Energy deeply influences the life of rural communities. It is fundamental to all aspects of human welfare, including access to clean water, health care and education and increasing agricultural productivity. Still, 2.7 billion people lack access to efficient and clean energy for cooking and heating, and 1.3 billion lack access to electricity; about 84% of this deprived population lives in rural areas of sub-Saharan Africa or Southeast Asia (IEA 2011). Many studies have shown that the cost of modern, sustainable energy services is a major barrier for the rural poor in the sub-Saharan Africa (OFID 2010; IEA 2010; UN-Energy/Africa 2007),...

The research presented in this paper is a case study designed to correspond with the analysis phase of the Logical Framework Analysis (LFA) methodology used by donors and NGOs worldwide to plan and evaluate projects. It involves four main elements: problem analysis, stakeholder analysis, objectives analysis, and strategy analysis. A basic principle behind LFA is that various stakeholder groups could have different objectives, strategies, problems, capacities and interests. This methodology explicitly recognizes these differences in the process of identifying key problems and strategic gaps. Multiple sources of evidence have been used, including literature, interviews and a survey, and the analysis...

Most developing countries frame their policies in the context of national development plans, embracing a set of quantitative targets and qualitative goals to be achieved within a given time period. The process of development planning usually starts from an ideological paradigm that sets a direction for the strategies. The country’s specific needs are at the centre of development plans, but global factors often play a role as well. The strategies then lead to specific policies and projects, and as those are implemented, the experience gained may provide new insights that lead to changes in the projects, policies and underlying strategies....

A first step in seeking to mainstream decentralized rural energy options is to understand Ethiopia’s current energy strategy, and how it has evolved in recent years. This section provides an overview of Ethiopia’s energy polices in the context of development and poverty reduction, with the goal of identifying opportunities to integrate decentralized approaches.

Ethiopia’s three-year Sustainable Development and Poverty Reduction Program (MoFED 2002) was developed in 2002, in consultation with the World Bank and the International Monetary Fund. The strategy paper’s goal for the power sector was to improve the quality and adequacy of Ethiopia’s power supply by developing hydropower...

This section presents the findings of the field research conducted in Ethiopia in 2011 to gauge the country’s readiness for adopting the Sector Wide Approach (SWAp) model in the rural energy sector. It looks at four key factors: the institutional framework; coordination among non-state actors; financial mechanisms, and the national energy policy framework.

Energy generation and delivery in Ethiopia involves a wide range of state and non-state actors, as shown in Table 1 below. Clearly there is a need for a strong lead institution to harmonize and coordinate all efforts. While the national grid (the “Interconnected System”, or ICS) is...

Clearly there are many challenges in implementing sustainable energy technologies in rural Ethiopia, but the single most-cited issue in the survey was the low level of private-sector involvement, followed by financial constraints. Figure 2 below shows the breakdown of responses to this survey question.

Non-state actors see the private sector as crucial to scaling up and replicating energy access initiatives in rural Ethiopia. Most energy access projects and programmes currently being implemented are public-private partnerships where the state, donors and/or NGOs cover part of the cost. Local businesses, however, are extremely risk-averse and do not develop and initiate their own...

The European Union is the world’s leading donor on energy. Over the past five years, it has spent approximately €1 billion on capacity-building and energy access expansion in developing countries. It has used a range of financial instruments and engaged in all aspects of energy provision, from electricity to governance, regulation and energy efficiency. For example, The ACP-EU Energy Facility is an innovative financing mechanism set up under the EU Energy Initiative (EUEI) with the purpose of supporting projects which enhance access to sustainable and affordable energy services for the poor living in rural and peri-urban areas in African, Caribbean...

The policy review and field research conducted for this paper reveal strategic gaps in the national development plans and their implementation which are hampering progress towards sustainable energy access across Ethiopia. In particular, the lack of participation of non-state actors in policy processes related to finance and regulation of the energy sector was identified as a major barrier. Moreover, the low participation of private actors in the Ethiopian rural energy sector was shown to be caused by institutional and policy gaps and deficiencies. This section offers a proposed way forward, taking three steps to implement a sector wide approach (SWAp)...

Ethiopia has made significant progress in recent years in expanding energy access, but the country’s experience also highlights many of the challenges in providing sustainable energy for all. Even though the government has recognized the importance of energy access in rural areas and included energy access in its strategic planning, only 1 in 20 rural households has electricity. The government efforts have focused on grid extension, but not all towns and villages can be reached by the grid — and even where the grid has arrived, the cost of connecting a house may be prohibitive. Off-grid options, meanwhile, have been...