Martin Wright asks whether low-income countries are on a fast track to low-carbon prosperity.
The tropical sun is beating down. The wind is picking up. Yet the co-op farmers and their VIP visitor from the National Treasury are wreathed in smiles. Of course, their spirit of well-being owes something to the creature comforts of this airy, ultra-modern building, and to the friendly shade and shelter of the tree belt that surrounds it. But the real story is there for all to see on the LED wall in the atrium.
The huge i-screen switches from a live collage of the smallholder co-op members scattered all across what was once southern Mali, to display a series of animated graphs. Not everyone grasps all the details, but it’s still impressive to see the combined total for all the juice those hybrid minigrids are pumping out. And the relentless upward trend of the carbon price tracker is a special source of satisfaction to the Treasurer. She can’t resist a glance through the porch to those thousand shimmering mirrors, just glimpsed beyond the trees. So much for those who doubted her enthusiasm for putting all her yuan in one basket: concentrated solar power (CSP) has repaid her faith tenfold.
Now her position in the regional cabinet of the Federation des Trois Fleuves – or ‘SNV’ (as the media call the new powerbloc named after the Senegal, Niger and Volta rivers) – is pretty much secure. After all, it’s down to her that the Prime Minister can strut his stuff as President of OSEC – the Organization of Solar Exporting Countries. She allows herself a modest tweet…
This, of course, is a fast-forward vision, and the future is another country: they’ll do things differently there. And you’d be forgiven for thinking it’s way too fanciful. The idea that Africa could somehow leap to a boom economy will strike some as hopelessly wishful thinking. But the seeds of this possible future already exist.
The combination of solar power, mobile phones and IT, for example, is already transforming the economic prospects for villagers across the continent. A simple piece of software enabling the transfer of small amounts of money instantly and cheaply by mobile is plugging remote rural backwaters into the global economy as never before. Millions are saving money, time and their health by switching to clean, efficient sources of energy – from solar to biogas, biomass to hydro. Agricultural innovations, too, are mushrooming, from water harvesting and hydroponics to the precise application of fertilizer and irrigation via GPS.
All such breakthroughs have one common characteristic: they are low-carbon technologies. The phrase has a rather worthy feel – especially when applied to developing countries. But it masks an intriguing possibility: that low-income nations could outflank the industrialized world, skipping the heavyweight, fossil fuel-dependent economic model and leapfrogging into a carbon-light future.
Nothing epitomizes that potential better than the mobile phone revolution. “In India in the 1990s,” observes Dhananjayan Sriskandarajah, Director of the Royal Commonwealth Society, “it took four years to get a land line. In come the private phone companies, and now the poorest Indians use mobiles to their fullest advantage – not just calls, but cash transactions and new business models. Rural India has genuinely leapfrogged the world in optimizing the benefits of this technology.”
As surprising as the extent and speed of the shift is the way it’s been delivered. Once upon a time, late last century, a massive infrastructural achievement like this could only have been conceived as a huge aid project – and one that would probably never have got off the drawing board. If the World Bank had been asked to fund a functioning telephone network for every Bangladeshi back in the 80s, its bean-counters would have thrown up their hands in horror. Instead, it’s happened virtually without any subsidy, delivered by private companies at a profit to people near the very bottom of the pyramid. It’s been repeated right across the developing world – and it’s only just beginning: as IT migrates to mobiles, expect a surge of apps specially designed for Indian farmers, say, or African school kids.
It couldn’t have happened without a parallel surge in solar. Still seen as an expensive luxury in the rich world, it has spread rapidly among off-grid communities in developing countries; sometimes subsidized, increasingly not. A typical solar home system, providing lights, mobile charging and power for TVs, radios and DVDs, costs around $500. Not cheap, but thanks to the widespread availability of micro-credit, increasingly affordable. The benefits in terms of education, health and income-generation are nothing short of revolutionary. Millions of solar installations have been sold over the last decade; the market is growing exponentially, and specialist companies like India’s SELCO, and the Indian-American D.light, are becoming serious players.
