KINGDOM OF MOROCCO

Minister of land Managemet,Urban Planning, Housing and Environment

Environment Department

GEFR A B / 9 4 / G 3 1

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Acknowledgements

Notes on authors

Executive summary

Introduction: Renewable energy, global warming and sustainable development

1- Energy and the poor

1.1 Rural-urban energy linkages

1.2 The energy mix in urban and rural areas

1.3 The 'energy ladder' and household fuel switching

1.4 Energy services for the poor

1.5 Energy and the poor: Conclusions

2- Biomass (Energy) for household use: Resources and impacts

2.1 Sources of household biomass

2.2 Impacts of household biomass use

2.2.1 Biomass and society: Gender, fuel and resource control

2.2.2 Environmental impacts of household biomass use

2.2.3 Health impacts of household biomass combustion

2.3 Household use of biomass: Conclusions

3- Biomass energy beyond the household: Scaling up

3.1 Small and medium commercial businesses and institutions

3.2 Potential to transform commercial and institutional biomass-based energy systems

3.2.1 Liquid fuels from biomass: the case of ethanol

3.2.3 Energy from woody biomass - an example from California

3.2.3 Supplies of biomass for commercial and industrial use

3.2.4 Jobs in the commercial biomass sector

3.2.5 Environmental impacts of medium and large-scale biomass utilization

3.3 Scaling up: Conclusion

4 Biomass energy conversion technologies

4.1 Combustion

4.2 Gasification

4.3 Anaerobic digestion

4.4 Liquid biofuels

4.5 Bioenergy conversion technologies: Conclusions

Table of contents

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5- Renewable energy technologies: Markets and costs

5.1 Recent progress in renewable energy system costs and performance

5.2 Lessons learned in developing countries

5.3 Levelling the playing field

5.4 Renewable energy technology markets and costs: Conclusions

6- Biomass, bioenergy and climate change mitigation

6.1 CDM: explicit link between climate change mitigation & sustainable development

6.2 Energy projects in the CDM: critical issues

6.3 Public participation in project development and implementation

6.4 Project management

6.5 Equity

6.6 Technology transfer and capacity building

Conclusion

References

Case Study 1: Modular biopower for community-scale enterprise development

Case Study 2: Scaling-up biogas technology in Nepal

Case Study 3: Commercial production of charcoal briquettes from waste

Case Study 4: Ethanol in Brazil

Case Study 5: Carbon from urban woodfuels in the West African Sahel

Case Study 6: Sustainable fuelwood use through efficient cookstoves in rural Mexico

Case Study 7: Use of enhanced boilers in the Hammams in Morocco

Case Study 8: Improvement of cooking equipment in the Moroccan countryside

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AcknowledgmentsThe authors would like to thank our colleagues at theUniversity of California at Berkeley: Barbara Haya,John-O Niles, Tracey Osborne, Sergio Pacca, andEmily Yeh of the Energy and Resources Group, SumiMehta and David Pennise of the School of PublicHealth and Laura Kueppers of the Department ofEnvironmental Science Policy and Management foruseful discussions and contributions. We also thankeach of the case study authors for the quality and thespeed with which they were able to assemble theirmaterial. In addition, Sivan Kartha and Rick Dukeboth provided an invaluable set of observations andrecommendations. We also thank Richard Hosier,Arun Kashyap and other members of theEnvironmentally Sustainable Development Group ofthe United Nations Development Programme(UNDP), who provided useful comments on earlierdrafts. Lastly, we acknowledge with thanks the help-ful comments we received on the first draft of thispublication, including suggestions from ElsenKarsted of Chardust Ltd., in Nairobi, Kenya, DeanStill of the Aprovecho Institute, and StephenKarekezi of the African Energy Policy ResearchNetwork (AFREPREN). We thank the UNDP, theEnergy Foundation and the Link Foundation for sup-port. Needless to say, any errors and omissions arethe sole responsibility of the authors.

Notes on the authorsDaniel M. Kammen is a Professor in the Energy andResources Group, in the Goldman School of PublicPolicy, and in the Department of NuclearEngineering at the University of California, Berkeley.He is the Founding Director of the Renewable andAppropriate Energy Laboratory (http://socrates.berkeley.edu/~rael). Dr. Kammenreceived his Ph.D. in physics from HarvardUniversity, and has been on the faculty of theWoodrow Wilson School of Public and InternationalAffairs at Princeton University where he chaired theScience, Technology and Environmental Policy(STEP) Program. His research ranges widely overmany aspects of energy use, impacts and develop-ment, in both developed and developing nations. Email: dkammen@socrates.berkeley.edu

Robert Bailis is a doctoral student in the Energy andResources Group. His research is focused on bio-mass energy resources and community empower-ment in Africa. He has undergraduate and mastersdegrees in physics and spent two years as a PeaceCorps Volunteer teaching Math and Physics atSambirir Secondary School in the Marakwet districtof northwestern Kenya. Email: rbailis@socrates.berkeley.edu

Antonia V. Herzog received her Ph.D. in physicsfrom the University of California, San Diego, in 1996.She then worked in Washington, DC, on energy andenvironmental policy and was awarded the 1998-1999 American Physical Society CongressionalScience Fellowship From 2000-2002 she was aUniversity of California President's PostdoctoralFellow in the Renewable and Appropriate EnergyLaboratory (RAEL) and the Energy and ResourcesGroup at the University of California, Berkeley.Currently Dr. Herzog is at the Natural ResourcesDefense Council in Washington, D. C. Her work isfocused on energy and development issues, federaland international energy policy, and the politics ofglobal warming. Email: aherzog@socrates.berkeley.edu

Case Study Authors:

1. Art Lilley, Community Power Corporation artsolar@aol.com

2. Bikash Pandey, Winrock International,Kathmandu, Nepalwinrock@wlink.com.np

3. Elsen Karstad and Matthew Owen, Chardust Inc.,Nairobi, Kenyabriquettes@chardust.com

4. Robert Bailis, Energy and Resources Group, UCBerkeleyrbailis@socrates.berkeley.edu

5. Jesse Ribot, World Resources Institute,Washington, DCjesseR@WRI.org

6. Omar Masera , Institute de Ecologia, UNAMomasera@ate.oikos.unam.mx

and Rodolfo Diaz, GIRAA.C.rdiaz@oikos.unam.mx

7. Abdelahanine Benallou, Center for Developmentof Renewable Energies,dgcder@iam.net.ma

and Abdelmourhit Lahbabi, ADS Moroccoadsmaroc@iam.net.ma

Executive summaryThis paper explores the linkages between renewa-ble energy, poverty alleviation, sustainable deve-lopment, and climate change in developing coun-tries. In many developing countries, the lack ofaccess to convenient and efficient energy services is amajor barrier to achieving meaningful and long-las-ting solutions to poverty. Of course, providing quali-ty energy services will not, in itself, eliminate pover-ty. Nevertheless, when poor people and communi-ties obtain access to convenient and efficient energy

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services, one major barrier to poverty reduction canbe lowered or removed. Renewable energy techno-logies using biomass, wind, solar, hydropower andgeothermal energy sources can provide energy ser-vices for sustainable development based on indige-nous sources, with almost no net emissions ofgreenhouse gases.

In most developing countries, conventional approa-ches to energy service provision – state-run utilitiesand extension of the national electrical grid – havenot proven successful. To date, most developingcountries have financed their energy sectors withloans from bilateral and multilateral lending institu-tions. For various reasons, these institutions haveheavily favored fossil fuel and large hydroelectricpower, which have left developing countries withlarge burdens of debt and taken a significant toll onthe local and global environment, while providingonly a small fraction of people with adequate energyservices.

Poor families in developing countries still rely ontraditional fuels – wood, crop residues and dung –for cooking, heating and productive activities. Theyare limited in their ability to do more than satisfybasic needs. The lack of access to clean and conve-nient energy services in rural areas limits economicopportunities and drives people, most frequentlymale household members, to seek employment intowns and cities. This leads to increasing numbers offemale-headed rural households, and adds to theburdens on poor women and children, who alreadyexpend a great deal of effort in gathering wood andother traditional fuels, as well as meeting the othersubsistence needs of the household.

Unsustainable use of traditional biomass fuels isassociated with significant health and environmen-tal costs. Smoky, unvented fires for cooking and hea-ting lead to high concentrations of indoor air pollu-tion which cause acute respiratory infections, tuber-culosis, adverse pregnancy outcomes, and lung dis-ease. Women who are doing the cooking, and theiryoung children, are the ones who are most affected.Open fires also contribute to atmospheric accumula-tions of greenhouse gases, particularly carbon dioxi-de. Deforestation adds to fuel wood scarcity andenvironmental degradation, and limits carbon dioxi-de absorption by trees.

Policies that focus on small-scale decentralizedrenewable energy systems, coupled with greateraccess to information, technical training, credit andmarkets, have the potential to succeed in promo-ting sustainable development, including economicopportunities and environmental protection, whereconventional approaches have failed. Recent techni-cal advances in renewable energy-based power gene-ration, accompanied by rapid growth in production

and dramatic reductions in costs, place renewableenergy technologies in a favorable position in com-parison with conventional fossil fuel systems, in anever-expanding variety of applications.

A combination of sound national and internationalpolicies and genuinely competitive markets – the so-called level playing field – can be used to promoteclean energy systems. However, there still remainnumerous technical, social and market barriers, onthe local as well as global level, preventing widerdeployment of renewable energy systems. Such bar-riers must be understood and dismantled in order totake advantage of the social and environmentalbenefits of a shift from conventional to renewabletechnologies. Renewable energy sources have had adifficult time breaking into markets dominated bylarge-scale, fossil fuel-based systems. In part this isbecause renewable energy technologies are only nowbeing mass produced, and have had high capitalcosts relative to more conventional systems. It is alsopartly because coal, oil and gas-powered systems, aswell as large hydroelectric dams have all benefitedfrom a range of subsidies over the years.

Renewable energy technologies tend to be characte-rized by low environmental costs which, in an idealworld, would help them compete with conventionaltechnologies. But, of course, many of these environ-mental costs are "externalities" that are not priced inthe market. Further internalization of these costs,through the provisions of the Kyoto Protocol andother energy and climate change policies, wouldencourage the spread of renewable energy systems.

Our discussion includes all types of renewable ener-gy technology, but we place special emphasis onbiomass-based energy systems. While biomass fuelsare likely to remain the primary energy source formost poor people, improved stoves and cleaner fuelscan reduce fuel requirements and adverse health andenvironmental impacts. Meanwhile, improved tech-nologies for use of biomass in small commercial andindustrial applications can make modern energyinstallations economically viable in rural and peri-urban areas of developing countries, since busines-ses have larger energy demands than householdsand are better able to mobilize capital.

Biomass energy has a number of unique attributesthat make it particularly suitable to climate changemitigation and community development applica-tions. Biomass fuel sources are readily available indeveloping countries, particularly in rural areas, anddo not have to be imported. Biomass-based indus-tries can be a significant source of jobs in rural areas,and sustainable land management activities can pro-mote biomass regrowth, allowing more carbon dioxi-de to be absorbed from the atmosphere. [See box onthe benefits of bioenergy.]

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By promoting biomass energy to provide clean andefficient "modern" energy services in the form ofsolid, liquid, and gaseous fuels as well as electricity,the governments of developing countries can add-ress many of the negative aspects of current unsus-tainable biomass consumption. Moreover, takingthat step now does not require devoting largeamounts of land to bioenergy crop production,which can potentially conflict with other land uses,particularly food-crop cultivation. Significantamounts of energy can be derived from underutili-zed agricultural, agro-industrial, and timber wastes,which include bagasse from sugarcane processing,sawdust and off-cuts from the timber industry, fruitpits and prunings from orchards, coffee husks, ricehusks, and coconut shells. Using these resources forenergy generation would allow countries to gainvaluable experience through learning-by-doingwhile continuing with basic research in energy cropproduction.

A variety of technologies can convert solid biomassinto cleaner, more convenient energy forms such asgases, liquids and electricity. Direct combustionremains the most common technique for derivingenergy from biomass for both heat and electricity.Advanced domestic heaters obtain efficiencies ofover 70 per cent with greatly reduced atmosphericemissions. Electrical power is commonly generatedin steam cycle plants often located at industrial siteswhere the waste heat from the steam turbine can berecovered and used in industrial processing.Combined heat and power systems provide highere fficiencies than systems that only generate elec-t r i c i t y.

Combustible gas can be produced from biomassthrough a high temperature thermochemical process- gasification - that involves burning biomasswithout sufficient air for full combustion, but withsufficient air to convert the solid fuel into a gas. Theresulting gas can be burned directly for cooking andheating uses, or used in internal combustion enginesor gas turbines for producing electricity or shaftpower. The systems range from small-scale technolo-gies suitable for household or village use, to largegrid-connected power or combined heat and powerfacilities.

Combustible gas can also be produced from biomassthrough the biological processes of anaerobic diges-tion, either in specially-designed digesters or in land-fills. This biogas can be used to provide energy forcooking and space heating, and to generate electrici-ty. Biogas digesters have been widely adopted inIndia and China, and other developing countries.

Liquid fuels produced from solid biomass can beused to replace petroleum-based fuels. The mostwidely produced liquid biofuel today is ethanol,which can be produced from fermentation of any

carbohydrate crop. Sugarcane and corn (maize) arethe most common ethanol feed stocks though cassa-va, sorghum, and other root crops have also beenconsidered.

Conversion of biomass to energy carriers like electri-city and transportation fuels can give biomass asignificant commercial value and potentially provideincome for rural economies. But transforming bio-energy into a renewable source of high-quality fuelsand electricity will not happen without the establish-ment of enabling policy environments and adequatepublic and private sector investment.

In addition to the lack of energy services, whichlimits opportunities for many people in developingcountries, there are numerous environmental pro-blems associated with energy development. Theseproblems are both local and global in nature. Amongthe most pressing of these environmental problemsis global climate change. Policy makers in manydeveloping countries are aware of the need for cli-mate change mitigation, but they are generally moreconcerned with providing basic services to popula-tions, including energy, as well as clean water andbasic health care and education. They also hold thatthe industrialized countries have been emittinggreenhouse gases for well over a century and shouldbear the brunt of the costs of climate change mitiga-tion.

The Kyoto Protocol to the UN FrameworkConvention of Climate Change recognizes theresponsibility of industrialized countries to takethe lead in reducing greenhouse gas emissions.Currently, most of the greenhouse gases added to theatmosphere by human activities are the result of car-bon dioxide from fossil fuel combustion. Over twothirds of those emissions come from industrializedcountries. But greenhouse gas emissions are increa-sing in developing countries much faster than inindustrialized countries as a result of growth in bothpopulation and national economies. If developingcountries follow the path taken by industrializedcountries in building energy generation infrastruc-ture, they will likely exceed industrialized coun-tries in net greenhouse gas emissions within one ortwo generations. And if that path continues withouta significant shift toward renewable-based energygeneration, there will be little hope of stabilizinggreenhouse gas accumulations even if industrializedcountries meet the modest goals set by the KyotoProtocol.

The Clean Development Mechanism (CDM) underthe Kyoto Protocol offers a means through whichindustrialized countries can work towards com-pliance with their commitments to reduce green-house gas emissions by supporting sustainabledevelopment projects in developing countries. It islikely that a number of CDM projects will target the

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energy sector, as well as land use and forestry activi-ties. Biomass energy projects can meet the require-ment of fostering sustainable development, due totheir numerous positive environmental and socialimpacts, including improvement of degradedlands, creation of employment opportunities andraised living standards for poor communities.

In order to ensure that CDM projects in fact promotesustainable development as well as climate changemitigation, projects must be guided by meaningfulpublic participation and local benefit-sharing poli-cies. Clear guidelines are needed so that the manycompeting uses of land areas supporting biomassprojects are considered, including the livelihoods ofindigenous and marginalized communities, differentethnic groups, and women. In addition, in order toestablish a critical knowledge base for sound andprofitable bioenergy management, there needs to bea collaborative partnership among researchers,governments and industries in developing as well asindustrialized countries. Lessons can be drawn fromjoint UNDP and World Bank efforts in climatechange mitigation projects under the GlobalEnvironmental Facility, and from case studies suchas those included as part of this document.

Biomass and bioenergy – advantages for climatechange mitigation and poverty alleviation:

Local resources: Biomass energy systems rely primari-ly on locally available resources and eliminate theneed for imported fuels

Participation: Local nature of fuel supply can encou-rage local participation through job creation and fuelsupply contributions, as well as local ownership,investment, and project management

Jobs: Biomass energy production is relatively laborintensive and the stages of energy production provi-de far more local jobs, skilled and unskilled, thancomparable energy technologies

Flexibility and multiple use: Biomass energy genera-tion can be based on a variety of feedstocks whichallow for multiple crops to be grown. Land used toproduce bioenergy crops can support multiple usesin order to meet changing local needs.

Stores carbon: standing stocks of biomass store carbonabove-ground, below-ground, in leaf litter, and in thesoil. The overall carbon accounting strongly dependson what the prior land use was.

Land degradation: If bioenergy stocks are planted ondegraded lands, they have the potential to bringlong-term improvements in soil quality and fertility.

Ecosystem services: Growing biomass can providenumerous ecosystem services including the controlof soil erosion, sustaining the hydrological cycle, andproviding habitat for wildlife.

Introduction: Renewable energy, global warmingand sustainable development

Conventional energy sources based on oil, coal, andnatural gas have proven to be both highly effectivedrivers of economic progress, and damaging to theenvironment and to human health. Perhaps the gra-vest challenge currently associated with energy usein all nations is the need to reduce greenhouse gasemissions.

The potential role of renewable energy technologiesin transforming global energy use, and addressingclimate change concerns, is enormous. Energy sour-ces such as biomass, wind, solar, hydropower, andgeothermal can provide sustainable energy services,based on a mix of readily available, indigenousresources that result in almost no net emissions ofgreenhouse gases.

