Energy in Developing Countries

January 1991

OTA-E-486

NTIS order #PB91-133694
Recommended Citation:

U.S. Congress, Office of Technology Assessment, Energy in Developing Countries,

OTA-E-486 (Washington, DC: U.S. Government Printing Office, January 1991).

For sale by the Superintendent of Documents

U.S. Government Printing Office, Washington, DC 20402-9325

(order form can be found in the back of this report).
Foreword

This report was prepared in the course of the ongoing OTA Assessment, Fueling

Development: Energy and Technology in Developing Countries, which is being carried out in

response to requests from the Senate Committee on Governmental Affairs; the House

Committee on Energy and Commerce; the Subcommittee on Energy and Power of the House

Committee on Energy and Commerce; the Subcommittee on Human Rights and International

Organizations and the Subcommittee on Africa of the House Committee on Foreign Affairs;

the Subcommittee on International Development, Finance, Trade and Monetary Policy of the

House Banking Committee; and individual members of the Senate Environment and Public

Works Committee; the House Select Committee on Hunger; and the Congressional

Competitiveness Caucus.

These committees and subcommittees asked OTA to examine the role of technology in

providing cost effective energy services that poor countries need for their economic and social

development, while minimizing adverse environmental impacts. The committees were

particularly interested in an analysis of the U.S. role in facilitating the adoption of such

technologies. The overall assessment is scheduled for completion in 1991. This report, the first

of two, was prepared in response to the requesting committees’ interest in receiving an interim

product. It examines how energy is supplied and used in developing countries, and how energy

use is linked with economic and social development and environmental quality.

OTA received substantial help from many organizations and individuals in the course of

preparing this report. We are very grateful for the efforts of the project’s contractors, who

prepared parts of the background analysis; members of the advisory panel; and workshop

participants, who provided guidance and extensive critical reviews; and the many additional

reviewers who gave their time to ensure the accuracy of this analysis.

U JOHN H. GIBBONS

Director

. . .

Ill
Advisory Panel—Energy and Technology in Developing Countries

Harry G. Barnes, Jr., Chairman

Critical Languages and Area Studies Consortium

Irma Adelman

Department of Economics

University of California, Berkeley

Jeffrey Anderson

Institute of International Finance

Edward S. Ayensu

Pan-African Union for Science and Technology

Gerald Barnes

General Motors Corp.

Mohamed T. El-Ashry

World Resources Institute

Eric Helland-Hansen

United Nations Development

Programme

Carl N. Hodges

Environmental Research Laboratory

University of Arizona

Donald Jest

Sun Refining and Marketing Co.

Amory Lovins

Rocky Mountain Institute

Mohan Munasinghe

World Bank

Henry Norman

Volunteers In Technical Assistance

Waafas Ofosu-Amaah

WorldWIDE

R.K. Pachauri

Tata Energy Research Institute

D. Lou Peoples

Bechtel Power Corp.

Gabriel Sanchez-Sierra

Organisacion Latino-Americana de Energia

Kirk R. Smith

Environment and Policy Institute

East-West Center

Irving Snyder

Dow Chemical U.S.A.

Thomas B. Steel, Jr.

Natural Resources Defense Council

Robert H. Williams

Center for Energy and Environmental Studies

Princeton University

Lu Yingzhong

Professional Analysis Inc. (PAI)

Montague Yudelman

World Wildlife Fund and The Conservation

Foundation

Eugene W. Zeltmann

General Electric Co.

Observer

David Jhirad

U.S. Agency for International Development

NOTE: OTA appreciates and is grateful for the valuable assistance and thoughtful critiques provided by the advisory panel members.

The panel does not, however, necessarily approve, disapprove, or endorse this report. OTA assumes full responsibility for the

report and the accuracy of its contents.

iv
OTA Project Staff-Energy in Developing Countries

Lionel S. Johns, Assistant Director, OTA

Energy, Materials, and International Security Division

Peter D. Blair, Energy and Materials Program Manager

Project Staff

Joy Dunkerley, Project Director

Samuel F. Baldwin, Senior Analyst

Karen Larsen, Senior Analyst

Robin Roy, Senior Analyst Paul S. Komor, Analyst

Nina Goldman, Research Assistant Sharon Burke, Research Assistant

Roger Chin, Summer Intern

Administrative Staff

Tina Brumfield Lillian Chapman Linda Long

Contributors

Rosina Bierbaum, OTA Oceans and Environment Program

Gretchen Kolsrud, OTA Industry, Technology, and Employment Program

Howard Levenson, OTA Oceans and Environment Program

Edward MacDonald, OTA Food and Renewable Resources Program

Contractors

Russell deLucia Virendra Kothari

deLucia and Associates, Inc. Energy and Environmental Analysis, Inc.

Cambridge, MA Arlington, VA

Ashok Desai Karin Lissakers

National Council of Applied Economic Research Columbia University

New Delhi, India New York, NY

K.G. Duleep and Sergio Ostria Arjun Makhijani

Energy and Environmental Analysis, Inc. Institute for Energy and Environmental Research

Arlington, VA Takoma Park, MD

Ahmad Faruqui and Greg Wikler Peter Meier and John Lee

Barakat and Chamberlain, Inc. International Development and Energy

Oakland, CA Associates, Inc.

Howard Geller Washington, DC

American Council for an Energy Efficient Henry Peskin

Economy Edgevale Associates, Inc.

Washington, DC Silver Spring, MD

Theodore J. Gorton Vaclav Smil

Petroleum Consultant University of Manitoba

Bethesda, MD Winnipeg, Canada

Donald Hertzmark

Independent Consultant

Washington, DC
Environmental Problems and Priorities in Developing Countries

Workshop Participants, April 19, 1990

Michael Adler

U.S. Environmental Protection Agency

Lutz Baehr

United Nations

Center for Science and Technology in Development

Leonard Berry

Florida Atlantic University

Al Binger

Conservation Foundation/Biomass Users Network

Janet Welsh Brown

World Resources Institute

Lalanath de Silva

Environmental Foundation, Ltd.

Sri Lanka

Clarence Dias

International Center for Law in Development

Paul Dulin

Associates in Rural Development

John J. Gaudet

U.S. Agency for International Development

Robert Goodland

World Bank

Lupe Guinand

BIOMA

Venezuela

Robert Ichord

U.S. Agency for International Development

Kari Keipi

Inter-American Development Bank

Ananda Krishnan

United Nations

Center for Science and Technology in Development

Russell Mittermeier

Conservation International

Hind Sadek

WorldWIDE

Paul Schwengels

U.S. Environmental Protection Agency

Thomas B. Steel, Jr.

Natural Resources Defense Council

NOTE: OTA is grateful for the valuable assistance and thoughtful critiques provided by the workshop participants. The views

expressed in this OTA report, however, are the sole responsibility of the Office of Technology Assessment.

vi
Outside Reviewers

Irma Adelman

Department of Economics

University of California, Berkeley

Dilip Ahuja

Environmental Protection Agency

Jeffrey Anderson

Institute of international Finance

Edward S. Ayensu

Pan-African Union for Science and Technology

Harry G. Barnes, Jr.

Critical Languages and Area Studies Consortium

Martin J. Bernard III

Argonne National Laboratory

Vic Fazio

Member of Congress

Robert Goodland

World Bank

Eric Helland-Hansen

United Nations Development Programme

Carl N. Hodges

Environmental Research Laboratory

University of Arizona

David Jhirad

U.S. Agency for International Development

Donald Jones

Oak Ridge National Laboratory

Donald Jest

Sun Refining and Marketing Co.

Dolores Kern

National Coal Association

Barbara Lausche

World Bank

Henry Norman

Volunteers In Technical Assistance

Waafas Ofosu-Amaah

WorldWIDE

Philip O’Keefe

ETC (U.K.)

R.K. Pachauri

Tata Energy Research Institute

Gabriel Sanchez-Sierra

Organisacion Latino-Americana de Energia

Anjali Sastry

Rocky Mountain Institute

Jayant Sathaye

Lawrence Berkeley Laboratory

Lee Schipper

Lawrence Berkeley Laboratory

Kirk R. Smith

Environment and Policy Institute

East-West Center

Irving Snyder

Dow Chemical U.S.A.

Thomas B. Steel, Jr.

Natural Resources Defense Council

Carlos Suarez

Instituto de Economia Energetica

Fundacion Bariloche

Pamela Wentworth

Bechtel Power Corp.

Thomas J. Wilbanks

Oak Ridge National Laboratory

Robert H. Williams

Center for Energy and Environmental Studies

Princeton University

Lu Yingzhong

Professional Analysis Inc. (PAI)

Montague Yudelman

World Wildlife Fund and The Conservation

Foundation

Eugene W. Zeltzmann

General Electric Co.

NOTE: OTA is grateful for the valuable assistance and thoughtful critiques provided by the reviewers. The views expressd in this

OTA report, however, are the sole responsibility of the Office of Technology Assessment.

w“i
Contents

Chapter Page

Chapter 1: Introduction and Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Chapter 2: Energy and Economic Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Chapter 3: Energy Services in Developing Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

Chapter 4: Energy Supplies in the Developing World. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93

Chapter 5: Energy and the Environment in Developing Countries ...........:. . . . . . . . . . . . . 111

Appendix A: Glossary of Energy Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137

.,. WI
Chapter 1

Introduction and Overview
Contents

Page

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

The Purpose of This Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

The Developing World and the Industrialized World . . . . . . . . . . . . . . , . . . . .. 4

Similarities and Differences Among Developing Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

The Developing World in Global Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Analytic Focus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Overview of the Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Population Growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Economic Development ..*. ... ..*. ... ... ... 11

Energy Supply Constraints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Financial Constraints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Biomass Supply Constraints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Institutional Constraints on Rapid Expansion in Energy Supplies . . . . . . . . . . . . . . . . . . 14

Environmental Degradation in Developing Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Greenhouse Gases and Developing Countries ● . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Prospects for Efficiency Improvements in Energy Production and Use . . . . . . . . . . . . . . . . 18

Appendix 1A: Economic, Social, and Energy Indicators for Developing Countries . . . . 20

Figures

Figure Page

1-1. Differences Between Developing and Industrial Nations . . . . . . . . . . . . . . . . . . . . . . . . . 4

1-2.1985 Energy Consumption, Industrial and Developing Region Fuel Mix . . . . . . . . . . . 8

1-3. Commercial Energy Consumption, 1973, 1985, and 2020 . . . . . . . . . . . . . . . . . . . . . . . 10

1-4. Per-Capita Commercial Energy Consumption, 1973, 1985, and 2020 . . . . . . . . . . . . . 10

1-5. Suspended Particulate Matter Levels in Selected Cities, 1980-84 ● . . . . . . . . . . . . . . . 15

1-6. Sulfur Dioxide Levels in Selected Cities, 1980-84 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Tables

Table Page

1-1. Heterogeneity of the Developing World: Social, Economic,

and Energy Indicators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

1-2. Commercial Energy Import Dependence in Developing Countries . . . . . . . . . . . . . . . . 7

1-3.1985 Primary Energy Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

1-4. Largest Energy Consumers, 1987 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

1-5. Passenger Fleet Annual Growth in Selected Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

1-6. Electric Appliance Ownership in Urban Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

1-7. Energy Imports, Debt Service, and Export Earnings for

Selected Developing Countries, 1987 ● . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

1-8. Estimated Annual Energy Investment as a Percentage of Annual Total

Public Investment During the Early 1980s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Chapter 1

Introduction and Overview

Introduction

Energy use in developing countries has risen more

than fourfold over the past three decades and is

expected to continue increasing rapidly in the future.

The increase in the services that energy provides is

necessary and desirable, since energy services are

essential for economic growth, improved living

standards, and to provide for increased human

populations. But finding the energy supplies to

provide these services could cause major economic

and social problems. For many of the developing

countries, much of the additional energy needed will

be supplied by imported oil, and rising oil imports

will further burden those countries already saddled

with high oil import bills. Similarly, building dams

or powerplants to meet higher demands for electricity could push these nations even deeper into debt.

Energy development and use also contribute to local

environmental damage in developing countries,

including record levels of air pollution in some

urban areas.

The rapid growth of energy use in developing

countries has wide impacts. The economic development process has traditionally been accompanied by

rapid increases in oil demand, which, together with

rising demand in the industrial countries, contribute

to upward pressures on world oil prices. High levels

of indebtedness in the developing countries, partly

energy-related, have already contributed to instability in the international money and banking system.

Rapid increases in fossil fuel use in developing

countries also represent a growing contribution to

the increase in local and regional air pollution as

well as atmospheric concentrations of greenhouse

gases such as carbon dioxide (CO2). International

efforts to control greenhouse gas emissions require

active participation by developing countries. Many

developing countries could be adversely affected by

climate change, some much more than most industrial nations.

An economically and environmentally sound

approach to energy development offers potentially

large benefits both for the developing countries and

for the rest of the world. It can contribute to

economic growth in the developing countries, leading to higher living standards, reduction of hunger

and poverty, and better environmental quality. This

strategy also holds benefits for the richer countries.

The developing countries are important trading

partners for the United States. More rapid economic

growth in these countries could stimulate U.S.

exports, including exports of energy technology

products, and, therefore, could benefit the U.S. trade

balance. Improved energy technologies can slow the

rate of increase in greenhouse gas emissions-a

global benefit.

The Purpose of This Assessment

This report is part of an assessment entitled

“Fueling Development: Energy and Technology in

the Developing Countries,’ requested by the Senate

Committee on Governmental Affairs; the House

Committee on Energy and Commerce; the Subcommittee on Energy and Power of the House Committee on Energy and Commerce; the Subcommittee on

Human Rights and International Organizations and

the Subcommittee on Africa of the House Committee on Foreign Affairs; the Subcommittee on International Development, Finance, Trade and Monetary Policy of the House Banking Committee; and

individual members of the Senate Environment and

Public Works Committee, the House Select Committee on Hunger, and the Congressional Competitiveness Caucus.

The Office of Technology Assessment (OTA)

was asked to examine the extent to which technology can provide the energy services that developing

countries need for economic and social development

in a cost-effective and socially viable manner, while

minimizing the adverse environmental impacts; and

to evaluate the role of the United States in accelerating the adoption of such technologies by developing

countries.

This report, the frost product of the assessment,

examines how energy is currently supplied and used

in the developing countries and how energy is linked

with economic and social development and the

quality of the environment. Our emphasis is primarily on the present status of developing countries, and

concerns about current energy trends. This report is

intended to provide an introduction to the problems,

challenges, and opportunities associated with pro-

-3–
4 ● Energy in Developing Countries

viding energy services for economic and social

development in the developing countries. These

issues are examined under four broad topic areas:

energy and economic development (ch. 2); energy

services (ch. 3); energy supplies (ch. 4); and energy

use and the environment (ch. 5). A subsequent report

will present the results of OTA’s assessment of

technologies that can potentially improve the efficiency of both energy production and use in developing countries; an examination of the technology

transfer process; and ways in which Congress can

help promote the rapid adoption of such policies.

The Developing World and the

Industrialized World

We largely follow the definition of “developing”

countries-low- and middle-income countries (further divided into lower middle and upper middle

countries)---used by the World Bankl (see app. 1A

for a list of these countries), including all of the

countries of Africa, Latin America, and Asia,

excluding Japan.2

There are wide differences in average indicators

of social and economic conditions between developing and industrial countries (figure l-l).

1. Social: The citizens of (OECD) countries have

a longer life expectancy (76 years, compared

with an average of 62 in developing countries),

largely due to lower infant mortality rates (9 per

1,000 live births compared with 71 in developing countries). A much larger share of the

Figure l-l—Differences Between Developing and

Industrial Nations (developing nation average

as a share of lndustrlal* nation average)

Real GDP

per capita

Commercial energy

consumption

per capita

Adult literacy

Life expectancy

t I 1 !

0% 25% 50% 75% 100%.

How to Interpret thls flgure. The average values for the industrial

countries are assigned 100 in all cases. The values for the

developing countries are expressed as a share of 100. For

example, average life expectancy in the industrial nations is 76

years and in the developing nations 62 years, or 82 percent of the

industrial country level.

“Industrial excludes the U. S. S. R.; based on weighted average of

high-income market economies.

SOURCE: United Nations, Human DevelopmenfReport 199a World Bank

2.

WorldDevelopment Report.

population has access to secondary and higher

education and health care.

Economic: Average per-capita incomes3 (expressed in purchasing power parities4

) are more

than eight times higher in OECD countries than

in the developing countries. This difference in

income levels reflects major differences in

economic structure, particularly the higher

share of agriculture in total production in the

developing countries. A much lower share of

IS=, for ~mple, World B* WOr/dD#elOp~ntRePO~ 1989 (New York+ NY: Oxford university pr~s, 1989), PP. 1*165”

2The deftition of developing countries is based prirnarily on per-eapits income levels. This ranking system is rather arbitrary, howeveq if all the

emmtriea of the world are ranked by ascending level of per-eapitaincome, there is no obvious gap in the series to demarcate the two groups of countries.

The World Bank distinguishes six categories of counties: low-income, lower-middle-income, upper-middle-income, high-income oil-exporters,

industrial market economies, including OECD as a subset and “non-reporting non-members” (the U.S.S.R., North Kor~ East Germany, Angol&

Bulgaria, Albani& Mongo@ and Namibia). The group of developing countries (low- and middlAncome and upper-rniddle-income countries) does not

include Saudi Arabb Kuwait and the United Arab Emirates by virtue of their high per-capita income. The World Bank does, however, include as

developing countries some East and West European countries, such as Poland, Hungary, Yugoslavia, Greeee, and ‘Ibrkey, that qual@ as developing

countries by virtue of their inmme levels, bu~ due to their integration with industrial economies of East and West Europe, do not share other

characteristics of underdevelopmen~ and are therefore not included in this qort. Some other eouniries are excluded due to lack of reported data. Where

group averages of general economic and social indicators are reported direetly from the WorZdlkveZopment Report, these countries are included in the

total. In more detailed analysis, they are excluded. While every effort is made to adhere to these deftitions, it is not always possible, especially when

other sources of data with slightly different deftitions are used.

s~come is USWy m~~by GrOSS Domestic or Gross National Product. The difference between the two-typiedy S@for most COuntrieS-_iS

that GDPmeasures the total output of goods and serviees witbin the national border of a country, whereas GNPmeasures the output of goods and aerviees

attributable to the nationals of a country wherever that activity oeeurs.

4H~et exc~emt~ me- to convert the GDP of different countries to dollars, average OECD per-pita income app=m to kovsr20 tim~

higher than average developing country per-capita income. If, however, the comparison of income levels is adjusted to take into aeeount differences in

purchasing power of currencies (i.e., what a unit of currency such as the dollar will buy in different countries) the gap between average per-capita income

levels in developing and OECD countries narrows, and OECD per-capita income levels are 8 times rather than 20 times bigher tban the developing

country average. In either case, the gap in income levels is substantial.
Chapter 1-Introduction and Overview ● 5

the population lives in urban areas-37 percent

in the developing countries compared with 77

percent in the OECD countries. Population

growth is more rapid in developing countries.

It is estimated to double by 2040, while the

population of the industrial world will increase

by only 15 percent over the same period.

3. Energy: The economic and social contrasts are

also reflected in energy consumption. Percapita consumption of commercial energy (coal,

oil, gas, and electricity)5 in the OECD countries

is on average 10 times higher than in the

developing countries. On the other hand, commercial energy consumption is increasing much

faster in the developing countries. Biomass

energy consumption in the developing countries is higher than in the OECD countries and

provides a much higher share of total energy

consumption.

Similarities and Differences Among

Developing Countries

The developing country averages shown in figure

1-1, though adequate to illustrate the broad contrasts

between developing and industrial countries, obscure the wide economic and social differences

among developing countries. Indeed, the range of

differences between LDCs is greater than that

between many of them and the industrial countries.

A generation of exceptionally fast economic growth

in the Newly Industrialized Countries (the NICs),

combined with the slow growth, or in some cases,

economic stagnation and decline, in many African

countries, has widened the gap among developing

countries. Thus the problems, energy or otherwise,

faced by a relatively rich and developed country

such as Brazil are different from those faced by a

poor country like Ethiopia, as are the resources

available for their solution. An appreciation of these

differences is necessary for the realistic assessment

of energy technologies.

Per-capita incomes in the upper middle-income

developing countries (e.g., Brazil, Argentina, Algeria, Venezuela, and Korea) are almost seven times

higher than in the low-income countries (table 1-1).6

The income differential reflects major differences in

economic structure. In the upper middle-income

countries, industry has a much larger share in total

output and agriculture a much lower share. India and

China are exceptions, with atypically large shares of

industry, given their levels of income. The share of

the total population living in urban areas is much

lower in the low-income countries. For example, in

several African countries only about 10 percent of

the total population is urban7 dwellers, in contrast to

countries like Brazil, Argentina, and Venezuela,

whose levels of urbanization (about 80 percent of the

population living in towns) are similar to those in the

industrial countries.

Developing countries also show wide variations

in social indicators. Life expectancy at birth rises

from an average of 54 years in the low-income

developing countries to an average of 67 in the upper

middle-income countries. Infant mortality is twice

as high in the low-income countries (over 100 per

1,000 births compared with an average of 50 in the

upper middle-income developing countries). India

and China are again exceptions: in both countries,

despite lower average income, indicators of social

development are similar to those found in countries

with much higher incomes. The experience of these

two countries testifies to the importance of social

policies in achieving relatively high levels of social

development despite low incomes.8 Population

growth rates also differ widely among developing

countries. In recent years these have ranged from

about 1 percent annually in some countries (e.g.,

China, Uruguay, Korea) to over 3 percent in several

African countries.

The wide variations in social and economic

conditions in developing countries are also reflected

in their energy use. In the upper middle income de-

%eterm “commercial energy” conventionally applies to cod oi~ gas, and electricity on the basis that they are widely traded in organized markets.

These fuels are distinguished from other fuels such as fuew~ charcoal, and animal and crop wastes, which are described as “biomass” or

“noncommercial fuels.” The distinction between them can be misleading, particu.kly in the context of developing countries, as some of the swzdled

“noncommercial” fuels, such as firewood and charcoal are also widely traded in highly organized markets. ‘ib~this ambiguity we use the term

“biomass energy” here.

6See also app. 1A.

%timates of urban populations are based on country-specfIc criteria related to size of settlement and presence of urban characteristics.

SW~eme is develo@ further in a recent publication by the United Nations Development RO~, Human Development Report 1990 (New

York, NY: Oxford University Press, 1990).

9&3j footnote 5.
Table 1-1—Heterogeneity of the Developing World: Social, Economic, and Energy Indicators

Low-income India and Lower middle- Upper middleIndicators Year countries China income countries income countries

Economic:

GNP per capita ($1987) (ppp)a . . . . . . . . . . . . . . . . . . . . . 1987 840.0 900.0 3,000.0 5,420.0

Share agriculture in GDP (%)b. . . . . . . . . . . . . . . . . . . . . . 1987* 33.0 30.0 21.0 10.O*

Urban population as share of total (%)C. . . . . . . . . . . . . . 1987 24.0 33.0 51.0 66.0

Cars and trucks per 1,000 members of Populationd . . . . . 1980* 3.2 3.2 19.3 93.3

Social:

Life expectancy at birth (years)e. . . . . . . . . . . . . . . . . . . . 1987 54.0 65.0 64.0 67.0

Infant mortality per 100 birthsf . . . . . . . . . . . . . . . . . . . . . . 1987 103.0 62.0 61.0 50.0

Share of age group with secondary education (%)9 . . . . . 1986 25.0 39.0 51.0 59.0

Energy:

Commercial energy consumption per capita

(gigajoules)h

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1986 4.9 16.3 36.2 58.3

Total energy consumption per capita (gigajoules)l.. . . . . 1986 12.3 18.7 41.7 67.0**

Share of traditional energy in total (%} j. . . . . . . . . . . . . . . 1986 60.0 13.0 13.0 13.0**

* Estimated.