The biggest solar surge, though, could come courtesy of CSP, with its potential to turn the Sahara from wasteland to powerhouse, meeting a large chunk of European as well as local needs, and greening the Sahel via desalination (see 'Can the Sahara light up Europe?'). Meanwhile, technical innovations across the solar sector promise to bring the price down and the efficiency up, leading Adair Turner, Chair of the UK Committee on Climate Change, to conclude that “a very rapid deployment of solar energy” is a distinct possibility.
The real excitement is the way technologies such as these can combine to create a new economy. Mike Harrison of the UK Department for International Development (DFID) in Kenya sees signs of this happening already: “There’s a huge number of individual initiatives, and we will continue to see lots of these being successful. Microgeneration, mobiles, IT breakthroughs, water harvesting, community jatropha plantations…could these spark some kind of momentum and change the game completely?”
It’s a question explored in a major new study by Forum for the Future, funded by DFID. The future climate for development: scenarios for low-income countries in a climate-changing world sets out a range of possible scenarios for the coming decades. They are not all exactly rosy – one scenario foresees a world in which oil shortages play havoc with the global economy. But they share a common conclusion: that the days of high-carbon prosperity are over. As lead author Jemima Jewell says: “Low-income countries cannot and should not have to make a false choice between addressing climate change and development. The report clearly demonstrates how the two are fundamentally, inextricably linked, with future scenarios to provide a practical means of exploring how low-income countries can best capitalize on the synergies.”
Climate finance should, of course, help speed the roll out of low-carbon technologies – although whether existing institutional models such as the much-criticized Clean Development Mechanism can achieve much here remains to be seen (see 'Carbon markets: time to clean up'). But geopolitical shifts will play their part, too.
These are the twilight days of easy petroleum and cheap coal: irrespective of any carbon tax, oil and gas prices are set to continue their unsteady rise. Coal remains a relatively cheap option, but as carbon capture becomes mandatory, it too will be less competitive. Countries rich in alternative energy sources – notably solar – will start to wield more clout. Shifts in inward investment models could accelerate the trend. Nothing epitomizes this more than Africa, where Chinese ‘soft power’ – wielded via the mighty yuan – is starting to replace Western-style aid diplomacy. This far from altruistic intervention is often seen as nothing more than asset-stripping on a grand scale. But it’s also opening up the prospect of a new kind of development which could give Africa renewed self-confidence. As Arnold Ekpe, of Lome-based Ecobank, remarks: “The Chinese are not setting out to do good. They’re setting out to do business. It’s actually much less demeaning.” And Chinese energy and IT companies are increasingly interested in major solar investments…
So how might a low-carbon future for low-income countries take shape? In energy, expect networks of smart micro- and mini-grids, using everything from solar and wind to mini-hydro and biomass. These could prove a far more effective way of delivering electricity to rural and even urban areas than attempting to roll out an inefficient, centralized system which in many countries is already stretched to breaking point. It’s a possibility explored in The future climate for development, and one which is already taking shape, as governments begin to recognize the potential. Nepal is planning mini-grids for its remote mountain valleys; China is rolling them out in sparsely populated western provinces; and the Indian Government has finally unveiled its much vaunted ‘Solar Mission’, with a target of installing a hefty 20GW of solar by 2022 – and bringing its price down to a par with coal generation.
Already ICT companies, such as Cisco, IBM and Google are looking at the opportunities, bringing their network management expertise to bear. The clean slate of many low-income countries in this area may allow more creativity than the fixed infrastructure of high-income countries – possibly leading to successful models ‘transferring back’ to wealthier nations.
Cities which have yet to collapse in gridlock or spend billions on old-style metro schemes, says Chris West of the Shell Foundation, could leapfrog to next generation urban transport systems, like bus rapid transit (BRT) of the sort pioneered in Curitiba (see, 'Exclusive interview with the man behind Curitiba's master plan'). He sees a future for “small, efficient bus fleets, structured like an underground but running on the surface…Undergrounds are so expensive, no city ever recovers the cost,” he says. By contrast, land values around BRT networks go up, and so rising rents swell the city coffers. Adair Turner sounds a cautionary note: “Status fascination remains a problem… High-income people in London will use the tube. High-income people in Nairobi will not use the bus. We will not have emerging economy middle classes immediately jump to the attitudes of the green middle class in high-income countries.”