The costs of solar and wind power systems havedropped substantially in the past 30 years, and conti-nue to decline. The economic and policy mechanismsthat support the widespread dissemination and sus-tainable markets for renewable energy systems havealso rapidly evolved. Future growth in the energysector will be primarily in renewable technologiesand, to some extent, natural gas-based systems,rather than in conventional oil and coal-based sour-ces.

Renewable energy systems are usually implementedin a small-scale, decentralized model. As an alterna-tive to centralized power plants, which require cus-tomized onsite construction, renewable systemsbased on solar photovoltaic (PV) arrays, windmills,biomass or small hydropower, can be mass-produ-ced at low cost and tailored to meet specific energyloads and service conditions. These systems alsohave fewer environmental impacts than larger, morecentralized power plants that, in some cases, havecontributed to serious ambient air pollution and acidrain, as well as global climate change.

In developing countries, heavy reliance on importedfossil fuels also represents a huge financial burden.Energy sector development in developing countries,with few exceptions, has focused on large hydro sys-tems and fossil fuels, despite the fact that manydeveloping countries are rich in biomass, wind,solar, and smaller, less environmentally and sociallydisruptive hydro resources that could power theireconomies and improve their living standards.

Renewable energy sources currently supply some-where between 15 per cent and 20 per cent of theworld's total energy demand, mostly in the form offuelwood used for household energy needs in deve-loping countries. New renewable energy sources(solar energy, wind energy, modern bio-energy, geo-thermal energy, and small hydropower) currently

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contribute about two per cent of the global energymix. Studies indicate that in the second half of thetwenty first century their contribution might increa-se dramatically, with the right policies in place. Thiswill only occur, however, if energy projects and poli-cies are evaluated and implemented based on theiroverall social, economic, and environmental merits.

Use of bioenergy resources in developing countriescan build local capacity to meet energy needs, andalso provide significant employment and develop-ment opportunities.

This document provides a re s o u rce guide on biomassand other renewable energy options, case studies, anda set of recommendations for international energy andclimate policy organizations, national governments,non-governmental groups, and local communities.

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1- Energy and the poor

The majority of the world's poor families have noalternative but to rely on traditional biomass fuels –wood, crop residues, and dung – to produce energyfor household uses, small-scale commercial activitiesand income generation.

Cooking re p resents the largest end-use of biomasse n e rgy in many developing countries (Dutt andRavindranath, 1993; Kammen, 1995a, 1995b). Formany years, wood collection for cooking was thoughtto be a direct cause of deforestation and desertifica-tion, particularly in Africa. However, re s e a rch has lar-gely failed to find direct links between household fuelconsumption and land degradation, except in locali-zed cases where commercial charcoal production is adominant household energy supply strategy. Whilethe fuel wood-deforestation link has been largely dis-c redited (Leach and Mearns, 1988), deforestation cau-sed by timber sales, expanding cultivation, and char-coal or fuel wood production, does place extre m ep re s s u re on rural biomass re s o u rces and reduces thebiomass that poor people are able to use for their ownneeds.

The most common method of cooking throughoutrural areas of the developing world is the openhearth or three-stone fire, which typically transfersonly 5-15 per cent of the fuel's energy into thecooking pot. For many years, development agencieshave promoted more efficient cook stoves.Ironically, many 'improved' stoves failed to raise effi-ciency in actual field use while many others havebeen rejected for numerous non-technical reasons.Still, there have been successes, such as the KenyanCeramic Jiko (Kammen, 1995a; Crewe, 1997).Improved stoves have been successfully dissemina-ted in several countries in addition to Kenya, but inother countries, where stove projects have failed,technical, social, and market barriers have preventedtheir wide-spread adoption. It is troubling that aftermore than two decades of improved stove programs,most of the world's poor people continue to cook onunimproved stoves (Kammen, 1995a, 1995b; Barnes,1994; Smith et al., 1993; UNDP, 1997).

Poor households generally spend more moneybuying, or more time collecting, each unit of energythey consume compared to wealthier households(Dutt and Ravindranath, 1993). They are limited intheir ability to do more than satisfy basic needsbecause value-adding activities require energyinputs – electricity, shaft power, and controlled pro-cess heating – that are simply not available throughsimple combustion of solid fuels.

Heavy reliance on biomass energy in poor urban andrural communities of the developing world is unli-kely to change in the near future. Fuel switchingoccurs principally in urban areas where alternative

fuels are available. A large-scale rural energy trans-formation to fossil-fuels is unlikely for economic rea-sons and undesirable in terms of increased green-house gas emissions. But there are alternative waysto utilize biomass energy that are cleaner, more effi-cient, and more convenient, and that can supportsustainable development.

1.1 Rural-urban energy linkages

Nearly every developing country has a rate of urbangrowth that outstrips the base rate of populationgrowth (World Bank et al., 2000). Not only are citiesgrowing in size, but they are growing faster than thepopulations in the rural areas that provide the foodand raw materials necessary for urban growth. Oneof the underlying causes of rural-urban migration isthe fact that development priorities favor urban cen-ters (Lipton, 1976). Lack of access to clean and conve-nient energy sources limits economic opportunitiesin rural areas and drives people, most frequentlymale household members, to seek opportunities intowns and cities. This leads to increased numbers offemale-headed households, and additional time andlabor burdens for women and children in rural areas.

Growing urban populations place increaseddemands on biomass resource areas. For example, inKenya, in one year, an urban household cookingexclusively with charcoal uses between 240 and 600kg of charcoal. This amount of charcoal requires bet-ween 1.5 and 3.5 tons of dry wood to produce. Thecharcoal sold in Nairobi usually originates from aridand semi-arid regions where tree cover is sparse. Thenational government owns, but does little to controlaccess to, the forests where charcoal production takesplace. Charcoal producers pay no stumpage fees, sotheir urban customers need pay only for labor,transportation, and handling of the charcoal, plus themark-ups charged by numerous middlemen (Kituyiet al., 2001a and b).

The detrimental effects caused by loss of tree coverare borne by rural populations. Since charcoal is apopular urban fuel and a huge revenue generator,prohibition of charcoal production would be extre-mely unpopular. An alternative to governmentcontrol is local community control of forest resour-ces. This would channel charcoal revenues into localcommunities and promote sustainable land manage-ment practices.

Growing urban populations also intensify thedemand for fossil fuels and electricity. Increases indemand must be satisfied by additional imports offossil fuels and electrical power, which places a strainon the country's balance of trade and costs dearly inforeign exchange. Rapid urbanization also creates ademand for more intensive agricultural production,which involves costly and energy- intensive inputs,thereby favoring wealthier farmers or big agri-busi-

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nesses, disempowering small-scale and subsistenceagricultural producers, and promoting further rural-urban migration.

1.2- The energy mix in urban and rural areas

Poor urban households often rely on a mix of com-mercial energy sources, including fuel wood, char-coal, kerosene, liquefied petroleum gas (LPG) andelectricity. Energy end uses range from subsistenceneeds like cooking, space heating, and lighting toincome generating activities and entertainment. Themix of sources and quantity of energy that urbanhouseholds use can change depending on domesticand international fuel markets, fluctuating house-hold incomes, and seasonal conditions that affectlabor markets and fuel availability.

Poor rural households usually have fewer energyoptions. The higher cost of, and lack of access to,commercial forms of energy, and the lower incomescharacteristic of rural populations, compel rural hou-seholds to rely more heavily on traditional fuels, andlimit the diversity of possible end-uses. Non-tradi-tional forms of energy that poor rural householdshave access to are usually limited to dry cell or lead-acid batteries, which are highly specialized in theapplications and extremely costly in terms of priceper unit of delivered energy. In addition to energystorage devices like batteries, solar photovoltaic (PV)panels have become an available in a small but gro-wing number of rural areas throughout the develo-ping world. While such systems remain too expensi-ve for poor families, the prices have come downconsiderably and in some instances, innovativefinancing mechanisms have been developed thatmake the systems affordable for a larger number ofhouseholds. We discuss this aspect of PV in moredetail in section 5.2 below.

1.3- The 'energy ladder' and household fuel switching

Analysts use a simple model, the 'energy ladder'(Smith, 1987; Leach and Mearns,1988; Leach, 1992;Masera et al., 2000), to describe a hierarchy of house-hold energy options characterized by traits such ascost, energy eff i c i e n c y, cleanliness, and convenience.Fuels which are available for free or for very low cost,such as wood, dung, and crop residues, are the dirtiestand the least convenient to use. Cleaner, more conve-nient fuels tend to transfer heat more eff i c i e n t l y, areeasily controlled over a range of heat outputs, and aremuch costlier. They may re q u i re large lump paymentsfor the fuel as with LPG, or large up-front expenditu-res for the stove, as with gas and electric cookers.

Problems with the energy ladder model arise fromthe simplified way that the model is applied to poli-cy-making, and the mistaken conclusion that fuelchoice is determined by purely economic factors. Anincrease in household income will not necessarily bespent on cook stoves or fuel. Moreover, complete

switching, where one fuel totally substitutes for ano-ther, is rare. Cultural preferences may cause a house-hold to retain a particular fuel/stove combination tocook certain foods or to use on special occasions.Finally, ease of access and consistent availability offuels are both important factors that determine theextent and/or permanence of fuel switching in anyhousehold.

1.4- Energy services for the poor

In developing countries, commercial energy in theform of grid-based electricity and fossil fuels is oftenunavailable in rural areas, and even many urban resi-dents do not receive reliable energy services. Whilethere is little doubt that 2-3 billion people in develo-ping countries use traditional biomass fuels to satis-fy their basic needs, there is a great deal of uncer-tainty surrounding their consumption and its effectson personal health, and local and global environ-ments. Data on household fuel consumption is diffi-cult to acquire and unreliable. Traditional biomassfuels may be collected, or obtained commerciallyfrom other individuals or small businesses.

A common small-scale commercial energy sourceused in developing countries is battery power.Disposable dry cell batteries allow people to usehandheld flashlights and play transistor radios.Larger lead-acid batteries, the type used in the igni-tion systems of cars and trucks, provide more electri-cal capacity and can be recharged repeatedly.Commercial energy service options for the poor alsoinclude off-grid electric power technologies for hou-sehold or commercial applications. The most com-mon ones are diesel powered generators. Solarphotovoltaic (PV) panels are becoming increasinglycommon as costs come down and markets develop.Less common off-grid renewable options includesmall (micro) hydroelectricity systems, wind turbi-nes, and biomass-powered electric systems.

A relatively new concept in energy provision for thepoor, which can utilize one or more decentralizedtechnologies is the Energy Service Company (ESCO).Usually, when decentralized energy technologies areintroduced in rural areas, the hardware is bought bythe end-user(s) with cash up-front or through finan-cing. The buyer assumes the risk of ownership and isresponsible for operating and maintaining the hard-ware. In the ESCO model, a private company, orcommunity-based organization, enters into acontractual agreement with community members toprovide them either with hardware or energy servi-ces. The company may have support from thegovernment, the national utility company or an out-side donor.

1.5- Energy and the poor: Conclusions

Lack of access to modern energy services is inextri-cably linked to poverty and the lack of fulfillment of

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other needs such as shelter, food, health care, educa-tion, secure land tenure, access to agricultural inputs,credit, information, and political power. Access toenergy is a necessary, but not sufficient ingredient inpoverty alleviation.

In most developing countries, conventional approa-ches to energy service provision - state-run utilitiesand the extension of the national electrical grid –have not proven successful. Policies that bring accessto information, credit, and jobs, implemented in tan-dem with the introduction of small-scale decentrali-zed energy systems, have the potential to succeedwhere 'conventional' approaches have failed.Renewable energy technologies that rely largely onlocal resources are particularly suited to thisapproach.

In many cases, providing energy services to poorcommunities is more expensive than providing it tobetter-off communities because of geographicalremoteness, high risk, poor payback, or low basedemand. Poor communities may also have difficultyattracting private energy suppliers. However, energyservice provision can involve indirect benefits likeincreased rural productivity, reduced rural-urbanmigration, and a potential decrease in pressure onrural energy resources with associated environmen-tal benefits. These benefits could outweigh the incre-mental costs of energy provision, and fully justifysome subsidies from an outside party (the govern-ment or a donor), in order to level the costs of servi-ce provision and make it an attractive investment forthe private sector.

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2- Biomass and bioenergy for householduse: Resources and impacts

Biomass is used by households in developing coun-tries for food, fuel, fodder, fibre, feedstock, and ferti-lizer (Leach, 1992). Policy decisions or interventionsaimed at enhancing or modifying biomass energyoptions will inevitably affect other areas of biomassutilization. In designing policy, it is therefore crucialto assess the potential impacts of the policies on allpossible users, as well as on all possible uses, of bio-mass resources.

2.1 Sources of household biomass

Biomass for household energy use is gathered fromroadsides, natural woodlands, or communal woodlots. It can be grown on the homestead in privatewood lots, intermingled with food crops, prunedfrom fruit trees or windbreaks, collected from fallowfields and grazing areas, or 'poached' from restrictedstate forests and nature preserves, which are oftensituated in areas of historical community access.When the primary household fuel is biomass, energysupply strategies are inseparable from land manage-ment strategies, and thus dependent on political andsocioeconomic issues like land tenure and tree tenu-re, markets for land and labor, norms governing pro-perty and land use, and rules of inheritance. Even atthe community level, access to biomass resources(and energy services) is not determined simply bytechnical or economic questions; social relationsmediated through gender, ethnicity, and class playan important role.

2.2- Impacts of household biomass use

The World Energy Assessment (UNDP et al., 2000)divides the chief environmental impacts of house-hold biomass use into two broad categories: impactsresulting from biomass harvesting and impactsresulting from biomass combustion. Harvesting offuels has a direct impact on the physical environ-ment, while combustion results in emissions that cansimultaneously place a burden on human health andon the atmosphere.

2.2.1- Biomass and society: Gender, fuel and resourcecontrol

The largest impact of changes in biomass usage pat-terns at the household level will certainly be onwomen and children, who expend the greatest effortin the acquisition of wood fuels and other biomassresources. Greater demand for biomass will almostcertainly increase the monetary value of biomass,making it less available to the poorest people, espe-cially women. Increased prominence of biomassenergy will likely attract entrepreneurs and businesspersons, and in most nations those individuals aregenerally men. In a number of settings, this process

will drive women to more marginal roles, and redu-ce their employment and economic opportunities(Agarwal, 1994). While the means to address this areoften complex, a simple rule is that multiple stake-holders, even those often silent or silenced, need tobe explicitly engaged and included in plans to deve-lop any given resource sector. The urgency growswhen we see that sharp divisions along gender andethnic lines occur in both the informal, cash-poor sec-tor and the formal, capital-rich sector of economyand society.

2.2.2- Environmental impacts of household biomass use

Considering the strong linkages between biomassconsumption for fuel and biomass utilization forother end-uses, it is impossible to implicate house-hold energy demand as a direct cause of environ-mental degradation. Deforestation is more often thecause of fuel wood scarcity than the effect of toomuch household fuel consumption. Nonetheless,once forest land is degraded or lost entirely, fuelwood consumption and scarcity can act as a feed-back process that prevents the recovery of the forest,or leads to further degradation. If trees are insuffi-cient to meet demand, then some households mayturn to agricultural residues or animal manure. Thisshift can reduce supplies of traditional fodder forlivestock, lower the quality of the animals' manure asfertilizer, reduce the availability of crop residues forfertilizer, and leave top soil unprotected from erosionwhen crop residues are removed. To satisfy house-hold energy needs, both tree cover and soil qualitymay be sacrificed, leaving rural households impove-rished and more susceptible to economic or environ-mental shocks.

One way to safeguard against this type of degrada-tion is to vest control of forest resources in local com-munities. Land degradation is the result of social aswell as physical processes, which must be consideredin their local and historical context in order to identi-fy, understand, and mitigate environmental pro-blems (Blackie and Brookfield,1987; Peluso,1999).

Trees planted within the household compound orinterspersed with crops or grazing land carry multi-ple benefits including, but not limited to, fuel wood,fruit, fodder, building material, shade, wind-breaks,and natural fencing. Some leguminous tree speciescan be interplanted with crops or on fallow fields tofix nitrogen and restore soil fertility. And all trees,including trees planted in agroforestry systems, canbe used to sequester carbon though the permanenceof the carbon-sinks is not guaranteed and has to beaddressed (Kartha, 2001).

Intensifying biomass utilization can have multipleimpacts on the environment. Principal environmen-tal concerns include soil erosion and loss of nutrientsas biomass is repeatedly harvested. In addition, loss

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of biodiversity may occur in cases where certain spe-cies are favored for energy production or whereenergy crops replace natural woodland or forest andthe local hydrology also may be affected. All of theseconcerns are manageable in theory, though localconditions will vary and need to be addressed on acase-by-case basis. Obviously full impact assess-ments should be conducted before any project goesforward. If steps are taken to minimize these andother impacts, the benefits of intensified bioenergyproduction should outweigh the costs.

Environmental effects of household biomass com-bustion also extend to the global arena, since hou-sehold biomass combustion results in greenhousegas emissions. Under optimal conditions, combus-tion of biomass results in the emission of water vaporand carbon dioxide. Water vapor, the most prevalentgreenhouse gas in the atmosphere, is quickly incor-porated in the hydrologic cycle with no measurablewarming effect, and carbon dioxide, the most com-mon anthropogenic greenhouse gas, is absorbed bynew plant growth through photosynthesis.Therefore, if biomass is harvested in a sustainableway so that long-term stocks of biomass are notdepleted, and burned in ideal combustion condi-tions, it is effectively greenhouse gas neutral.

However, in hearths and stoves commonly used indeveloping countries, combustion is never ideal.Under these conditions, hundreds of compounds areemitted in addition to carbon dioxide and water(Smith, 1987; UNDP, 2000). These compounds inclu-de large amounts of carbon monoxide, methane,non-methane hydrocarbons, and particulate matter,as well as small amounts of many other pollutants.Carbon monoxide, methane and non-methanehydrocarbons all affect the radiative balance of theatmosphere to an equal or greater extent than anequivalent amount of carbon dioxide (IPCC, 2001).Moreover, these non-carbon dioxide greenhousegases are not absorbed by photosynthesis andremain in the atmosphere despite new biomassgrowth. Preliminary research has shown that as aresult of incomplete combustion by common house-hold cooking devices, cooking with biomass canrelease more greenhouse gases than cooking withclean burning fossil fuels like kerosene and LPG.See UNDP et al., 2000 or Smith, 2000b and 2000c formore details on this research.