If Brazil is excluded, the total per capita energy consumption would be 62 gigajoules and the share of traditional energy in total 2 percent.

SOURCES: ‘WOIM Bank, 146ddDeve/opment Report 1989 (New York, NY: Oxford University Press, 1969). Purchasing power parity (ppp) estimate based on data on pp. 164and 222.

blbid,, based on data in table 3.

C

lbid., table 31.

d JoY DunkerleY and Irving t-loch, TfmSpOnEnefgy: Determinants and Po/icy(Washington, DO: Resources for the Future, September 1965), table 51 afld appendiX ta~e 13. 6ae~ on

estimates. Note that totals are unweighed averages and the countries included differ slightly from Work/ Development Report 1989.

e World Bank, op. cit., table 1.

1

lbid., table 32.

g lbid., ta~e ~.

hlbid, ta~e &

lunit~ Nations, Energy ~a~~ Yearbook 1986( New York, NY: United Nations, 1988), table 4.

JThese values for the share of traditional energy are muoh lower than those found in field surveys. These values are presented herein order to have a consistent data set. Estimates

based on field surveys suggest that biomass provides one-third of the energy used by developing countries overall (chs. 3 and 4).
Chapter 1--Introduction and Overview ● 7

Table 1-2-Commercial Energy Import Dependence in Developing Countries

Country Number of Number of Number of High Medium Low

income countries energy energy importers importers importers

group in groupa

exporters importers (70-100%)b (30-70%) b

(0-30%) b

Low-income . . . . . . . . . . . . . . 38 4 34 29 3 2

China and India . . . . . . . . . . . 2 1 1 0 0 1

Lower middle-income . . . . . . 30 10 20 15 3 2

Upper middle-income . . . . . . 10 6 4 2 1 1

Total . . . . . . . . . . . . . . . . . . 80 21 59 46 7 6

a lnd~es all countries for which import dependence data are Wddh.

b shares of imports in total commercial energy Consumption.

SOURCE: Based on data in the United Nations, 1966 Energy Statistks Yearbook(New York, NY: 1988).

veloping countries, per-capita annual commercial

energy consumption (at 60 gigajouleslO) is 12 times

higher than in the low-income countries (5 GJ).ll

Again China and India differ from the other lowincome countries, with per-capita consumption of

commercial energy more than 3 times higher than

other low-income countries. Per-capita consumption

of traditional biomass fuels, on the other hand, is

generally higher in the poorest countries, depending

on the biomass resources available.12

There are similarly large variations in energy

resource endowment. While many countries have

some energy resources, three-quarters of the developing countries depend on imports for part or all of

their commercial energy supplies (table 1-2). Levels

of import dependence vary, but in many countries,

imports (almost entirely oil) provide nearly all

commercial energy supplies. Oil imports can be a

considerable strain on already tight foreign exchange budgets. In several countries, particularly in

Africa and Central America, oil imports represent

over 30 percent of foreign exchange earnings from

exports (see app. 1A).

Despite these differences in aggregate indicators,

there are strong similarities among developing

countries within specific sectors. Energy use in

traditional villages throughout the developing world

is fairly similar in terms of quantity used, source

(biomass, muscle power), and services provided

(cooking, subsistence agriculture). At the other end

of the scale, energy use by the economically well off

is also reasonably similar between developing and

industrial countries, in terms of quantity used (to

within a factor of 2 or 3), source (oil, gas, coal,

electricity), and services provided (electric lighting

and appliances, industrial goods, private automobiles, etc.). The large differences between countries

are then in large part due to the relative share of the

total traditional villagers and the economically well

off in the population, and in the forms and quantities

of energy used by those who are making the

transition between these two extremes. The broad

similarities within specific population sectors imply

that it is possible to make generalizations about

technology that are applicable to a wide range of

otherwise disparate countries.

The Developing World in

Global Energy13

The developing countries now account for about

30 percent of global energy use, including both

commercial and traditional energy (see table 1-3),

and their share is growing rapidly. Their use of the

different fuels vary widely: they account for 85

percent of biomass fuel consumption but only 23

percent of commercial fuels (oil, gas, coal, and

electricity). The main sources of energy for the

developing countries as a group are coal, oil, and

9

See footnote 5.

10A ~gajo~e (GJ), or 1 b~on jo~es, is about& enqy content of 8 gallons of gasoline. For refeNnCe, ~~per-cwi~ en%Y com~Ptionh

the United States is 327 million Britiah thermal units (Mu) or 343 gigajoules. An exajoule (W), or 1018 joules, ia about the same as a Quad (1.05 EJ =

1 Quad).

llWorldB@ Wor/dDeVezop~ntReport J989 @Je~ York NY: Ofiord University press, 1989). Da@ tirnp. 172, in tOIUES Of Od eqllhkllt(tot?)

converted to gigajoules at 1 toe = 41.9 gigajoules.

12Br=il, d=pite its ~~tivelY hi@ ficome, ~s subs~~ ~ntities of bio~sfiels in modem ~plicatio~, wch ss charcoal for stdmdK@ and

ethanol for cars. This contrasts with the use of biomass in the poorer countries, as a cooking fuel using traditional technologies.

ls~e ~~~ this ~tion we ~m from the World ~m= Cotiemnce, G/o~/EnergyPer~ectives 2000-2020,” 14th Congress, Montreal 1989 (his

1989); and the United Nations, 1986 Energy Statistics Yearbook (New Yorlq NY: 1988), updated to 1987 by data provided by the U.N. Secretariat.
8 ● Energy in Developing Countries

Table 1-3-1985 Primary Energy Supplies (exajoules)

Primary Total Total

Coal Oil Gas electricity commercial Biomass energy

World . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88.7 104.6 58.2 33.0 284.5 36.9 321.3

Industrial countries . . . . . . . . . . . . . . . . . 63.5 77.0 51.7 26.6 218.7 5.5 224.2

Developing countries . . . . . . . . . . . . . . . 25.2 27.7 6.5 6.4 65.7 31.3 97.1

Share of industrial countries . . . . . . . . . . 72% 74% 89% 81% 7770 15% 70%

Share of developing countries . . . . . . . . 28% 26% 11% 19% 23% 85% 30?40

NOTE: As in table 1-1, the values reported for developing country biomass are too low. Field surveys indicate that biomass accounts for roughly one-third of

the energy used in developing countries.

SOURCE: World Energy Conference, G/oba/ Energy Perspecths2M0-2020, 14th Congress, Montreal 1989 (Paris: 1989).

Figure 1-2—1985 Energy Consumption, Industrial and Developing Region Fuel Mix

Oil

34%

Biomass

electricity y fuels

7% 32%

Gas

23%

Developing nations

Total = 97 exajoules

Industrial nations

Total ■ 224 exajoules

SOURCE: World Energy Conference, G/oba/Enewy Perspecfives20@2020, 14th Congress, Montreal 1989 (Paris:

1989). ‘-

-.

biomass (see figure 1-2). However, much of the coal

is used in India and China only. The other developing countries rely heavily on oil and biomass for

their energy supplies. Several developing countries—

China, India, Mexico, Brazil, and South Africa-are

among the world’s 20 largest commercial energy

consumers (see table 1-4). China alone accounts for

almost 10 percent of the world’s total commercial

energy use.

Three countries-Chin. a, India, and Brazil—

together account for about 45 percent of total

developing country consumption of both commercial and biomass fuels. And these countries plus four

more-Indonesia, Mexico, Korea, and Venezuela--

account for 57 percent of the total. At the other end

of the scale are a large number of small countries

that, combined, account for only a small part of

global consumption. The 50 countries of Africa, for

example, use under 3 percent of total world commercial energy consumption. Concerns about global

energy use and its implications focus attention on the

large consumers, but the energy needs of the small

developing nations, though of lesser importance to

global totals, are critical to their development

prospects.

The developing countries are becoming increasingly important actors in global commercial energy.

Their share of the total has risen sharply in recent

years (see figure 1-3), from 17 percent of global

commercial energy in 1973 to over 23 percent now.

Despite their much lower levels of per-capita

commercial energy consumption, developing coun-
Chapter l-introduction and Overview ● 9

Table 1-4-Largest Energy Consumers, 1987

Per-capita

Total commercial commercial energy

energy consumption consumption

Country (exajoules) (gigajoules)

20 largest commercial energy consumers:

Rank

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

10

United States . . . . . . . . 68.1 280

U.S.S.R. . . . . . . . . . . . . 54.7 194

China . . . . . . . . . . . . . . . 23.5 22

Japan . . . . . . . . . . . . . . . 13.4 110

West Germany . . . . . . . 10.0 165

United Kingdom . . . . . . 8.5 150

Canada . . . . . . . . . . . . . 7.5 291

India . . . . . . . . . . . . . . . . 6.5 8

France . . . . . . . . . . . . . . 6.1 109

Italy . . . . . . . . . . . . . . . . . 6.0 105

Poland . . . . . . . . . . . . . . 5.3 141

Mexico . . . . . . . . . . . . . . 4.1 50

East Germany . . . . . . . . 3.8 231

Australia . . . . . . . . . . . . 3.2 201

Brazil . . . . . . . . . . . . . . . 3.2 22

South Africa . . . . . . . . . . 3.2 83

Romania . . . . . . . . . . . . 3.1 136

Netherlands . . . . . . . . . 3.1 213

Czechoslovakia . . . . . . . 2.9 185

Spain . . . . . . . . . . . . . . . 2.4 147

largest developing country energy consumers:

Rank

1 China . . . . . . . . . . . . . . . 23.5

2 India . . . . . . . . . . . . . . . . 6.5

3 Mexico . . . . . . . . . . . . . . 4.1

4 Brazil . . . . . . . . . . . . . . . 3.2

5 South Africa . . . . . . . . . . 3.2

6 South Korea . . . . . . . . . 2.2

7 Argentina . . . . . . . . . . . . 1.7

8 Venezuela . . . . . . . . . . . 1.6

9 Indonesia . . . . . . . . . . . 1.4

10 Egypt . . . . . . . . . . . . . . . 1.0

22

8

50

22

83

52

56

88

8

20

NOTE: Data for the top 10 developing country energy consumers include

only countries listed in app. 1A.

SOURCE: United Nations secretariat.

tries accounted for one-half of the total increase in

global commercial energy consumption since 1973.

The increasing share of the developing countries

in global commercial energy consumption is widely

predicted to continue. The World Energy Conference projects an increase in their share to 40 percent

by 2020 (see figure 1-3), and this trend is confirmed

in a large number of other studies.14 The developing

countries are projected to account for almost 60

percent of the global increase (over current levels)

in commercial energy consumption by 2020. China

alone accounts for over one-third of this increase.

These increasing shares are sufficiently large to have

a major impact on world energy markets. Despite the

more rapid rate of growth in energy consumption in

developing countries, their per-capita consumption

of commercial energy will still continue to be far

below the levels in industrial countries (see figure

1-4).

Analytic Focus

The analysis presented in this OTA study has

three important features. First, rather than concentrating on energy supplies, the analysis focuses on

the services energy provides. The reason for this

approach is simple. Energy is not used for its own

sake, but rather for the services it makes possible--

cooking, heating water, cooling a house, heating an

industrial boiler, transporting freight and people.

Further, there may be many different means of

providing a desired service, each with its own costs

and benefits. For example, transport is provided in a

number of ways-bicycle, motorcycle, car, bus,

light rail, or aircraft. The consumer chooses among

these according to such criteria as cost, comfort,

convenience, speed, and even aesthetics. Within

these consumer constraints, a more efficient car may

be preferable to increasing refinery capacity in order

to reduce capital and/or operating costs, or because

of environmental benefits. More than just engineering and economics must be considered, including

social, cultural, and institutional factors. Such factors are more readily included in a services framework than in a conventional energy supply analysis.

Second, within this services framework the changes

in how energy is used are traced from traditional

rural areas to their modem urban counterparts. This

14~a@Y~i~O@rOj&tiom ~fglo~comai~emr= com~ptionova~next zoy~~~~s. -eandhSckattetiolm,lntermtiomZ

Energy Workshop: Overview of Poll Responses (Stanford University International Energy ProjecL July 1989), reports the results and assumptions of

over 100 projections of global energy consumption and production and provides the means of the different studies. Not all studies report results for all

I@ons. The coverage is nonetheless a comprehensive indicator of how energy forecasters view the future. ‘l%ey suggest that the developing countries’

share could rise to over one-third by 2010. Longer term projections in general arrive at similar conclusions. For example, the Emissions Scenurios

document prepared by the Response Strategies Working Group of the Intergovemmental Panel on Climate Change, Appendix Report of the Expert

Group on Emissions Scenarios (RSWG Steering Committee, lhskA), April 1990, concludes that, overa wide range of scenarios, the share of developing

countries (Centrally Planned Ask Afiic& Middle East, and South and East Asia) will increase ffom a 1985 reference level of 23 percent to between

40 and 60percent of global energy in 2100, and that this group of developing countries would account for between60 and 80 percent of the total increase

inenergyconsumption over tbisperiod. Further, developments in the developing countries define much of the difference between the low and high growth

scenarios.
10 ● Energy in Developing Countries

Figure 1-3-Commercial Energy Consumption, 1973,

1985, and 2020 (developing nation energy demand as

100%

76%

60%

26%

o%

a percentage of world total)

EZ Developing regions

Estlmated

1973 1985 2020

Year

SOURCE: VMd Enercw Conference. G/oba/ Enerav Perspectives 2000-

2020, 14th &mgress, Montreal 19S9 (P&is: 1989).

Figure 1-4-Per-Capita Commercial Energy

Consumption, 1973, 1985, and 2020

Gigajoules per capita

250

200

150

100

50

0

- Developing regions

m Developed regions

1973 1985

Year

2020

SOURCE: Vhxfd Energy Conference, Global Enemy Perspwtives 2000-

2020, 14th Congress, Montreal 1989 (P&is: 1989).

progression from the traditional rural to the modern

urban helps illuminate the dynamics of energy use,

and how it can be expected to change in the future.

Third, the entire system needed to provide energy

services-from the energy resource to the final

energy service, including production, conversion,

and use-is examined as a whole. This is done in

order to show the total costs and consequences to

society, as well as to the individual, of providing

particular services, and how they might be provided

more effectively in terms of financial, environmental, and other costs. For example, increased

lighting services can be met by using more conventional lighting and increasing the amount of electricity generated, by increasing the use of more efficient

light bulbs, or by a combination of the two. A

systems approach permits the comparison of efficiency and supply options in achieving the desired

end.

In our analysis of energy services and systems it

is recognized that technology adoption and use is

embedded in an institutional framework that provides both incentives and disincentives to users, and

largely determines which and how technologies will

be used. This approach has a number of implications

both for the way technology is used now and for the

adoption of new technologies in the future. Thus, the

energy sector in many developing countries is

frequently characterized as “inefficient” in the

sense that more energy is used to provide a given

service or output than is usual in industrial countries.

In a wider context, however, taking into account the

many other relevant factors (financial, infrastructural, managerial, and institutional), the technology

may well be used to the best of human ability and

often with considerable ingenuity and resourcefulness. In many cases, although energy appears to be

used inefficiently, energy users may be acting

logically given the framework of incentives and

disincentives within which they make their decisions. It follows therefore that the adoption of a new

technology will depend not only on the intrinsic

superiority of the technology itself but also on

whether institutional factors favor its adoption. The

policy environment is of crucial importance to the

adoption of new technologies.

Overview of the Report

Energy consumption in the developing world has

risen rapidly in the past and is widely expected to

continue increasing rapidly in the future. The World

Energy Conference, for example, projects (in its

“moderate” economic growth case) a tripling in

consumption of commercial energy in developing

countries between now and 2020. A survey of a large

number of projections of commercial energy use

broadly confirms this trend. The projected rate of

increase in commercial energy consumption implicit

in these forecasts is lower than that experienced
Chapter 1--Introduction and Overview ● 11

between 1973 and 1985.15 Increased supplies of

biomass fuels (fuelwood and animal and crop

wastes) will also be required. The World Energy

Conference projects a 25 percent increase in biomass

use. Population growth and economic development

are the principal forces driving the rapid increase in

energy use.

Population Growth

In many developing countries, fertility rates (the

number of children expected to be born to a woman

during the course of her life) have dropped dramatically over the past 20 years. Nevertheless, the

population of the developing world continues to

grow rapidly. Over 90 percent of world population

growth is now occurring in the LDCs. At present, the

population of the developing countries is about 4

billion, 77 percent of the world’s population. Even

assuming continued decreases in fertility rates, the

population of these countries is projected to rise to

7 billion in 2025,16 and could reach 10 billion in

2100, due to the large number of women of

childbearing age. Developing countries would then

account for 88 percent of the global population in

2100, and for virtually all of the increase in global

population. The increase in population alone in

developing countries would account for a 75 percent

increase in their commercial energy consumption by

2025 even if per-capita consumption remained at

current levels.

Economic Development

Securing higher living standards for the increasing population of the developing world implies high

rates of economic growth. The World Energy

Conference, for example, assumes in its “moderate” growth rate scenarios, an average annual gross

rate of economic expansion of 4.4 percent to 2020,

slightly lower than in the past. This would represent

more than a fourfold increase in economic activity

between now and 2020. Achieving such rates of

growth will certainly not be easy, especially in light

of the high levels of debt that have constrained

economic growth in the 1980’s, and increasing

competition for foreign assistance from the countries

of Eastern Europe; but failure to achieve high rates

of growth could spell great hardship for the developing countries, as their populations are growing so

rapidly.

The process of economic development that underlies improving living standards in developing countries involves a number of changes, including higher

agricultural productivity, growth of manufacturing,

construction of a modern public works infrastructure, urbanization, and increased transportation (table

1-5 shows the rapid increase in the road transport

fleet). Higher standards of living also lead to

expansion in the ownership of consumer appliances

(table 1-6 illustrates saturation levels for some of the

most widely used appliances). All of these changes

have profound impacts on the amounts and types of

energy used.

Commercial energy consumption typically rises

faster than economic growth as the development

process gets underway, and the share of commercial

energy in total energy consumption grows as it takes

the place of traditional biomass fuels. Even though

the relative share of traditional fuels has declined,

the absolute amounts consumed have continued to

rise, by an estimated 2.5 percent per year.17

Despite the strong connection between commercial energy consumption and economic growth,

there is evidence of considerable differences among

developing nations in their energy intensity-the

amount of commercial energy consumed relative to

Gross National Product (GNP). There are examples

of countries with similar per-capita incomes that

consume quite different quantities of commercial

energy. Some of these differences result from

country-specific physical characteristics, but others

are associated with differences in social and economic policies. Policies promoting heavy industry

and high rates of urbanization contribute to high

energy intensities. Similarly, the energy intensities

of countries change over time. In several industrial

countries energy intensities declined even before

1973 at a time when oil prices were falling, largely

Isworld Energy Coderence, Global Energy Perspectives 2000.2020,” Mon@e~, 1989 (P~: 1989) projects a threefold kll%ise hl CCI nsumption of

commercial fuels in developing countries between 1985 and 2020. The Marine study projects a rise of 250 percent between 1985 and 2010 (see Alan

S. Marine and IAN Schrattenholzer, “Intermtional Energy Workshop: Overview of Poll Responses,” Stanford University International Energy Projec6

July 1989).

16Rudo~o A. B~@, ~Wd Bos, Patience W. Stephens, and My T. vu, Europe, Middle East, andAfiiCa (EMN) Region popldatiO?l prO@fi”O?fS,

1989-90 Edition (Washingto@ DC: World B@ 1990), table 9.

ITWorld Energy Conferenm, Global Energy Perspectives 2000-2020, 14th Congress, Montreal 1989 (pa: 1989).
12 ● Energy in Developing Countries

Table 1-5-Passenger Fleet Annual Growth in Selected Countries (percent)

Passenger Commercial Two and three

Country group cars vehicles wheelers Total

Developing countries:

Cameroon . . . . . . . . . . . . . . . . . . 11.8

Kenya . . . . . . . . . . . . . . . . . . . . . . 3.2

Bolivia . . . . . . . . . . . . . . . . . . . . . . 8.6

Brazil . . . . . . . . . . . . . . . . . . . . . . . 8.9

Thailand . . . . . . . . . . . . . . . . . . . . 8.8

India . . . . . . . . . . . . . . . . . . . . . . . 8.2

China . . . . . . . . . . . . . . . . . . . . . . . 41.6

Taiwan . . . . . . . . . . . . . . . . . . . . . 16.2

Weighted average . . . . . . . . . . 10.0

29.5

3.7

24.5

7.3

4.4

11.2

14.8

5.4

11.4

9.1

4.0

6.9

25.6

9.5

25.4

44.9

10.3

19.1

13.1

3.3

11.6

9.8

8.8

18.4

29.8

11.0

13.9

industrial countries:

Japan . . . . . . . . . . . . . . . . . . . . . . 3.0 4.1 7.0 4.4

United States . . . . . . . . . . . . . . . . 2.4 3.5 -5.6 2.3

West Germany . . . . . . . . . . . . . . . 3.3 0.4 -2.2 2.6

Weighted average . . . . . . . . . . 2.6 3.6 2.4 2.8

SOURCE: Fleet size and growth from Energy and Environmental Analysis, “Pohcy Options for Improving Transportation Energy Eff.kiency in Developing

Countries,” contractor report prepared for the Office of Technology Assessment, March 1990.

Table 1-6-Electric Appliance Ownership in Urban Areas (percent of households)

Country Radio Tv Fan Washer iron Cooker

China.. . . . . . . . . . . . . . . . . . . . . .

Liberia ... , . . . . . . . . . . . . . . . . . .

Guatemala . . . . . . . . . . . . . . . . . .

Manila ... , . . . . . . . . . . . . . . . . . .

Malaysia ., . . . . . . . . . . . . . . . . . .

Hong Kong . . . . . . . . . . . . . . . . . .

Bangkok ., . . . . . . . . . . . . . . . . . .

Taipei . . . . . . . . . . . . . . . . . . . . . .

39

76

78

80

70

90—

—

66

4

25

78

79

91

96

92

45

56—

82

75

96—

94

2

1—

—

16

34

5

53

1

74—

94

77

87

—

16

44

91

84

89

KEY: — information not available.

SOURCE: Jayant Sathaye and Stephen Meyers, “Energy Use in Cities of the Developing Countries,” Armua/ F?eviewof Energy, vol. 10, 1985, pp. 109-133,

table 6.

due to improved technologies. After the 1973 and

1979 oil price shocks, the decline in energy intensities was experienced in all industrial countries.

While the energy intensities of the developing

countries continued to rise after 1973, the rise was

less sharp than before. These experiences testify to

some flexibility in commercial energy use. The

current projections cited above, however, already

incorporate assumptions about declining energy

intensity in developing countries.

Energy Supply Constraints

The developing countries will face major difficulties in tripling energy supplies over the next 30

years. Significant obstacles include financial constraints, difficulties in increasing biomass fuel

supplies, institutional and policy factors, and environmental impacts.

Financial Constraints

Commercial energy consists of both domestically

produced and imported supplies. Many developing

countries rely on imported oil for virtually all of their

commercial energy needs. Further increases in

energy imports will impose a heavy burden on

limited foreign exchange resources, which may

already be under pressure because of debt service

payments (see table 1-7).

Funding the development of domestic energy

supplies and infrastructure also poses problems.