So there may be more potential in electric taxis, already proving a success on the narrow streets of Kathmandu. And further down the line, electric car clubs, too: most journeys in third world cities are well under 50 miles – ideal for electric vehicles, recharged by a web of solar stations which can double as ‘energy balancers’ for the notoriously unstable urban electricity networks.
There’s leapfrog potential for the farmers of the third world, too. A combination of new technology, more resilient local business models and improved farming techniques could revolutionize agriculture across Africa and Asia. The traditional agribusiness route of investment in monoculture on a large scale, with all the implications for mechanization and high fuel and other input costs, is already being challenged by breakthroughs in intensive organic or semi-organic production. It’s particularly so for commodities such as cocoa, coffee and tea, as well as spices and medicinal plants. with networks of smallholder farmers offering a more resilient model in the face of climatic and market fluctuations.
Christof Walter, a sustainable agriculture expert at Unilever, points out that, at present, “the food industry tends to source from just the 0.5% of the world’s farmers who work more than 100 hectares. The greatest potential for productivity increases is with smallholders in low-income countries. However, it is often expensive and complicated for the food industry to buy from smallholders. So the question is: can we efficiently scale up models of smallholder-based buying that have proven to work?”
The not-so-distant future could see smallholder cooperatives, supported by microfinance loans and investment from global private finance, becoming the dominant agricultural model. Armed with iPhone-style handhelds, farmers would use sophisticated GPS field software, complete with pinpointed local weather forecasts, to plan cropping patterns, irrigation and inputs with a precision unimaginable a generation ago – so minimizing costs and maximizing yields. Expert advice via face time video will be just a call away, and ‘crowd-sourced wisdom’ – drawing on the experience of millions of other farmers – will be, too. Concerns over ‘peak phosphorous,’ rising input costs and water scarcity would drive research into highly efficient mixed organic systems, resilient to drought or pest attack. Many farmers would be members of global sourcing networks organized using collaborative software to dynamically match supply and demand. Tomorrow’s multinational food companies will be able to plug into these networks to mutual benefit.
As the ‘leapfrogs’ multiply, so developing countries will start to be attractive places to do business. Some companies could relocate their HQs there, drawn by cheap, low-carbon electricity and a vibrant workforce. Western countries could find themselves scrambling to keep up, says Camilla Toulmin, Director of the International Institute for Environment and Development. Unless we meet tough carbon reduction targets, she argues, we will be increasingly left out of the new economy. She cites a cautionary tale from the last century: “The US auto industry fought tooth and nail against government regulation on emissions. The net result was a complete inability to compete with the Japanese and Europeans for the 21st century car market. It shows how it’s a real mistake for government to listen to industry lobbies too much!”
Some even see the post-colonial structure of nation states, especially in Africa, begin to lose relevance and authority to more ‘intuitive’ geographic and economic entities – such as major cities, or vital water catchment areas. There’s been much talk of impending ‘water wars,’ fueled by the latest tensions over the Nile headwaters. But as a new study from the Stockholm International Water Institute points out, this “ignores massive amounts of recent research which shows that water-scarce states that share a water body tend to find cooperative solutions rather than enter into violent conflict.” States will go to war over oil, but make peace over water.
It’s easy, of course, to get carried away on a rush of optimism. Toulmin sounds a note of caution. “[The low carbon transition] is not going to happen by itself… you need a mixture of measures, some economic such as subsidies, some institutional – like establishing and safeguarding land rights. And you need a proper price for carbon.” Other experts emphasize the need for vast improvements in fiscal and regulatory control, and in governance – with trust and transparency still lacking.
But virtually all agree that a simple functioning carbon market would be the single most effective intervention. “The minute you charge a proper price for carbon,” says Alan Winters, Chief Economist at DFID, “many other sorts of decisions – on food miles, on energy sources, and so on – become perfectly obvious. So many policies would be simpler if we could have a basic global carbon tax, involving every significant player. Yes, it’s politically difficult, but [it] is also the easiest solution in the long run.”