In an important link between climate change andpublic health, exposure to many of the compoundsreleased by incomplete biomass combustion is quiteharmful. Improving combustion efficiency of house-

hold cooking devices therefore will mitigate bothgreenhouse gas emissions and severe public healthproblems. The health aspects of the equation are dis-cussed in more detail below.

2.2.3- Health impacts of household biomass combustion

Because of the high concentrations of indoor air pol-lution resulting from biomass combustion and thelarge number of people affected, rural areas of deve-loping countries suffer the greatest exposure global-ly to particulate matter and other solid fuel combus-tion emissions (Smith, 1993). Wood smoke containshundreds of different compounds, including a num-ber which are carcinogenic. In addition, small-scalebiomass combustion emits large amounts of particu-late matter, including fine particles less than 2microns in diameter. These particles penetrate dee-ply in the lungs and are thought to cause more healthdamage than larger particles (Raiyani et al., 1993;Bruce, et al., 2000). The effects of high levels of expo-sure to these chemical compounds and particulatematter include a number of possible health impacts:acute respiratory infections; tuberculosis; adversepregnancy outcomes; chronic obstructive lung disea-se; and several types of cancer (Smith, 1993).

The strongest evidence of causal linkage betweenbiomass combustion emissions and ill health is withacute respiratory infection in children (Smith, et al.,2000a; Ezzati and Kammen, 2001; Bruce et al., 2000).It is the primary cause of morbidity and mortality inchildren under five, causing more deaths and illhealth globally than either malnutrition, diarrhea, orchildhood diseases like measles and mumps.Children of this age group are most affected becausethey spend a large amount of time indoors, close tothe women of the household who do most of thecooking.

Emissions generally decrease, and efficiency impro-ves, as cooking devices move along the 'energy lad-der' discussed above. Accordingly, policy interven-tions have targeted both improving biomass stovesand encouraging the use of alternative fuels. Themost common alternative fuels are non-renewablefossil fuels like kerosene, natural gas, and LPG.Renewable alternatives like biogas will be discussedin detail below. Figure 1 shows a comparison of theparticulate emissions and efficiencies of differentstove technologies from China and India, with theemissions and efficiencies of two types of wood bur-ned in a three-stone fire and the efficiencies of twoimproved Kenyan charcoal stoves included for com-parison (Zhang et al., 2000; Smith, et al., 2000c;Kammen, 1995b).

Figure 1

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T h e re is a tension between the desire to move awayf rom traditional biomass combustion and the desireto avoid increasing reliance on fossil fuels. Fossil fuelsa re costly, rely on imported re s o u rces, and re q u i reexpensive stoves, which are often imported as well. Itis also argued that a switch to fossil fuels results in ani n c rease in greenhouse gas emissions. However, aswe discussed above, this is not necessarily true. Itdepends strongly on the sustainable harvest of bio-mass fuel and on the efficiency of combustion, whichis usually quite poor in household stoves.

Improved biomass stoves can improve combustionefficiency and reduce emissions considerably,though not in all cases. Stove performance is highlyvariable, depending strongly on user behavior, fuelcharacteristics, and household microenvironment.Even when 'improved' solid fuel stoves do offer realimprovement, they rarely reduce harmful emissionsto the level of 'clean' liquid and gaseous cookingfuels. The resulting pollutant levels from improvedstoves like the Kenyan Ceramic Jiko and the

Maendaleo stove still result in ambient indoorconcentrations of pollution that are well above stan-dards set for outdoor air in industrialized countries(Ezzati, Mbinda and Kammen, 2000).

2.3- Household use of biomass: Conclusions

More research and policy discussion is needed todetermine the threshold of exposure below whichmorbidity and mortality from biomass combustionemissions fall to acceptable levels, and to determinethe most appropriate stove/fuel combinations, tech-nically and socially, to reach that level of emissions.Biomass fuels will likely remain the primary energysource for most poor people in Africa, South andSoutheast Asia, and, with coal, for people in China aswell. A rapid switch to cleaner burning fossil fuels isextremely unlikely. It also may not be desirablebecause of the greenhouse gas emissions and unfa-vorable trade balances that may result. However, agradual transformation of biomass utilization, awayfrom burning raw biomass in smoky open hearths

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Emissions factors and Efficiencies of Various Traditional andImproved Cookstoves

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All data are from Zhang, et al., 2000, except the biogas stove and 3-stone fires, which are taken from Smith, et al., 2000c, and thecharcoal stoves, which are taken from from Kammen, 1995 (no emissions factors available). Error bars show +/- one standarddeviation, based on, in most cases, three measurements.

Stove efficiency (%)

TSP (gm per MJdelivered to pot)

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and simple metal stoves to cleaner, more efficientbiomass energy conversion devices and/or fuelsderived from biomass feedstock, is both more likely,and arguably more desirable (Ezzati and Kammen,2001). There will be multiple benefits for short-termpublic health, by reducing indoor air pollution, aswell as long-term environmental health, by reducingor eliminating greenhouse gas emissions. In addi-tion, managing biomass resources for energy pro-duction can bring ancillary benefits to rural popula-tions, including the restoration of degraded landsand creation of rural livelihoods by through jobs andincome generating opportunities.

One necessary, though not sufficient, condition forsuccessful biomass/bioenergy transformation isclearly defined land and tree tenure rights. Localcommunities must be confident that any improve-ments they initiate will not be taken over by state orcorporate interests, and that they will be justly com-pensated if and when the resources under theircontrol are used by outsiders. In addition to well-defined rules of tenure, program for biomass utiliza-tion and modernization will need to be flexible andadaptable to local needs, include the full participa-tion of target populations, and have support from

both the national government and the internationalcommunity.

The Future Role of BiomassModernized biomass energy is projected to play amajor role in the future global energy supply.Estimates of the technical potential of biomass ener-gy are much larger than the present world energyconsumption. If agriculture is modernized up to rea-sonable standards in various regions of the world,several billions of hectares may be available for bio-mass energy production well into this century. Thisland would comprise degraded and unproductive

lands or excess cropland, and preserve the world’snature areas and quality cropland. The table belowgives a summary of the potential contribution of bio-mass to the worlds energy supply according to anumber of studies by influential organizations.Although the percentile contribution of biomassvaries considerably, depending on the expected futu-re energy demand, the absolute potential contribu-tions of biomass in the long term is high, from about100 to 300 EJ per year.

Role of biomass in future global energy use according to 5 studies (Source: Hall, 1993; UNDP et al., 2000)

Source Time Projected global Contribution of biomass Remarksframe energy demand to energy demand,(Year) (EJ/year) EJ/year (% of total)

IPCC (1996) 2050 560 180 (32%) Biomass intensive energy 2100 710 325 (46 %) system development

Shell (1994) 2060 1500 220 (15%) - Sustained growth*

900 200 (22%) - Dematerialization+

WEC (1994) 2050 671-1057 94 - 157 (14 -15 %) Range given reflects the 2100 895-1880 132 - 215 (15-11 %) outcome of three scenarios

Greenpeace (1993) 2050 610 114 (19 %) Fossil fuels are phased out 2100 986 181 (18 %) during the 21st century

Johansson et al. 2025 395 145 (37 %) RIGES model calculation

(1993) 2050 561 206 (37 %)

* Business-as-usual scenario; + Energy conservation scenario

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3- Biomass energy beyond the household:Scaling up

3.1- Small and medium commercial businesses andinstitutions

Biomass energy is used for many commercial andsmall industrial applications in rural and peri-urbanareas of developing countries. It is the principal sour-ce of energy for institutions like schools, health cli-nics, and prisons, and it is an important input in lar-ger energy intensive agro-industries like sugar refi-neries, sawmills, and pulp and paper manufacturers.At the small rural level, commercial applications ofbioenergy are usually limited to providing processheat for productive value-adding activities liketobacco curing, tea drying, beer brewing, fish smo-king, and brick firing. While these may seem likenegligible activities, taken in aggregate they repre-sent a significant amount of wood fuel consumptionas well as an important source of rural employment.

In many cases, fuel wood is harvested from naturalwoodlands that are owned and, in theory, maintai-ned by the state. If harvesters pay little or no stum-page fees, the supply-price of wood fuel can be arti-ficially low because replacement costs are not inter-nalized (Boberg, 1993; Ribot, 1998). However, theharvesters may be only the first step in a long supplychain; prices per unit of energy delivered to the end-user are often still higher than fossil fuels.Alternatively, fuel for small and medium commercialand institutional consumers can be supplied fromland cleared from cultivation, from larger commer-cial farms, or from woodlots or plantations that wereestablished specifically to supply wood fuel. Largeragro-processing industries often maintain their ownfuel wood plantations, usually in the form of fast-growing tree species like eucalyptus.

Fuel wood and charcoal markets have been in exis-tence for quite a long time and exist in a variety offorms, from highly organized vertically integratedmarkets to unorganized piecemeal operations. Someare tightly regulated by the state while others arecompletely laissez faire markets. These variationshave been explored in detail by a number of authors(Leach and Mearns, 1988; Hosier, 1993; Ribot, 1998).

Alternative biomass fuels for households and smallbusinesses have long been discussed by energy deve-lopment analysts, but have seen very little commer-cialization. In Zimbabwe, due to recent keroseneshortages, some markets, gas stations and hardwarestores, now sell an ethanol-based gel fuel made fromsugar cane and starch, and small metal stoves desi-gned especially for the fuel. A second alternate fuelavailable in some African urban markets stems froman old idea: briquetting or pelletizing. Dissagregatedbiomass, like sawdust, bagasse, and nut shells, gene-

rally has very low energy density and very poorcombustion characteristics. Compression creates afuel that is easy to package and transport and thathas uniform size and moisture content, which burnsmuch more efficiently. To date, most attempts tocommercialize biomass waste briquettes have failedbecause they cannot compete with charcoal or fuelwood. However, there are some notable exceptions.Case Study 3 illustrates the example of a privatecompany in Kenya that is briquetting charcoal dustgathered from charcoal vending and distributionsites throughout Nairobi and is currently expandingits business to the production of carbonised briquet-tes made from bagasse.

3.2- Potential to transform commercial and institu -tional biomass-based energy systems

Like households, most small and medium commer-cial businesses and institutions in developing coun-tries consume solid biomass fuels in simple combus-tion devices with low efficiencies and high emis-sions. Rural businesses and institutions provide anuntapped opportunity for transforming bioenergyconsumption in developing countries. Demand forelectricity in the domestic sector is small and inter-mittent, and any capital-intensive modern energyinstallation will likely have low capacity utilization ifit targets household consumers alone. Small busines-ses and industries like grinding mills, carpentryshops and food processors, as well as institutions likeschools and health clinics, have larger energydemands that are more predictable and consistent.Therefore, they represent a potential base-load thatwould make a modern energy installation economi-cally viable. They are also able to mobilize capitalbetter than individual households, and hold lowerrisk for the prospective energy service provider.C u r re n t l y, there are technologies under development,or nearing the commercial stage, that are designedspecifically for small and medium scale energy appli-cations. For two concrete examples of diff e rent tech-nologies that are currently filtering into rural applica-tions, see: Case Study 1: Modular Biopower forCommunity-scale Enterprise Development, and CaseStudy 2 : Scaling-up Biogas Technology in Nepal.

In addition, large industries that rely on biomass forraw material inputs also represent a largely untap-ped opportunity. Some industries, principally sugarrefineries, pulp and paper manufacturers, and saw-mills, use their biomass wastes to produce process-heat and/or electricity. But many of them operateinefficiently, and have little incentive to optimizetheir energy production or sell to excess power toother consumers. Figure 2 shows some characteristicconversion efficiencies for a range of available tech-nical options.

Figure 2

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Very few developing countries currently exploitsugarcane or other biomass-based power generationfor public sale. One exception is Mauritius, whereroughly 30 per cent of the island's installed genera-tion capacity is at sugar refineries. In 1998, theMauritian sugar industry exported 195 GWh ofexcess electricity to the national grid – roughly 14 percent of the national power production (Beeharry,2001). Most factories export power only during theharvest season, but three large companies have dual-fuel boilers that can provide power to the nationalgrid throughout the year by burning bagasse duringthe harvest season and burning coal off-season.

3.2.1- Liquid fuels from biomass: The case of ethanol

Ethanol is produced by fermentation of sugars, mostf requently from maize or sugarcane. Ethanol pro d u-ced from sugarcane in developing countries has beenused primarily as a transportation fuel. It also may beused as an industrial input, or sold for export. Brazilhas been a world leader in ethanol production, thoughseveral countries in Africa have also had experiencep roducing ethanol. Ethanol from sugarcane canreplace a fraction of imported fossil fuels with a local-ly grown renewable energy source, improve a nation'sbalance of trade, assist with rural job creation, andreduce pollution emissions. The Brazilian ethanolexperience has been characterized as largely positive,though it has had its share of setbacks. See Case Study4: Ethanol in Brazil, for a more detailed discussion.Kenya, Zimbabwe, and Malawi have also pro d u c e dethanol from sugarcane, with mixed results (Eriksen,1995; Karekezi and Ranja, 1997).

3.2.2- Energy from woody biomass - an example fromCalifornia

Wood wastes and agricultural residues also offer animmense and untapped source of power. An exam-

ple from an industrialized country, the United States,suggests one strategy to develop this resource. In thestate of California, in 2000, there were 29 wood wasteburning power plants, ranging in capacity from lessthan 5 MW to over 50 MW, that contributed a total of600 MW to California's energy mix. These powerplants rely entirely on wood waste: sawmill residues,agricultural pruning and thinning, forest residues,and urban wood waste. The disposal of this wasteunder optimized combustion conditions has led to asignificant reduction in conventional air pollutionand greenhouse gas emissions. In the absence ofcontrolled combustion for power generation, the bio-mass fuel would have been burned openly, land-filled, or composted. Each of these alternative dispo-sal techniques is more polluting than controlled com-bustion.

California had an aggressive policy of favorable taxbreaks and subsidies for renewable energy technolo-gies throughout the latter half of the 1980s and early1990s. This example shows that favorable policiescombined with readily available, well-tested techno-logies can have substantial results in establishing alarge amount of renewable and sustainable genera-ting capacity.

3.2.3- Supplies of biomass for commercial and industrial use

Residues are a particularly important potential bio-mass energy source in densely populated regions,where much of the land is used for food productionand there are large quantities of byproduct residues.For example, in 1996, China generated crop residuesin the field (mostly corn stover, rice straw and wheatstraw) plus agricultural processing residues (mostlyrice husks, corn cobs and bagasse) totaling about 790million tons. If half of this resource were to be used

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Condensing Extraction SteamTurbine (CEST)

CEST with SteamConservation

Biomass integrated gasifierwith combined cycle (BIGCC)

Gasifier with STIG and SteamConservation

kWh of electricity output per ton of cane processedAdapted from Turn, 1999

Comparison of technical options for generating electricityfrom sugar cane

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for generating electricity at an efficiency of 25 percent (achievable at small scales today), the resultingelectricity generation would be about half of the totalelectricity generated from coal in China in 1996.(China Agricultural Statistical Yearbook, 1996 andChina Energy Statistical Yearbook, 1996).

There is also a significant potential for providing bio-mass for energy by growing crops specifically forthat purpose. The IPCC's biomass intensive futureenergy supply scenario (below) includes 385 millionhectares of biomass energy plantations globally in2050 (equivalent to about one quarter of presentplanted agricultural area), with three quarters of thisarea established in developing countries.

I n t e rgove rnmental Panel on Climate C h a n ge (IPCC)

An Intergovernmental Panel on Climate Change(IPCC) study has explored five energy supply scena-rios for satisfying the world’s demand for energywhile limiting cumulative CO2 emissions between1990 and 2100 to fewer than 500 Gton (C). In all scenarios,

Such high levels of land use for bioenergy raise theissue of intensified competition with other impor-tant land uses, especially food production. But com-petition between land use for agriculture and forenergy production can be minimized if degradedland and surplus agricultural land are targeted forenergy crops. Care must be taken however, becauseland that is considered “surplus” or “degraded” bypolicy makers may still be occupied and put to pro-ductive uses by marginal populations. The process ofidentifying land for bioenergy production shouldinclude a full social impact assessment allowing forparticipation of local communities. This is discussedfurther in section 6.3 below.

3.2.4 - Jobs in the commercial biomass sector

Biomass-based industries can be a significant sourceof jobs in rural areas. However, it should not be assu-med that all rural areas in developing countries arecharacterized by surplus unskilled labor, and there-fore automatically provide a pool of workers forlabor-intensive bioenergy projects. Employment inrural areas is primarily agricultural and hence highly

1990 2025 2050 2075 2100 1990 2025 2050 2075 2100 1990 2025 2050 2075 2100

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Primary commercial energy use by source for the biomass-intensive variant of the IPCC model (IPPC,1996), shown forthe world, for industrialized countries, and for developing countries (Sources: Kartha and Larson, 2000)

a substantial contribution from carbon-neutral bio-mass energy as a fossil fuel substitute is included tohelp meet the emissions targets. The figure aboveshows the results for the IPCC’s most biomass-inten-sive scenario where biomass energy contributes 180EJ/year to global energy supply by 2050, nearly threetimes its current contribution. Roughly two-thirds ofthe global biomass supply in 2050 is assumed to beproduced on high-yield energy plantations coveringnearly 400 million hectares, or an area equivalent toone-quarter of present planted agricultural area. Theother one-third comes from residues produced byagricultural and industrial activities.

seasonal. There is also a significantly genderedaspect to labor. In many regions, men of the house-hold leave to seek formal employment in towns andcities, which then places greater demands on wome-n's labor in the home and on the farm. Planners mustbe aware of competing claims on rural labor beforeinitiating a project, to ensure that labor requirementsfit local availability and that unreasonable demandsare not placed on women, whose labor often goesunrecognized and unrewarded.

