Sub-Saharan Africa” brings the energy and extractives industries together. The report suggests that mining companies—with their large demand for power—can become anchor customers to national electricity utilities, in turn helping to expand electricity access to communities and enterprise consumers in Africa.

Last Updated: Sep 22, 2016

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