Energy supply facilities such as electricity generating stations and petroleum refineries are highly

capital intensive, placing major demands on the

scarce supplies of both domestic and foreign resources available for capital investment. Already,

investments in the commercial energy supply sector

(including electricity, oil and gas, and coal) represented in the 1980s over 30 percent of public
Chapter 1--Introduction and Overview ● 13

Table 1-7—Energy Imports, Debt Service, and Export Earnings for Selected Developing Countries,a 1987

Energy imports as share of Debt service as share of Energy imports and debt service

merchandise exports exports of goods and services as share of total exports 1987

Country (percent) (percent) (percent)

Low-income:

Ethiopia . . . . . . . . . . . . . . . . . . . . . . . . . . 55 28.4 83.4

Tanzania . . . . . . . . . . . . . . . . . . . . . . . . . 56 18.5 74.5

Madagascar . . . . . . . . . . . . . . . . . . . . . . . 36 35.3 71.3

Rwanda . . . . . . . . . . . . . . . . . . . . . . . . . . 53 11.3 64.3

Benin . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97 15.9 112.9

Kenya . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 28.8 67.8

Pakistan . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 25.9 51.9

Burma . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 59.3 64.3

Lower middle-income:

Morocco . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 29.9 56.9

Jamaica . . . . . . . . . . . . . . . . . . . . . . . . . . 31 26.6 57.6

Turkey . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 31.7 62.7

Jordan . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 21.8 74.8

Syrian Arab Republic . . . . . . . . . . . . . . . . 40 16.5 56.5

Upper middle-income:

Argentina . . . . . . . . . . . . . . . . . . . . . . . . . . 10 45.3 55.3

Algeria . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 49.0 51.0

a lncludes all nations in which debt service and oil imports combined is greater than 50 percent Of tOtal eXpOrtS.

SOURCE:WorldBank, Wbr/dfJeve/oPmentReport 1989(New Ye*, NY: Oxford University Press, 1989), pp. 172-173 and210-21 1.

investment budgets in a wide range of developing

countries (see table 1-8), with the electric utility

sector accounting for the lion’s share. Despite these

already large claims on capital resources, the current

level of investment in the electricity sector maybe

inadequate. The World Bank estimates that investments of $125 billion annually (twice the current

level) will be needed in developing countries to

provide adequate supplies of electricity .18 This

figure represents virtually the entire annual increase in the combined GNP of the developing

countries.

Finding the domestic and foreign resources needed

to finance energy facilities has always posed major

difficulties for developing countries. Current levels

of domestic resource mobilization, often related to

low levels of energy prices, are reported in many

countries to fall short of the amounts needed for

system expansion. 19 In the past, about one-half of all

investments in energy supply have been provided by

foreign sources,20 but high levels of current debt in

many developing countries and increasing fiscal

difficulties in the industrial countries make it

difficult for many developing countries to increase

their borrowing from abroad.

Biomass Supply Constraints

It maybe equally difficult to increase supplies of

traditional biomass fuels. Despite rapid rates of

urbanization in the developing world, almost twothirds of the total populations in poor nations live in

rural areas. These populations largely depend on

biomass fuels to produce their energy, with some

rural electrification where available, and small but

vital quantities of petroleum products (for irrigation,

lighting, and transport).

Demand for biomass fuels (largely fuelwood) will

continue rising to meet the domestic needs of the

urban and rural poor, rural industry, and in some

cases, such as Brazil, modern industry. Overuse of

biomass resources already contributes to environmental degradation (see below). Moreover, gathering traditional supplies of fuelwood is timeconsuming, exhausting work frequently undertaken

by women and children, who are thus diverted from

other activities (education and farming) that could

18u.s. A8~Y for~er~tio~DeVelo~e@ Power Shortages inD#eloping Counm.es: ~agni~e,lmpacts, solutions, andthe Role of the private

Sector (Washington.L DC: March 1988), p. 10.

l~wenw J. ~~ )7~rgy p~ce R@~ in De~e/oping Counm.es: ]s~es and options (OSIC Ridge, TN: ()& Ridge National bbomto~, Au~t

1987).

WorldB@ The Energy Transition in Developing Counm.es (Washington DC: 1983).
14 ● Energy in Developing Countries

Table 1-8-Estimated Annual Energy Investment as a Percentage of Annual Total

Public Investment During the Early 1980s

Over 40 percent 30-40 percent 20-30 percent 10-20 percent 0-10 percent

Argentina Ecuador Botswana Benin Ethiopia

Brazil India China Egypt

Colombia Pakistan Costa Rica Ghana

Korea Philippines Liberia Jamaica

Mexico Turkey Nepal Morocco

Nigeria

Sudan

SOURCE: Mohan Munasinghe, E/ectrk Power Ecvnomics (Imdon: Butterworths, 1990), p. 5.

eventually improve their productivity and living

conditions. An estimated one-third of the population

of developing countries now faces fuelwood deficits, and will increasingly rely on crop wastes and

animal dung to meet their energy needs.

Institutional Constraints on Rapid Expansion

in Energy Supplies

Over and above the capital constraints discussed

above, a wide range of other factors, customarily

defined as “institutional,” currently impede commercial energy sector development. While definitions of institutional factors differ between observers, they are generally taken to be nontechnological,

encompassing a variety of economic, organizational,

and policy factors that affect the way technologies

perform in operational settings.21 Some of these

factors (the worldwide increase in interest rates, for

example) are outside the control of individual

countries, but others are related to policies and

procedures in the individual country.

The electricity supply system offers an example of

the importance of institutional factors. In most

countries of the developing world the electricity

sector is government owned, reflecting the importance attached to electric power for meeting economic and social objectives, and in some cases,

especially in small systems, the advantage of centralization for securing economies of scale and

coordination in planning and operations. However,

government ownership can lead to interference and

loss of autonomy in day-to-day management of

utility operations and therefore reduced efficiency.

A recent World Bank report on the power sector in

developing countries points out that:

Such interference has adversely affected least cost

procurement and investment decisions, hampered

attempts to raise prices to efficient levels, mandated

low salaries tied to civil service levels, and promoted

excessive staffing. This in turn has resulted in

inadequate management, the loss of experienced

staff due to uncompetitive employment conditions

and poor job satisfaction, weak planning and demand forecasting, inefficient operation and maintenance, high losses, and poor financial monitoring,

controls and revenue collection.22

Manpower problems are exacerbated by the lack

of standardization of equipment,23 which makes the

learning process more difficult. Another disadvantage of the multiplicity of equipment is the difficulty

of maintaining adequate supplies of spare parts.

Pricing policies are frequently identified as a

major institutional problem. Energy pricing policies

vary in developing countries, reflecting differences

in energy resource endowments and social and

developmental policies. However, price controls on

energy products, such as kerosene and some electricity prices, are a common feature in many countries.

While low prices help to make energy more affordable, they can also result in a level of revenues

inadequate to cover costs and finance future supply

expansion. Many analysts have characterized this as

a common problem in the electricity sectors of a

wide range of developing countries.24

Zlworld B-A Review of World Bank Lending for Elecm”c Power (Washington, ~: tih1988), p- 74.

%fohan M~in@qcurrent Power Sector issues in Developing Counrries (WaShirIgtOrL DC: World B*, November 1986), P. 14.

23~ ~i, for ~xwp]e, ~ae we ~ diesel generator sets from 17 different ~~ac~ers(s= U.S. Ag~cy for hte~tional Development, “Ekztric

Power Utility Efficiency Improvement Study,” draft core report, May 15, 1990).

Mfiu, op. cit., footnote 19; adDo~d He rtzmar~ ‘ ‘Energy Efficiency and Energy Pricing in Developing Countries,” OTA contractor repq June

1990.
Chapter l--Introduction and Overview 15

Figure 1-5-Suspended Particulate Matter Levels in Selected Cities, 1980-84

Shown is the range of annual values at individual sites and the composite 5-year average for the city.

WHO Guideline 60-90 ug/m3

10 ~ 10 0 1,000

I I I I I 1 I I I I I I I I I I I I

Key

1. Kuwait

2. Shenyang

3. Xian

4. New Delhi

5. Beijing

6. Calcutta

7. Tehran

8. Jakarta

9. Shanghai

10. Guangzhou

11. Illigan City

12. Bangkok

13. Bombay

14. Kuala Lumpur

15. Zagreb

16. Rio de Janeiro

17. Bucharest

18. Accra

19. Lisbon

20. Manila

Range of individual site I I { 1.

annual averages 1 2.

t 1

I

3.

- F

/ I 4.

I 5.

Combined site 1 1 ]

6.

average 1980-84 I I 7.

I 8 .

1 ’ I 19.

r

I

I 10.

I 11.

[ I 12.

I I 13.

I

I

14.

I 15.

1’ I 16.

I

17.

/ ‘

18.

19.

20.

SOURCE: World Health Organization and United Nations Environment Fund, G/oba/ Po//@.on and Health (1.mdon: Yale University Press, 1987), figure 3.

Environmental Degradation in Developing

Countries

Developing countries are experiencing accelerating rates of environmental degradation and pollution. While many factors contribute to environmental degradation, energy production and use play

key roles, especially in urban environmental quality.

Even at present levels of energy generation and use,

the impacts on environmental quality are severe in

many areas. Additional large increases in energy use

will exacerbate the situation unless steps are taken to

mitigate adverse environmental impacts. At the

same time, energy is an essential input to such

environmental control systems as sewage treatment.

The combustion of fossil fuels has led to levels of

air pollution in cities of developing countries that are

among the highest in the world (see figures 1-5 and

1-6). The transportation sector is the largest contributor to air pollution in many cities.25 The combustion of oil or gas in stationary sources, such as

electric generating units, factories, and households,

also contributes through emissions of nitrogen

oxides, particulate, sulfur dioxide, carbon dioxide,

carbon monoxide, and hydrocarbons. The fossil fuel

mix has an important impact on emission levels.

Coal is the most deleterious of fossil fuels in terms

of emissions per unit of useful energy provided,

particularly when it is not burned in modern,

well-operated plants.

In addition to the environmental damage caused

by the combustion of fossil fuels, their production

and transportation also impose environmental costs,

such as disturbance of lands and aquifers from coal

mining, and accidental leaks and spills during oil

and gas production and refining. Air quality impacts

include, for example, local air pollution from

particulate and other emissions during coal mining

preparation, and transport and the release of methane, during coal mining and natural gas production

and transportation.

Non-fossil energy sources such as hydroelectric

development also causes environmental damage.

Dam construction often requires the clearing of

lands for access routes and removal of construction

material, with resulting soil degradation and erosion.

Filling the reservoir floods large tracts of land,

which usually means loss of agricultural land,

human settlements, fish production, forests, wildlife

~hh~mcities, for example, gasoline-fuekdv ehickx-mostly two and thre wheeler+ar eresponsible for 85 percent of carbon monoxide and 35

to 65 percent of hydrocarbons, while diesel vehicles-+uses and trucks-are responsible for over 90 percent no NOX emissions. Tats Energy Research

Instit&e, TERIEnergy Data Directory and Yearbook 1988 (New Delhi, India: 1989), p. 250.

.-
16 ● Energy in Developing Countries

Figure 1-6-Sulfur Dioxide Levels in Selected Cities, 1980-84

Shown is the range of annual values at individual sites and the composite 5-year average for the city.

WHO Guideline 40-60 ug/m3

1 Concentration (ug/m3

) 10 / \ 100

I I I I I I I I I I I I I I I I I I I I I 1

Key

1. Milan

2.Shenyang

4. Seoul

5. Rio de Janeiro

6. Sao Paulo

7. Xian

8. Paris

9. Beijing

10. Madrid

11. Manila

12. Guangzhou

13. Glasgow

14. Frankfurt

15. Zagreb

16. Santiago

17. Brussels

18. Calcutta

19. London

20. New York City

Range of individual site

annual averages

Combined site

average 1980-84 I I

j 7.

I

I 8.

1 I 19.

I

, J

I I J 10.

1 I

I 11.

i

~ 12.

/

I 13.

14.

I

1 5 .

I

] 18.

] 17.

I I [ 16.

1 I I 19.

1

[ 20.

SOURCES: Worfd Health Organization and United Nations Environment Fund, G/oba/ Pohtion and Hea/th (Ixmion: Yale University Press, 1987), figure 2.

habitat, and species diversity.26 The dam and reser- where there is a high population density or a

voir interrupt the free flow of surface water, affect concentrated urban demand for fuelwood, such as

water tables and groundwater flow, and disrupt the African Sahel.28

downstream flows of water and nutrient-laden sediments. These environmental costs are all the more When fuelwood is in short supply, rural populaonerous if the lifespan of hydroelectric projects is tions turn to crop residues and dung for their fuel

reduced through heavier than expected siltation of needs. To the extent that these forms of biomass

reservoirs from deforested and/or degraded lands would have been used as fertilizers, their diversion

upstream. 27 to fuel contributes to lowered soil productivity.29

Burning biomass, the source of energy used by Finally, biomass fuel combustion has a significant

most of the developing world’s population, also impact on air quality. Food is typically cooked over

causes environmental degradation. Although the use open fries or poorly vented stoves, exposing houseof biomass for fuel is only one, and not the principal, hold members--particularly women and children—

cause of deforestation, it does add additional pres- to high levels of toxic smoke. Similarly, in colder

sure on forest resources especially in arid or climates, homes in rural areas are often heated by

semi-arid regions where forest growth is slow and open fires, with increased exposures to toxic smoke.30

~FOre~ple, thereservo~fiosofio Onthe Volta inGha~ withalandrequirementof 8,730km2, approaches the size of countries Suchrishbmon

or Cyprus. See R.S. Pan&y (cd.), Man-made Lakes and Human Health (Parsmari lxx University of Suriname, 1979).

~The ~~d~semoh ~ ~% for emple, wss exFted to be productive for about 110 years, but now has an es-ted Pr~uctive lifetime of

35 years. U.S. Congress, Of3ke of Technology Assessment, Technologies To Sustain Tropical Forests, O’IILF-214 (WssMngtoq DC: U.S. Government

Printing Oftlce, March 1984), p. 43.

28~ug~ F. Bmnes, World Bs& “PoptitionGrow@ Wood Fuels, ~d Resource Problems ~ SU~S_ Mc%” ~d~try~~~8Y

Department Working Paper No. 26, March 199Q R.P. Moss and W.B. Morgarq “Fuelwood and Rural Energy Production and Supply in the Humid

Tropics,” United Nations University, Tycooly International Publishing, Ltd., Dublin, 1981; Daniel Finq “Land Use and Abuse in the East Mica

RegiorL’’AMBIO, vol. 12, No. 6, 1983, pp. 296-301, Dennis Anderson and Robert Fiahwic~ World Bar& “FuelwoodComption and Defomatation

in African Countries,” staff working paper No. 704, 19S4.

29~gafic ~tter~soflspovidesm ost of the fitrogen~d mad ss much= ~the pllospho~ n~~~p~n~. It helps the ~ilbhldimpo~t

minerals suchasmagnesiurq calchq andpotaasiumthat would otherwise be leached away. It buffera the acidity of soils, and it improves water retention

and other physical characteristics. See Geofffey Barnard and Lars Kristofersoq Agricultural Residues as Fuel in the Third Worli.1, Earthscaq

hlternationalInstitute for Environment and Developmen~ Energy InfonnationProgram, technical report No. 4 (Washington DC andl-mdomEarthscaQ

1985).

= R. Smi@ Biojkels, Air Pollution, and Health:A Global Review (New York NY: Plenum Presa, 1987).
Chapter 1--Introduction and Overview ● 17

Greenhouse Gases and Developing Countries

Energy use in developing countries also contributes to increased emissions of greenhouse gases and

associated global climate change. An international

panel of scientific experts of the Intergovernmental

Panel on Climate Change (IPCC)31 recently concluded that:

. . . emissions resulting from human activities are

substantially increasing the atmospheric concentrations of the greenhouse gases: carbon dioxide,

methane, chlorofluorocarbons (CFCs) and nitrous

oxide. These increases will enhance the natural

greenhouse effect, resulting on average in an additional warming of the Earth’s surface.32

Based on current models, the panel predicts that,

under a “business as usual” scenario, the global

mean temperature will increase at a rate of about 0.3

°C per decade during the next century, a rate at least

10 times higher than any seen over the past 10,000

years. 33

Atmospheric concentrations of CO2 have increased by about 25 percent since preindustrial

times, largely due to emissions from the burning of

fossil fuels and from deforestation. In 1985, according to another IPCC working group, developing

countries contributed about one-quarter (26 percent)

of annual global energy sector CO2 emissions.%

Under the “business as usual” scenario, with

expanding populations, rapidly increasing energy

use, and assuming the absence of control measures,

the developing country share would increase to 44

percent of annual energy sector emissions by 2025.35

The magnitude of C02 emissions from fossil fuel

sources is fairly well known, but the contribution

from deforestation, which is virtually all from

developing countries, cannot be estimated accurately. This makes it difficult to calculate with

confidence the developing country share of global

annual and cumulative emissions for CO2 and other

gases. Estimates of CO2 emissions from tropical

deforestation differ by a factor of 4.36 By various

estimates, deforestation could be the source of

between roughly 7 and 35 percent of total annual

CO2 emissions.

Despite uncertainties, it is safe to conclude that

the developing countries already contribute a substantial part of current annual global CO2 emissions,

and that their share will increase in the future. But,

because of their large and rapidly growing populations, per-capita CO2emissions in the developing

countries will still remain much lower than in the

countries of the industrial world. Developing countries also account for at least half of the global

anthropogenic generation of two other important

greenhouse gases, methane and nitrous oxide.

Developing and industrial countries would both

be damaged by the anticipated impacts of climate

change. In addition to increases in mean global

temperature, other major effects of global climate

change would include increases in sea leve137 and

shifts in regional temperature, wind, rainfall, and

sl~e~tergovmma~ panel “n Climate -e(WCC) is an international task force created by the World Meteorological Ggatition md tie

United Nations Environment Program. Initiated in 1987, this body focuses on analyzing current information available on climate change issues and

devising strategies to address climate change.

qzrntergov-en~ Panel on Climate Change, “POliqmakerss~of the Scientiilc Assessment of Climate Change: Report to IPCC from

Working Group I,” June 1990, p. i.

qqId., atp. ii. ‘f’his would m-an incr~ over the preindustrial global average temperature of 2 degrees centigrade by 2025 ~d 4 ‘C by 2@0. TJlis

best estimate prediction has an uncertainty range of 0.2 to 0.5‘C per decade. This was based on projections derived from another working group that

emissions of C02 could grow from approximately 7 billion tonnes of carbon (BtC) in 1985 to between 11 and 15 BtC in 2025. Methane emissions were

projected to increase from 300 teragrams in 1985 to 500 teragrams by 2025. 34rntergov~nmen~ panel on c~te -q wor~g &OUp m @sponse s@&@S working @up), “Policyrnakers’ S~ Of the

Formulation of Response Strategies: Report Prepared for IPCC,” Executive Summary, p. 10, table 2, June 1990.

qsOTAc~c~ation~~“n2030° ~@ ~sio~~wer&ofiScefio, @bles A-21 ~dA-193 h rntergovernmentipmel On Climate -e,

“Emissions Scenarios Prepared by the Response Strategies Working Group of the Intergovernmental Panel on Climate Change,” Appendix Report of

the Expert Group on Emissions Scenarios (RSWG Steering Committee, Task A), April 1990.

WPCC, “Policymakex’s Summary of the Formulation of Response Strategies: Report Prepared for JPCC by Working Group III, ” June 1990, p. 5.

Estimates of C02 emissions from deforestation and land use changes (including wood fhel) were 0.6 to 2.5 PtC in 1980 according to a report prepared

for the WCC Working Group 1. “Scientific Assessment of Climate Change: Peer Reviewed Assessment for WG1 Plenary Meeting, May 1990,” Apr.

30, 1990, p. 1-9. Mom recent evidence iiom selected countries would indicate deforestation rates now are higher than they were in 1980. Estimates of

C02 emissions in 1987 were 5.7 +0.5 PtC from fossil fuel burning and total emissions were of 7 +1.1 PtC.

qT~e IPCC wor~g ~OUp predicted an ave~ge mte of global mean sea level rise of about 6 cm per decade over the next century-20 cm by 2030

and 65 cm by the end of the century (with signillcant regional variations). This predicted increase is due primarily to thermal expansion of the oceans

and melting of some land ice.
18 ● Energy in Developing Countries

storm patterns. These effects in turn would submerge some low-lying coastal areas and wetlands,

threaten buildings and other structures in these areas,

and increase the salinity of coastal aquifers and

estuaries. Such changes would disrupt human communities and aquatic and terrestrial ecosystems, and

affect food production and water availability. A

number of developing countries would be especially

vulnerable to rising sea levels through threats to

coastal communities and ecosystems, increased

vulnerability to storm damage, and inundation of

low-lying arable lands.38 The adverse effects of

climate change would exacerbate the impacts of

increased populations in Asia, Africa, and small

island nations of the Caribbean, Indian, and Pacific

Oceans.39 The timing, severity, and extent of these

potential impacts remain uncertain.

Prospects for Efficiency

Improvements in Energy

Production and Use

Increasing energy supplies in the “business as

usual’ mode that underlies the conventional projections thus poses formidable challenges. This unfortunate fact suggests that alternative approaches for

providing the vital energy services needed for rapid

economic and social development should be investigated, focusing on efficiency improvements.

OTA examined the following energy-related services: cooking, lighting, and appliances in the residential and commercial sectors; process heat and

electrical and mechanical drive in industry and

agriculture; and transportation (see ch. 3). For the

developing countries as a whole, the largest energy

end use markets are residential/commercial and

industry, which together account for roughly 85

percent of the energy used by final consumers,

including traditional energy. Considerable differences exist, however, among developing nations. In

Africa, the residential/commercial sector constitutes

a particularly high share (mostly in the form of

biomass fuels for cooking), while industry’s share is

quite low. In Latin America, transportation accounts

for an exceptionally high share of the total, whereas

its share in India and China is quite low.

Industrial process heat and cooking are the largest

energy services, each accounting for about one third

of all energy consumed (commercial plus biomass)

in developing countries. This pattern of energy use

contrasts with the United States, where transportation and space conditioning are the highest (although

in the United States process heat is a major user as

well). Much of the energy used for residential

cooking and process heat in the developing countries

is consumed in China and India. Together their

consumption of energy for cooking and industrial

process heat accounts for over 40 percent of all

cooking and process heat energy used by developing

countries, and for well over one-quarter of all the

energy consumed in developing countries.

A wide range of technologies are currently used to

provide energy services in developing countries. For

example, cooking technologies include stoves using

fuelwood, charcoal, kerosene, liquid petroleum gas,

natural gas, and electricity, all with different characteristics. These technologies vary widely in their

energy efficiency. In an open fire, for example, only

about 15 percent of the energy contained in fuelwood goes into cooking. In contrast, in a‘ ‘modern”

gas stove about 60 percent of the energy contained

in the gas is used in cooking. The wide range of

efficiencies in the current stock of stoves suggests

opportunities for increasing efficiencies of the stock

and therefore providing more cooking services with

less energy.

There are also differences in efficiencies in

providing energy services in the industrial sector—

industrial process heat and electric and mechanical

drive. The two largest developing country energy

consumers, India and China, currently rely on

several technologies that are a generation or more

behind the state of the art, and are much less

energy-efficient than technologies now being used

in the United States and other countries. Integrated

iron and steel plants in China and India, for example,

use twice as much energy per ton of crude steel

produced as integrated plants in the United States

and Japan. Lower efficiencies are also frequently

observed in the transportation sector.