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3.2.5- Environmental impacts of medium and large scale biomass utilization

Many bioenergy systems offer flexibility in choice offeedstock as well as the manner in which it is produ-ced, which makes it easier to meet environmentalobjectives. For example, bioenergy crops can be usedto revegetate barren land, reclaim water-logged orsaline soils, and stabilize erosion-prone land, most ofwhich would be unsuitable for cash or food crops.Biomass energy feedstock, when properly managed,can both provide habitat and improve biodiversityon previously degraded land.

Erosion and removal of soil nutrients are problemsrelated to the cultivation of annual crops in manyregions of the world. Energy crops could be fast-gro-wing trees that are harvested by coppicing in short(4-8 year) rotations. This method leaves the rootstructures intact. Trees regenerate for multiple rota-tions, and are replanted every 15-20 years. Energycrops can also be grown from perennial grasses thatare harvested every year and replanted every tenyears. Compared to annual planting and harvestingof conventional crops, these practices reduce the dis-turbance of the soil. Where natural forests are beinginfringed upon for energy or other end uses, bio-energy crops can be used in buffer zones or shelterbelts critical for preserving a core of undisturbedforest that acts as a reservoir of biodiversity and asource of non-timber forest products.

Possibly the biggest concern, and perhaps the mostlimiting factor to the spread of bioenergy crops, is thedemand on available water supplies, particularly inarid and semi-arid regions. Impacts on local hydro l o g yalways need to be evaluated on a case-by-case basis.

Biomass plantations are frequently criticized becausethe range of biological species they support is muchnarrower than natural ecosystems. While therewould be a detrimental impact if a virgin forest wereto be replaced by a biomass plantation, when a plan-tation is established on degraded lands or on excessagricultural lands, the restored lands are likely tosupport a more diverse ecology.

A major environmental concern is, of course, thepotential for bioenergy systems to mitigate climatechange by the direct displacement of fossil fuels. It isalso possible that biomass, either naturally regrown,or managed in plantations, wood lots, or agrofores-

try systems, can be used as a carbon sink to offsetemissions (IPCC, 2000b).

3.3- Scaling up: Conclusion

Utilization of biomass wastes and residues to produ-ce commercial energy services is an initial steptoward transforming bioenergy from a predominant-ly traditional energy source into a renewable sourceof high-quality fuels and electricity. Rural industriesthat rely on large amounts of biomass inputs are par-ticularly well placed to initiate this transformation,though it will not proceed without an enabling poli-cy environment, and adequate public and privatesector investment.

Progress in scaling up the use of modernized bio-mass energy can occur only in stages, with differentpilot projects focused on overcoming different insti-tutional and commercial barriers. A good example ofthis strategy comes from the United StatesDepartment of Energy's National Renewable EnergyLaboratory (NREL) Small Modular Biomass Project(Bain, 2000). See Case Study 1: Modular Biopower forCommunity-scale Enterprise Development, whichrelates the experiences of one company that was asuccessful participant in this program.

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4- Biomass energy conversion technologies

Biomass energy has the potential to be 'modernized'worldwide, that is, produced and converted effi-ciently and cost-competitively into more convenientforms such as gases, liquids, and electricity. A varie-ty of technologies can convert solid biomass intoclean, convenient energy carriers over a range of sca-les from household/village to large industrial. Someof these technologies are commercially availabletoday, while others are still in the development anddemonstration stages. If widely implemented, suchtechnologies can enable biomass energy to play a farmore significant role in the future than it does today,especially in developing countries. In addition,modernized biomass energy is projected to play amajor role in the future global energy supply.

4.1- Combustion

D i rect combustion remains the most common tech-nique for deriving energy from biomass for bothheat and electricity. Advanced domestic heatersobtain efficiencies of over 70 per cent with gre a t l yreduced atmospheric emissions. The pre d o m i n a n ttechnology in the world today for electricity gene-ration from biomass, at scales above one megawatt,is direct combustion of biomass in a boiler to pro-duce steam, which is then expanded through a tur-bine. The typical capacity of existing biomasspower plants ranges from 1 to 50 MWe with an ave-rage around 20 MWe. Steam cycle plants are oftenlocated at industrial sites, where the waste heatf rom the steam turbine can be re c o v e red and usedin industrial processing. Combined heat and power(CHP) systems provide higher efficiencies than sys-tems that only generate power. By utilizing wasteheat, combined efficiencies of 80 per cent are possi-ble. There is relatively little CHP capacity installedin developing countries. The most significant instal-lation of such capacity is in sugar refining usingbagasse as a fuel, but the potential for CHP exists inmany timber and agricultural processing industriesworldwide.

An alternative to dire c t - f i red biomass combustiontechnologies described above, and considered then e a rest term low-cost option, is biomass co-com-bustion with fossil fuels in existing high-eff i c i e n c yboilers. Effective biomass fuel substitution can bemade in the range of 10-15 per cent of the total ener-gy input with minimal plant modifications and noimpact on the plant efficiency and operation. Thisstrategy is economical when the biomass fuels arelower cost than the fossil fuels used. For fossil fuelplant capacities greater than 100 MWe, this canmean a substantial amount of displaced fossil fuel,which results in substantial emissions re d u c t i o n s ,particularly for coal-fired plants.

4.2- Gasification

Combustible gas can be produced from biomassthrough a high temperature thermochemical processcalled gasification, which involves burning biomasswithout sufficient air for full combustion, but withenough air to convert the solid biomass into agaseous fuel (Reed and Gaur, 2000). The intendeduse of the gas and the characteristics of the particularbiomass (size, texture, moisture content, etc.) deter-mine the design and operating characteristics of thegasifier and associated equipment. After appropriatetreatment, the resulting gases can be burned directlyfor cooking or heat supply, or used in secondaryconversion devices, such as internal combustionengines or gas turbines, for producing electricity orshaft power (where it also has the potential for CHPapplications). The systems range from small-scale (5-100 kW), suitable for the cooking or lighting needs ofa single family or community, up to large gridconnected power or combined heat and power faci-lities consuming several hundred kilograms ofwoody biomass per hour and producing 10-100 MWof electricity. Biomass gasification is not yet fullycommercialized, though many projects of differentscales have been attempted and have yielded valua-ble lessons (Larson, 2000; Reed and Gaur, 2000).

In direct combustion applications, gas has advan-tages over solid fuels because it allows for cleaner,more controllable combustion. Models have beenimplemented in China and India, with producer gasused for industrial processes or distributed for com-munity cooking and space heating (Jain, 2000;Henderick and Williams, 2000).

For electricity production, gas from biomass gasifica-tion can be used in modified internal combustiondiesel or gasoline engines, where it can replace 70-80per cent of the diesel or 100 per cent of the gasolinerequired by the engine. These smaller scale biomassgasifiers, coupled to diesel/gas internal combustionengines, operate in the 10-200 kWe range with effi-ciencies on the order of 15-25 per cent, and have beenmade available commercially. However, they havehad limited operational success due to gas cleaningrequirements, relatively high costs and the need forcareful operation, which have so far blocked large-scale applications. In addition, a reliable and techni-cally appropriate fuel supply is a critical issue thatrequires careful planning, particularly for remoterural applications.

Generally, these smaller gasification/engine systemstarget isolated areas where grid-connections areeither unavailable or unreliable so they can be costcompetitive in generating electricity. The UnitedStates National Renewable Energy Laboratory(NREL) is funding a small modular biopower project

20

to develop biomass systems that are fuel flexible,efficient, simple to operate, have minimum negativeimpacts on the environment, and provide power inthe 5 kW-5 MW range (Bain, 2000). There is particu-larly strong interest in the quality-of-life improve-ments that can be derived from implementing suchgasifier/engine technology for electricity generationat the village scale in developing countries. As wasmentioned above, Case Study 1 relates the experien-ces of one company that was a successful participantin this program.

4.3 Anaerobic digestion

Combustible gas can also be produced from biomassthrough the biological processes of anaerobic diges-tion. Biogas is the common name for the gas produ-ced either in specifically designed anaerobic diges-ters or from decomposing municipal waste in land-fills. Almost any biomass can be converted to biogas,though woody biomass presents a technical problembecause lignin, a major component of wood, is notdigestible by bacteria. Animal and human wastes,sewage sludge, crop residues, carbon-laden indus-trial byproducts, and landfill material have all beenused.

Biogas can be burned to provide energy for cookingand space heating, or to generate electricity.Digestion has a low overall electrical efficiency(roughly 10-15 per cent, strongly dependent on thefeedstock) and is particularly suited for wet biomassmaterials. When human or animal wastes are used,the effluent sludge from the digester is a concentra-ted nitrogen fertilizer, with the pathogens in the ori-ginal feedstock largely eliminated by the warm tem-peratures in the digester tank.

Anaerobic digestion of biomass has been demonstra-ted and applied commercially with success in manysituations and countries. In India, biogas productionfrom manure and wastes is applied widely in manyvillages and is used for cooking and power genera-tion, though not without problems. A mass populari-zation effort in China in the 1970s led to some 7million household-scale digesters being installed,using pig manure and human waste as feed material.Many failed to work, however, due to insufficient orimproper feed characteristics, or poor constructionand repair techniques. Since then, research, develop-ment, and dissemination activities have paid greaterattention on proper construction, operation, andmaintenance of digesters. Several thousand biogasdigesters are also operating in other developingcountries, most notably South Korea, Brazil,Thailand and Nepal. See Case Study 2: Scaling-upBiogas Technology in Nepal, for a discussion concer-ning recent biogas dissemination.

4.4- Liquid biofuels

Biofuels are produced in processes that convert solidbiomass into liquids, which have the potential toreplace petroleum-based fuels used in the transpor-tation sector. However, adapting liquid biofuels toour present day fuel infrastructure and engine tech-nology has proven to be difficult. Soybeans, palmnuts and oilseeds, like rape seed, can produce com-pounds similar to hydrocarbon petroleum products,and have been used to replace small amounts of die-sel. This 'biodiesel' has been marketed in Europe andto a lesser extent in the United States, but it requiressubstantial subsidies to compete with conventionaldiesel fuel.

Another family of petroleum-like liquid fuels is aclass of synthesized hydrocarbons called Fischer-Tropsch (F-T) liquids. These are produced from agaseous feedstock, potentially gasified biomass,though more commonly coal-gas or natural gaswould be used. F-T liquids can be used as sulphur-free diesel or blended with existing diesel to reduceemissions, which is an environmental advantage. F-T liquids have yet to be produced economically on alarge scale, but research and development effortscontinue (Larson and Jin, 1999a and b).

Other alternatives to petroleum-based fuels are alco-hols produced from biomass, which can replacegasoline or kerosene. The most widely producedtoday is ethanol, from the fermentation of biomass.The Brazilian Proalcool ethanol program, initiated in1975, has been successful due to the high productivi-ty of sugarcane, and subsidies. See Case Study 4:Ethanol in Brazil for a more detailed discussion ofthe Brazilian ethanol experience.

Two other potential transportation biofuels aremethanol and hydrogen. They are both producedfrom biomass feedstock and may be used in eitherinternal combustion engines or in fuel cells, but nei-ther is close to commercialization.

4.5- Bioenergy conversion technologies: Conclusions

Biomass is one of the renewable energy sources thatcan make a large contribution to the developingworld's future energy supply. Latin America, Africa,Asia and, to a lesser extent, Eastern Europe, repre-sent a large potential for biomass production. Theforms in which biomass can be used for energy arediverse. Optimal resources, technologies and entiresystems will be shaped by local conditions, bothphysical and socio-economic in nature.

Since the majority of people in developing countrieswill continue using biomass as their primary energysource well into the next century, it is of criticalimportance to policy-makers concerned with public

21

health, local environmental degradation, and globalenvironmental change that biomass-based energytruly can be modernized, and that such a transfor-mation can yield multiple socioeconomic and envi-ronmental benefits.

Conversion of biomass to energy carriers like electri-city and transportation fuels will give biomass acommercial value, and potentially provide incomefor local rural economies. It will also reduce nationaldependence on imported fuels, and reduce the envi-ronmental and public health impacts of fossil fuelcombustion. To make progress, biomass markets andnecessary infrastructure must be developed with therealization that the large-scale commoditization of

biomass resources can have negative impacts of poorhouseholds that rely on biomass for their basicneeds. Hence, measures must be taken to ensure thatthe poor have an opportunity to participate in, andbenefit from, the development of biomass markets.

In addition, high efficiency conversion technologiesand advanced fuel production systems for methanol,ethanol and hydrogen must be demonstrated andcommercialized, and experiences in industrializedand developing countries shared openly. The bene-fits of modernized bioenergy systems will only beenjoyed globally if efforts are made to gain experien-ce in a wide variety of ecological and socioeconomicvenues.

Figure 3

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5- Renewable energy technologies:Markets and costs

The development of renewable energy technologieshas been driven by fossil fuel markets. Interest inadvancing non-fossil fuel energy options surgedwith the oil 'price shocks' of the 1970s and 1980s, andwaned as oil crises subsided. More recently, fossilfuel prices have been relatively low, but there hasbeen a growing awareness of the high external costsof fossil fuel consumption (primarily global climatechange and adverse impacts on human and environ-mental health).

While most of the greenhouse gas emissions from theenergy sector currently occur in industrialized coun-tries, this is projected to change by 2035, which isroughly when industrial emissions from developingcountries are expected to surpass those of industria-lized nations (UNDP et al., 2000). One of the princi-pal ways to reduce greenhouse gas emissions is tomake a transition away from conventional fossil fuel-based energy systems.

Technical advances and cost reductions in renewableenergy technologies will directly affect the futureenergy path of developing countries, as will interna-tional incentives like the Clean DevelopmentMechanism under the Kyoto Protocol, which willpromote technology transfers to developing coun-tries.

5.1- Recent progress in renewable energy systemcosts and performance

The American Wind Energy Association (AWEA)estimates that the current levelized costs of windenergy systems range from 4.0 to 6.0 cents per kWh,and that the costs are falling by about 15% with each

doubling of installed capacity. Installed capacity hasdoubled three times during the 1990s and windenergy now costs about one-fifth as much as it did inthe mid-1980s (AWEA, 2000). Design and manufac-turing advances, along with further economies ofscale, are expected to bring the levelized costs ofwind power down to 2.5 to 3.5 cents per kWh overthe next ten years (U.S. DOE, 1997; Chapman et al.,1998). Wind turbine performance has also increased,and is expected to improve. The United StatesDepartment of Energy (DOE) is forecasting a 25-32per cent improvement in net energy produced perarea swept by 2010, from a 1996 baseline, rising to 29-37 per cent in 2020, and 31-40 per cent in 2030 (U.S.DOE, 1997).

Solar energy technologies have also been decliningsignificantly in cost. In Japan, solar photovoltaic (PV)module prices have declined from 26,120 yen perwatt in 1974 to 1,200 yen per watt in 1985, and 670yen per watt in 1995 (in constant Year 1985 yen)(Watanabe, 2000). DOE reports that from 1976 to1994, PV modules experienced an 18 per cent reduc-tion in cost with each doubling of production, withcosts falling from over $30 per watt in 1976 to wellunder $10 per watt by 1994 (U.S. DOE, 1997).Meanwhile, thin film PV cells tested in laboratoriesare showing efficiencies of over 17 per cent, compa-red with about 13 per cent in 1990 and 10 per cent in1980 (U.S. DOE, 1997).

Renewable energy systems based on biomass, geo-thermal, and solar thermal technologies are alsoexperiencing cost reductions which are forecast tocontinue. Figure 3 presents forecasts made by theU.S. DOE for the capital costs of these technologies,from 1997 to 2030.

Capital cost forecasts for renewable energy technologies (Source: U.S. DOE, 1997)

1997 2000 2010 2020 2030

10,000

8,000

6,000

4,000

2,000

0

Biomass (Gasification-based)

PV (Residetial)

Solar Thermal (Power Tower)

Geothermal (Hydrothermal)

PV (Utility scale)

Wind Turbines (Adv. Horizontal Axis/Class 6)

Figure 5

Figure 4

23

Of course, capital costs are only one component ofthe total costs of generating electricity, which alsoinclude fuel costs, and operation and maintenancecosts. In general, renewable energy systems are cha-racterized by low or no fuel costs, although opera-tion and maintenance costs can be considerable Butrenewable energy systems such as photovoltaics

contain far fewer mechanically active parts thancomparable fossil fuel combustion systems, and the-refore are likely to be less costly to maintain in thelong term. Figure 4 presents U.S. DOE projectionsfor the levelized costs of electricity production fromthese same renewable energy technologies, from1997 to 2030.

Recent analyses have shown that additional genera-ting capacity from wind and solar energy can beadded at low incremental costs relative to additionsof fossil fuel-based generation. As shown in Figure 5,geothermal and wind can be competitive with

modern combined-cycle power plants. And geother-mal, wind, and biomass all have lower total coststhan advanced coal-fired plants, once approximateenvironmental costs are also included.

Levelized cost of electricity forecast for renewable energy technologies (Source: U.S. DOE, 1997)

Actual electricity costs 2000 (Sources: Ottinger, 1991; U.S. DOE, 1997; U.S. DOE, 2000)

40.00

30.00

20.00

10.00

0.00

1997 2000 2010 2020 2030

Biomass (Gasification-based)

PV (Residetial)

Solar Thermal (Power Tower)

Geothermal (Hydrothermal)

PV (Utility scale)

Wind Turbines (Adv. Horizontal Axis/Class 6)

51.0

U.S. cents/kWh

Geothermal (Hydrothermal)

Wind Turbines ( Class 6 site)

Advanced Combined-Cycle

Biomass (Gasification-based)

Advanced Coal

Solar Thermal (Power Tower)

PV (Utility scale)

PV (Residential)

0 5 10 15 20 25 30 35

operating cost environmental cost

Figure 6

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Shell Petroleum has made one of the highest profileprojections of future renewables growth. As shownin Figure 6, Shell projects that renewables couldconstitute about 15 per cent of the OECD's energy

production by 2020, and that renewables and naturalgas combined could account for about 50 per cent oftotal production (Shell, 2000).