“There are lots of practical reasons why fast tracking low-carbon development is difficult,” says Jewell, “but none of these are insurmountable.” James Goodman, Forum’s Head of Futures, agrees: “One thing we’ve learnt from this work is that the barriers to low-carbon development are the same as the barriers to development in general, namely: institutional inertia, power inertia, lack of available funds and corruption. In one sense that’s depressing – but at least we don’t have to reinvent development because of climate change! It makes problems more acute, but it should also help focus attention, and add urgency.”
For Jewell, “the biggest obstacle is one of perception. The low-carbon route is still sometimes seen – especially in the countries concerned – as a second class option; a sort of neo-colonialism on the part of the rich world, as if it were saying ‘Right, we’ve pulled the ladder up after us. Now you’re just left with this…’. That not only stymies the potential of low carbon development: it’s also plain wrong. After all, the so-called developed world is not exactly having it easy: it’s locked into a fossil-fueled economy and facing an energy crunch! By contrast, a low-carbon economy is positive in so many ways that this perception fundamentally has to change. [Because] whether we like it or not, whether it’s fair or not, we are going to move to a low-carbon economy across the globe. That is what is going to happen. And low-income countries can leapfrog precisely because they haven’t got locked into a high-carbon model. That gives them a tremendous competitive advantage. So this is not just about mitigating climate change: it’s about opportunity.”
India’s solar entrepreneur Harish Hande of SELCO agrees: “Too often things are framed in terms of fear – of worrying about global warming – or of blaming someone else for it. And that can just paralyze people. Governments can get stuck in the past, too – trying to solve new problems with old thinking. There are 500 million people in India today with no access to energy. Now, when the Indian Government thinks of energy, it usually thinks about mega-scale projects – about coal, nuclear and so on. And those just feed into all the inefficiencies of the existing, centralized grid.”
Instead, argues Hande, the Government should think: “‘What are the best interventions we can make to meet the needs of those 100 million households?’ And once you start looking at that, everything changes. A lot of people’s basic needs – like cooking, lighting, education, ways of earning income – can best be met with a combination of low-carbon interventions – solar, biomass, biogas, micro-hydro, and so on. These are site specific, highly efficient ways of meeting those needs; they’re not dependent on help from outside. So there’s a huge potential for developing countries to grab this with both hands, rather than just complain about the rich world.”
Perhaps the most crucial shift of all, then, is not one of technology, politics or money, but of attitude. It’s early days, but from India to Africa to Latin America, there are signs of a break from the post-war consensus that development necessarily involves ‘catching up’ with the industrialized West. Catching up, that is, through a distinctly 20th century mix of fossil fuels, heavy industry, intensive chemical-fueled agriculture and mass urbanization. “We might just be looking at a ‘values leapfrog’,” says Jewell, “where because low carbon living carries so many benefits in its wake, people see it not just as a necessity, but as an aspiration.”
Such a leap could give a whole new slant on that hackneyed term, ‘development’. In years to come, perhaps, ‘developing country’ will mean just that: unfolding and evolving, rather than striving to emulate the fossilized model of the 20th century West.
This piece originally appeared on Green Futures. Green Futures is published by Forum for the Future, one of the leading magazines on environmental solutions and sustainable futures. Its aim is to demonstrate that a sustainable future is both practical and desirable – and can be profitable, too.
Martin Wright is Editor in Chief of Green Futures. Additional material by Roger East.
Image of man and woman sorting cocoons using a solar headlamp and portable solar light via SELCO.
An effort to change fundamental economic forces is what I would seek to do as a world changer, I believe taking my stand for this change must precede any fundamental change in power at government level.
great great great will read it thoroughly later, started driving a bus today, highly stressful and not what I thought it would be, access-a ride, is indeed "stress-a ride" feel already some of my "disabled" aren't honestly those the "American's with disabilities " act sought to serve, and feel the people truly served are sadly victims again and receiving a disservice of sorts, mostly concerned with the enormous amount of vehicles moving through my fair city's streets,despite my new access to "a hand full of dimes" am again seeking new employment,as I continue to train for this job.