An analysis of the energy supply industry in

developing countries similarly indicates much lower

ssktergovwnm~~ Panel on Climate Change, ‘‘Policymalcers’ SUmmary of the Potential Impacts of Climate Change: Report from Worlcing Group

II to the IPCC,” May 1990, p. 8.

39J$D. W* et al, “Environmental and Economic Implications of Rising Sea Level and Subsiding Deltas: The Nile and Bengal Examples,”

AMBIO, vol. 18, pp. 340-345, 1989.
Chapter 1--Introduction and Overview ● 19

operating efficiencies than in the industrial countries. In electricity generation, for example, thermal

power plants frequently operate far below design

capacity and efficiency. Transmission and distribution losses (including unaccounted for losses, unmetered use, etc.) are frequently over 15 percent,

substantially higher than losses in industrial country

systems. 40 Refineries also operate at much lower

efficiencies.

Energy supplies in many developing countries are

unreliable, imposing a heavy economic burden. In

India, for example, losses sustained by industry due

to unreliable electric power supplies in recent years

are estimated to represent 2 percent of annual GNP,

not including losses in agriculture or losses and

inconvenience experienced by residential and commercial users. Similar losses have been estimated for

Pakistan. Furthermore, electricity supplies in many

countries are of poor quality, discouraging the use of

efficient technologies that are critically dependent

on high-quality energy supplies.

In characterizing important parts of the energy

system as ‘‘inefficient, however, it should be

realized that in many cases users and producers are

acting logically given the framework of resources,

incentives, and disincentives within which they

make their decisions. One of the reasons that poor

households use fuelwood inefficiently is that they

lack the financial means to buy more efficient

cooking systems. Industrial users must cope with

antiquated machinery and erratic fuel supplies of

uncertain quality. On the supply side, the record of

“poor” performance reflects many factors: poor

repair and maintenance, unavailability of spare

parts, low fuel quality, older equipment, unsatisfactory management, lack of skilled workers, problems

of reaching dispersed populations served by inadequate transport systems, and inappropriate pricing

and allocation systems.

The existence of wide differences between operational efficiencies in reasonably standardized operations (e.g., cooking, steelmaking, electricity generation, and petroleum refining), both among developing countries and between the developing and

industrial countries, suggests that dramatic improvements in efficiencies are possible. However, the

importance of factors other than technology must be

recognized for the role they play in improving

efficiencies. The policy environment in particular is

crucial to the adoption of new technologies.

More efficient ways of providing energy services

for development, including both technologies and

the institutional and policy mechanisms determining

their rate of adoption, will be presented in a later

report of this OTA assessment. Attention will also be

paid to the energy implications of different development strategies. Some development strategies are

associated with high energy use. But developing

countries at the beginning of the development

process may be able to capitalize on technology to

develop toward modern economies without the high

energy growth that earlier characterized the path to

industrialization.

ah tie utit~ Stites, for ex~ple, transmission and distribution losses in dense urban service areas are between 6 and 7 percent and irI rural semice

areas nearer 9 to 10 percent.
20 ● Energy in Developing Countries

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Chapter 1--Introduction and Overview ● 21

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Chapter 2

Energy and Economic Development
Contents

Page

Introduction and Summary ... .*. *.. ... .,. ... ..** e*. **. ..**, *,** ***. *+

. e*8****, v* *e. 25

Economic Development and Its Impact on Energy ● ....**,.*........****,***.**.**** 25

Rising Populations *.** *.. ... .+. *.. ... *.. .**. ... .., +**q

. *,*+ **6* *,+* *, ******e,* 26

Higher Living Standards .*. ..*. ... ... ... ... ... ... **. ... +o***. **** .*c*. ..** *.o c*. 27

Changes in Energy Consumption With Economic Development . . . . . . . . . . . . . . . . . . . 27

projected Energy Consumption in Developing Countries ., *...****.*....,,+,,.**.**,* 33

The Energy Sector and the Macroeconomy ... .*. ..** *,. ... ,.. *.. ... *+ *****6+,****.* 34 Financing Energy Supplies *.. ... *.. ... ... ,***. .,** ***c c* Q**, **, **,   ** . *Q**,* 34 Energy Supply Reliability ... ..* ........,.*..**.**+.*****,**,.**,**,*****+**,*,.* 36 Energy Pricing and Demand Management ● *.. ... .*. ... ... ... ..*. ,*+**e* **, **, Q*.,*+ 36 Energy and The Traditional Sector ... ..*. ... .*. ... ... .,. ... .., e

,#*<. **, **. .a *,***.* 39 Seasonality .*. .., *.*. ... ... .*, **. ..**   ** o* **** *ee. **+ *co*******,***,++***.* 40

Inequities in Resource Distribution and Access . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

The Role of Women ... ... ... ... ... .,. **. ..*. **** ***o .**, *e

. **** **, Q*a*, ***, o** 42

The Role of Commercial Biomass in the Rural Economy ● .**.....,.*.....*.,,**** 43

Conclusion ... ..*. *.. ... ,.. ... ... *.. **, ,e*o#**   ** ** *,*4 **. ***+ *,4

. oo***&*+ **c@. 44

Boxes

Box Page 2-A. Factors Affecting Population Increase ... ... .*. ... ... ... ... .., .,. ,,*, ,**, ,ea #*+ 28 2-B. Energy Conservation Initiatives in ASEAN Countries ● . . . . . . . . . . . . . . . . . . . . . . . . . 39

Figures

Figure Page 2-1. World Population Growth, 1750-2100 in Industrial and Developing Regions . . . . . . 26

2-2. Average Annual Increase in Population Per Decade in Industrial

and Developing Regions, 1750-2100 ... ... ... **. ... ..*. .,. *.. ,*, * 26 2-3. Historical and Projected Global Population, 1950-2025 ● ● ● ● . ● ● ~ ● . . . ● . . . . . . . * ● ● ..27 2-4. Projected Shares of Global Population, 2000 and 2025 ● ..,.....*......,+*,*,.**. 27

2-5. Commercial Energy Consumption and Economic Development in

Selected Countries ... ... ..*. ... ... .,. *.. ... ... ,*, ***. .**. **** *Q

. *e** .**+ o**,** 31 2-6. Commercial Energy Consumption and Social Development

in Selected Countries   ** . .*. .$

, .*. ... ... .*, *.. ,,, ***. **, ,,*+*+* vc <a,,***,** 32 2-7. Energy Intensity and Economic Development, 1960-2000. . . . . . . . . . . . . . . . . . . . . . . 33

2-8. Historical and Projected Energy Consumption in Developing Countries:

World Energy Conference “Moderate” Projections . ....*..,......,.***..*,***** 34 2-9. Seasonal Pattern of Energy Expenditure on Agricultural and Other Essential Tasks:

Adult Farmers, Genieri Village ... ... ... ... ... ... .., .*. .*, ,., *o**.,**.+****,*+ 41

Tables

Table Page

2-1. Energy Intensities in Selected Countries . ..........**......+,**.,....@******.*.* 32

2-2. Commercial Energy Consumption, 1985 and Projections for 2010 . . . . . . . . . . . . . . . 35

2-3. Estimated Annual Energy Investment as a Percentage of Annual Total Public

Investment During the Early 1980s . .......,..........*..........,,.*+..*,++*** 35
Chapter 2

Energy and Economic Development

Introduction and Summary

This chapter examines the two-way linkage between energy and economic development in developing countries--how the process of economic

development impacts energy, and how, in turn,

developments in the energy sector can affect economic growth.

In the course of economic development, commercial energy consumption is observed to increase

faster than economic activity. There are a number of

reasons for this: the growth of mechanized agriculture and manufacturing, the construction of a modem infrastructure, urbanization, increased transportation of goods and services, rapid expansion in

ownership of consumer appliances, and the substitution of commercial for traditional fuels. The absolute

amount of traditional energy consumed also continues to rise, although its share of total energy

consumption falls.

In the years to come, high rates of economic

growth will be needed in developing countries to

provide their rapidly growing populations with

improved living standards. If current trends in

energy and economic growth continue, commercial

energy consumption in the developing countries

could more than double over the next 40 years

according to most projections. Supplies of biomass

fuels would also need to increase substantially to

meet the needs of growing rural populations and the

urban poor.

This prospect raises a dilemma. On the one hand,

increases in energy supplies on this scale could

severely strain financial resources in the developing

countries. The energy sector absorbs a large share of

available foreign exchange and capital investment.

Consequently, energy supply policies have far-

-reaching impacts on other development priorities. In

many developing countries, financial resources may

not be adequate to increase commercial energy

supplies on the scale projected above.

On the other hand, inability to supply needed

energy can frustrate economic and social development. Already in many countries, the unreliability

and poor quality of energy supplies lead to major

costs to the economy through wasted materials,

stoppage of operations, and investment in standby

equipment.

Energy prices are a key factor in the development

of a country’s energy supply infrastructure, through

their impacts on the amount of energy used in the

economy, the technologies adopted, and, in some

cases, the direction of industrial development. Energy prices in developing countries are typically

subject to price regulation throughout the distribution chain. The average level of energy prices,

particularly in the electricity sector, are reported to

be too low in many countries to ensure the sector’s

financial viability.

Although commercial fuels attract the most policy

attention, two-thirds of the developing world’s

population live in rural areas with low standards of

living based on low-resource farming. This population has little access to commercial fuels and relies

largely on traditional sources of energy, gathered

and consumed locally, and animal and human

energy, often used at very low efficiencies. The main

form of traditional energy used is wood, an increasingly scarce and unsustainable resource. This imposes a special hardship on those-mainly women

and children-responsible for gathering it. Dung

and crop wastes, the other forms of energy widely

used for cooking when wood is not available, have

alternative uses as soil nutrients.

Economic Development and Its

Impact on Energy

The pace of economic growth and level of

economic activity have major impacts on the energy

sector. From 1965 to 1987, for example, the economies of the developing countries grew at an annual

average of 5.3 percent, and their consumption of

commercial energy grew by just over 6 percent.l

These energy growth rates were higher than those in

the industrial countries over the same period. As a

result, the developing countries’ share of global

commercial energy consumption also rose-from 17

lw~rld Ba~ Wo~ZdDe~elop~ntRepo~t 1989 @ew Yo&, ~: Ofiord universi~ Press, 1989), pp. 167 and 173.

–25–

33-718 0 - 90 - 2
26 ● Energy in Developing Countries

percent in 1973 to 23 percent in 1987.2 High rates of

economic growth will continue to be needed in the

developing world to provide the rapidly growing

population with improved living standards.

Rising Populations

The past two centuries have witnessed sharply

accelerated growth in the global population (see

figure 2-l). The largest additions to global population have been in the developing countries and have

occurred primarily in the past 50 years (see figure

2-2). Box 2-A discusses factors affecting population

growth.

Although current projections of global population

growth over the next 35 years differ (see figure 2-3),

there is consensus on several major points:

The world’s population is projected to increase

despite assumptions of continued declines in

fertility rates. The rate of increase in global

population, while lower than in the past, still

represents a large increase in numbers of

people. World Bank estimates,3 which are

similar to both the United Nations medium

projection and the U.S. Department of Agriculture projection, project an increase in global

population from 5.3 billion in 1990 to 8.4

billion in 2025, an increase of 3.1 billion.

Virtually all of the increase will come from the

developing countries. According to the World

Bank projection, for example, population

growth in the industrial countries--i.e., nations

in the Organization for Economic Cooperation

and Development (OECD), the U. S. S. R., and

Eastern Europe-is expected to add only about

125 million, or about 4 percent of the global

increase (see figure 2-4). The population of the

developing countries is estimated to rise from

its present level of 4.1 billion to 7.1 billion in

2025, increasing their share of world population from 77 to 88 percent (see figure 2-4).

Population growth in China is projected to be

quite moderate, as current low rates of growth

are assumed to be maintained. Projections of

China’s population growth are critical because

of its large share of the global total.

According to World Bank projections, the

biggest increases in population are predicted to

Figure 2-1—WorId Population Growth, 1750-2100

in Industrial and Developing Regions

Population in billions

12 — –—-

T 7

10

8

6

4

2

0

1750 1800 1850 1900 1950 2000 2050 2100

SOURCE: Thomas MerncK Population Referenee Bureau, “World Population in Transition,” /Jopu/afion Bu//etin, vol. 41, No. 2, April 1986,

update based on United Nations 1989 projections.

Figure 2-2—Average Annual Increase in Population

Per Decade in Industrial and Developing Regions,

1750-2100

Population in millions

~ 100 ~ ‘

—– –

-

~

40 -

NNN Developing regions

Industrial regions

I

‘201 T —rl ‘l_~ T

- 

T--r I I [ 1 I 1 1 1 I 1 1 1 1 I ! 1

1750 1800 1850 1900 1950 2000 2050 2100

SOURCE: Thomas Merrick, Population Reference Bureau, “World Population in Transition,” Po@ation Bu//etin, vol. 41, No. 2, April 1986,

update based on United Nations 1989 projections.

come from Africa and Asia, which will account

for 30 and 58 percent respectively of the total

global increase. In Asia the large addition to

population derives from the existing large

population base; rates of population growth are

relatively low. In Africa, on the other hand, the

primary cause is the rapid increase in population that, despite the relatively low population,

increases its share of the total population from

a current 12 percent to 19 percent in 2025.

world Energy Conference, GlobaZEnergy Perspective 2000-2020 14th Congress, Montreal 1989 (Paris: 1989), Table 2.

SRMOKOA. B~a~, EdWdBos, patien~ Stephens, and My T VW Europe, MiaWeEast, andA@”ca (EMN)Region Population projection: I$WMICI

E&”tion, Population and Human Resourees Department, working paper 328 (Washingto~ DC: World Bank), November 1989, table 5.
Chapter 2--Energy and Economic Development ● 27

10

8

6

4

2

Figure 2-3-Historical and Projected Global

Population, 1950-2025

Population in billions

U.N. (low, reed, high) ,

-- World Bank

- 1

/ “

Variations among these projection arise

from dlfferences in projected future fertility rates,

in turn are based on many assumptions, such as the

effects of government policies, GNP per capita,

literacy, and sociocultural factors.

1

1950 1975 2000 2025

Year

SOURCE: Office of Technology Assessment, 1990, based on data in

United Nations, World Population Prospects 1988 (New York,

NY: United Nations, 1989); Rodolfo Bulatao et al., Europe,

Middle East, and Africa (EMN) Region Population Projections,

1989-90 Edition, World Bank, Population and Human Resources Department, Washington, DC, working paper series

328, November 1989.

Though there will no doubt be some unforeseen

divergence from these population paths (changes in

fertility rates are difficult to predict; the impact of

the AIDS epidemic in Africa on fertility rates and

population growth is unknown), it is clear that there

will be a large increase in the world’s population in

the decades ahead, accompanied by a powerful

upward pressure on energy consumption. Even with

no increase in per-capita energy consumption, the

predicted rise in the global population by 2025

implies a 75 percent increase in total commercial

energy consumption.

Higher Living Standards

The major development challenge is to provide

higher standards of living for the rapidly rising

populations of the developing world. This task is all

the more urgent because of the declining levels of

per-capita income in many of the countries of Latin

America and Africa in recent years. Given the

projected rise in developing country populations—

an annual average of about 1.6 percent over the next

Figure 2-4-Projected Shares of Global Population,

2000 and 2025

Billions

10

6

6

4

2

0

I m Developing regions I

I 1= industrial regions I

World Bank projections

1

23% I I 20% I I ,

\ 1

1990 2000 2025

Year

SOURCE: Rodolfo Bulatao et al., Europe, MicWe East, and AMca (EMN)

Region Population Projections, 1989-90 Edition, World Bank,

Population and Human Resourees Department, Washington,

DC, working paper series 328, November 1989.

35 yearn-a rise in average per-capita incomes of,

say, 3 percent per year implies economic growth

rates of around 4.6 percent annually.4

It may not be easy to achieve such rates of growth.

The current indebtedness of many developing nations has added to the already difficult tasks of

economic management, and threatens to jeopardize

prospects of attaining even modest improvements in

standards of living. The foreign debt of developing

countries increased rapidly in the 1970s and 1980s

and in early 1989 was estimated at about $1.3

trillion. 5 As a result of this increase and the rise in

interest rates, debt service as a share of total exports

of goods and services is now double what it was in

the early 1970s.6

Changes in Energy Consumption With

Economic Development

The economic expansion necessary to achieve

higher standards of living for the increasing population of the developing world would be expected to

d~e World Energy Coderence “modemte” growth rate projection is based on annual economic growth rates of 4.4 perC@. Average ~onomic

growthrates of 5.3 percent annually are assumed in the series of projections in Alan S. Marine andbSchrattenholzer, “InternationalE nergyWorkshop:

Overview of Poll Responses,’ Stanford University International Energy Projec6 California, July 1989. The Intergovernmental Panel on Climate Change,

“Appendix Report of the Expert Group on Emissions Scenarios (Response Strategies Worl@ Group Steering Committee, Task A),” April 1990,

assumes high economic growth rates for the different developing regions of 4 to 5 percent annually, and 2.2 to 3.0 percent annually for the low-growth

case.

SIJfited Nations Development Programme, Humun Development Report 1990 (New Yorlq NY: Oxford University Press, 1990), p. 79.

%ese principal and interest repayments are now much higher than new disbursements of long-term debt to developing countries. The net transfer

or outflow of resources from the developing countries amounted to $38 billion in 1987, compared with a net inflow of $35 billion in 1981. See World

Banlq WorZdDeveZopment Report 1989 (Washington DC: Oxford University Press, 1989), p. 18.
28 ● Energy in Developing Countries

Box 2-A—Factors Affecting Population Increase

Rates of population growth are determined by the balance between birth and death rates. Historically, death

rates were the first to decline, due to improvements in nutrition and sanitation, and medical advances such as

vaccines. If death rates decline, but birth rates remain the same, population increases. This is what happened in the

presently developed world from 1750 to about 1900. Around that time, however, birth rates started to fall, resulting

in an overall reduction in the rate of population increase. This process, the lagged adjustment of birth rates to the

prior decline in death rates, is known as the “demographic transition. ” In the developing world, the demographic

transition is far from complete: death rates have fallen dramatically--though they are still higher than in the

industrial countries-but birth rates remain high, leading to a continued rapid rate of increase in total population. l

Future trends in population will similarly depend on the balance between death and birth rates. For the

developing countries, opportunities still exist to reduce death rates through improvements in medicine and public

health, and further declines are likely and desirable. On the side of birth rates, there is much greater uncertainty over

future trends. Birth rates are falling in the developing countries, from 41 crude births per thousand population in

the mid-1960s to 30 per thousand at present. Birth rates in the developing countries, however, are still well above

death rates, and more than twice the birth rates in the industrial countries (currently 13 per thousand).

The number of births depends on three factors: fertility rates, the age structure of the population, and the size

of the population base.

The fertility rate is defined as “the number of children that would be born to a woman if she were to live to

the end of her childbearing years and bear children at each age in accordance with prevailing age-specific fertility

rates.” Fertility rates in developing countries have fallen steadily, and in some cases sharply, in recent years. For

the developing countries as a whole, they fell from 6.1 in 1%5 to 4 in 1987, with particularly sharp declines in China

and India, Sri Lanka, Korea, and several Latin American countries. Despite this drop, they are still much higher than

in the industrial countries. There are, however, exceptions to this declining trend; fertility rates have not changed

in sub-Saharan African countries, and in some of these countries the rates appear to have risen.

Fertility rates are projected to continue declining until the end of the century, when they would be 3.3 compared

with the current 4. While this assumption seems reasonable in the light of historical trends, the determinants of

family size are not clearly known, and there is inevitably some degree of uncertainty over such assumptions. Broadly

speaking, fertility rates decline as levels of economic and social development and urbanization rise, women’s

education improves, and knowledge about family planning spreads. The connections between these factors are not

well-established, however, as they are highly correlated, and it is therefore difficult to disentangle the impact of any

single determinant. A higher share of the population living in urban areas, other things equal, maybe of particular

importance in lowering fertility rates. In rural farming communities, many benefits accrue to a large family. Children

provide farm Iabor—from an early age children are able to perform simple farm chores. Children can also provide,

in the absence of social insurance, some guarantee of old age security for parents. These benefits of a large family

are not so evident in the urban context, where they may also be outweighed by the financial costs of supporting a

large family.

Other factors also influence fertility rates. Cultural and religious factors can lead to higher family size than

would otherwise be predicted by indicators of social and economic development and urbanization. Algeria, Libya,

Iran, and Iraq, for example, have fertility rates near or over 6 despite their relatively high per-capita incomes. On

the other hand, aggressive government policies to restrict families can lead to lower family sizes than predicted by

other social and economic indicators. For example, fertility rates in China, a low-income country, fell dramatically

from 6 in the mid-1960s to 2.4 in 1987—lower than the rate for the industrial countries 20 years ago-due largely

to strong government policy.

With a given fertility rate, the number of births will be higher if a larger share of the population is in the

reproductive age group. In the developing countries, young people comprise a higher share of the population. This

population structure gives a much greater “population momentum” (the tendency for population growth to

continue even after fertility rates have fallen to the replacement level). In the developing countries, the rising share

of women of childbearing age in the population will continue to exert strong upward pressure on the population,

despite the expected drop in fertility rates.
Chapter 2--Energy and Economic Development ● 29

The size of the population base is the third determinant of population growth. The highest fertility rates exist

in the developing countries, which already have by far the largest share (77 percent) of the global population. This

means that larger numbers are being added to the world population than would be the case if the high fertility rates

applied to the industrial countries, which comprise only 15 percent of the global population.

Iworld B-Wor~DmelOp~ntRepOrt 1989 (New York NY: oxforduniv~i~Press, 1989), pp. 164-165.

lead to comparable increases in energy consumption. In addition, several factors inherent in the

development process tend to cause commercial

energy use in developing countries to rise more

rapidly than the gross national product.

First, most of the people in developing countries

now rely primarily on traditional biomass fuels—

wood, crop wastes, animal dung-for their energy

needs. These fuels are often difficult and timeconsuming to gather, are inefficient and awkward to

use, and can cause significant environmental damage. Similarly, most people in developing countries

rely primarily on human and animal muscle power

for doing their work, despite its low efficiency and

limited output. People who are dependent on these

traditional forms of energy will turn to commercial

fuels and technologies if and when they are available

and affordable. Thus, the share of traditional fuels in

total energy consumption falls sharply as development proceeds. In the low-income African countries,

traditional fuels account for as much as 90 percent of

total energy use. In the middle-income developing

countries their share falls typically to under 20

percent.

Second, most developing countries are now building their commercial, industrial, and transportation

infrastructures. This requires large quantities of

energy-intensive materials such as steel and cement.

As a result, energy use in the near- to mid-term

increases faster than income.

Third, developing countries are experiencing

rapid urbanization. Urbanization has profound effects on the amount and type of energy consumed.7

As industry and the labor force become more concentrated in urban areas, transportation needs grow.

Food and raw materials are hauled longer distances,

and finished products are marketed over a wider

area. Urban households purchase a larger share of

their total needs from outside the family, compared

with rural households, and commercial providers of

goods and services are more likely to use modern

fuels. Scarcity of space in cities- encourages the

substitution of modern, compact energy forms for

the bulkier biomass fuels. Finally, the growing food

needs of the cities encourage changes in agricultural

technology, which usually involve increased use of

modern fuels and energy-intensive fertilizers.