5.2- Lessons learned in developing countries

In developing nations, renewable energy technolo-gies are increasingly used to address energy shor-tages and to expand the range of services in bothrural and urban areas. In Kenya, over 80,000 small(20-100 Wp) solar PV systems have been commer-cially financed and installed in homes, battery char-ging stations, and other small enterprises (Kammen,1999; Duke and Kammen, 1999; Duke et al., 2000).Meanwhile, a government program in Mexico hasdisseminated over 40,000 such systems. In the InnerMongolian autonomous region of China, over130,000 portable windmills provide electricity toabout one-third of the non-grid-connected house-holds in this region (IPCC, 2000a).

These examples demonstrate that a combination ofsound national and international policies and genui-nely competitive markets, the so-called 'level playingfield', can be used to generate sustainable marketsfor clean energy systems. They also show that rene-wable energy systems can penetrate markets in thedeveloping world, even where resources are scarce,and that growth in the renewables sector need not belimited to applications in the developed world. Justas some developing countries are bypassing cons-truction of telephone wires by leaping directly to cel-lular-based systems, so too might they avoid buil-ding large, centralized power plants and grids, andinstead develop decentralized systems.

Despite their recent limited success, renewable ener-gy sources have historically had a difficult time brea-king into markets that have been dominated by tra-ditional, large-scale, fossil fuel-based systems. Inpart, this is because renewable and other new energytechnologies are only now being mass produced, andhave previously had high capital costs relative tomore conventional systems. This is also partlybecause coal, oil, and gas-powered systems havebenefited from a range of subtle subsidies over theyears. These include military expenditures to protectoil exploration and production interests overseas, thecosts of railway construction that have enabled eco-nomical delivery of coal to power plants, and a widerange of smaller subsidies.

Another limitation has been the intermittent natureof some renewable energy sources, such as wind andsolar. One solution to this last problem is to developdiversified systems that maximize the contributionof renewable energy sources, but that also use cleannatural gas and/or biomass-based power generationto provide base-load power when the sun is not shi-ning and the wind is not blowing.

In essence, however, renewable energy technologiesface the same situation confronting any new techno-logy that attempts to dislodge an entrenched techno-logy. For many years, industrialized countries havebeen 'locked into' a suite of fossil fuel and nuclear-based technologies, and many secondary systemsand networks have been designed and constructed

OECD electricity mix (Source: Shell Petroleum, 2000)

100

%

75

50

25

0

OECD Electricity Mix

Renewables

Gas

Hydro and

nucleear

OilCoal

25

accordingly. Just as electric-drive vehicles face anuphill battle to dislodge gasoline-fueled, internalcombustion engine vehicles, so, too, do solar, wind,and biomass technologies face obstacles to replacemodern coal, oil, and natural gas power plants.

5.3- Leveling the playing field

Renewable energy technologies tend to be characteri-zed by relatively low environmental costs. In an idealworld, this would help them compete with conventio-nal technologies but, of course, many of these envi-ronmental costs are 'externalities' that are not priced inthe market. Only in certain areas, and for certain pol-lutants, do these environmental costs enter the pictu-re, and, clearly, further internalization of these costswould encourage the spread of renewables.

When politically possible, the first-best policy is tofully internalize pollution costs (e.g., through pollu-tion taxes set at the marginal social cost of the pollu-tion externality, or tradable emissions permits set atthe socially optimal pollution level). The internatio-nal effort to limit the growth of greenhouse emis-sions through the Kyoto Protocol may lead to someform of carbon-based tax, and this could prove to bean enormous boon to renewable energy industries.More likely, however, concern about particulate mat-ter emissions from fossil-fuel power plants will leadto expensive mitigation efforts, and this may tip thebalance toward cleaner renewable systems.

Targeted government investments and market sup-port programs can promote research and develop-ment on renewable energy systems, thereby helpingto build demand for cleaner energy technologies,and speed up their commercialization process.

When a new technology is first introduced, it is inva-riably more expensive than established substitutes.T h e re is, however, a clear tendency for the unit cost ofm a n u f a c t u red goods to fall as a function of cumulativep roduction experience, and government support canhelp to move renewables to a point where they beco-me more cost competitive. However, the costs of poorp rogram design, inefficient implementation, or simplychoosing the 'wrong' technologies can easily outweighcost reduction benefits. There f o re, government markettransformation programs should be limited to emer-gent clean energy technologies with a steep industryexperience curve and a high probability of major long-term market penetration once subsidies are re m o v e d ,

and public agencies should invest in a portfolio of newclean energy technologies to reduce overall perfor-mance risk through diversification.

5.4- Renewable energy technology markets andcosts: Conclusions

Both solar photovoltaics and wind energy are expe-riencing rapid sales growth, declining capital costsand costs of electricity generated, and continued per-formance increases. Because of these developments,market opportunity now exists to both innovate andto take advantage of emerging markets, with theadditional encouragement of governmental andpopular sentiment. The development and use ofthese sources can enhance diversity in energy supplymarkets, contribute to securing long term sustaina-ble energy supplies, reduce local and globalatmospheric emissions, provide commercially attrac-tive options to meet specific needs for energy servi-ces (particularly in developing countries and ruralareas), and create new employment opportunities.

Integration of renewable energy supplies and tech-nologies can temper the cyclical nature of fossil fuelmarkets, and give renewables a foothold from whichthey can continue to grow and compete. There aremany opportunities for creative integration of rene-wables into energy production systems. These inclu-de combined fossil and biomass-fueled turbines, andcombinations of intermittent renewable systems andbase-load conventional systems with complementa-ry capacity profiles. Strategies such as these, inconjunction with development of off-grid renewablesystems in remote areas, are likely to provide conti-nued sales growth for renewable and other cleanenergy technologies for many years to come.

At present, however, the rates and levels of invest-ment in innovation for renewable and other cleanenergy technologies are too low. This is because mar-kets undervalue the social costs of energy produc-tion, firms cannot typically appropriate the full valueof their R&D investments in innovation, and newtechnologies are always characterized by uncertainperformance and thus greater risk compared to theirmore well-developed rivals. These issues suggest arole for public sector involvement in developingmarkets for renewable energy technologies throughvarious forms of market transformation programs.

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6- Biomass, bioenergy and climate change mitigation

Renewable energy technologies are well suited forclimate change mitigation. Biomass-based energysystems are particularly appropriate for applicationsin developing countries, where climate change maynot be given high priority, but where there is an acuteneed for equitable and efficient provision of modernenergy services. Although policy makers and scien-tists in developing countries are generally quiteaware of the need to reduce greenhouse gas emis-sions, and to take steps to adapt to a changing globalclimate, most of these nations lack adequate resour-ces to do either. While the consequences of climatechange will affect poor countries with disproportio-nate severity, the world's poorest countries are una-ble to provide their populations with basic serviceslike clean water, education, health care, and energy.Other nations, partially industrialized or 'in transi-tion', argue that taking measures to reduce emissionsnow would disrupt the course of national develop-ment. They also hold that industrialized countries of'the West' have been emitting long-lived greenhousegases for well over a century, and so should bear thebrunt of the costs of climate change mitigation.

These circumstances have led to a climate change tre a-ty that re q u i res industrialized countries to reduce theirnet greenhouse gas emissions by an average of five percent during the first commitment period (2008-2012),while developing countries have no emission limita-tions or reduction re q u i rements during the first com-mitment period. Yet with emissions from developingcountries increasing, the five percent reduction inemissions agreed to in the Kyoto Protocol will not bes u fficient to “prevent dangerous anthropogenic inter-f e rence with the climate system”. There f o re, it is criti-cal that developing countries be engaged in the inter-national effort to mitigate climate change. The KyotoP rotocol’s Clean Development Mechanism (CDM) isthe principal means for fostering broad engagement ofdeveloping countries in climate change mitigation,and can be used as a means of promoting sustainabledevelopment as well, by providing access to impro v e de n e rgy services, creating rural employment, and ena-bling improved land management practices.

6.1- The CDM - an explicit link between climatechange mitigation and sustainable development

Article 12 of the Kyoto Protocol introduced the CleanDevelopment Mechanism for the purposes of assis-ting industrialized countries in achieving complian-ce with their commitments to reduce greenhouse gasemissions, and of fostering sustainable developmentin developing countries. Given the dual role of theCDM it is likely that a number of CDM projects willtarget the energy sector, since the energy sector issimultaneously a major source of greenhouse gas

emissions, and an area that is critical for the socioe-conomic development of all nations. It is also quitelikely that many CDM projects will target land-useand forestry activities. The issues of Land Use, LandUse Change, and Forestry (LULUCF) under theKyoto Protocol are intimately linked to the themes ofbiomass, bioenergy, and poverty alleviation in deve-loping countries. Bioenergy systems reduce green-house gas emissions through the displacement offossil fuels, but unlike other renewable energy sour-ces, biomass also removes carbon from the atmo-sphere, so that any land dedicated to the productionof biofuels also acts as a carbon sink though the sinkmay not be a permanent one (Kartha, 2001).

6.2- Energy projects in the CDM: The critical issues

Energy projects implemented under the CDM mustmeet several conditions and overcome various bar-riers that do not arise in clean energy projects imple-mented within industrialized countries.

In order to qualify for Certified Emission Reductionsunder the CDM, projects need to address additiona-lity, permanence, and leakage requirements as wellas satisfy sustainable development criteria definedby the host country.

The additionality re q u i rement states that emissionsf rom anthropogenic sources must be "re d u c e dbelow those that would have occurred in theabsence of the re g i s t e red CDM project activity"( F C C C / C P / 2 0 0 1 / C R P. 11 paragraph 41). In ord e rto determine additionality, a baseline needs to bedefined: what would have happened if the pro j e c tw e re not undertaken. There are many alternativemethodologies for determining a baseline (seeIPCC, 2001; Lazarus et al., 2000).

Most biomass projects in the CDM will fall withinthe range of small projects allowed to choose a stan-dardized baseline based on a regional average or aparticular technological package. While we general-ly consider this a positive outcome, particularly forprojects that utilize biomass wastes and residues, wewould voice caution in streamlining bioenergy pro-jects that rely on the establishment of new bioenergyplantations. Experience with this type of project isminimal, particularly in sub-Saharan Africa.Bioenergy plantations are extremely land-intensiveand even a 'small' 15 megawatt project would requi-re a large amount of land with potentially large eco-logical and social impacts. We strongly recommendthat these types of projects undergo full reviews untilsufficient experience is gained to justify streamli-ning.

Permanence refers to the duration of emissionsreductions and leakage is the term used to describeany unintended consequence of project implementa-tion. Both terms are more directly associated with

27

LULUCF activities, but can apply to bioenergy pro-jects as well. Any forest or plantation is subject tovarious natural and manmade hazards that couldlead to loss of some or all of the carbon it has accu-mulated over time. In addition, devoting a particularpiece of land to forest or plantation for energy or car-bon sequestration may lead to leakage by divertingactivities previously conducted on that land else-where. In energy applications, however, if fossil fuelconsumption is displaced by a biofuel, then emis-sions reductions are permanent. Even temporarysubstitutions of biofuels for fossil fuels result in per-manent reductions of specific quantities of carbonthat would otherwise be released. (Kartha, 2001).

While additionality, permanence and leakage arematters that are subject to review by the ExecutiveBoard of the CDM, sustainable development criteriaare not. Whether or not a project meets the hostcountry's goals for, and definition of, sustainabledevelopment, is solely the decision of the host coun-try (FCCC/CP/2001/L.7 section 3.1). Biomass ener-gy projects, as they have been presented in thisreport, can be associated with numerous positiveenvironmental and social impacts, specifically theimprovement of degraded lands, the creation ofemployment opportunities, and the associated reali-zation of quality of life improvements for poor com-munities. However, positive impacts like these arenot guaranteed and, in many developing countries,national governments do not have a history of sup-porting local environmental and social justice forpoor urban or rural constituencies. Moreover, theeffects of biomass-based projects, whether for energyproduction, carbon-sequestration, or a combinationof mitigation measures and alternate uses, can beextremely complex. Decision-making with regard tothose projects can be a time-consuming and conten-tious process, making transaction costs prohibitiveand endangering the viability of all but the simplestCDM projects – particularly in countries that do nothave a lot of experience in project implementation.

Indicative List of National Sustainability Criteriaensure that AIJ/CDM projects:

3 limit activities to priority sectors, such as renewa-ble energy or energy efficiency;

3 protect biological diversity;

3 deliver local environmental benefits;

3 contribute to training and enhancing local capacity;

3 directly or indirectly enhance local employment3 purchase local goods and services;

3 transfer advanced technology or modern produc-tion processes;

3 do not increase the host country’s debt burden.

The list is taken from Werksman, et al., 2001, whoadapted it from UNFCCC, National Programs foractivities implemented jointly under the pilot phase.The latter is available on-line at www.unfccc.de/pro -gram/aij/aij_np.html.

6.3- Public participation in project development andimplementation

In keeping with the twin goals of climate protectionand sustainable development, the CDM should bereserved for locally appropriate projects that involvedemonstrated clean energy technologies with astrong emphasis on energy efficiency and renewableenergy projects, including sustainable bioenergy pro-jects, while excluding large-scale hydro and coal pro-jects. Furthermore, if CDM projects are to have envi-ronmental and social integrity, then the CDMExecutive Board should allow public access to pro-ject information, meaningful public participation indecision-making, and access to justice, including red-ress and remedies for poor project implementation.Projects should be guided by public participationand local benefit-sharing policies that are mandatory,credible, and allow for informed input. In thisrespect, current trends that have project informationmade available to the public through the internet aretroubling because communities that may be adverse-ly affected by project activities generally do not haveworking knowledge of, or access to, computers. TheCDM Executive Board needs to establish rules thatallow directly affected local communities as well asthe general public to have multiple channels ofaccess to project information in the appropriate lan-guage and to have significant input into projectdesign, implementation, and crediting.

6.4- Project management

Aregistry of well-managed projects is needed to bet-ter direct approval of strong CDM projects. This isparticularly lacking for bioenergy projects that inclu-de best practice land-use management techniques. Inaddition, projects should be examined holistically, asthere can be both positive and negative synergies ari-sing from a group of projects carried out in the sameregion. CDM projects should be consistent with thebiodiversity and desertification conventions as wellas with other relevant UN conventions covering theenvironment, development, human rights, and inter-national labor organization agreements. They shouldalso be in accordance with national policies and prio-rities of the host countries to ensure their long-termsustainability. Independent third party monitoringand verification of emission reduction credits withthe results available to the public, and investor liabi-lity, is essential for project success.

6.5- Equity

A number of steps can be taken to ensure that deve-

28

lopment objectives, and thereby the immediateneeds of many poor communities and nations, arenot made secondary to carbon issues. First, clearcommitments by industrialized nations to invest inbiomass energy projects domestically will help togrow the institutional and human capacity for bio-mass projects, while both building the market andproviding important training opportunities forgroups and individuals from developing nations.Building domestic industries would also help theinternational community to encourage industriali-zed nations not to 'cherry pick', i.e., to use theirresources to acquire rights to the least expensive bio-mass projects around the world in terms of cost perunit of carbon emissions avoided or sequestered.Opting only for the least-cost projects would favorspecific countries and hinder the flow of informationand technology to least developed countries thatarguably need it the most. In contrast, a thriving bio-mass industry spread evenly throughout the develo-ped nations would provide important opportunitiesto reduce the cost of new technologies and methodsthrough the learning-by-doing process (Spence 1984;Duke and Kammen, 1999). This, in concert withCDM initiatives, would foster the transfer of biomassand bioenergy technologies.

Second, the CDM can institute clear guidelines thatrecognize and require multi-disciplinary projectteams and review procedures so that the many com-peting uses of land areas supporting biomass pro-jects are considered. These would include the rightsand livelihoods of indigenous and the most margi-nalized communities, ethnic groups, and women,nature itself, and small-scale as well as larger-scaleenterprises. This process would work across socio-economic levels to promote intra-national and inter-national equity.

Third, projects need to be developed that reward thepreservation and sound management of existingforests, as well as new bioenergy-focused tracts ofland. Forest systems represent a critical resource forthe poorest people and nations of the plant, andsound management is an invaluable resource forlocal self-determination.

6.6- Technology transfer and capacity building

A key component of any expanded biomass energyand land-use program is access to not only the phy-sical resources, but also, critically, to the knowledgebase for sound and profitable biomass and bioenergymanagement. To accomplish this, a clear and colla-borative partnership between researchers, govern-ments and industry in developed and developingnations is needed. Projects specifically focused on theneeds of the poorest households and nations remainthe greatest need in the bioenergy field. Lessons canbe drawn from the UNDP and World Bank's jointeffort in climate-change mitigation GEF projects. Seefor example, Hosier and Sharma (2000), which givesa valuable review of the lessons learned from theGlobal Environment Facility's biomass-based energyprojects.

Unfortunately, there are few examples of successfuland sustainable biomass-based land management orenergy generation projects, particularly projectseffective in addressing poverty alleviation. A databa-se of projects, including a critical analysis of succes-ses and failures, should be developed and widelydisseminated in order to facilitate the exchange ofinformation and ideas so critical to the success ofinnovative projects. The case studies included in thefinal part of this document provide a preliminarymodel for such a database.

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7- Conclusion

In this report we have explored the links betweenenergy, poverty, and climate change, with an empha-sis on energy derived from biomass. Lack of access toclean and efficient energy services – fuels, electricity,and motive power – is a major factor contributing thepoverty that is so common in rural areas throughoutthe developing world. Local environmental factorsalso limit the ability of the poor to create sustainablelivelihoods, while the effects of human-induced cli-mate change will likely impact poor rural popula-tions with disproportionate severity.

The provision of improved energy services based onrenewable re s o u rces alone will not eradicate povertyin poor communities of the developing world.Nevertheless, providing such access will create anenabling environment that could lead to substantialincome generating opportunities as well as impro v e-ments in education, public health, and local enviro n-mental conditions. In addition, encouraging the pro-vision of energy services for poor communities deri-ved from renewable re s o u rces will encourage develo-ping countries to follow a more sustainable energ ypath fueled by indigenous re s o u rces, which will bene-fit national trade balances as well as the atmosphere.

