UNDP states that a minimalist approach, focusing on the basic energy needs of the poor (lighting homes, cooking, heating).is not sufficient for effective poverty reduction. The report about the UNDP "Energy plus" approach adds: "Projects that complement energy service provision with measures that raise incomes and improve livelihoods – e.g. improving access to information, market linkages, business development services and access to capital – show tremendous promise in poverty reduction and economic and human development. Such ‘Energy Plus’ initiatives, however, are few in number and are yet to be scaled up in terms of the number of people reached."
UNDP continues: "Energy services per se do not reduce poverty. Instead, they transform people from being ‘poor without energy access’ to ‘poor with energy access’ – a poor family with two light bulbs, or a poor family using an improved cookstove. This is because the energy services provided do not open opportunities to poor households to increase their incomes. Therefore, the resources needed to acquire modern energy services continue to be limited, and energy programmes and projects are forced to rely perpetually on unsustainable subsidies. By itself, energy can only start a process of rural transformation and poverty reduction. Other inputs are needed to bring about more profound changes. Energy uses are determined first by immediate subsistence needs, and then by the livelihood opportunities and available resources. For the poor, the prospects of using energy services to pull themselves out of poverty are influenced by whether other complementary inputs are available, including:
- infrastructure (e.g. roads and communications);
- access to markets;
- access to capital;
- availability of information and skills training; and
- social services such as medical facilities and schools.
The transition to more comprehensive, integrated approaches should therefore be a priority. Provision of energy services must be combined with capacity development and productive uses of energy for income generation, which can contribute to improved household living standards and to increased capacity to pay for energy services.
The following Figure illustrates the findings of the Review to present a condensed view of the proposed approach for expanding energy services for the poor:
Source: UNDP, Towards an "Energy Plus" Approach for the Poor, p. 42.
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