Fourth, modern manufacturing technologies and

materials have significantly lowered the real cost of

many consumer goods--from radios to refrigeratorscompared with costs a generation ago, and global

distribution systems have increased their accessibility. People in developing countries can thus purchase many consumer goods at a far earlier point in

the development cycle than did people in today’s

industrial countries. This could increase energy use

in the near- to mid-term both to produce the

materials for consumer goods and—particularly for

those that are intensive energy users, such as

motorcycles, cars, air conditioners, and refrigerators—

to operate them.

On the other hand, there are factors that may

counterbalance these trends and significantly moderate the rapid increase in energy demand.

First, the high cost of developing national energy

infrastructures and of purchasing energy to support

growing energy demands could potentially sharply

limit economic growth. This possibility is highly

undesirable given current low, and in many cases

declining, living standards in developing countries.

Second, the expected growth in energy use in

developing countries could be reduced through

efficiency improvements. Energy is now used much

less efficiently in developing countries than in

industrial countries. Traditional fuels and technologies are often much less efficient than modern ones:

for example, the efficiency of a typical wood-fueled

cooking stove is just one-fourth that of a modern gas

range. Moreover, the efficiency of energy use in the

?Donald W. Jones, “Urbanization and Energy Use in Energy Development” Energy JournuZ, vol. 10, No. 4, October 1989.
30 ● Energy in Developing Countries

modern sector in developing countries is often far

lower than that commonly achieved in the industrial

countries. If developing countries adopt the most

efficient technologies now available, they might

achieve average energy efficiencies that are higher

than those in industrial countries that have a large

installed base of older and less efficient infrastructure and equipment.

Third, continued economic development is at

some point accompanied by structural changes that

shift investment from energy-intensive infrastructure (roads, buildings, etc.) to consumer goods

(refrigerators, cars, etc.) and finally to less materialintensive but higher value-added goods such as

personal services and electronics.

Energy use in developing countries will depend

on the net impact of these opposing factors. At low

levels of development the first set of factors predominates, and commercial energy consumption typically rises much faster than gross domestic product

(GDP). Figure 2-5 compares per-capita commercial

energy consumption with per-capita GDP for selected countries, ranging from lowest to highest

income. 8 As this figure suggests, within the poorest

countries commercial energy consumption rises

faster than per-capita GNP; in the middle-income

countries they rise at about the same rate; and at the

highest levels of income, the increase in total

commercial energy consumption is less than the

increase in per-capita GNP.

It is often argued9 that GNP per capita, a measure

of the value of economic output in relation to

population size, is an inadequate and misleading

indicator of standards of living and well-being.10 An

index recently developed by the United Nations

Development Programme, the Human Development

Index (HDI),ll incorporates both economic and

social factors. This index is based on three indicators: life expectancy at birth, adult literacy, and

per-capita purchasing power.12 The first two are

sensitive to social conditions in a country and in

addition reflect underlying conditions of income

distribution. Average purchasing power in a country

gives some indication of material standards of

living. At low values, the HDI also shows a close

positive association with commercial energy consumption (see figure 2-6). Higher levels of HDI,

however, can be achieved with a wide range of

commercial energy consumption.

Commercial energy is only part (and for the

poorest countries, a very small part) of total energy

consumption. If estimates of traditional fuel consumption are included with commercial fuel to

represent total energy consumption, the association

between per-capita energy consumption and GNP

remains close, but at lower income levels the slope

is less steep than in figure 2-5.13 Adding commercial

and traditional energy together to make total energy

consumption does not, however, take into account

the lower conversion efficiencies of traditional

energy compared with commercial energy. If traditional energy consumption were expressed in coms~e re~tiom~p betw~n GDP pm Capiti and comrnerci~ energy consumption shown in figure 2-5 is consistent with other std.ieS. A Per-cilpitti

income elasticity for fossil fuels of about 1.5 is given for 13 industrial and developing countries in Gerald Leach et al., Energy and Growth (London:

Butterworths, 1986),p. 25. That is, agivenincreasein per-capita GNP between countries (purchasingpowe rparity) is associated witha 50 percent higher

increase in consumption of fossil fuels. Another study, based on 100 countries, reports a per-capita income elasticity of 1.26 (i.e., a given increase in

per-capita GNP between countries is associated with a 26 percent higher increase in commercial energy consumption). See B.W. Ang, “A

Cross-Sectional Analysis of Energy Output Correlation” Energy Economics (lmndon: Butterworths, 1987), table 3, p. 280. This elasticity is based on

market exchange rates; comparison of purchasing power parity GNP data increases the elasticity to 1.8. These elasticities are based on cross-sectional

studies (i.e., intercountry comparison at a given point in time, rather than developments in an individual country over time), which are considered to

give a more accurate picture of the long-term relationship between energy consumption and economic growth.

*or example, see Carlos Andrea Perez, T“wardk a New Way to hfeasure Development (Caracas, Venezuela: Oftlce of the South Commission in

Venezuel& 1989).

IOG~ my be ~ ~d~te rn~me of so~i~ Wefl-being, but it nonetheless corre~tes strongly with -y SOCid indicators. SeeP-Dxgup@

“Wellbeing and the Extent of Its ReaUzation in Poor Countries,” The Econom”c Journal, supplement (Cambridge, MA: Royal Economic Society Basil

BlackweU, 1990), pp. 1-32. The argument is made here that GNP per capita also correlates closely with political and civil rights.

llunited Nations Development Programme, Human Development Report 1990, op. Cit., fOO~Ote 6, pp. 11-16.

12~ev~um of achimementforthew indimtorswemJ~~’s ~eexpec~ncyatbirtho f78, ~ad~tliteraqrateofloopercen$ andtheaverageofflcial

“poverty Une” income in nine industrial countries, adjusted to take into account purchasing power, of $4,861 per capita

~s~ch op. cit., foo~ote 9, p. 25, gives ~r-=pi~ ~mme elmticities for to~ enqy at about 1.2, lower~the 1.5 for fossil fuels alone. B.W.

Ang, “A Cross Sectional Analysis of Energy Output Correlation” op. cit., footnote 9, reports income elasticities of traditional energy consumption of

-0.95 (i.e., a 10 percent increase in GNP per capita is associated with a 9.5 percent decline in traditional energy consumption) and for total energy

consumption (commercial and traditional) of 1.05.
Chapter 2--Energy and Economic Development .31

Figure 2-5-Commercial Energy Consumption and Economic Development

in Selected Countries

Gigajoules per capit a

100 0 ~

■ 24

■ 2 2

■ 23

1 0 0 ~

m 19 ■ 21

17= ■ 18

■ 20

■ 13 ■ 16

5 6 11

.l;l~ ’

5

1 Ethiopia 13 Algeria

2 Nigeria 14 Peru

10 ~ .4

7%:1 0 3 Kenya 15 Costa Rica

4 India

■ 2

16 Brazil

5 Zimbabwe 17 Korea

■ 3 6 Egypt 18 Argentina

7 Cameroon 19 Venezuela

8 Indonesia 20 Mexico

1 :

9 Morocco 21 Japan

–m 1 10 Philippines 22 Franc e

11 China 23 W. German y

12 Thailand 24 United States

0.1 -

I I I I I I

o 2 4 6 8 10 12 14

Gross domestic product per capita (thousand dollars) (ppp)

SOURCES: United Nations, 1986 Energy Statistics Yearbook(New YOIIG NY: United Nations, 1988), table 4; Robert

Summers et al., “A New Set of International Comparisons of Real Product and Prioe lsvels, Estimates for

130 Countries, 1950-1985,” F/eviewofhworne and W’ea/th, Series 34, No. 1, March 1988.

mercial fuel equivalent,14 the increase in energy

consumption in relation to GNP might be somewhat

greater than the increase in total energy (an energy

elasticity of just over 1.0), but less than the increase

in commercial energy alone (1.5 or more).

The inclusion of traditional energy, though necessary to provide a more complete picture of the

relationship between economic growth, social development, and energy use, raises problems of its

own. First, the measurement of traditional fuels is

difficult and prone to underestimation. For example,

for Indonesia, Malaysia, the Philippines, and Thailand, estimates by the United Nations Food and

Agricultural Organization, the Asian Development

Bank, and the World Energy Conference-three

frequently quoted sources of data on traditional

fuels-are found in almost all cases to be considerably lower than in other cou.ntry-specific studies.15

Second, when considering traditional sources of

energy, it is difficult to know whereto draw the line.

Animate forms of energy are important in most

developing countries, particularly the poorest. If the

biomass fed to bullocks to provide plowing and

irrigation services were included, the amount of

traditional energy consumed would increase substantially. Further, if the large amounts of biomass

burned in preparing soil for cultivation in slash and

burn agriculture were included, per-capita energy

use where shifting agriculture is practiced could

conceivably be as high or higher than in the

industrial countries.l6

Although GNP growth is an important determinant of energy consumption, it is not the only one.

Table 2-1 shows commercial and total energy

consumption relative to GNP for different levels of

income. If the amount of energy consumed were tied

to the level of output or development, the energy

intensities of all countries would be the same. As

these figures show, however, there are considerable

variations in energy intensity (the ratio of energy

consumption to GNP) at all levels of development.

Among the industrial countries, energy intensities

vary widely. And among the developing countries,

energy intensities of countries with the same level of

14BOW. ~g, ‘{A Method forEs@@ Non<o~erc~Ener~ con~ption in ~er-ro~ilold s~tor Of Developing COWtriSS,” Energy (l.ondoa”

Pergamon Press, 1986), p. 423, table 8.

15&, op. cit., footnote 15, P. 423, ~ble 8.

16s= ~R. sfi~ “me Biofiel T~itio~” pa~fic andA~an JOWWZ1 OfEnergy, VO1. 1, No. 1, JSII~ 1987, p. 18, fi~e 5.
32 ● Energy in Developing Countries

Figure 2-6-Commercial Energy Consumption and Social Development

in Selected Countries

Gigajoules per capit a

“ o

r

300

250 1

200 -

150 -

100 -

50 -

1 Ethiopia 13 Algeria . 24

2 Nigeria 14 Peru

3 Kenya 15 Costa Rica

4 India 16 BraziI

5 Zimbabwe 17 Korea

6 Egypt 18 Argentina

7 Cameroon 19 Venezuela

8 Indonesia 20 Mexico

9 Morocco 21 Japan

10 Philippines 22 France

■ 2 3

11 China 23 W. Germany m 22

12 Thailand 24 United States

■ 21

■ 1 9

18

20 ■ 

r 

, 7

■ 13 , 16

7 ■ r3 ■ 5 11 ■ . 1 4 ■ 1 5

I 1 4. ~m~ g .8 - 

■ 12

0 ’

, 2 10 m I

o 0.2 0.4 0.6 0.8 1 1. 2

Human development index

SOURCES: United Nations, 1986 Energy Statistics Yearbook(New York, NY: United Nations, 1988), table 4; United

Nations Development Programme, Human Development Report 1990 (New Yo~ NY: Oxford University

Press, 1990), p. 79.

Table 2-l—Energy Intensities in Selected Countries

Gross domestic Total energy Commercial energy

product, 1985 consumption per GDP consumption per GDP

Country $PPPa GJ/$1,000 Index, U.S.= 100 GJ/$1,000 Index, U.S.=1OO

Ethiopia. . . . . . . . . . . . . . . 304 29.6 123 2.3 10

Nigeria . . . . . . . . . . . . . . . . 565 24.8 103 9.0 38

Kenya . . . . . . . . . . . . . . . . 603 29.9 124 5.0 21

India . . . . . . . . . . . . . . . . . 775 15.5 64 11.4 48

Zimbabwe . . . . . . . . . . . . . 954 30.4 126 22.3 94

Egypt . . . . . . . . . . . . . . . . . 1,080 21.3 88 20.6 87

Cameroon . . . . . . . . . . . . . 1,180 16.9 70 9.1 38

Indonesia . . . . . . . . . . . . . 1,269 12.6 52 6.6 28

Morocco . . . . . . . . . . . . . . 1,284 7.8 32 7.3 31

Philippines . . . . . . . . . . . . . 1,352 11.1 46 6.7 28

China . . . . . . . . . . . . . . . . . 1,489 15.4 64 14.3 60

Thailand . . . . . . . . . . . . . . 1,896 12.7 53 7.0 29

Algeria . . . . . . . . . . . . . . . . 2,133 17.8 74 17.4 73

Peru . . . . . . . . . . . . . . . . . . 2,333 9.9 41 8.1 34

Costa Rica . . . . . . . . . . . . 2,712 16.2 67 8.3 35

Brazil . . . . . . . . . . . . . . . . . 3,164 16.4 68 10.7 45

Korea . . . . . . . . . . . . . . . . 3,381 16.6 69 16.1 68

Argentina . . . . . . . . . . . . . . 3,640 17.0 71 15.9 67

Venezuela . . . . . . . . . . . . . 3,723 29.8 124 29.9 126

Mexico . . . . . . . . . . . . . . . . 3,987 13.3 55 12.5 53

Japan . . . . . . . . . . . . . . . . 9,739 12.7 53 12.7 54

France . . . . . . . . . . . . . . . . 10,032 16.1 67 16.0 67

Germany . . . . . . . . . . . . . . 10,959 17.0 70 16.9 71

United States . . . . . . . . . . 12,787 24.1 100 23.7 100

a ppp refers to purchasing power Parity.

SOURCES: United Nations, 1986 Energy StafMcs Yearbook (New York, NY: United Nations, 1988), table 4forenergy consumption data. Robert Summers

et al., “A New Set of International Comparisons of Real Product and Price Levels, Estimates for 130 Countries, 1950-1985,” Review of home

and Wea/fh, Series 34, No. 1, March 1988 for gross domestic product, purchasing power parity.
Chapter 2--Energy and Economic Development ● 33

development (measuredly GNP per capita) can vary

more than fourfold.17

Variations in energy intensity are also evident in

individual countries or groups of countries over

time, as shown in figure 2-7. In the years immediately before 1973, global energy intensities rose.

After 1973, there was a sharp drop in the industrial

countries, in contrast to a continued rise in the

developing nations, if at a lower pace. Experience

within the developing countries varied considerably,

again testifying to the importance of factors other

than economic growth in determining energy consumption.

Differences in rates of urbanization and industrial

structure account for part of the variation in energy

intensities. Countries with a large share of energyintensive industries, such as steel, paper, chemicals,

and aluminum, will tend to have higher energy

intensities than countries with few energy-intensive

industries. Nigeria, Egypt, Algeria, and Venezuela

(with large oil drilling and refinery operations) and

Argentina, Korea, Zimbabwe, and China (with large

metals industries, mainly iron and steel) all have

relatively high energy intensities.

The impact of changes in industrial mix is also

evident over time. About half of the post-1979

decline in energy intensity in China (which fell by 40

percent between the late 1970s and the late 1980s)

can be ascribed to the limits on the expansion of

heavy industries and to the promotion of light, and

often export-oriented, manufactures (e.g., textiles,

consumer electronics, processed foodstuffs, and

plastics) .18 The equally dramatic decline in Korea’s

energy intensity is also due in large part to the

changing industrial mix. Although the output of

heavy industries in Korea rose sharply in these years,

production of less energy-intensive industries such

as machinery and transport equipment grew even

more rapidly, resulting in a declining share of heavy

industry in the total.

Energy intensities are also influenced by the

technologies used throughout the economy. For

example, the older generation of coal-burning technologies still used in developing countries are much

Figure 2-7—Energy Intensity and Economic

Development, 1960-2000

Barrels of oil equivalent per $1,000 of goods and services

8 I I

7.5-

7 -

8.5- >6

8 -

5.5 -

5 ~

1 4.5 I

1 1 1 I

1960 1973 1982 1990 2000

‘– Industrial nations + World average

+ Developing nations

SOURCE: World Bank, Industry and Energy Department, “Energy Issues

in the Developing World,” Energy Series Paper No. 1, February

19s8.

less efficient than modern technologies. Consequently, the coal-burning countries (India and China)

are more energy-intensive than countries largely

reliant on oil and gas.

Some of the factors that determine energy consumption (e.g., the size of the country and the

location of natural resources in relation to industry

and major markets) are country-specific, but others

can be affected by policy decisions.

Projected Energy Consumption in

Developing Countries

In the past, the three factors discussed in the

preceding section—rapidly rising population, high

economic growth rates to provide improved standards of living, and structural change as development

gets underway-have been associated with rapid

rates of increase in commercial energy consumption

in developing countries. If these trends continue,

increases in commercial energy consumption in

developing countries could be very large. Table 2-2

illustrates some of the current projections. The

synthesis of a wide range of projections shown in

this table suggests that commercial energy consumption in the developing world (including here

OPEC) in 2010 could be 2.5 times higher than it was

in the base year, 1985, an annual rate of increase of

17FrOrn~e~ted sample shown intable 2.1, there does not appear to be a systematic tendency for energy/GNP ratios to rise as levek of development

rise; the energy/GNP ratios of the advanced developing countries are very similar to those of Europe and Japan. However, Ang, op. cit., footnote 9, using

a wider sample, shows a commercial energy/GNP ratio with respect to GNP per capita at 0.80. That is, a 10 percent increase in GNP is associated with

sn 8 percent increase in the energy/GNP ratio.

lsvac~v Srnil, “Cti’s Energy: A Case Study, “ contractor report prepared for the Office of Technology Assessmen4 April 1990.
34 ● Energy in Developing Countries

3.8 percent. China accounts for more than one-third

of the projected increase.

The World Energy Conference forecasts a somewhat slower rate of growth in commercial energy

consumption in the developing world, an annual

average increase of 3.3 percent. By 2020, however,

consumption of commercial energy in the developing world would be three times higher than in 1985,

and consumption of traditional fuels about 25

percent higher (see figure 2-8). Population growth

and rising standards of living each account for about

half of the total increase.19

The Energy Sector and the

Macroeconomy

Energy is widely recognized as a key economic

sector in developing countries. Reliable and affordable supplies of energy make major contributions to

economic and social development; conversely, inadequate or unreliable energy supplies frustrate the

development process.

Financing Energy Supplies

Most developing countries (59 out of 80) are net

energy importers, relying on imports for virtually all

domestic commercial energy consumption; for many

countries, oil imports represent 30 percent or more

of total export earnings.20 The share of energy

imports in the total export earnings of developing

countries has fluctuated widely in recent years as oil

prices have changed. Such wide fluctuations are

highly disruptive to energy planning and economic

development.

Many developing countries emphasize domestic

production of energy. Investments in highly capitalintensive energy supply systems often represent a

major share of the total investment budget (see table

2-3), accounting in some countries for over 40

Figure 2-8-Historical and Projected Energy

Consumption in Developing Countries: World

Energy Conference “Moderate” Projections

Exajoules

300 ~ — ~

100

\

50

1

o +

1970 1980 1990 2000 2010 2020

SOURCE: World Energy Conference, Conservation and Studies Committee, Global Energy Perspective 2000-2020, 14th congress,

Montreal 1989 (Paris: 1989).

percent of all public investment.21 As the predominant claimant on scarce capital resources, developments in the energy sector therefore have a major

impact on the amounts of investment available for

other economic and social development.

The scale of future investment demands for the

energy sector in developing countries is projected to

be very large. The World Bank, for example,

estimates that investments of $125 billion annually

(twice the current level) would be needed in

developing countries to provide adequate supplies of

electricity.

22 According to a World Bank estimate ‘f

annual average expenditures on commercial energy

supply facilities for developing countries, electricity

accounts probably for one-half of the total; oil,

including refineries, accounts for about 40 percent;

and natural gas and coal 5 percent each. These

expenditures do not include investment in smallscale renewable or energy conservation.

l~e ~t=govemenM panel on Climate change has undertaken projections of energy consumption in developing counties in “Append.ixReport

of the Expert Group on Emissions Scenarios (Response Strategies Working Group Steering Committee, Task A),” April 1990. Several scenarios are

provided, with different rates of economic grow@ emission coeftlcients, and policies. The high economic growth (growth rates similar to the other

studies quoted here), low emissions scenario forecasts a threefold increase in developing world energy consumption between 1985 and 2025, which is

reasombly similar to the World Energy Conference forecast. The high growt.lL high emissions scenario is similar to the combined forecast results in Alan

S. Marine and hSchrattenholzer, International Energy Workshop: Overview of Poll Responses (Palo Alto, CA: Stanford University, Intern@onal

Energy Project, July 1989).

%Energy imports and debt service together account for over one-third of total export earnings in middle-income countries, and almost 40 percent in

lower-income countries (excluding china and Lndia).

zl~ese &@ cover investmen~ in tie energy sector by public entities. They may include some small amounts of investment in energy COmematiOQ

but virtually all is in energy supplies. They do not include private investment in backup equipment.

~WorldB*“CapiMfiWndi~e for Elecrric Power in the Developing Countries in the 1990’ s,” World Bank Industry andlMergy Depment

Working Paper, Energy Series Paper No. 21, Washington DC, Februmy 1990.
Chapter 2--Energy and Economic Development ● 35

Table 2-2--Commerciai Energy Consumption, 1985 and Projections for 2010 (EJ=Exajoules)

Increase in

Share of Share of AARG,a

consumption, Share of

1985 total 2010 total 1985-2010 1985-2010 increase

(EJ) percent (EJ) percent percent (EJ) percent

Developing countries . . . . . . . 69.26 23.3 175.!56 34.5 3.8 106.30 50.2

China . . . . . . . . . . . . . . . . . 21.91 7.4 59.54 11.7 4.1 37.63 17.8

OPEC . . . . . . . . . . . . . . . . . 11.65 3.9 28.91 5.7 2.5 17.26 8.1

Non-OPEC developing

countries . . . . . . . . . . . . 35.70 12.0 87.11 17.1 3.6 51.41 24.3

OECD . . . . . . . . . . . . . . . . . . . 155.83 52.4 215.03 42.2 1.3 59.20 27.9

United States . . . . . . . . . . . . . 73.87 24.8 98.47 19.3 1.2 24.60 11.6

U.S.S.R. and

Eastern Europe . . . . . . . . . 72.32 24.3 118.66 23.3 2.0 46.34 21.9

Total . . . . . . . . . . . . . . . . . . 297.41 100.0 509.25 100.0 2.3 211.85 100.0

a~RG = annual average rate of growth.

SOURCE: Alan S. Marine and Leo Sehrattenholzer, /nternationa/ Energy Workshop: Overview of Po// Responses (Palo Alto, CA: Stanford University,

International Energy Pro@t, July 1989).

Table 2-3-Estimated Annual Energy investment as a Percentage of

Annual Total Public investment During the Early 1980s

Over 40 percent 30-40 percent 20-30 percent 10-20 percent 0-10 percent

Argentina Ecuador Botswana Benin Ethiopia

Brazil India China Egypt

Colombia Pakistan Costa Rica Ghana

Korea Philippines Liberia Jamaica

Mexico Turkey Nepal Morocco

Nigeria

Sudan

SOURCE: Mohan Munasinghe, E/eciric Power Eeortomics (London: Butterwotihs, 1990), p. 5.

About one-half of total estimated energy supply

investments are projected to be in foreign exchange.23 The foreign exchange component for oil

and gas is typically high (about two-thirds of the

total), as much of the equipment must be imported.

On the other hand, foreign exchange costs for coal

development are low (about one-quarter of the total),

mainly because the major coal-using countries, India

and China, manufacture coal industry equipment

domestically. The projected share of foreign exchange in electric power varies widely according to

country. In countries with developed industrial

sectors, the share may be between 5 and 10 percent,

but in countries that import all their generating

equipment, the share rises as high as 70 Percent.24

Achieving these high levels of foreign resources

for the energy sector investment poses immense

challenges. Though most countries are likely to

experience difficulties, the issues will vary from

country to country. The poorest countries are highly

dependent on confessional aid (which accounted for

80 percent of their total external borrowing for the

energy sector in 1975-80). Their success in acquiring funds will depend on the extent of the increase

in confessional flows. On the other hand, the

middle-income countries depend mainly (80 percent) on export-related and private financial flows

for their external financing of energy investments.