Keeping in mind that the resources and technologiesavailable in developing countries are highly variable,as are local conditions and needs, it should beobvious that no simple set of policy prescriptionswill be applicable in all circumstances. Nevertheless,we conclude with a general set of ideas that projectdevelopers and policy makers can utilize, providedthat they are suitably adapted to local conditions.

First and foremost, governments, NGOs and thedonor community must take a holistic approach toenergy projects of all sizes. The development of ener-gy services is linked with many other sectors: agri-culture and forestry, finance and lending institutions,education and technical training institutions, toname a few of the most obvious. Energy-related pro-jects have a greater likelihood of success if they areimplemented in tandem with other activities in orderto ensure that there is sufficient demand for the ener-gy services to be provided, that there is sufficienttechnical capacity to maintain and improve the ener-gy generation, transmission and distribution infras-tructure over time, and that there appropriatemechanisms in place to ensure that the target popu-lation is fully informed about, and able to pay for, theservices that are being provided.

Secondly, energy project implementation needs to besensitive to the underlying social relations within thetarget population. These factors, which cut acrosslines of gender, ethnicity and class or income level,determine the distribution of power within the com-munity and the household. The distribution of bene-

fits (and costs) from any type of project is going to bedetermined as much by these relations as by thedesign and implementation of the project. While thisdynamic is widely discussed and accounted for inthe literature and documentation published by thedevelopment community, it is often overlooked inenergy-related projects, which tend to give moreweight to technical matters.

Thirdly, current flows of information are inadequate.There are many benefits to be had from sharing les-sons, both successes and failures, within and bet-ween countries. In recent years, the developmentcommunity has placed more emphasis on free-mar-ket approaches to the provision of “essential” servi-ces. While this can lead to improvements in projectperformance and the efficiency with which servicesare delivered, it can also impede the flow of infor-mation. There are few reasons for private firms topublicize their practices – this is especially true inhighly competitive markets. Here the developmentcommunity needs to assume the role of informationclearinghouse and exchange. Further, informationshould be disseminated in a variety of media. Theinternet has been an extremely useful tool in makinginformation available to people throughout theworld, but we still must recognize that access is limi-ted to a small minority of people in the developingworld and that even those who have access may findit difficult to view large reports laden with color gra-phics – like this one. Other forms of information dis-semination like newspaper and radio still reach farmore people in developing countries than the inter-net; project implementers need to take advantage ofthese more accessible forms of media.

Lastly, while the development community largelydiscourages the use of subsidies to provide energyservices, some well-targeted subsidies are justified.Although costs have come down considerably, rene-wable energy technologies will continue to havetrouble competing with conventional (non-renewa-ble) energy technologies. It is unlikely that the priceof fossil fuels will be adjusted to reflect their fullsocial and environmental costs so that subsidies forrenewable energy technologies can help to level theplaying field. Such subsidies need not distort the costof providing energy service to the end-user, ratherthey should be directed upstream at R&D facilities,technical capacity building, information dissemina-tion, consumer education, and the provision of crediton favorable terms.

Financing related to climate change mitigation, likeCDM projects and other funds related to the KyotoProtocol may help in this respect. However, as westated earlier, the majority of CDM projects are unli-kely to be distributed equally among all developingcountries. Rather, they will be directed towards asmall number of developing countries where emis-

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sions reductions are available for the least cost and atthe lowest risk. These projects are unlikely to benefitthose most in need. In order to provide poor com-munities with improved energy services, additionalfunds will still be required.

This is especially true for improved energy servicesderived from biomass. While there is no single ener-gy technology that will solve the problem of energypoverty, biomass-based energy technologies areassociated with an array of benefits, discussed in thispaper, which easily justify the type of financing des-cribed above. Taken together with other forms of

renewable energy technologies – wind, solar, andsmall, low-impact hydro – biomass-based systemscan form part of a secure and sustainable energyinfrastructure. Opportunities exist around the world,in both industrialized and developing countries, tobuild biomass energy industries that also provideincome and the means for local control over naturalresources. This paper explores a number of technical,social, economic and environmental opportunitiesthat the international community and individualnations and communities can adopt and adapt tobuild a clean energy future.

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Case Study 1: Modular Biopower forC o m m u n i t y - s c a l eEnterprise Development( P h i l i p p i n e s )

Art Lilley, Community Power Corporation

Summary

Conversion of underutilized biomass to high qualityheat and power can help the rural poor generateincome and reduce emissions of greenhouse gases.Small modular biopower systems hold great promi-se for community-scale application in countrieshaving large numbers of rural, agricultural commu-nities with access to underutilized biomass resour-ces. A first-of-a-kind small (15kWe)modular biopo-wer system called the BioMax 15, has been develo-ped by Community Power Corporation (CPC) anddemonstrated in the Philippines, where it met theelectrical energy needs of home owners as well as asmall production facility.

Background

For significant income generation activities, or village-wide central power, the rural poor need access to highquality electrical power and thermal energ y. In 1998,CPC performed a market assessment for the USDepartment of Energy that showed that many off - g r i dcommunities have ready access to sustainable quantitiesof biomass residues from either agricultural or fore s ts o u rces, that could potentially be used for biopower. Infact, most of the residues are underutilized, being left torot, and generating significant quantities of methane, asignificant greenhouse gas. It was also shown that therewas a lack of commercially available small biopowerequipment that one could purchase for village powerand productive use applications. Systems that did existw e re too large, were not modular, and did not meetWorld Bank environmental standard s .

Approach

In 1999,with funding support of the US Departmentof Energy, Shell Renewables and the SustainableEnergy Programme, CPC developed a modular bio-power system for community-scale applications inrural, agricultural areas. Based on CPC's prior expe-rience with power systems,

the modular system was designed to be fully auto-mated, mobile, easy to install and relocate, and toproduce high quality AC power. It was intended tobe competitive against diesel power systems andsolar PV/ wind hybrids generating 24-hour power.Unlike solar PV and wind hybrids that require theimportation of equipment, the modular biopowersystem was designed to be manufactured usingcomponents that are available locally in most deve-loping countries. Coconut shells were selected as theinitial biomass resource, because they are an excel-

lent fuel, and plentiful in the Philippines, where thedemonstration project was conducted. Coconutshells have low ash and low moisture, and flow wellwhen crushed into small pieces. The BioMax can alsouse wood pellets.

Besides providing power to a village, a priority objec-tive was to provide power to a productive enterprise.To further this goal, a new NGO, named SustainableRural Enterprise was formed to work with the com-munity cooperative, to develop new coconut-basedp roducts, provide marketing assistance, and developnew productive uses of renewable energ y.

Impacts

The system was installed in the village of Alaminos,Aklan Province, Philippines in April 2001, where itunderwent successful commissioning. In July, thesystem was handed over to CPC's partner ShellRenewable Philippines Corporation, the RenewableEnergy Service Company for the village of Alaminos.

With funding from the Sustainable EnergyProgramme of the Shell Foundation, a small coconutprocessing enterprise was developed in the village,using biopower to make coconut-related productssuch as geotextiles and horticultural plant media.(see figure 2)

Figure 1 15 kWe BioMax power system fueled by locally available coconut shells

Figure 2 Manufacture of geotextiles fromcoconut husk fibre

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About 100 people from the village of Alaminos willbe employed in the manufacture of these products.

Lessons Learned

In 1998, CPC had little understanding of biopowertechnology; however, we understood the villagepower market and the needs of our customers extre-mely well. Armed with this knowledge, we wereable to specify the requirements for a new generationof small modular biopower systems, and secure thetechnical expertise needed to develop the system.CPC benefited greatly from the biopower expertiseof its collaboration partner, Shell Renewables. Shell'sability to specify key operational and environmentalrequirements, as well as design a demanding endu-rance test, resulted in CPC's ability to develop a first-of-a-kind unit that was able to meet all of its fieldoperational objectives. The interest level from thepublic and private sectors in the biopower system issubstantially greater than that for any village powersystems that CPC had been involved in previously.The main reason for this interest is that this system isfocused on poverty alleviation and local wealth crea-tion. The ability to integrate the biopower systemwith an enterprise that generates biomass fuel as awaste stream helps to assure sustainability of the fuelsupply.

While the Biomax has performed well, a number ofimprovements have been identified for incorpora-tion in future generations of equipment – primarilyto make the system easier to operate, easier to main-tain, and lower in cost. Productive use replicationprojects are being sought to implement these impro-vements.

Contacts:

Art LilleyCommunity Power Corporation306 McChain RdFinleyville, PA 15332 USATel 724-348-6386Fax 724-348-8923Email: artsolar@aol.comWeb: www.gocpc.com

Perla ManapolSustainable Rural Enterprise467 N. Roldan St Kalibo, Aklan, PhilippinesTel 63-36-262-4846Fax 63-36-268-4765Email: acdc@kalibo.i-next.netWeb: www.gosre.org

Case Study 2 : Scaling-up BiogasTechnology in Nepal

Bikash Pandey, Winrock International,Kathmandu, Nepal

Summary

Some 80,000 families in Nepal are using methanefrom biogas digesters for cooking, with around aquarter of the users also using it for lighting. Anadditional 24,000 families are expected to purchasedigesters in the coming year. Plant sizes are in therange of 4m3 to 10m3. The most popular size is 6m3and costs US$300. Of this, around $100 comes as sub-sidy support from the Government of Nepal, plusGerman and Dutch bilateral aid. The users themsel-ves supply the rest, in part through bank loans.

Approximately 48 private companies are certified toconstruct biogas digesters. The digesters have highreliability, with almost 98% of them working wellafter three years of operation. Using biogas reducesindoor air pollution, firewood collection, and pressu-res on forests, shortens cooking times and can alsoprovide significant global climate benefits throughlowered emissions of greenhouse gases. In the futu-re, it may be possible to substitute a large part of thegovernment subsidy by selling the greenhouse gasbenefits from biogas plants in the developing globalcarbon market.

Background

The vast majority of rural communities in develo-ping countries will continue to derive the bulk oftheir energy needs from biomass sources for the fore-seeable future. Biogas, largely methane and carbondioxide, is produced by the anaerobic digestion ofanimal waste and other biomass. While the technolo-gy is well understood and widely used, particularlyin South and South East Asia and China, few pro-grams have been able to achieve the rates of use seenin the last decade in Nepal. The technology has beenavailable in Nepal since the mid 1970's, however, itwas not until the early 1990's that the number ofinstallations was substantially scaled up by theBiogas Support Programme (BSP).

Approach

Nepal's Biogas Support Programme can be describedas subsidy-led while at the same time being demand-driven and market-oriented. Subsidies have beenjustified by the difference between the high socialbenefits and the more modest private benefitsaccruing to users. A progressive structure, whichprovides lower subsidy amounts to larger plants, hasencouraged smaller plants that are affordable to poo-rer households.

All participating biogas companies have to be certi-

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Lessons Learned

The Nepal biogas experience gives a very goodexample of how a national program can, through asubsidy mechanism, bring commercial companies tothe table and, with their participation, obtain highquality installations. Free market conditions, particu-larly when regulations are weak and when the cus-tomer does not have full information regarding theproduct, often result in competition between sup-pliers based on price alone, at the expense of productquality. For a program like BSP to succeed, a majorprerequisite is that the national program must beindependent and free from political interference.

A second lesson is that freezing technology to one

approved design makes it easier to control qualitywhile at the same time lowering barriers to marketentry. Although such a strategy may not be suitablefor a fast-changing sector such as solar PV, this hasturned out to be quite effective for biogas.

Contacts:

Sundar Bajgain Programme Manager: Biogas SupportProgrammeJhamsikhel, Lalitpur PO Box 1966 Kathmandu , NEPALTel: +977-1-521742/534035Fax: + 977-1-524755Email: snvbsp@wlink.com.np

fied by BSP and must build plants to one fixeddesign according to approved standards. Qualitycontrol is enforced by carrying out detailed qualitychecks on randomly selected plants. Ratings, from Ato E, are revised each year to encourage companies toimprove their performance. This focus on high qua-lity has increased the confidence in the programamong users, banks, supplier companies and donors.

Despite the availability of subsidies, users themsel-ves must invest a substantial amount in cash andlabor. Companies must thus market themselvesaggressively to generate demand for plants. BSPencouraged the number of participating companiesto grow from a single government-related entity in1991 to 48 separate companies today. The reductionin real prices of installations by 30% in the last tenyears demonstrates that there is fierce market com-petition on the supply side.

Impacts

Biogas plants in Nepal have had positive impacts ona number of fronts. Reduced indoor air pollution has

lowered respiratory infection, particularly amongchildren. Firewood collection time has been reduced,as has the time to cook and clean pots. Women havesaved an average of 3 hours per day on these chores.Houses using the gas for lighting are saving on kero-sene bills. Increased stall-feeding of animals hasmade more organic fertilizer available to farmers,and almost 45% of the owners of biogas plants havealso attached new toilets to them, leading to impro-ved sanitation and hygiene. There is anecdotal evi-dence of regeneration of forests in areas where thereis high penetration of biogas plants, although theexact extent of this has not been documented.

The first attempts are being made to quantify theanticipated climate benefits from biogas plants.Preliminary calculations show that a typical familybiogas plant in Nepal saves between 5 and 10 tons ofcarbon equivalent over its 20-year life, depending onwhether all greenhouse gases are included or onlythose within the Kyoto Protocol. The price per ton ofcarbon would need to be $10 to $20 to cover the sub-sidy presently provided to biogas plants in Nepal.

Figure 1 The production of biogas plants up to the end of July 2001 is presented in the attached graph.

Figure 1

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Case Study 3: Commercial Production ofCharcoal Briquettes from Waste (Kenya)

Elsen Karstad and Matthew Owen, Chardust Ltd.,Nairobi, Kenya

Summary

Soaring prices of lumpwood charcoal and regionaldeforestation associated with traditional charcoalproduction prompted Chardust Ltd. of Nairobi,Kenya to investigate the production of charcoal sub-stitutes from waste biomass. Chardust's leading pro-duct is made from waste products salvaged fromcharcoal wholesaling sites in Nairobi. In less than ayear, sales of the company's "Vendors' WasteBriquettes" have gone from a few bags a week toover 7 tons per day, displacing an equivalent amountof lumpwood charcoal and effectively sparing over80 tons of indigenous wood per day. The briquettedfuel is cheaper than regular charcoal and burns formuch longer. Chardust's customer base is broad,including institutions such as hotels, lodges andschools as well as farmers (for space heating) anddomestic consumers.

Chardust is also exploring the use of agro-industrialwastes to produce additional types of charcoal bri-quettes. A recent feasibility study concluded thatsawdust, bagasse and coffee husk have practical andcommercial potential as raw materials for premiumcharcoal products.

Briquetting projects in Africa have a poor trackrecord due to an over-emphasis on processing tech-nology or environmental conservation at the expen-se of market factors. Chardust came to the problemfrom a new perspective, focusing directly on pricingand performance to under-cut lumpwood charcoalwith cheaper and better-performing products.

Background

Over 500,000 tons of charcoal are consumed in Kenyaevery year, with a retail value in excess of US$40million. The charcoal trade is a major contributor toenvironmental degradation, operates largely outsidethe law and pays no taxes. Demand for charcoal isexpected to increase at over 4% per annum for theforeseeable future in East Africa, leading to an inten-sification of the ongoing process of environmentaldestruction. For every ton of charcoal consumed, atleast 10 tons of standing wood are being felled.Charcoal quality is in decline as the quality of availa-ble raw material declines.

Government efforts at substitution with kerosene orliquid propane gas have proven financially unwor-kable. Such fossil fuel alternatives in any case havetheir own drawbacks associated with unsustainabili-ty and foreign exchange dependency. Initiatives tobring charcoal producers and traders under systemsof formal management have fallen foul of corruptionand influential charcoal 'mafias'. On the productionside, improved kiln technologies that could increasewood-charcoal conversion efficiencies have not beenadopted due to the quasi-legal and mobile nature ofproducers who would rather maintain a low profilethan install more efficient fixed equipment.

The promotion of fuel-saving stoves is an area wherepositive impacts have been realized on overall effi-ciency in the sector, but with adoption of such stovesby consumers now virtually ubiquitous, little thatcan be done to further improve efficiencies at thepoint of use. In short, many of the means by whichcharcoal demand might be reduced, efficienciesimproved or substitution encouraged have beentried. They have either failed or have reached theapparent limit of their potential.

Chardust's Approach: Commercial Competition

One opportunity for reducing charcoal demand thathas not yet been systematically investigated inKenya is direct substitution - not with fossil fuels butwith nearly identical affordable and environmental-ly acceptable alternatives that can be produced in-country. Chardust is an alternative energies compa-ny that has grasped this opportunity.Chardust pursues two parallel approaches. The firstis to salvage wastes from charcoal wholesalers in thecity of Nairobi and use this to fabricate fuel briquet-tes. The waste is typically 30 years old or more butremains undegraded and is readily salvaged at cen-

Aerial photo showing the impact ofcharcoal production in Mt. Kenyaforest

Figure 3

Figure 2

38

tralized sites. Chardust uses locally-made machineryto produce cylindrical briquettes 3.2 cm in diameterand 5 cm. in length. These briquettes produce nosmoke, sparks or smell when burned. They have ahigher ash content than lumpwood charcoal andhence an extended burn. Chardust prices its Vendors'Waste Briquettes (VWB) 30% below regular charcoalin Nairobi and currently sells in excess of 7 tons perday. The operation has also created employment for23 semi-skilled workers.

Chardust's second focus is on waste recovery in the agricultural, agro-processing and timber industries.Large amounts of biomass go to waste in this sectorbut could be converted to charcoal briquettes at anaffordable price. Market research and initial produc-tion trials on a range of agro-industrial by-productsindicate that an injection of lumpwood charcoal sub-stitutes into the urban Kenyan marketplace is cur-rently viable. Chardust has looked into more than 20different wastes in Kenya and concluded that saw-dust, bagasse and coffee husks may have commercialpotential due to their bulk availability at centralizedlocations, few (if any) alternative uses and conduci-veness to carbonization and conversion to charcoalbriquettes. In conjunction with sawmills, sugar facto-ries and coffee mills, Chardust now intends to pro-duce a range of premium low-ash charcoal productsto complement its Vendor's Waste Briquettes.

Lessons Learned

With the rapidly rising price of lumpwood charcoalin Kenya's urban centers, Chardust saw that therewas a market opportunity to be exploited if it couldoffer cheaper or better-performing substitutes. Thisapproach is what distinguishes Chardust's operationfrom that of previous briquetting ventures in Africa,which typically set out to provide technology-drivenincome-generating opportunities for communitygroups, salvage urban waste, protect the environ-ment or simply test a recently developed piece ofmachinery. These top-down approaches tend to beunsustainable as they are not always based on soundcommercial sense. Chardust has built its businessaround market niches that value price and perfor-mance. The company's research and developmentefforts, which respond directly to market forces, haveprompted the invention of customized screw extru-ders, a particulate biomass carbonization system andseveral types of domestic and institutional waterheaters.

Partnership Potentials

Chardust Ltd. is prepared to enter into partnershipwith suitable businesses or organizations that havesimilar interests. The company currently re-investsall profits into expansion, so research and develop-ment progress is slow (but steady) and governed byavailable funds. Chardust is currently poised to com-mercially prove its waste-conversion technology atmuch larger scales and, by doing so, make a trulysignificant impact within East Africa.

An extruder in operation at Chardust'splant

Waste bagasse at a Kenyan sugar factory

Figure 4

39

Contacts:Elsen Karstad or Matthew OwenChardust Ltd.P.O. Box 24371Nairobi, KENYATel: +254 2 884436/7Email: briquettes:@chardust.comWeb: www.chardust.com

Case Study 4: Ethanol in Brazil

Robert Bailis, Energy and Resources Group,University of California, Berkeley, USA

Summary:

Brazil launched its ethanol program, ProAlcool, inthe mid 1970's partially in response to the first oil cri-sis, but also in an attempt to stabilize sugar prices inthe face of a volatile international market. Since itsinception, Brazil's production of sugarcane hasexpanded five-fold to over 300 million tons duringthe 1998/9 growing season (UNDP et al., 2000).Roughly 65 per cent of this cane is dedicated to theproduction of ethanol. The industry currently produ-ces nearly 14 billion liters of ethanol per year, whichis used either as a blending agent and octane enhan-cer in gasoline in a 22:78 mixture called gasohol, or inneat, ethanol-only, engines. In total, ethanol displa-ces roughly 50 per cent of the total demand for gaso-

line in the country, equivalent to 220,000 barrels perday of gasoline (making Brazil the largest producerand consumer of alternate transportation fuels in theworld), and off-setting as much as 13 million tons ofcarbon emissions while employing hundreds ofthousands of people and stimulating the rural eco-nomy.

Despite the impressive figures, Brazil's ethanol pro-gram is not entirely environmentally benign.Moreover, the future of the ethanol program is by nomeans clear. It faces considerable uncertainty for acombination of reasons, including the lack of a cohe-rent national energy policy, high sugar prices in theinternational market favoring sugar production forexport over domestic ethanol production, and, ofcourse, lack of incentives to invest in ethanol pro-duction as a result of low international oil prices anda failure to fully account for the costs of oil produc-tion and consumption.

Background

Brazil began producing ethanol and blending it withgasoline nearly a century ago, but it wasn't until the1930s that it was mixed in all petrol by federal dec-ree. As a fuel, ethanol can be used in two ways. It canbe mixed with gasoline in concentrations that typi-cally range from 10-25 per cent; ethanol that is mixedin this way must be anhydrous, i.e. all of the water isremoved, which requires a double distillation pro-cess yielding 99.6 per cent pure ethyl alcohol (0.4 percent water by volume). The second way that ethanolcan be used as a fuel is without mixing. So-calledneat engines may be used with hydrated ethanol(approximately 4.5 per cent water by volume), whichis obtained through a single distillation process.

At the height of Brazil's "ethanolization", in the mid1980's, 95 per cent of new light vehicle sales wereneat ethanol-only automobiles. Sales of ethanol-onlyvehicles soon declined, partly because of sustainedlow petroleum prices and increasing world sugarprices, which encouraged sugar production ratherthan ethanol production. Neat vehicle sales fell toonly 1 per cent of total new vehicle sales by 1996, butethanol consumption has continued a slow increasebecause of booming sales in conventional cars, whichstill use a 22 per cent ethanol blend. See Figure 1.

Dried coffee husks (right) and carboni-zed coffee husk briquettes (left) produ-ced by Chardust Inc. during a feasibilitystudy of multiple waste-based resour-ces.

Figure 1

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Approach

The first decade of the program was characterized bystrong government intervention. Initially theBrazilian government used existing sugar mills toproduce anhydrous ethanol, eventually moving intoautonomous distilleries, which produced hydrousethanol. To ensure the program's success, a deal wasstruck between the government and domestic auto-mobile industry to develop and market vehicles withthe proper engine modifications so that the ethanolcould be used. This met some resistance from manu-facturers, but the government assisted with R&Dsupport.

Scaling up sugarcane production was eventuallyguaranteed because the government secured a com-mitment from Petrobrás, the state-owned oil compa-ny, to purchase a fixed amount of ethanol to blendwith their petrol. To meet the projected demand forethanol, the state offered nearly US$2 billion in lowinterest loans and initially established a cross-subsi-dy with petrol so that they could sell ethanol at only59 per cent of the pump-price of the gasoline, whichwas set by the government.

This scaling up took place without conflict over landuse. Cultivation of sugarcane occurs principally inthe south-east and northeast parts of the country. Thetotal area occupied by sugarcane cultivation is about7.5 per cent of all cultivated land in Brazil, or 0.4 percent of Brazil's total land area. This is smaller thanthe land devoted to any one of the major food crops:maize, soybeans, beans, or rice. Despite providinghalf of the national transportation fuel requirementsthere has been no significant conflict between etha-nol cane, food, or export crops (Moreira andGoldemberg, 1999). One reason for this is thataggressive R&D in both cultivation and processinghave led to rapid gains in productivity that havebeen sustained at over 4 per cent per year since theinception of the project, so that ethanol productivityeffectively doubled in twenty years from approxima-tely 2600 liters per cultivated hectare of sugarcane in1977 to 5100 liters per hectare in 1996. In addition, inroughly the same period of time, the cost of produ-cing a unit volume of ethanol dropped by more thanhalf. Figure 2 shows the experience curve for Brazil'sethanol industry.

* All gasoline is blended with

anhydrous cthanol in varyingproportions, usually 22%From Moreira and Goldemberg,

1999

1800

1600

1400

1200

1000

800

600

400

200

0 0

5

10

15

20

25

30

35

40

45Ethanol cars

Gasoline cars*

Gasoline prices (US$/bbl)

Sales of automobiles in Brazil from 1975 to 1996

Figure 2

41

Despite the cost reductions, which extended into the1990's, Brazilian ethanol was not able to competedirectly with gasoline. To support the industry, thegovernment continued the cross-subsidy, taxinggasoline. This policy ensured that ethanol producerswere paid enough to cover their costs per liter ofproduction and consumers were able to purchaseethanol at 80 to 85 per cent of the pump-price ofpetrol.

Since the late 1990s there has been a global shift inattitudes toward market-distorting policies, and thishas played itself out in the Brazilian ethanol programas well. In some locations, specifically the southeastof Brazil, where the majority of the nation's ethanol isproduced, subsidies were reduced, then in 1999removed altogether (UNDP et al., 2000). The long-term effects of this remain to be seen. The decrease inthe number of neat ethanol vehicles has not led to adecrease in ethanol consumption because there hasbeen rapid growth of vehicles using gasohol and insome locations the fraction of ethanol is as high as 26per cent (UNDP et al., 2000). Figure 1 shows thegrowth and decline in sales of neat ethanol vehicles.It also shows the price of gasoline on the internatio-nal market for the same time period. Note that theturning point marking the decline in neat ethanolvehicle sales lags slightly behind the global declinein petroleum prices.

Impacts

The Brazilian ethanol program has passed its 25thyear, and there are simply too many impacts to list in

a brief case study. Below are some of the more dra-matic impacts relating to employment, the environ-ment, and fossil-fuel avoided which were three areasthat the national government was most concernedabout in initiating the program.

Jobs. The entire sugarcane sector directly employsbetween 0.8 and 1.0 million people. This is the largestnumber in the agro-industry sector in terms of for-mal jobs, with 95 per cent of workers legallyemployed, and a minimum wage 30 per cent greaterthan the national minimum wage. Ethanol produc-tion also has a relatively low index of seasonal work,contributing to stable employment in sugarcane gro-wing areas (Moreira and Goldemberg, 1999). Theethanol industry also has relatively low investmentrates per job created: between US$12,000 and$22,000, compared with US$220,000 in the oil sector,US$91,000 in the automobile industry andUS$419,400 in the metallurgical industry (Rosillo-Calle and Cortez, 1998).

E n v i ronment. One of the principal negative impacts ofl a rge-scale ethanol production is the disposal of stilla-ge, a liquid by-product of the fermentation pro c e s s .This is a major environmental problem because of itsl a rge pollution potential. Air pollution is another envi-ronmental issue. Cane harvesting is often preceded byin-field burning of cane leaves and tops, which facili-tates the harvest and helps manual harvesters to avoidinjuries. This occurs in both ethanol and sugar pro-duction. The smoke can have direct health effects onexposed populations and most certainly results in

Cumulative Production (10 m )38

Cost Evolution of Ethanol in Brazil

200

2010 100 1000

19961990

1989

1988

1987

198519821981

from Moreira and Goldemberg, 1999

42

g reenhouse gas emissions. Though it is not common,t h e re has been re s e a rch into harvesting tops and lea-ves of cane for energy production (Beeharry, 2001)which would incur additional harvesting costs butwould likely yield a net gain in energy pro d u c t i o n ,and potentially create additional employment. Byreducing consumption of gasoline, the ethanol pro-gram has reduced air pollution by cars. Pollutantssuch as carbon monoxide and hydrocarbons are re d u-ced by about 20 per cent compared with gasoline.

Fossil fuel use avoided (and greenhouse re d u c t i o n s ) .Ethanol accounts for half of the light-vehicle fuelconsumption in Brazil. Since its inception, the ethanolp rogram has displaced the consumption of over 140million cubic meters of gasoline and saved the coun-try nearly US$40 billion in hard currency that wouldhave been spent on importing the fuel. Use of sugar-cane ethanol also mitigates global warming. Whenone crop is converted to alcohol and burned, the car-bon released is sequestered in the subsequent cro p .T h e re are small emissions of greenhouse gases in thep roduction process, which uses a fossil fuels for farmm a c h i n e r y, but bagasse provides nearly all of there q u i red thermal, mechanical, and electrical energ yneeded for production. The production and use of 1liter of ethanol to replace an energ y - e q u i v a l e n tamount of gasoline avoids the emission of about a halfa kilogram of carbon dioxide, which is a 90% re d u c-tion over gasoline (Rosillo-Calle and Cortez, 1998). Intotal, ethanol yields a net savings in carbon dioxideemissions of about 13 Mt carbon per year, corre s p o n-ding to about 20 per cent of the carbon dioxide emis-sions from fossil fuels in Brazil (UNDP et al., 2000).

Lessons Learned

“The ProAlcool has gone from a highly innovativeperiod to almost technical stagnation. The highgovernmental intervention of the early years hasbeen replaced by a more conservative attitudetowards subsidies and by a lack of clear directionwith regard to energy policy” (Rosillo-Calle andCortez, 1998, p. 124). The same authors contend thatthe positive environmental aspects of ProAlcool faroutweigh its potential damage.

An economic analysis would indicate benefits aswell. Consumers pay roughly US$2 billion per yearon the cross-subsidy while annual saving for thecountry in avoided imports is nearly US$5 billion(Moreira and Goldemberg, 1999). We have seen thattargeted subsidies and support for R&D yieldedhuge gains in productivity and substantial costreductions. In addition, setbacks arose and continueto persist because of the low price of petroleum,which is due in part to the failure to fully account forthe environmental and social costs of its productionand use. Nevertheless, the project has been able to

bring about substantial financial savings, pollutionreduction and avoided carbon emissions, while crea-ting jobs and stimulating the rural economy. Futuretrends toward greater mechanization will bringabout further cost reductions and possibly higherproductivity, however this must be balanced withthe social costs in terms of lost employment.

References

Beeharry, R. P. (2001). "Strategies for AugmentingSugarcane Biomass Availability for PowerProduction in Mauritius." Biomass and Bioenergy 20:421-429.

Moreira and Goldemberg, (1999) "The alcohol pro-gram", Energy Policy, 27: 229-245.

Rosillo-Calle and Cortez, (1998) "Towards PROAL-COOL II - A Review of the Brazilian

Bioethanol Programme", Biomass and Bioenergy, 14(2): 115-124.

UNDP, UN DESAand World Energy Council, (2000),World Energy Assessment: Energy and theChallenge of Sustainability. New York, UNDP.

Contact:

Robert Bailis Energy and Resources GroupUniversity of CaliforniaBerkeley, CA94720-3050, USAEmail: rbailis@socrates.berkeley.edu

Case Study 5: Carbon from UrbanWoodfuels in the West African Sahel

Jesse Ribot, Institutions and Governance Program,World Resources Institute

Summary:

This program has two distinct objectives: 1) influen-cing policy to improve forest management of urbanwoodfuel use and improve rural and urban well-being; and 2) supporting the emergence of a newgeneration of policy researchers and analysts andinstitutions focused on environmental governanceissues. The four-phase program is to be executedover a two to three year period.

The charcoal market is most important in Senegalwhere we propose to base the program. Ideally,however, we would also conduct comparativeresearch of this nature in other countries in theregion (The Gambia, Mali and Burkina Faso) wheresimilar issues are emerging as urban woodfueldemand grows.

43

Background:

Wood is still, by far, the main source of urban andrural household fuel in Africa. As African cities growthrough births and in-migration, the demand forcommercially harvested woodfuels grows even fas-ter. Wood use also increases disproportionatelybecause urban dwellers consume charcoal producedinefficiently from wood, while the rural populationcooks directly over firewood.

Urban woodfuel prices have risen due to greatercompetition, greater transport distances andtransport oligopolies - reducing urban disposableincome and increasing insecurity as fuel shortagesbecome more frequent. Growing urban woodfueldemand is also affecting surrounding forests, withbroad implications for the rural environment, econo-my and livelihoods. Woodfuel use also accounts for10 to 30 per cent of energy based carbon emissions inthe Sahel, 20 to 40 per cent coming from urban areas.

Regulation of urban woodfuel production has beenthe single most-important function of forestrydepartments in the Sahel since at least 1916.Although efficiency gains from improved cook sto-ves (designs taken from Kenya) have been largelyrealized, wood demand is still growing faster thanpopulations. Substitution has been complicated bythe high up-front costs of new equipment, culturalpreferences for charcoal, and intermittent shortagesof substitutes due to foreign exchange constraints.Projects and legal reforms have been targeted atreducing and better managing the harvest.

Substitution with petroleum fuels increases carboncontributions. This has had little effect, however, dueto the slow rates of substitution. Sustainable harves-ting of wood, however, should sequester as muchcarbon as is released. But, there is still little unders-tanding of the balance between patterns of wood cut-ting and regeneration.

Wood-harvesting patterns throughout the region arenow changing due to broadening rural access tourban markets. As more local communities becomeengaged in wood-cutting, they use less intensiveproduction methods than commercial merchants.Further, community-based production regulationsalso require more measures to ensure regeneration.This new pattern is increasing the potential for rege-neration and for sustainable harvest in ways thatappear to reduce the urban woodfuel trade's net car-bon contribution to the atmosphere. But, older moreintensive techniques continue to dominate due tourban demand pressures and powerful transport oli-gopolies. Fear of urban discontent over rising priceshas led politicians to pressure forest services to conti-nue business-as-usual centralized forms of woodfuel

harvesting and transport. This project aims to findsolutions to this rural-urban tension.

Approach:

Phase I, Constituting the Research Team, involvesidentifying a research institution and policy resear-chers. Three or four candidates will be selectedthrough a rigorous review process. These researcherswill then constitute a team under the direct guidanceof a senior policy analyst and the WRI contact per-son. This period will also be used to set up a nationalpolicy advisory group to provide additional guidan-ce for the program.

Phase II, Assessment, will first involve an analysis ofa full range of policies (from constitutional framing,electoral laws, tax codes, and justice codes to forestrycodes). This will be followed by grounded fieldresearch on Senegal's charcoal commodity chain, fol-lowing the structure of regulation, the market andmarket relations from the forest villages where woodis cut and converted to charcoal by surga, to the'Diallo kerñ' vendors points in Dakar and one secon-dary city. The analysis will be aimed at understan-ding the way the commodity chain functions and theeffects of the existing policy framework on produc-tion, transport, exchange and final sale. This researchwill explore the rural and urban price effects of cur-rent policy structures as well as the spatial distribu-tion of production-with its ecological and socialimplications. The analysis will include an assessmentof the effects of charcoal production and marketingon forest cover change and on carbon emissions. Thefinal product of such the assessment phase will be athorough mapping of the relations between currentpolicy and the dynamics of production and marke-ting.

Phase III, Policy Analysis, involves preparation foroutreach and advocacy. This period will be used toanalyze the data collected, identify opportunities forchange and intervention, formulate policy recom-mendations and strategies, and discuss policy ideaswith policy makers, organizations and individualsinterested in the range of issues – from environmen-tal management to social justice – that this programaims to influence. In the policy analysis phase, theresearchers will analyze how policies and marketrelations shape ecological, economic and social out-comes. From the analysis, a number of alternativepolicies – ranging from minimum environmentalstandards approaches to deregulation and changesin decentralization or fiscal policy – will be conside-red.