The situation is particularly acute in highly indebted

developing countries.

The other half of the projected increase in

investment in the energy sector comes from domestic resources, with a particularly high share in

electricity and coal. In many countries, however, the

financial situation of the power sector has deteriorated, as increases in costs have not been matched by

~~te~ titigfor tie enq ~tor was projected to come largely (almost threequarters) fium private SOUKXS (supplk dtand privab

commercial loans). Imam horn multilateral agencies and bilateral aid accounted for about onequarter.

~World B@ The Enei-# Transition in Developing Countries @?@@gtOQ w: 1983).
36 ● Energy in Developing Countries

increased revenues.25 The financial viability of oil

refinery operations in many countries is also compromised by the structure of petroleum product

prices. 26 The issue of domestic resource mobilization is of particular importance for coal, where much

of the financial resources needed are local rather

than foreign.

There are indications that the developing countries are paying increased attention to resource

mobilization for the energy sector. Several countries

(e.g., Peru, Ecuador, and Colombia) are currently

opening more of their territories to oil exploration by

foreign firms. Requirements for government participation in oil development ventures are being relaxed. Improved fiscal arrangements providing for

the special characteristics of gas have been adopted

in Egypt, Tunisia, Pakistan, and elsewhere with a

dramatic increase in exploration specifically directed at gas.27

Energy Supply Reliability

Just as the presence of reliable supplies of

high-quality energy can be a strong incentive to

economic development, so unreliable supplies can

discourage development and add substantially to the

cost of usable power. Electricity supplies in many

developing countries are characterized by frequent

service curtailments to customers, including blackouts, brownouts, and sharp power surges. This can

have two types of impacts:

● Industries and offices are unable to operate,

production is lowered, and raw materials are

wasted. In China, for example, it is claimed that

electricity shortages and disruptions during the

1980’s were responsible for idling at least 20

percent of the country’s industrial capacity.28

For the five public-sector steel plants in India,

it has been estimated that at 1986-87 operating

levels, irregular and restricted electricity supply resulted in increased electricity consumption of over 216 gigawatthours at a cost of $10

●

million, and the poor quality of the electricity

resulted in additional consumption of 412

gigawatthours at a cost of $18 million.29 More

generally, lost industrial output caused by

shortages of electricity in India and Pakistanis

estimated to have reduced GDP by about 1.5 to

2 percent.30 Residential consumers are also

affected.

Many consumers, both residential and industrial, - are obliged to invest in a variety of

equipment-voltage boosters, standby generators, storage batteries, kerosene lamps-in

order to minimize the impact of disrupted

supplies. Though no data are available, expenditures on these devices are certainly substantial, adding to the cost of providing usable

supplies.

Such supply constraints are usually associated

with electricity, but there are also shortages of other

sources of energy. Supplies of household fuels in

many countries (e.g., India) are notoriously intermittent. This accounts for the existence of a wide range

of cooking systems in many households in order to

ensure against the shortage of any one fuel. Transportation services are also subject to disruption

because of unreliable fuel supplies.

Energy Pricing and Demand

Management

Energy prices play a key role in energy sector

development, through their impacts on the amount

of energy used in an economy, the technologies

adopted, and in some cases, the direction of industrial development. The effects on the energy infrastructure are long term in nature, and often difficult

to reverse.

Energy pricing policy may have several objectives: efficient allocation of resources, provision of

affordable supplies to consumers, reasonable returns

to energy producers, substitution between fuels for

fiworldB* “Review of World Bank Lending for Electric power, ”World Bank Industry and Energy Department Working Paper Energy Series,

Paper No. 2, March 1988.

~Don~d Her&mm~ “Energy Efficiency and Energy pricing in Developing ComtrieS,” contracto~ report prepared for the Office of Technology

Assessment, May 1990.

zT’fhe~ore J. Gor@q “Pe~ole~ in the Developing World,” contractor report prepared for the Gi31ce of Twtiology Assessment J~Y 1990.

28Vac~v sd,‘CC~’S ~er=: A Case Study, ” op. cit., footnote 18.

%hergyandEnvironmentalAnalysis, ‘Conserving Process Heat in Primary Industries of India and C-” contractorreportprepared for the Gfi3ce

of Technology Assessmen4 April 1990.

‘Arm P. San@vi, “Impacts of Power Supply Inadequacy in Developing Countries,”Journal of Energy Policy (forthcoming).
Chapter 2--Energy and Economic Development ● 37

national security or environmental reasons, promotion of regional development and industrial competitiveness. 31 The weights of these different objectives

in the formulation of energy policy vary among

countries. The importance of the regional development objective, for example, varies from country to

country depending on geographical configuration,

politics, and history. As in other aspects of economic

and social policy, however, there are several characteristics of energy pricing that are shared by many of

the developing countries:

●

●

●

Governments play a strong role in the commercial energy sector. In virtually all developing

countries the electricity sector is government

owned, and in many countries the government

also owns the coal, and oil and gas sectors.

Regardless of the form of ownership, the

government typically regulates prices of energy

products, frequently at several levels of the

production and distribution chain.

Social objectives are an important factor in

formulating energy pricing policies. As a basic

necessity of life, energy accounts for a substantial part of total household expenditures. Governments frequently aim to keep the typical

cost of household fuels-e. g., kerosene for

lighting and cooking, and in some cases electricity-low. The large number of poor in the

population also makes price stability an important policy objective. Though social equity

issues are a major preoccupation in the pricing

of commercial fuels, prices of the most common form of energy used by the poor—wood

and charcoal-are usually not regulated.

Economic objectives, notably, the desire to

encourage key strategic development sectors

including transportation and agriculture, are

also reflected in policies designed to promote

rural electrification or to keep diesel prices low.

Policies that keep key energy product prices low

can also produce adverse results. Revenues from

energy sales may be inadequate to cover the costs of

supplying the energy. This problem is especially

acute in the electricity generating sector in developing countries. One study32 showed that in 30 out of

37 developing countries for which data were available, electricity tariffs were too low to generate the

revenues needed to cover total operating costs plus

allowances for equipment replacement or expansion

of the system. A survey of electric power projects

financed by the World Bank over a 20-year period33

indicates a consistent decline in key financial

indicators as revenues from sales of electricity

lagged behind rising costs.

Petroleum prices are rather different. At present,

subsidies (defined here as prices significantly lower

than those charged in international markets) are

largely limited to oil-exporting (or at least oilproducing) countries. Countries that import all their

supplies of petroleum products, and are therefore

obliged to pay current international prices for their

supplies, are generally unwilling to subsidize prices

on the domestic market. In the oil-exporting countries, however, despite sharp price increases in

recent years, several petroleum products—notably,

kerosene and heavy fuel oil-continue to be sold at

half the international price or less. Low domestic gas

prices, in combination with other factors, discourage

the development of gas resources and contribute to

the spectacularly high share of flared gas in developing countries--47 percent of total production, compared with 4 percent in the OECD countries.%

In both India and China, which together account

for 70 percent of all coal consumption in the

developing world, coal prices are kept below production costs. In China, two-thirds of all coal

enterprises lost money in 1984.35 In the early 1980s

the World Bank estimated Coal India’s losses at

$300 million on sales of $700 million.36

31F0r -mdi~m~~ionof the ~co~ and obj~tives of enerw pfic~g, see ~O~n M~~e, Ener~AnalY~”s and Policy @ndon: Buttenvortbs,

1990); Lawrence J. Hill, Energy Price Rejorm in Developing Countn”es: Issues and Options (Oak Ridge, TN: Oak Ridge National Laboratory, August

1987), and Corazon Siddayao, Criteria for Energy Pricing Policy (London: Oraham and Trotmaq 1985).

sZ~Wence J. Mll, op. cit., footnote 31, pp. 2-10 and 2-20, table 2-3.

Ssworld Ba~ “Review of World Bank Lending for Ek%@ic Power, ” Industry and Energy Department Working Paper, Energy Series paper No. 2,

March 1988.

~~kKomo, Money tOB~n? Theffigh co~tofEnergy~~~sidies @Twhin@o~ DC: world Resources ~tit@e, 1987), p. 14. Based onInternational

Energy Agency data.

ss~wence J. Him op. cit., footnote 31.

~N&k Kosmo, op. cit., footnote 34, p. 16.
38 ● Energy in Developing Countries

In some cases, the costs of energy supplies are

also higher than necessary. Factors such as excessive

staffing and poor management in the electricity

sector increase costs, and there are similar inefficiencies in the oil supply sector. Insofar as the

population is aware of these problems, they maybe

reluctant to agree to price increases that would in

effect subsidize the inefficiencies of the supply

system. Improved efficiencies on the supply side

might make increases in prices and tariffs more

palatable and also help to minimize the total cost to

consumers.

In addition to the general level of energy prices,

the structure of energy prices is of concern in both

the electricity and petroleum product markets. Major

differences in the prices charged for similar services--

as in the case of electricity--or for petroleum

products that can be substituted for each other—

have given rise to distortions in product demand.

The subsidization of some fuels (kerosene and diesel

fuels) for general economic and social reasons,

combined with high taxes on others (gasoline), leads

to shortages of the subsidized fuels, surpluses of the

highly taxed fuels, and capital investment decisions

made on the basis of energy costs that do not reflect

the cost of providing that energy.

In Thailand in the early 1980s, for example, price

differences between gasoline, diesel, kerosene, and

liquid petroleum gas (LPG) led to shortages and

black markets in kerosene and LPG; the diversion of

half of the total kerosene supply to the transport

sector to adulterate diesel fuel; dieselization of many

older vehicles by retrofitting a spark ignition engine

to use diesel fuel; widespread theft of diesel fuel; and

surpluses of gasoline as all vehicles used commercially changed over to diesel.37 Similar developments in other countries have contributed to serious

refinery imbalances. In recent years, Thailand has

moved to reform its petroleum product pricing

system, but wide price differentials persist in other

countries, including Indonesia and India.

Energy pricing decisions are often motivated by

the need to keep energy affordable for large populations of poor households. However, the practical

implementation of such policy is difficult. It is often

difficult to “target” disadvantaged groups. Energy

consumption surveys indicate that the use of commercial fuels is concentrated among middle and

upper income households, rather than the poor who

rely mainly on wood and charcoal. Moreover, if

subsidy programs expand in scale, they can lead to

outcomes that penalize the very people they are

designed to help. Thus, the deteriorating revenue

situation of electricity systems, attributable in some

measure to subsidized tariffs, leads to declining

quality and availability of power supplies, which can

cause factories and workshops to stop operations,

thus increasing unemployment.

Though important, pricing is just one mechanism

for influencing energy demand. Others include

measures to inform consumers of cost-effective

opportunities to save energy, the imposition of

technical efficiency standards, and sponsorship of

energy-efficient technologies.

Developing countries, frequently aided by donor

countries and organizations, have made some progress in demand management and conservation. For

example, the Association of South-East Asian Nations (ASEAN) countries (see box 2-B) have been

particularly active in conservation in both industries

and buildings. In addition, China has established

energy conservation technical centers, which have

contributed to the sharp decline in China’s energy

intensity. In Brazil, energy-saving protocols have

been established with major industries. Korea has

conducted major audits of large companies. Traffic

management schemes, designed mainly to alleviate

congestion, but with an energy-saving bonus, have

been introduced in Brazil, Singapore, Thailand, and

Venezuela. New, more energy-efficient automobile

technologies have been introduced in India. And

several improved wood-burning stoves have been

introduced, at least one of which appears to have

enjoyed considerable success.38 On the institutional

side, movements toward deregulation of economic

activity, as in China in the 1980s, have improved the

competitive environment under which energy decisions are taken and thus have contributed to improved energy efficiency.

37Donald Hert.zmarIG “Energy Efficiency and Energy Pricing in Developing Countries,” op. cit., footnote 26.

sss~uel Baldwin, Howard Geller, Gautan Dut4 and N.H. Ravindrarnat.4 “Improved Wtiburnin g Cookstoves: Signs of Success,’ AA4BZ0, vol.

14, No. 4-5, 1985, pp. 280-287.
Chapter 2--Energy and Economic Development ● 39

L

Box 2-B—Energy Conservation Initiatives in ASEAN Countries

In Southeast Asia, many governments are adopting and implementing laws to encourage energy conservation

in buildings and industry. Design standards have been enact@ or are being considered, in most ASEAN countries.

In Malaysia, the Ministry of Energy, Telecommunications, and Posts has embarked on development of energy

standards for new buildings, with the goal of reducing overall usage by 10 percent by 1991 (5 to 15 percent for

lighting, 5 to 10 percent for air-conditioning, and 15 to 20 percent relating to heat gain through building envelopes).

These standards were widely circulated for review, and were expected to be implemented during 1989. Some energy

audits have been commissioned.l

In the Philippines, major energy consumers are required by law to have energy management programs, and

large customers must report their consumption to the Office of Energy Affairs (OEA) quarterly. The OEA offers

a wide range of conservation services, including an energy management training program, energy conservation

briefings, industry-specific publications, assistance to the Energy Management Association of the Philippines (a

private-sector group), consulting and audits, efficiency testing, and industrial efficiency monitoring. The Omnibus

Energy Conservation Law mandates the development of standards for energy use in commercial buildings, for

building construction materials, and for designs of commercial and industrial buildings prior to the issuance of

permits for building or for adding equipment such as air-conditioning units.

Singapore encourages conservation through educational programs. Indirect controls imposed by the

government’s Building Control Department standardize various design features, such as overhangs and reduced

window area to decrease demands for air conditioning.

In Thailand, the government’s Sixth National Economic and Social Development Plan (1987-91) specified

targets for increased efficiency in transportation, industry, and households. Tax reductions and low-interest loans

for energy conservation equipment are available.

lm 1986 s~dards instituted iu Malaysia areas follows: 1) Buildings whose connected electric service is over 250 kV’ are reqti

to have separate meters for lighting and outlets and for air conditioning systems. 2) Lighting loads are specified for interior spaces, several

building interiors, and roads and grounds in the vicinity of the building. Lighting controls are specified. 3) For air conditioning, dry bulb

temperatures are set at 25 degrees Celsius and relative humidity at 65 percent plus or minus 5 percent. Automatic setback and shutoff systems

are required.

Energy and The Traditional Sector and related traditional technologies generally have

low efficiencies and limited output and productivity

Two-thirds of the developing world’s population—

some 2.5 billion people--live in rural areas39 with

low standards of living based largely on lowresource farming. This type of farming is characterized by high labor requirements, low productivity

per hectare and, because of the marginal subsistence,

strong risk aversion. Rural populations have little

access to commercial fuels and technologies and

only limited connection with the modern economy.

Biomass fuels satisfy the heating and cooking needs

of these populations, and muscle power largely

provides for their agricultural, industrial, and transportation energy needs. Although these energy

sources provide crucial energy services at little or no

direct financial cost, biomass fuels, muscle power,

levels (see ch. 3).

In many areas, biomass supplies are diminishing

due to a host of factors, including population growth

and the expansion of agricultural lands, commercial

logging, and fuelwood use (see ch. 5). The poorest

rural people often have limited access to even these

resources and, therefore, must spend longer periods

of time foraging for fuel sources--exacerbating their

already difficult economic position.

Traditional villages are complex, highly interconnected systems that are carefully tuned to their

environment and the harsh realities of surviving on

meager resources.40 Because the villages are largely

closed systems, changes in any one part affect other

s~orld B@ World Development Report 1989, op. cit., footnote 1.

@See, for e=ple,M.B. Coughenour et al”> “Energy Extraction and Use in a Nomadic Pastoral lkosysteq” Science, vol. 230, No. 4726, Nov. 8;

1985, pp. 619-625; J.S. Singh, Uma Pandey, and A.K. Tiwari, “Man and Forests: A Central Ehrnalayan - Case Study,” AMBIO, vol. 13, No. 2, 1984,

pp. 80-87; Anmlya Kumar and N. Reddy, “An Indian Village Agricultural Ecosystem-Case Study of Ungra Village, Part II: Discussion” Biomuss,

vol. 1, 1981, pp. 77-88.
40 ● Energy in Developing Countries

elements of village life. Changes in agricultural

practices, for example, change the amount and type

of energy supplies available. In turn, energy sector

developments, such as rural electrification, can have

major impacts on agricultural practice and income

distribution. Making changes in rural systems frequently proves difficult due to the large risks that

changes can pose to populations living on the margin

of subsistence.

The following sections examine four of the major

factors that affect the linkages between energy and

the economic and social development of rural

economies: seasonality; inequities in the distribution of and access to resources; the role of commercial biomass in the rural economy; and gender issues

in labor. Mechanizing the mundane tasks of rural

life, a process facilitated by the introduction of

modern fuels, could greatly increase the productivity

of rural peoples. To bring about improvements,

however, will require paying close attention to the

numerous related complications, such as seasonality, the type of task, culture-specific labor roles,

children’s labor, and many others.

Seasonality ,

The seasons affect every aspect of rural life: the

availability of food, fuel, and employment; the

incidence of disease; and even the rates of fertility

and mortality .41 Labor requirements for planting are

seasonally peaked to take advantage of limited

rainfall and other favorable growing conditions.

When rains begin, soil bacteria multiply rapidly and

break down the dead plant matter in the soil left by

the dry season; this process releases a large amount

of organic nitrogen in the soil. Crops planted quickly

after the rainfall can take advantage of this nitrogen,

but a short delay leaves weeds as the main beneficiaries. 42 Labor requirements to harvest crops are

similarly peaked (see figure 2-9). Thus, while there

may be a large labor surplus during most of the year,

labor shortages occur during the critical planting and

harvesting seasons. Studies of African agriculture

indicate that labor is “the major scarce resource in

food production.’ ’43

Modern equipment could reduce the high labor

demands during planting and harvesting. Even when

the necessary commercial fuels are available, however, modern agricultural equipment is often prohibitively costly to purchase or rent due to the very short

period in which it can be profitably used.44 Relatively low-cost traditional technologies face similar

cost barriers. For example, the average animaldrawn cart in Ungra, India, is used at just 6 percent

of its annual capacity .45

Draft animal technologies can ease critical seasonal labor shortages to some extent. Draft animals,

however, can only be used productively for little

more than the short growing season, yet these

animals require food year round. Limited uses for

draft animals, coupled with their high food requirements, reduce the average draft animal efficiencies

to just a few percent. Because of the limited supplies

of fodder available, farmers often semi-starve draft

animals in order to save fodder for when the animals

need their strength to plow the dry-baked ground or

for other purposes. 46 A shortage of draft animals

may limit crops to just one per year-even in areas

with potential for double cropping.47

Although agriculture demands very high levels of

labor during the peak seasons, during the remainder

of the year, rural areas experience serious under41R0~fl Chambers, Richard bnghurs~ and Arnold Pacey (eds.), Seasonal Dimensions to Rural Poverty (lcmdon: Frances Pinter Publishers, Ltd.,

and ‘Ibttawa, NJ: Allanheld, Osmund2 Co., 1981); Robert Chambers, “RuralPoverty Unperceived: Problems and Remedies,” WorZdDeve/opment, vol.

9, 1981, pp. 1-19.

42Robert Chambers, Richard Longhursl and Arnold Pacey (eds.), Seasonal Dimensions to RuraJ Poverty, op. cit., footnote 41, pp. 10-11.

asJeame K~p_ He- “F~ing the Cities and Fe-gthe p~nts:~tRole for Africa’s Woma F~ers?” wOr~DeveZOpment, VO1. 11,

No. 12, 1983, pp. 1043-1055.

~prabhu ~~, Yves Bigo~ adH~ p. B-anger, Agricul~ral Mechanization and the Evo~ution of ~ar?ning systems in hb-sdulra?l&I’Ccl

(Baltimore, MD: Johns Hopkins University Press for the World B* 1987).

asAs a COm~uenceoflowu~tion rates, villagers preferred lower cost wooden wheels OverhigherpdO~ ce pneumatic tires until the depletion

of timber resources caused the price of wooden wheels to rise signit3cantly. At the same time, these price rises led to an active market in second-hand

traditional carts. H.I. Somashekar,N.H. Ravindranath, and Amulya Kumar N. Reddy, Studies on the Ungra Village Agricultural Ecosystem, Part III:

Animal Drawn Carts and Transport (_&mgalore, India: AS-no &te).

*H.I. Somashekar, N.H. Ravindranati and AmulyaKumaz N. Reddy, Studies on the Ungra Village Agricultural Ecosystem Part III: AnimalDrawn

Carts and Transport, op. cit., footnote 45; Jane Bartlett and David Gibbon, Animal Draught Technology: An Annotated Bibliography @mdon: ITDG,

1984); Peter Munzinger, Animal Traction in Afi”ca (Eschborq West ~y:G’IZ, 1982).

4TN.H. RZWh&a~ and H.IN. chnaky~ ‘‘Biomass Based Energy System fOr a South hdian Village, “ Biomass, vol. 9, No. 3,1986, pp. 215-233.
Chapter 2--Energy and Economic Development . 41

Figure 2-9-Seasonal Pattern of Energy Expenditure on Agricultural and Other

Essential Tasks: Adult Farmers, Genieri Village

Kcal/day

2000 r

Females -

1600

1200 I——.r-1

.-

1

I

I

wI

- -

1 :

/

I

. L . :-_ ---- ------ -.

I

?

1

-—1

I

I

1- — I

t I

J

— — — —— -—

H

1

— — —— — — — — — — ———I

800

2

_j - - H_ _ -,s=+_ -

I

I 1 !

Female annual

.- — - ——-—— ——

average

Male annual

- —- — —— --

Y

1 J,,, I, III I I I L

I

- — -

Males I l - - l

;--7. - -

I

I- - . I

I

I

400 I

I

- 1

I

I

I Rainy season I

I

4 ~

I

o

May June July Aug Sept Oct Nov Dec Jan Feb Mar Ap r

-— — Males Females

SOURCE: Margaret Haswell, EneWy for Subsistence (London: MacMillan Press, Ltd., 1981).

employment. In turn, this seasonal unemployment in

rural areas propels a large amount of both seasonal

and permanent migration to urban areas.48 In Africa

and Asia, where the migrants are mostly men,49

more of the burden for subsistence crop production

is shifted to the women who stay behind. Migration

to cities increases pressure on forests as well, because urban dwellers generally purchase their wood

supplies, which are likely to be derived from cutting

whole trees, rather than the gathering of twigs and

branches as is more typical of rural foragers.

rainy season, wood is less easily obtained and more

difficult to burn than during the drier months. In

areas heavily dependent on crop residues for fuel,

shortages at the end of the dry season can force the

use of noxious weeds as substitutes, particularly by

the very poor.50 The use of biogas is limited by the

availability of dung, which in Ungra, India, varies

for adult cattle from 3.5 kg/day during the 7-month

dry season to 7.4 kg/day during the wet season.51

Correspondingly, in mountainous areas or elsewhere

with large seasonal temperature variations, fuel

The seasons also affect the availability and demands can increase significantly during the

usability of renewable energy resources. During the winter. In a Kashmir village, for example, wood

4sM.ic~el P. Todaro, Econonu”c Development in the Third World (New York NY: ~x44uuW Inc., 1977); Oerald M. Meier, Leading Issues in

Econonu”c Development, 4th ed. (New York NY: Oxford University Press, 1984); Scott M. Swinto~ Peasant Farnu”ng Practices and Off-Farm

Employment in Puebla, Mm-co (Ithac& NY: Cornell University, 1983).