Phase IV, Outreach and Advocacy, will be used toorganize a series of national policy dialogues. Thesedialogues can range from open meetings with all sta-

44

keholders to smaller seminars in which findings andpolicy recommendations are discussed with particu-lar interest groups such as the charcoal magnates, thenational forest 'exploiters' union, some maraboutswho have interests in the charcoal trade, the forestservice, the ministry for environment, the Institutefor Environmental Science at the University, associa-tions of forest villagers, particular villages within thecharcoal production regions, and members of thenational assembly. This phase will also involve follo-wing up on any bills being drafted that have impli-cations for the market and encouraging legislators topropose changes where necessary.

Contact:

Jesse RibotInstitutions and Governance ProgramWorld Resources InstituteEmail: JesseR@WRI.org

Case Study 6: Sustainable Fuelwood Usethrough Efficient Cookstoves in RuralMexico

Omar Masera and Rodolfo Díaz,

Instituto de Ecología, UNAM and GrupoInterdisciplinario de Tecnología Rural Apropiada(GIRA A.C.), Patzcuaro, Mexico

Summary

Efficient wood-based cookstoves are being dissemi-nated in the Patzcuaro Region of rural Mexico. Thestoves are part of an integrated program that exploitsthe synergies between health, environmental andenergy benefits. It builds on the local knowledge ofindigenous women and community organizations,to provide better living conditions at the householdlevel and improved management of forest resources.The program also provides a link between researchinstitutions, NGOs and local communities in a cycleof technology implementation and innovation.

Currently more than 1,000 Lorena-type stoves havebeen disseminated within the region. A subsidyworth US$10 is provided to users in the form of tubesfor the chimney and part of the construction mate-rials. Users provide their own labor as well as therest of materials. Total stove costs are estimated atUS$15. Scaling-up has been initiated, as local muni-cipalities are now providing funds to enlarge theprogram. In addition to substantial benefits to theusers from reduced indoor air pollution and reduc-tion in firewood collection and cooking times, andbenefits to the local environment through reducedpressure on forests, efficient cookstoves can also pro-vide significant global climate benefits throughlowered carbon dioxide emissions.

Background

Approximately three quarters of total wood use inMexico is devoted to fuel wood (Masera, 1996).Currently, 27.5 million people cook with fuel woodin the country (Díaz-Jiménez, 2000). Despite increa-sed access to LPG in the last decades, Mexican ruraland peri-urban inhabitants continue to rely on fuelwood, in a pattern of "multiple-fuel cooking".

The Patzcuaro Region case study illustrates a newgeneration of wood-based efficient cookstove disse-mination programs that have been launched in diffe-rent parts of the world with high success rates. Keyto their success is a shift from narrow technology-centered approaches to more integrated approaches,centered on understanding local women's prioritiesand providing capacity building as well as multiplehealth, environmental, and financial benefits.Efficient cookstoves have been shown to providereductions of more than 30% in indoor air pollution,a cleaner cooking environment, reductions of 30% infuel wood consumption and a similar reduction infuel wood gathering time or fuel purchases.

Approach

The Sustainable Fuelwood-Use Program in thePatzcuaro Region is based on an integrated and par-ticipatory strategy that tries to find synergies bet-ween environmental and local socio-economic bene-fits. It draws on local indigenous knowledge and tra-ditions, and seeks to strengthen the abilities andcapabilities of local women. To do so, socio-economicand environmental problems associated with fuelwood use are first identified and possible solutionsdeveloped by local women themselves. The programwas initiated 15 years ago as a collaborative effortbetween the National University of Mexico(UNAM)-two local NGOs (GIRA and ORCA) andlocal communities.

Stoves are disseminated in village clusters. Withineach village, women are trained by local promotersthrough two workshops, where the linkages betweenfuel wood use, health and the environment areemphasized. Users actively participate in their ownstove construction and they also help in the cons-truction of other stoves within the village. A strictstove monitoring program provides user feedbackand assures the acceptance and adequate performan-ce of the stoves already built. A subsidy policy, in theform of the stove chimney, and specific buildingmaterials, implemented three years ago, has beeninstrumental in increasing the adoption of cooksto-ves substantially. The subsidy is justified to make upfor the difference between higher social benefits (pre-vention of forest degradation, and reduction in emis-sions of greenhouse gases) and lower private bene-fits (reduction in expenditure for fuel wood, savingscooking time, cleaning, and firewood collection, and

Figure 1

reduction in respiratory illnesses) accruing to users.The user-centered approach has resulted in dramaticprogram benefits: stove adoption rates are above85%; stove construction time has decreased from 2weeks to 4 hours, and stove duration is 4.8 years, onaverage.

Impacts

The program has had positive socio-economic andenvironmental impacts. Measured fuel woodconsumption and indoor air pollution reductionsreach more than 30% in comparison to traditionaldevices. Firewood collection time has been reduced,as has the time to cook and clean pots.

Participating women and their families are increa-singly involved in forest restoration and manage-ment programs within their own villages. The fores-try options promoted by the NGOs, range from thepromotion of agroforestry systems in private landsto the support of common property forest manage-ment, and are proving effective to increase the sus-tainability of fuel wood resources.

These small impacts have led to a multiplier effect,both within the region and at the national level.Locally, the region's municipalities have started tofund the program using the same subsidy incentiveand one hundred people, mostly women, have beentrained in stove construction and dissemination. Inseveral villages, demand for stoves now surpassesthe program's current supply possibilities. One hun-dred promoters from all over Mexico have been trai-ned by the program, and at least three other regionshave started similar programs.

Carbon benefits from the use of stoves have beenpreliminary estimated at 0.5 tC per stove-year fromfuel wood savings, which, for the average duration

of the stove means 2.4 tC/stove. Thus, a price of$6.3/tC would cover the present subsidy providedto stoves.

Lessons Learned

The Sustainable Fuelwood Use Program in RuralMexico shows how a user-based and integratedapproach for efficient cook stove dissemination canresult in substantial environmental and socioecono-mic benefits. Actively involving local women andrelying on their own priorities and traditional kno-wledge has proven essential for stove adoption. Alsoessential has been adopting a flexible stove design,based on basic principles and critical dimensions,rather than on a fixed design. The active collabora-tion between research institutions-local NGO's andusers has provided a nurturing field for technologyinnovation and adaptation. The small in-kind subsi-dy is essential to get users initially involved in theprogram, and to speed the dissemination process.Linking fuel wood demand with environmentalissues has been important to get users more awareand actively involved in programs to increase thesustainability of fuel wood resources. Governmentinvolvement, through this clear and transparentfinancial support and through a decentralizedapproach, is essential for project success.

References

Masera, O and J. Navia (1997). Fuel switching ormultiple cooking fuels? Understanding inter-fuelsubstitution patterns in rural Mexican households,Biomass and Bioenergy, (12):5,347-361.

Masera, O.R., B.D. Saatkamp y D.M. Kammen 2000."From Linear Fuel Switching to Multiple CookingStrategies: A Critique and Alternative to the EnergyLadder Model for Rural Households". WorldDevelopment 28: 12, pp. 2083-2103.

Contact

45

Figure 2

Efficient Lorena-type cookstove shownduring tortilla-making. User adapta-tions are almost the rule; in these case acover has been added to the stove toincrease durability and cleanliness.

Stove promoter and users chat over anefficient cookstove during tortilla-making.

46

Rodolfo Díaz

Program Manager-GIRA AC: Sustainable Use ofBiomass Resources

P.O. BOX 152, Patzcuaro 61609Michoacan, MEXICOTel and FAX: (52)- 434- 23216Email: rdiaz@oikos.unam.mx

CASE STUDY 7 : USE OF ENHANCEDBOILERS IN THE HAMMAMS INMOROCCO

Dr. Abdelahanine Benallou, Center for theDevelopment of Renewable Energies and

Dr. Abdelmourhit Lahbabi, Director General ADSMorocco

Summary

The hammams or public baths belong to the tradi-tions of Morocco. They constitute, within the low-income strata of the Moroccan society, and especiallyamong women, privileged places for meetings, dis-cussion and exchange of news. There are no less thanfive thousand hammams in Morocco, mainly withinthe low-income neighborhoods of the urban centers.Almost all these hammams use wood residues andfirewood for the production of hot water.

The consumption of firewood and wood residues bythe hammams is estimated at 700,000 tons per year,which represents 3% of the national consumption inconventional energy. The combustion of wood isdone in fire rooms using rudimentary and inefficientboilers. Pilot installations of enhanced boilers haveenabled firewood savings of 40% to 50% comparedwith the consumption of a model traditional boiler.The current project consists of generalizing the use ofthe enhanced boilers tested during the pilot phase toall the hammams of the Kingdom.

Background

The consumption of firewood in Morocco represents53% of the consumption of biomass; it is estimated at12 millions tons, 30% of the total energy consump-tion in Morocco. A comparison between the actualconsumption of firewood from the forest and pro-duction capacity shows that extractions within theforests represent about 4 times their productioncapacity, resulting in annual deforestation correspon-ding to 30,000 hectares. This deficit results in an ove-rexploitation of the forest and compromises its sus-tainability, with all the resulting negative consequen-ces from the environmental standpoint, in particularweakening of its carbon dioxide sequestering power.

In the cities, it is the hammams and the ovens for

bread which are the highest firewood consumers.According to the associations of hammam ownersand the studies carried out by the Center forRenewable Energies (CDER), no less than 5,000 ham-mams distributed over the different urban centers ofMorocco consume more 700,000 tons per year of fire-wood and wood residues.

The low thermal yield of the equipment used forwater heating results in considerable waste. Severalexperiments conducted by the CDER have shownthat enhanced boilers enable wood savings some-where between 40 and 50% over the typical traditio-nal system.

Approach

A pilot project was initiated by the Center forDevelopment of the Renewable Energies and theGerman cooperation agency (GTZ) in collaborationwith the Association of Owners of Hammams ofMarrakech (APHM). This first pilot phase led to thedevelopment of an enhanced boiler adapted to thespecific operating conditions of the hammams, tes-ting of the boiler in some fifteen hammams. Thesavings achieved were evaluated by monitoring thethermal performance of the pilot hammams beforeand after the installation of the new boilers. The ave-rage thermal yield has gone from 28% to more than70%.

In order to control the quality of the facilities, reducethe costs and facilitate the manufacturing of the newboilers, a model design plan has been drawn up bythe CDER and the GTZ and supplied to the localworkshops manufacturing the tanks. Training hasbeen given to local welders regarding the manufac-turing and maintenance of the new boilers.Awareness campaigns aimed at the hammamowners and the dissemination of the new boilershave been managed by the APHM.

The CDER plans to expand the use of these boilers tothe whole country by equipping the 5,000 hammamsin the Kingdom. The large-scale dissemination ofthese enhanced boilers will be the subject of anagreement between the National Federation ofOwners and Operators of Hammams (FNPEH) andthe CDER. An appropriate financial package to faci-litate the purchase of the new equipment by theowners is under study.

Expected outcomes

Extrapolation of the results of the pilot phase to the5,000 hammams in the Kingdom leads to an estima-ted savings - at 50% of the current consumption ofthe hammams - of 350,000 tons per year of fire w o o dand of wood residues (see table). With 70% of thewood consumption of the hammams coming dire c t-ly from the forest and an average quantity of bio-

mass on foot estimated at 23 tons of firewood perh e c t a re of forest, the program will contribute to asavings of about 10,000 hectares from clearing,which represents one third of the current loss of

Moroccan forest.

By reducing firewood consumption, the programwill reduce air pollution (particulate, carbon mono-

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HEADING Model Hammam Hammam with enhanced boiler

Thermal yield 28% to 42% 78%

Average consumption 140 tons/year 70 tons per year

Savings 50%

Cost of the boiler 2,000 $ 4,500$

Time of return on investment

for the change of boiler 8 months

xide, nitrous oxides and sulphur dioxide and green-house gas emissions. At the end of the conversion ofall the hammams, the reduction will reach 600,000tons of carbon dioxide emission per year.

Despite the excellent economic profitability of theboiler change projects, the owners and the operatorsremain reluctant to engage in transformation workand in the installation of new boilers. The pilot phasehighlighted the need to adopt a global approach,including within the same program the followingimportant aspects:

The involvement of the National Federation and ofthe local associations of hammam owners and opera-tors in all the phases of the program (design of theboilers, awareness campaigns with the owners, trai-ning, etc.).

The establishment of a financial package based on asoft loan and a subsidy (limited to the starting phaseof the project) to encourage the owners to purchasethe new boilers.

The launch, in collaboration with the FNPEH, of alarge-scale campaign to sensitize and inform theowners.

The training and supervision of the manufacturersand installers.

Contacts

Dr. Abdelahanine BenallouDirector General of the Center for theDevelopment of Renewable EnergiesB.P. 509 Rue El Machaar El Haram-IssilMarrakech, MoroccoPhone 212-44-309814 or 212-44-309822Fax.: 212-44-309795

e-mail: dgcder@iam.net.maweb: http://www.cder.org.maDr. Abdelmourhit LahbabiDirector General ADS Morocco4 Av. Bin Al Widane N°6Agdal, Rabat, MoroccoPhone : 212-37-681011 or 212-37-681012Fax : 212-37-681013e-mail : adsmaroc@iam.net.ma

CASE STUDY 8 : IMPROVEMENT OFCOOKING EQUIPMENT UTILIZED INTHE MOROCCAN COUNTRYSIDE

Dr. Abdelahanine Benallou, Center for theDevelopment of Renewable Energies and

Dr. Abdelmourhit Lahbabi, ADS Morocco

Summary

Although the use of wood for cooking purposes inthe countryside is the main cause of deforestation(about 90% of the energy needs of the rural popula-tion, resulting in a deforestation of more than 30,000hectares per year), the equipment used for cookingfood (traditional fire rooms) and for baking of bread(traditional ovens) remain of a rudimentary design.

In order to alleviate pressures on the forest resultingfrom a non-rational exploitation of wood, and toreduce the consumption of firewood within ruralhouseholds, the Center for the Development ofRenewable Energies (CDER) has launched a pilotproject for dissemination of enhanced fire rooms andovens. Different models of enhanced fire rooms andovens have been developed and are being dissemi-nated in different regions of the country with thesupport and close collaboration of local organiza-tions. The prototypes of fire rooms developed underthis project are robust, movable, and enable a woodsavings of 30 to 40% compared with the traditionalfire rooms. (This percentage varies, depending on the

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operating mode of the enhanced fire room and of thedesign of the traditional fire room used before). TheCDER is also currently developing, in collaborationwith an NGO from Marrakech, a prototype of solaroven whose first launch is scheduled in 2002.

Approach

According to a survey made by the CDER, it hasbeen observed that the correct use of enhanced firerooms contributes to a significant reduction in thedemand for firewood by the households, and conse-quently to a certain alleviation of the chores ofwomen and young girls in the countryside. Theseenhanced fire rooms have been widely welcome byhousewives, and all the households surveyed aresatisfied with the use of these types of fire rooms.The impact of the use of enhanced fire rooms on thereduction of the demand in energy wood of the ruralpopulations can only be maximized by a massivedissemination of this equipment nationwide. To thatend, several promotion and outreach activities havebeen carried out, including demonstration projects invillages, and training and supervision of the manu-facturers of enhanced fire rooms and of facilitatorsfor the adoption and use of these technologies. Theseactions have been undertaken in collaboration withlocal associations. The following development pro-jects have been carried out:

Dissemination of the enhanced fire rooms andovens in the Zat Valley in collaboration with

the Association of Friends of the Zat area (about160 fire rooms installed).

Integrated Development of Tassa - Ouirgane incollaboration with the Regional Direction of

the Water and Forests Authority / Marrakech /The El Haouz Province and the Ouirgane

Association (60 households equipped withenhanced fire rooms).

Thanks to information and awareness buildingefforts, these new cooking technologies have alsobeen integrated in several local and regional deve-lopment projects and programs:

● Land reclamation in Ouled Fennane, in collabora-tion with the Provincial Agriculture Delegationof the city of Khouribga (1,000 enhanced fire roomsand 300 ovens for bread disseminated)

● Land reclamation project in the Doukkala region(joint project between the Regional Agency for LandReclamation and Agricultural Development and theEuropean Union) : 890 enhanced fire rooms and 10ovens for bread

● Argan Grove project in Agadir (Water and ForestAuthority and GTZ)

● Soil protection and restoration project (GTZ andthe Provincial Agricultural Delegation of the city ofKhenifra)

● Projects of the NEF Foundation (City ofOuarzazate)

Currently, in Morocco, more than 3,000 enhanced firerooms and ovens have been disseminated, thus ena-bling the constitution of an important base of expe-riences. The studies of the CDER have shown thatthe dissemination potential is for about:

- 250,000 enhanced fire rooms,

- 120,000 solar ovens,

- 85,000 enhanced ovens for bread.

Through a participatory approach, the CDER plansto achieve a penetration rate of 30% by 2005. Thismeans the dissemination of:

- 80,000 enhanced fire rooms

- 40,000 solar ovens

- 28,000 enhanced ovens for bread.

For the implementation of the program, partnershipsare being put in place with some associations in thetargeted regions. These are: the Touiza MovementAssociation in the Province of Azilal: the Green OasisAssociation for the conservation of environment inthe Province of Guelmim; and the AoudidAssociation in the Province of Ouarzazate.

Contacts:

Dr. Abdelahanine BenallouDirector General of the Center for theDevelopment of Renewable EnergiesB.P. 509 Rue El Machaar El Haram-IssilMarrakech, MoroccoPhone 212-44-309814 or 212-44-309822Fax.: 212-44-309795e-mail: dgcder@iam.net.maweb: http://www.cder.org.ma

Dr. Abdelmourhit LahbabiDirector General ADS Morocco4 Av. Bin Al Widane N°6Agdal, Rabat, MoroccoPhone : 212-37-681011 or 212-37-681012Fax : 212-37-681013e-mail : adsmaroc@iam.net.ma

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Daniel M. Kammen1,2,3, Robert Bailis1,2 andAntonia V. Herzog1,2

1 Renewable and Appropriate Energy Laboratory (RAEL)2 Energy and Resources Group

3 Goldman School of Public Policy

University of California, Berkeley USA