49Mic~el p. T~~, Econo~”c Develop~nt in the Third world, op. Cit., f~tnote 48, pp. 192-193. Note tit in IAtk America more wOmeIltbl

men now migrate.

%&un Vidyarthi, “Energy and the Poor in an I.ndian Village,” WorZdDeve20pment, vol. 12, No. 8, 1984, pp. 821-836.

SIN*H.~v~&~~ and HJq.a%“Bio~s Based ~erg System for a SOUth Indian Vikge,” op. Cit., fOOtiOte 47.
42 ● Energy in Developing Countries

demands during the winter are four times higher than

during the summer.52

Inequities in Resource Distribution

and Access

In regions where biomass fuel supplies are

limited-particularly those with dry climates and/or

high population densities-rural people may travel

long distances to collect fuel for domestic use, as

much as 20 miles round trip in some areas under

special conditions. More generally, when wood is

scarce they rely on crop wastes, animal dung, or

other materials as substitutes. Estimates of time

spent in foraging range as high as 200 to 300

person-days per year per household in Nepal.53

Foraging is also heavy work. In Burkina Faso,

typical headloads weigh 27 kg (60 pounds) .54 In

many regions, women and children shoulder most of

the burden.

Despite these heavy burdens, villagers often

prefer to invest their capital and labor in technologies for income-producing activities, such as yarn

spinners, rather than in fuel-conserving stoves or

tree-growing efforts.55 Reasons for this investment

preference include lack of cash income; the ability to

minimize wood use or to switch to alternative fuels

when wood becomes scarce;56 conflicts over ownership of land or trees; and easy access to common

lands. In addition, villagers often carry out fuelwood

collection in conjunction with other tasks, such as

walking to and from the fields or herding animals. In

this case, collecting biomass resources may prove

less burdensome than it appears.57

If wood is scarce, villagers use crop wastes, dung,

‘or other less desirable fuels. To the village user, the

immediate value of these fuels outweighs their

potential long-term environmental costs.58 In India,

for example, a ton of cow dung applied to the fields

produces an estimated increase in grain production

worth $8 (U.S. dollars), but if burned eliminates the

need for firewood worth $27 in the market.59 The

diversion of crop residues, previously used as soil

enhancers, to fuel use may lead to a long-term loss

in soil fertility unless offset by increased use of

chemical fertilizers.

Local fuel shortages often have their most serious

impacts on rural landless and/or marginal farmers

with little access to fuel supplies. The poor may also

sometimes be denied access to their traditional fuel

sources when the market value of biomass rises.60

For example, farm laborers in Haryana, India, are

now sometimes paid in crop residues for fuel rather

than in cash, although previously they had free

access to these agricultural wastes.6l

The Role of Women

Women shoulder the burden of most domestic

tasks, including foraging for fuelwood and cooking.

In many areas they also perform much of the

subsistence agricultural labor. A 1928 survey of 140

Sub-Saharan ethnic groups found that women “carried a major responsibility for food farming" in 85

percent of the cases, and did all but the initial land

52~Jid Huss~ “Fuel COnsumption Patterns in High Altitude Zones of Kashmir and LadaklL” Energy Environment Monitor @iia), vol. 3, No.

2, September 1987, pp. 57-62.

“ “ManandForests: A Central “ 53JCS.sw Umpmdey, and AK. Tiw~, Hunalayan Case Study,” AMBZO, vol. 12, No. 2,1984, pp. 80-87; Kedar

I-al Shresttq Energy Strategies in Nepal and Technological Options (Nepal: Research Center for Applied Science and Technology, Tnbhuvan

University, for the End-Use Oriented Global Energy Workshop, Sao Paulo, Brazil, June 1984). The World Bank Energy Sector Assessment for Nepal

estimated tbat 16 percent of all labor went for fuelwood and animal fodder collection.

fiE.tis~ “Fuel ConsumptionAmong Rural Families in Upper VOIW West Afric~” paper presented at Eighth World Forestry Conference, Jakar@

Indonesi% 1978.

SSV~Vidyd, “~ergy and the Poor in an Indian Village, ” op. cit., fOotnOte 50.

Mphil O’Ke~e and Barry MunsIow, “Resolving the Irresolvable: The Fuelwood Problem in Eastern and Southern Africz” paper presented at the

ESMAP Eastern and Southern Africa Household Energy Planning Seminar, Harare, Zimbabwe, Feb. 1-5, 1988.

sTfiene T~er, “meR~ Rural Energy crisis: Women’s Time,” Energy Journal, vol. 8, 1987, pp. 125-146.

5%eoffrey Barnard and Lars Kristoferso~ Agricultural Residues as Fuel in the Third World (Washington, DC, and London: Earthscan and

International Institute for Environment and Development% Energy Information progrmq Technical Report No. 4, 1985).

59G.C0 Awm~ ~d NOT s%~~fimW ad fionomic Rem From ~tfle Dug u ~nure md R@” Energy, vol. 9, No. 1, 1984, pp. 87-9Q

see also G.C. Aggarw~ “Judicious Use of Dung in the Third World,” Energy, vol. 14, No. 6, 1989, pp. 349-352; Eric Eckhohn et al., Fue2wood: The

Energy Crisis That Won’t Go Away (1..ondon: EarthscarL 1984), p. 105; Ken Newcombe, World Bank, Energy Departmen~ “AnEconomic Justifkation

for Rural Afforestation: The Case of Ethiopia,” 1984.

@V~ Vidyfi, “Ener~ and the Poor in an Indian Village,” Op. Cit., footnote 50.

61 Cen~e for Science ad~v~omen~The State of India’sEnviro~nt 1984-85: The Second Citizen’s Report (New De~: 1985).
Chapter 2--Energy and Economic Development . 43

clearing in 40 percent of the cases.62 In contrast,

the Muslim custom of Purdah, for example, tends to

keep women near their homes and away from the

fields in Bangladesh.63 As women’s work often does

not produce any cash revenue, opportunities for

introducing energy- and labor-saving technologies

for women’s work are limited. Improving labor

productivity and energy efficiency in rural areas will

thus require special attention to the role of women.

The careless introduction of labor-saving technologies could increase the burden on women. For

example, the introduction of animal or mechanical

traction for land preparation and planting increases

the area that men can cultivate, but does nothing to

assist women in weeding, harvesting, post-harvest

food preparation, storage, and other tasks.64

The migration of men to look for urban work

leaves women to fulfill traditional male roles as well

as their own. In Uttar Pradesh, India, the male:female

ratio in villages is 1:1.4 for the working age group of

15 to 50 years.65 In Kenya, a quarter of rural

households are headed by women—in Botswana, 40

percent. 66 Yet the remittances of the migrants can

make an important contribution to rural household

finances.

Children, too, play an important role in rural

labor, freeing adults to perform more difficult

tasks.67 In Bangladesh, for example, children begin

performing certain tasks as early as age 4. By age 12,

boys become net producers-producing more than

they consume-and are nearly as efficient in wage

work as men. By age 15, boys have produced more

than their cumulative consumption from birth, and

by 22 they have compensated for their own and one

sibling’s cumulative consumption.68 The major role

of children in farming helps explain high fertility

rates in rural areas.

The Role of Commercial Biomass in

the Rural Economy

While much biomass is used locally, rural areas

are also the source of substantial amounts of

fuelwood (both firewood and charcoal) used in

towns.69 This trade pumps relatively large amounts

of cash into the rural economy and provides muchneeded employment to rural dwellers during nonagricultural seasons. To supply Ouagadougou, Burkina Faso, with wood during 1975, for example,

required some 325,000 person-days of labor and

generated over $500,000 in income directly and an

additional $2.5 million in income through transport

and distribution.70 Such marketing networks can be

quite extensive and complex.71

In many countries, people in the poorest areas,

where conditions do not permit expansion of crop or

animal production and natural woody vegetation is

the only resource, depend heavily on sales of

GzJ~nne Koopman Hem “Feeding the Cities and Feeding the P~ts: What Role for Africa’s Women Farmers? “ op. cit., footnote 43.

6qMmd x cm“meEconomic Activities of children in a Village in Banglade~” Population and Deve20pment Review, VO1. q, No. s, September

1977, pp. 201-227; GloriaL. Scott and Marilyn Carr, “The Impact of Technology Choice on Rurrd Women in Bangladesh” World Bt@ Staff Worldng

Paper No.731, Washington DC, 1985.

apeter M~inger,&imaJ Traction Zn Afi”ca, Op. cit., foo~ote 4’6.

GSJOSOs- Um p~dey, and A.K. Tiw~‘Wan and Forests: A Centi~yan Case Study,” op. cit., footnote 40.

=World B@ population Growth and Policies in Sub-Saharan Afi”ca ~Mhk@OIL DC: l!JW, P. 39.

67rngrid pwer ~‘otd.“ “Children’s labor, especially daughters’, is usually more signiilcant tban husbands’ in easing a work bottleneck for

women.” Ingrid Palmer, “Seasonal Dimensions of Women’s Roles,” in Robert Chambers, Richard Longhurst, and Arnold Pacey (eds.), Seasonal

Dimensions to Rural Poverty, op. cit., footnote 41.

68M~d T. Cm ~~’rhe Econofic ~tivities of ~dren~ a Vfiage in Banglade~” op. Cit., foottlote 63.

@The value of commercialized fuelwood and charcoal exceeds 10 percent of the gross domestic product in countries such as Burkina Faso, Ethiop@

and Rwanda and exceeds 5 percent in Libe@ Indonesia, Zaire, Mali, and Haiti. Philip Wade and Massimo Pahnie@ “What Does Fuelwood Really

Cost?” UNASYLVA, vol. 33, No. 131, 1981, pp. 2023. George F. Taylor, II, and Moustafa Soumare, “Strategies for Forestry Development in the West

African Sahel: An Overview,” RuraZAfi”cana, Nos. 23 and 24, Fall 1985 and Winter 1986.

nJ.E.M. hold, “woodEhergy and Rural Communities,” Natural Resources Forum, vol. 3, 1979, pp. 229-252.

Tl~fiBefi~~4<~ketingNe~orks forForestfiels to supplyufi~c~te~ in the S~el,’’R~aZAfi”cana, Nos. 23 md24, Fdl 1985 ~d Winter

1986.
44 . Energy in Developing Countries

firewood for their income.72 Similarly, when crops

fail, charcoal production73--or, as in Bangladesh, the cutting of wood from farm hedgerows

grown in part as an economic buffer to be sold before

more valuable livestock and land74—provides alternatives for earning cash. In India, for example,

“headloading” (individuals carrying wood to urban

markets on their heads) has become an important

source of income for perhaps 2 to 3 million people .75

The response of rural peoples to fuel shortages

varies widely. Some sell wood to urban markets and

use the lower quality residues themselves. Others

use dung for fuel rather than for fertilizer. In Malawi,

to grow sufficient fuel for household use on the

typical family farm would displace maize worth

perhaps 30 times more; collecting “free” wood

proves much easier.76 In contrast, aerial surveys of

Kenya have shown that hedgerow planting increases

with population density-demonstrating that villagers respond to the reduced opportunity of collecting

free wood from communal lands by growing their

own.77

Conclusion

High rates of economic growth will be needed in

developing countries to provide the rapidly growing

population with improved living standards. If present trends in energy and economic growth continue

into the future, a sharp increase in commercial

energy consumption in developing countries will be

required. Substantial increases in supplies of biomass fuels will also be needed. This prospect raises

a dilemma. On the one hand, increases in energy

supplies on this scale would severely strain financial, manpower, and environmental resources. But

on the other, inability to supply needed energy can

frustrate economic and social development.

One way to resolve this dilemma lies in distinguishing between the energy that is consumed and

the services derived from it. Technological improvements and other means offer the potential of greatly

improving the efficiency of energy use-providing

more of the energy services needed for development

while consuming less energy. The next chapter

provides an introduction to the services provided by

energy, and how they are currently delivered, with a

view to identifying potentials for improving efficiencies.

TZJ.E.M. Arnold, “wood Energy and Rural Communities,” op. cit., footnote 70, Centre for Science and lhvironmen~ The State of India’s

Environment 1984-85: The Second Citizen’s Report, op. ci~, footnote 61.

T3D.C). Hall and P.J. de Groot, “Biomass For Fuel and Food-A Parallel Necessity,” draft for A#vances in Solar Energy, Karl W. Boer (cd.), vol.

3, Jan. 10, 1986; RafiqulHudaChaudhury, “The %asonality of Prices and Wages in Banglade~” in Robert Chambers, Richard Imnghurst, and Arnold

Pacey (eds.), Seasonal Dimensions to Rural Poverty, op. cit., footnote 41.

TdRick J. V~ Dm Beld~ ‘SUpplying Firewood for Household Energy, “ in M. NurulIslaq Richard Morse, and M. Hadi Soesastro (eds.), Rural

Energy To Meet Deve/opnzent Aleeds (Boulder, CO: WestView Press, 1984).

TSCen~e for Science and EINuo~a~ The Smte of Idia’sEnvironrnent 1984-85: The Second Citizen’ sReport, op. cit., footnote 61, p. 189.

TGD. fiencm “me Economics of BioEnergy in Developing COuIttrieS, “in H. Egneus et al. (eds.), Bioenergy 84, Volume V: Bioenergy in Developing

Countries (Amsterdam: Elsevier, 1985). It is estimated that 90 percent of all rural households collect all their woo@ IOpercent purchase some of their

wood at $0.50m3 or $0.04/GJ. Urban households buy their wood at a cost of $0.12/GJ. In contras~ plantation-derived fuelwood can cost $1.50 to

$2.00/GJ. A farmer could plant trees, but the loss of 0.4 hectare of farmland reduces maize production by a total of $125 and profit by $30. In contras~

trees produced on 0.4 hectare will be worth $6 in 7 years.

~p.N. Bradley, N. Chava.ngi, and A. Van GeIder, “Development Research and Energy Planning in Kenya,” -1o,VO1. 14, NOS. 4-5, 1985, PP.

228-236.
Chapter 3

Energy Services in

Developing Countries

Contents

Page

Introduction . . * *, .,.*,.,. . . 47

The Residential/Commercial Sector ... ... ... **. ***. .*, .., ... ... ,.. ,. *Q,**,+**,***+ 50

Cooking ... ... ... *.. ... ... ... ... ... ... *.. ... ... ... +

.. $*** ***. ..c**. ++q4 @**4**** 51

Lighting ..*. *.. ... ... ..*. ... ... ... ... ... ... ... ... ... .**+ *.. .*. ..*+ q **e.***.**** 55

Space Conditioning, Refrigeration, and Other Appliances . .........*..*..,.,..***., 58

The Industrial Sector ... ... ... ... ... ... ... ... *.. ... ... ... .**. *.. *.** .**. +4@+ .* **a, 62

and Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Process Heat . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ., * . . . . . . . . * * * . * . . * . . * * . * * *,*.,,... 63

Mechanical Drive ... ... ... ... ... ... ... ... *.. ... .o

. ... ***. *.** .**. **. ..a *v*.*** 67

Barriers to Efficiency Improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71

The Traction (Agricultural) and Transportation Sectors . .......**,.,*,*...**.**..*,. 72

Traction and Agriculture ... ... ... ... ... ... ... ... ... ... e#. *.*. *.** ..+* .<*c

. .+. .o 72

Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76

Conclusion ... ... ... ... ... ... ... ... ... *.. ... ... ..*. ... ..$***+ *.** **** ..<* ****be@*, 80

Appendix 3-A: Energy Balances for Selected Developing Countries . . . . . . . . . . . . . . . . . . 81

Appendix 3-B: Sources for Table 3-9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88

Box

Plow ● ✎ ✎ ✎ ✎ ✎ ✎ ✎ ✎ ✎ ✎ ✎ ✎ ✎ ✎ ✎ ✎ . . . . . . . ........*...****.,..*...,..,..
Figures

Figure Page

3-L Per-Capita Energy Use in Village Households in Developing Countries . . . . . . . . . . . . . . . . . 50

3-2. Choice of Cooking Fuel by Income for Five Medium-Sized Towns in Kenya ... ... ......52

3-3. Representative Efficiencies and Direct Capital Costs for Various Stoves . . . . . . . . . . . . . . . . 53

3-4. Direct Energy Use for Cooking in West Java, Indonesia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

3-5. Daily Load Profiles for Cooking Energy, Pondicherry,India, 1980 . . . . . . . . . . . . . . . . . . . . . 55

3-6. Light Output and Efficiency of Various Lighting Technoiogies . . . . . . . . . . . . . . . . . . . . . . . . . 56

3-7. Costs of Various Lighting Technologies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

3-8. Changes in Capacity and Type of Installed Electric Lighting Per Household

With Income Level South Bombay, India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58

3-9. Household Electricity Use for Lighting v. Household Income, in Brazil . . . . . . . . . . . . . . . . . 59

3-10. E1ectric Appliance Ownership in Urban Malaysia by Income Group, 1980 .. .. ... ... .....60

3-11. Electric Appliance Ownership in Urban Java,1988 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

3-12. Refrigerator Ownership in Beijing, China, 1981-87 ....*.,. . . . . . . . . . . . . . . . . . . ...***... 60

3-13. Reduction in the Real Cost of Refrigerators Over Time in the United States . . . . . . . . . . . . . 60

3-14. Per-Capita Steel Consumption v. GNP for Various Countries . . . . . . . . . . . . . . . . . . . . . . . . . . 66

3-15. Per-Capita Cement Production v. GNP for Various Countries ..?,.... . . . . . . . . . . . . . . . . . . 66

3-16. Efficiency of Electric Motors in the United States, Brazil, and India . . . . . . . . . . . . . . . . . . . . 71

3-17. Energy Losses in an Example Electric Motor-Driven Pumping System

in the United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72

3-18. Use of Agricultural Pumpsets in India 1950-90 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76

3-19. Passenger and Freight Transport v. GNP for Selected Countries, 1%0-81 . . . . . . . . . . . . . . . 77

Tables

Table Page

3-1. Total Delivered Energy by Sector, in Selected Regions of the World, 1985 ........ .....49

3-2. Delivered Energy Per Capita by Sector in Selected Regions, 1985 . . . . . . . . . . . . . . . . . . . . . 49

3-3. Per Capita Energy Use by Service in Selected Countries . . . . . . . . . . . . . . . . . +....,,.. . . . 49

3-4. Principal Cooking Fuels Used by the World Population, 1976 . . . . . . . . . . . . . . . . . . . . . . . . 51

3-5. Typical Air Pollution Emissions From Various Cooking Fuels . . . . . . . . . . . . . . . . . . . . . . . . 52

3-6. Residential Nonheating Electricity Intensity in Selected Countries, 1970 and 1986 ... ...61

3-7. Kenyan National Energy Use by Fuel, 1980 . . . . . . . . ..,.,...* . . . . . . . . . . . . . . . . . . . . . . . 63

3-8. Annual Consumption of Fuelwood and Charcoal in Kenya by Rural Cottage Industries,

(GJ/Capita . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64

3-9. Efficiency of Fuel Use in Traditional (Developing Countries)andModern

(Industrial Countries) Commercial and Industrial Operations . . . . . . . . . . . . . . . . . .,,..,.*, 65

3-10 Energy Consumption by Chinese Industry, 1980 . . . . . . . . . . . . . . . .,,,,... . . . . . . . . . . . . . 65

3-11. Average Energy Intensities of Building Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67

3-12. Energy Intensities of End Products Using Alternative Building Materials ... ... ... ......67

3-13. Average Daily Household Consumption of Water, Gujurat, India . . . . . . . . . . . . . . . . . . . . . . 68

3-14. Industrial Electricity End Use in Brazil, 1984 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69

3-15. Projected Electricity Consumption in India by Sector and End Use, 1990...............70

3-16. Agricultural Indicators for Selected Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..+. 74

3-17. Passenger Fleet Size and Growth in Selected Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78

3-18. Energy Efficiency of Trucks in Selected Countries . . . . . . . . . . . . . . . . . . . . . . . . . . ...,.*.,. 79

3-19. Comparison of Rail Systems in China, India, and the United States . . . . . . . . . . . . . . . . . . . . 80

3A-1. Brazil: Energy Supplies and Services, 1987, Exajoules and Percent of

National Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82

3A-2. China: Energy Supplies and Services, 1987, Exajoules and Percent of

National Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83

3A-3. India: Energy Supplies and Services, 1985, Exajoules and Percent of

National Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

3A-4. Kenya: Energy Supplies and Services, 1980, Petajoules and Percent of

National Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85

3A-5. Taiwan: Energy Supplies and Services, 1987, Petajoules and Percent of

National Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86

3A-6. United States: Energy Supplies and Services, 1985, Exajoules and Percent of

National Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Chapter 3

Energy Services in Developing Countries

Introduction and Summary

Energy use in the world’s developing countries is

increasing rapidly. In 1960, developing countries

consumed just 15 percent of the world’s commercial

fuels; by 1985, their share had increased to about 24

percent.1 Including traditional fuels, the developing

country share of world energy consumption was

about 28 percent in 1986. Developing countries

might consume as much commercial energy as

today’s industrial countries by early in the next

century. 2 Factors driving this rapid increase in

energy use include population growth, economic

growth, and increasing urbanization (see ch. 2).

Even with this rapid growth, overall per-capita

energy consumption rates in developing countries in

2025 would be just one-fifth that of the United States

in 1987.

The purpose of this chapter is to examine how

energy is used in developing countries. As explained

in chapter 1, the focus of this report is on the services

energy provides rather than the amount of energy

consumed. The reason for this approach is simple:

energy is not used for its own sake, but rather for the

services it makes possible. For example, wood might

be burned to cook food, heat water, warm a house on

a winter evening, heat an industrial boiler, or to

provide other services.3 Similarly, diesel and gasoline are used primarily to provide transportation

services.

There may be many different means of providing

a desired service, each with its own costs and

benefits. Transportation, for example, might be

provided by bicycles, motorcycles, cars, buses, light

rail, or aircraft. The consumer chooses among these

according to such criteria as cost, comfort, convenience, speed, and aesthetics. Within these consumer

constraints, a more efficient car maybe preferable to

an increase in refinery capacity in order to reduce

capital and/or operating costs or because of its

environmental benefits. Thus, in addition to engineering and economics, energy analyses should also

consider social, cultural, and institutional factors.

Such factors are more readily included in a services

framework than in a conventional energy supply

analysis.

The amount of energy consumed in the main end

use markets-residential and commercial, industry,

and transportation-is examined first; then the

major services provided by energy are examined

within each end-use market. In the household sector,

the services examined are cooking,4 lighting, space

conditioning, and refrigeration; in industry, process

heat and motor drive; in agriculture, irrigation and

traction; and, finally, transportation. These services

are chosen on the basis of their current or likely

future levels of energy consumption or their social

and economic impacts.

Within this services framework, changes in energy use are traced from traditional rural areas to

their modern urban counterparts. The progression

from the traditional rural to the modern urban

illuminates well the wide range of technologies now

being used in the developing countries and the

dynamics of how energy use can be expected to

change in the future.

Energy use in traditional rural villages reflects a

much different set of considerations from that of the

modern urban economy. First, traditional energy use

is part of a complex and interdependent biological

system, rather than being based on fossil fuels. The

biomass that is used for fuel is part of a system that

provides food for humans, fodder for animals,

construction materials, fiber for ropes, and even

traditional medicines. Similarly, the bullock that

pulls a plow also provides milk, meat, leather, and

dung for fertilizer or fuel.

Second, people in traditional economies carefully

assess their choices and make complex tradeoffs

IJay~t Sathaye, Andre Ghirar@ and Lee Schipper, “~ergy D~din Developing Countries: A Sectoral Analysis of Recent Trends,” Annuu2

Rew”ew of Energy, vol. 12, 1987, p. 253.

T.S. Environmental Protection Agency, “Policy Options for Stabilizing Global Climate,” vol. 2, February 1989, p. VII-30. Rapidly Char@ng

World Scenario.

% some cases, particularly in the industriahxd countries, wood might be burned in a fweplace simply for aesthetic reasons.

dWa@rh=@ is~~~w~nt residen~mmm~~ energy servim titis often S- to coo- b t- of the tdlrlologies wed. It k nO~

however, explicitly considered here.

-47–
48 ● Energy in Developing Countries

between the numerous pressures they face in day-today survival, at a level seldom seen in the modern

economy. Gathering fuel, for example, is not free: it

costs time and personal energy that must be balanced

against all the other demands that one faces,

particularly during the agricultural season when

labor demand is at its peak. There are also complex

tradeoffs involved in gaining access to fuels on

common lands or on privately owned land.

Third, although people in rural areas may use

energy inefficiently in comparison to what is possible with modern commercial technologies, they use

energy rather efficiently and wisely given the

constraints on their resources, technology, and

capitals They have little choice in this if they are to

survive on their meager resources. Rather than

maximizing production, as is done in modern

industrial society, traditional peoples focus on

minimizing risk in the face of the vagaries of drought

and other natural disasters.

The efficiency and productivity of traditional

energy technologies in developing countries can be

significantly improved. To do so effectively, however, will require an understanding of the complex

linkages of village life. In general, village populations operate rationally within their framework;6

change then requires that the framework be changed

through the introduction of external inputs—

financial, managerial, material, and technical. The

lack of success of many development programs can

be attributed in part to a failure to recognize the

rationality of rural lifestyles and the need to address

the overall framework in which villagers operate.

For the developing countries as a whole, the

residential/commercial and industrial sectors constitute the largest end use energy markets, together

accounting for 85 percent of the energy used by final

consumers when traditional fuels are included.

Transportation accounts for the remaining 15 percent. There are, however, considerable differences

among developing nations.7 The residential/commercial sector accounts for a particularly high share

of energy use in African countries (mostly in the

form of biomass fuels for cooking), while industry’s

share is quite low. Transportation accounts for an

exceptionally high share of the total in Latin

America, whereas its share in India and China is low.

Tables 3-1,3-2, and 3-3 provide sectoral and energy

service breakdowns for the developing countries;

figure 3-1 shows per-capita energy use in rural

households as determined by village surveys in

Africa, Asia, and Latin America. Residential cooking and industrial process heat account for almost

two-thirds of all the energy used in the developing

world. About 40 percent of all energy consumed in

providing these services in developing countries, or

well over a quarter of the total energy consumed in

developing countries, is used in India and China.

Cooking is the single largest energy use in many

developing countries. There is a well-established

transition in cooking fuels associated with higher

incomes, improved supply availability, and urbanization. In rural areas, and in poor urban households,

traditional fuels (wood, crop wastes, and dung) are

used in simple stoves. In more affluent households,

people switch to modern stoves and clean, convenient fuels such as kerosene, Liquefied Petroleum

Gases (LPG), and electricity. Because wood stoves

are relatively inefficient, households that use kerosene or LPG can consume significantly less energy

for cooking than those using wood and charcoal.

Lighting technologies follow a similar technological progression, from candles or light from wood

frees in some rural areas, to kerosene and butane

lamps, to electricity, which is a highly prized energy

service. Electricity use for lighting rises rapidly with

household income.

Relatively little energy is used for residential

space cooling in developing countries. Space cooling is becoming significant in commercial and

government buildings, however, and energy use for

space cooling is likely to grow rapidly in the future.

sNotable examples of studies on this topic include: N.H. Ravindranath et al., “An Indian Village Agricultural Ecosystem-Case Study of Ungra

Village, Part I: Main Observations,”Biomass, vol. 1, No. 1, September 1981, pp. 61-76; Amulya Kumar N. Reddy, “An Indian Village Agricultural

lkosyste~e Study of Ungra Village, Part II: Discussion” Biomuss, vol. 1, No. 1, September 1981, pp. 77-88; M.B. Coughenour et al.,

“EnergyExtraction and Use in a Nomadic Pastoral Ecosystew” Science, vol. 230, No. 4726, Nov. 8, 1985, pp. 619-625.

‘Ibid.

%nergyuse at the village level is fairly similar in both quantity and source (biomass), and in application (cooking, subsistence agriculture) throughout

the world. Energy use by the economically well off is also reasombly similar throughout the industrial countries as well as among the urban elite in

developing countries. The large differences in energy use between countries are due primarily to the relative numbers of villagers and economictdly well

off inthepopulatiow the form and quantity of energy use by those who are making the transition between these two extremes; and the development path

being followed.
Chapter 3--Energy Services in Developing Countries ● 49

Table 3-l—Total Delivered Energy by Sector, in Selected Regions of the World, 1985 (Exajoules)

Residential/commercial Industry Transport Total

Commercial Traditional Commercial Traditional Commercial Traditional Commercial Traditional Total

Region fuels fuelsafuels fuelsa

fuels fuelsa

fuels fuelsa

energy

Africa . . . . . . . . . . . . . . 1.0 4.0 2.0 0.2 1.5 — 4.4 4.1 8.5

Latin America . . . . . . . 2.3 2.6 4.1 0.8 3.8 — 10.1 3.4 13.5

India and China . . . . . 7.3 4.7 13.0 0.2 2.0 — 22.2 4.8 27.1

Other Asia . . . . . . . . . . 1.9 3.2 4.0 0.4 1.9 — 7.8 3.6 11.3

United States . . . . . . . 16.8 — 16.4 — 18.6 — 51.8 — 51.8

-Not available or not applicable.

a these estimates of traditional fuels are lower than those generally observed in field studies. See figure 3-1, app. 3-A, and ch. 4.

b this is delivered energy and does not include conversion losses.

NOTES: 1 exajoule (1018 Joules) equals 0.9478 Quads. The residential and commercial sector also includes others (e.g., public services, etc.) that do not fit

in industry or transport. Traditional fuels such as wood are included under commercial fuels for the United States. These figures do not include

conversion losses (from fuel to electricity, in refineries, etc).

SOURCE: International Energy Agency (lE/l), Wbt# Energy Sfatisfics and 8a/ances 1971-1987 (Paris: OECD, 1989); IEA, Energy 6a/ances of OECD

Countries f970-1985(Paris: OECD, 1987); and IEA, Energy 6a/ances of Developing Counties 1971-1982 (Paris: OECD, 1984).

Table 3-2—Delivered Energy Per Capita by Sector in Selected Regions, 1985

(gigajoules) (Includes traditional fuels)

Region Residential/commercial Industry Transport Total

Africa . . . . . . . . . . . . . . . . . 11.8 5.2 3.5 20.5

Latin America . . . . . . . . . . 12.7 12.5 9.7 34.9

India and China . . . . . . . . 6.7 7.3 1.1 15.1

Other Asia . . . . . . . . . . . . . 7.2 6.2 2.7 16.1

United States . . . . . . . . . . 69.8 68.5 77.5 215.8

NOTE: These estimates do not include conversion losses in the energy sector and underestimate the quantity of

traditional fuels used compared to that observed in field studies. See app. 3-A for better estimates of traditional

fuel use and for sectoral energy use including conversion losses.

SOURCE: Derived from table 3-1.

Table 3-3-Per Capita Energy Use by Service in Selected Countries (Gigajoules)

Brazil China India Kenya Taiwan U.S.A.

Residential . . . . . . . . . . . . . . . . . . 6.2 11.7 5.5 16.9 8.9 64.9

cooking . . . . . . . . . . . . . . . . . . . 5.3 8.5 5.0 16.4 4.7 3.5

lighting . . . . . . . . . . . . . . . . . . . 0.3 0.4 0.5 0.5 0.7 —

appliances . . . . . . . . . . . . . . . . 0.6 — 0.05 — 3.1 13.0a

Commercial . . . . . . . . . . . . . . . . . 1.5 0.7 0.26 0.4 4.2 45.2

cooling . . . . . . . . . . . . . . . . . . . 0.4 — 0.13 0.24 1.9

lighting . . . . . . . . . . . . . . . . . . .

—

0.5 — 0.05 0.16 0.8 7.2

appliances . . . . . . . . . . . . . . . . 0.6 — 0.07 — 1.5 .

Industrial . . . . . . . . . . . . . . . . . . . . 19.4 13.8 4.1 4.8 39.2 94.1

process heat . . . . . . . . . . . . . . 17.5 10.2 2.7 — 55.8

motor drive . . . . . . . . . . . . . . .

—

1.6 3.6 1.3 20.4

lighting . . . . . . . . . . . . . . . . . . .

— —

0.1 — 0.05 — — —

Transport . . . . . . . . . . . . . . . . . . . 13.3 1.2 1.3 2.7 11.5 80.8

road . . . . . . . . . . . . . . . . . . . . . . 12.0 0.2 0.8 1.8 10.1 66.7

rail . . . . . . . . . . . . . . . . . . . . . . 0.2 0.7 0.4 0.2 0.1 2.0

air . . . . . . . . . . . . . . . . . . . . . . . 0.7 — 0.1 0.7 0.7 11.3

Agriculture . . . . . . . . . . . . . . . . . . 2.1 1.8 0.6 0.5 2.6 2.5

Total . . . . . . . . . . . . . . . . . . . 43.4 27.0 11.7 25.6 67.7 288.0

— Not available or not applicable.

a This is the combined total for applicances and lighting.

NOTE: These estimates include the upstream conversion losses in the energy sector, such as the loss in going from fuel to electricity or crude to refined

petroleum products. This in in contrast to tables 3-1 and 3-2 where energy sector conversion losses were not included.

SOURCE: Adapted from app. 3-A, tables 1 through 6.
50 ● Energy in Developing Countries

Figure 3-l—Per-Capita Energy Use in Village

Households in Developing Countries

Per-capita energy use, GJ/year

35 ~ -—-- —- —

3 0 -

2 5 -

2 0 -

15

10

5

I o - 1 IllIll Illldlll Ii l

Asia Africa Latin

America

This figure shows per-capita use of biomass fuels as found in

household energy surveys in Asia, Africa, and Latin America. The

observed energy use depends on such factors as fuel availability,

climate, diet, income, and other factors. The generally higher

levels of energy use in Africa and Latin America reflect, in large

part, the greater availability and accessibility of wood and other

biomass fuels. The sporadic peaks in energy use shown in the

figure are typically for villages in colder, more mountainous

regions.

SOURCES: D.O. Hall, G.W. Barnard, and P.A. Moss, Biomass for f%erav

in the Developing Countries (Oxford: Pergamon Press, 19~~,

pp. 212; World Bank, “Bolivia: Issues and Options in the

Energy Sector,” UNDP/WB Energy Sector Assessment Program, Rpt. 4213-60, April 1983; J.S. Singh, U. Pandey, and

A.K. Tiwti, “Man and Forests: A Central Himalayan Case

Study,” AMBIO, VOI. 12, No. 2, 1984, pp. 80-87; Issoufou

Boureimaand Gilles De Chambre, Rapport sur/’Eva/uation du

Programme Foyers Ame/lores (Niamey, Niger: Association

des Femmes du Niger and Church World Service, November

1982).

Also, electric appliances are quickly penetrating the

residential sector. Many of these air conditioners and

appliances, notably refrigerators, have low efficiencies. These end uses are having strong impacts on the

electric power infrastructure.

Many commercial and industrial processes require process heat, ranging from the low-temperature heat provided by biomass used to dry food

in cottage industries to the high-temperature processes used in the large-scale steel and cement

industries. With some exceptions, the efficiencies of

these processes are typically much lower than those

found in industrialized countries.

Much of the population in developing countries

depend for their mechanical work in both industry

and agriculture on human or animal muscle, with

low efficiencies and power outputs that seriously

limit productivity. The efficiencies of modern diesel

and electric motors are significantly lower in developing countries than in the industrialized countries

as well.

As in other sectors, there is a transition in

transportation technologies. Walking and use of

domesticated animals are the dominant transport

technologies in poorer and rural areas. The next step

up is bicycles, and then the internal combustion

engine. Transport services in the developing world,

as in the industrial world, are based largely on

highways. In the developing countries, however,

freight rather than passenger traffic is the most

important transport activity in terms of energy

consumption.

The Residential/Commercial Sector8

Energy use in the residential/commercial sector of

developing countries typically accounts for about 30

percent of commercial energy use and two-thirds or

more of traditional fuel use (see app. 3-A). Cooking

is by far the largest use of fuel in rural areas; in urban

and more developed areas, lighting and appliances

(refrigerators and electric fans, for example) are also

large energy users. Air conditioning is likely to

become important in the future in residences and is

already widely used in commercial, institutional,

and government buildings in developing countries.

The average energy efficiency of the most common cooking, lighting, and appliance technologies

in use in developing countries today can be improved dramatically,9 but usually at a significant

additional capital cost to the consumer. Nevertheless, the advantages of these more modern technologies--convenience, comfort, effectiveness-are incentive enough for consumers to make the investment where the technologies and the necessary fuel

supplies are available, affordable,10 and reasonably

reliable.

%this analysis, the residential/cmmnercial sector includes other energy uses such as public buildings not included in the industrial and transportation

sectors.

% can be accomplished by changing both the mix of technology (e.g., shifting users from Iow-efllciency wood stoves to high-efficiency LPG

stoves) and by improving the individual technologies themselves (e.g., moving toward higher efilciency refrigerators).

IOApp~priate f~cial mechatims ‘yh ‘etid”
Chapter 3--Energy Services in Developing Countries ● 51

Table 3-4-Principal Cooking Fuels Used by the World Population, 1976

Percent of people using fuel

Fossil Dung and

Region energya Fuelwood crop waste

Africa South of Sahara . . . . . . . . . . . . . . . . . . . . . . .

India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Rest of South Asia . . . . . . . . . . . . . . . . . . . . . . . . .

East Asia, developing Pacific . . . . . . . . . . . . . . . . .

Asia centrally planned economies . . . . . . . . . . . . .

Middle East, North Africa. . . . . . . . . . . . . . . . . . . . .

Latin America and Caribbean . . . . . . . . . . . . . . . . .

North America, OECD Pacific. . . . . . . . . . . . . . . . .

Western Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Europe, centrally planned economies . . . . . . . . . .

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10

10

12

36

22

53

71

100

100

100

47

63

47

46

41

51

17

26

0

0

0

33

27

43

42

23

27

30

3

0

0

0

20

a Includes electric cooking.

SOURCE: Adapted from David Hughart, Prospects fbr Traditbua/ and fVon-Convenfiorm/ Energy Soumes in

Developing Countries, Worfd Bank staff working paper No. 346,132 pp., July 1979.

Cooking ll

The most important single energy service in many

developing countries is cooking. In rural areas of

developing countries, traditional fuels--wood, crop

wastes, and dung-are used for cooking; in many

urban areas, charcoal is also used. More than half of

the world’s people depend on these crude fuels for

their cooking and other energy needs (see table

3-4). 12 Higher incomes and reliable fuel supplies

enable people to switch to modern stoves and clean

fuels such as kerosene, LPG, and electricity.

Traditional Fuels

Traditional fuels are predominant in rural areas

because they can be gathered at no financial cost and

used in very simple stoves—as simple as an open

free. At the national level, the use of biomass for fuel

reduces expensive energy imports. These are substantial benefits.

Use of traditional fuels also exacts substantial

costs. Large amounts of labor are expended to gather

these fuels in rural areas, and a significant portion of

household income is spent for them in poor urban

areas (see ch. 2). Cooking with traditional fuels is

awkward and time-consuming. Unlike modern gas

or electric stoves, stoves that use traditional biomass

fuels must be constantly tended to maintain an

adequate flame. This demands a large share of

women’s time in developing countries-averaging

perhaps 3 to 5 hours per day13—and interferes with

other activities.

Cooking with traditional fuels is also usually

unpleasant and unhealthy due to the large amount of

noxious smoke emitted (see table 3-5). Measurements of indoor concentrations in homes in developing countries have found levels of carbon monoxide,

particulate, and hydrocarbons 10 to 100 times

higher than World Health Organization standards.

Cooks can be exposed to as much or more carbon

monoxide, formaldehyde, benzo(a)pyrene, and other

toxins and carcinogens as heavy cigarette smokers.14

Smoke from cooking stoves is therefore thought to

be a significant factor in ill-health in developing

llAItiou@ tie ~scussion here focuses on household cooking, the same considerations apply to commercial and hstilut.iOMlset-s.

12Hea~g water for ba~~d cl~~ and kiling water for &inking are implicitly included in the discussion here, u the teehOIO@es uSed are

often the same for the lower and middle income groups in developing countries, and separation of energy use for these purposes is difikult,

13Ric~d Morse et~., “OrganiAngCurrentInformation forRuralEnergyand Development Planning,” M. NurulIslamj Richard Morse, andM.Hadi

Soesastro (eds.), Rural Energy to MeetDevelopment Neea%: Asian Village Approaches (Boulder, CO: Westview Press, 1984), table 7, p. 498.

1a~ R. Smi@ BioM~~ Fuels, Air Pollution, a~Health: A Global Review (New York NY: plenum pr~s, 1987)
52 ● Energy in Developing Countries

Table 3-5-Typical Air Pollution Emissions From Various Cooking Fuels

Efficiency Grams per gigajoule of delivered energya

Fuel (percent) TSP s o , NOx HC GO

Wood (tropical) . . . . . . . . . . . . . . . 15 3,800 250 300 3,200 34,000

Cow dung (Hawaiian) . . . . . . . . . 15 10,000 3,200 . 44,000

Coal (Indian) . . . . . . . . . . . . . . . . .

—

20 280 2,200 460 2,200 27,000

Coconut husk . . . . . . . . . . . . . . . . 15 17,000 — — 54,000

Natural gas . . . . . . . . . . . . . . . . . . 60 0.7 — 13 ‘ 7 330

— Not available or not applicable.

a TSP, total Suspended particulates; SO2, sulfur dioxide; NOX, nitrogen oxides; HC, hydrocarbons; CO, carbon monoxide.

SOURCE: Adapted from Kirk R. Smith, Biomass Fuels, Air Po//ution, and Hea/th:A G/oba/ Review (New York, NY: Plenum Press, 1987).

countries. The diseases implicated include severe

eye irritation, respiratory diseases, and cancer.15

Finally, although the expansion of agricultural

and grazing lands and commercial logging are the

most important causes of deforestation globally, the

use of wood for fuel may also contribute to deforestation in some local areas, particularly where the

population density is high and the climate is dry such

as the West African Sahel (see ch. 5).

The Transition to Modern Stoves

and Clean Fuels

People are generally observed to make the transition to modern, efficient stoves and clean fuels as

soon as they are available and affordable (see figure

3-2). 16 These technologies are preferred for their

convenience, comfort, cleanliness, ease of operation, speed, and other attributes.

There is a natural progression in efficiency, cost,

and performance as consumers shift from wood

stoves to charcoal, kerosene, LPG or gas, and

electric stoves (see figure 3-3). Improved wood and

charcoal stoves have also begun to fill a potentially

important niche between traditional wood or charcoal stoves and modern kerosene or gas stoves.

Cultural factors are often cited as a barrier to the

adoption of improved biomass stoves and fuels.

Figure 3-2-Choice of Cooking Fuel by Income for Five

Medium-Sized Towns in Kenya

Percent of income group using fuel

100 r — –

1

80, ‘i >

i .- ‘-’

60

[

\

40 /

/

r

20 ‘

o L . . — -L— — ( -– ~

Low Middle High

Income group

‘-- Wood + Charcoa l + Kerosen e

+ 

Gas - Electricit y

Many households use more than one fuel depending on the

particular food cooked and the supply and cost of fuel. Note the

shift in fuel choice from wood to charcoal and kerosene, and then

from charcoal and kerosene to gas and electricity.

SOURCE: John Soussan, “Fuel Transitions Within Households,” Discussion paper No. 35, Walter Elkan et al. (eds.), Transti”ons

Between TracWonaland Commeraal Energy in the Third kldkl

(Guiidford, Surrey, United Kingdom: Surrey Energy Economics

Center, University of Surrey, January 1987).

Although cultural factors may play a role in choices

of stoves or fuels, it is hardly a dominant one, as

evidenced by the wide variety of stoves and fuels

that have already been adopted across the full range

of class, cultural, and income groups in developing

countries. More typically, the reason that various

stoves have not been adopted by targeted groups in

IsAlthough the limited data available linkins human exposure to the smoke from wood fwes to lung cancer is still ambiguous (but may indicate

anomalously low cancer rates), there is now evidence of excess lung cancer among cooks using certain types of coal irt China. Overall, the World Health

Organization now cites respiratory disease fmm all causes as the leading cause of mortality in developing countries. See Kirk R. Smi@ “PAHand the

Household Cook in Developing Countries: The Lung Cancer Anomaly,” paper presented at the Symposium on Polynuclear Aromatic Hydrocarbons

in the Workplace, Intermtional Chemical Congress of Paci.t3c Basin Societies, Honolulu, HI, December 1984, to be published in M. Cooke and A.J.

Dennis (eds.), Polynuclear Aromutic Hydrocarbons: Formation, Metabolism and Measurement (Columbus, OH: Batelle Press); J.L. Mumford et al.,

“Lung Cancer and Indoor Air Pollution inXuan Wei, chin%” Science, vol. 235, Jan. 9, 1987, pp. 217-220; H.W. de Koning, K.R. SmitlL and J.M. LasL

“Biomass Fuel Combustion and Heal@” Bulletin of the World Health Organization (EFP/84.64).

Ic’r’his ~msition is complex ~d not yet well unde~tood. Factors that affect ahousehold’s shift to modern stoves ~d fuels include household income

and fuel-producing assets (land, trees, animals, etc.); reliability of access to modem fuels; relative cost of traditional and modern fuels and stoves; level

of education of the head of household; cooking habits; division of labor and control of fwces within the household; and the relative performance of

the stoves and fuels available.
Chapter 3--Energy Services in Developing Countries ● 53

Figure 3-3-Representative Efficiencies and Direct Capital Costs for Various Stoves

Stove efficiency (%) Capital cost ($) .

7 0

–r —

30

20

10

8 0

6 0

/

I

/ /

, I 4 0

2 0

0 I I I I o

Agricultural Traditional Improved Kerosene Electric

waste in charcoal charcoal pressure hot plate

traditional ● stoves ● stoves ● stoves

● tovea

Animal Tradition al Improved Kerosene

dung In

LPG

wood WOO d Wic k

traditional

stoves

stoves stoves

● tovea

● stoves

The range of performance both in the laboratory and in the field is much larger than that suggested by

this figure and is affected by such factors as the size of the stove and pot, the climate (wind), the quality

of the fuel used, the care with which the stove is operated, the type of cooking done, and many other

factors. The type of material that the pot is made of is also a significant factor: aluminum pots are almost

twice as efficient as traditional clay pots due to their better conduction of heat. Although the efficiency

of improved charcoal stoves is shown as slightly higher than improved wood stoves-the case today for

the simplest uninsulated metal woodstoves--the potential performance of wood stoves is higher than

that for charcoal stoves.

SOURCE: Samuel F. Baldwin, ~“omass Stoves: Engineering Design, Development, and Dissemination (Arlington, VA:

VITA, 1986); and OTA estimates.

the developing countries is that they simply have not

worked well.17

The transition to modern stoves and fuels is often

sharply constrained due to their higher capital costs

(figure 3-3) and uncertainty in the supply of fuel. In

Colombo, Sri Lanka, for example, the cost of

converting to LPG in 1983 was equivalent to 1

month’s income for 70 percent of the population and

5 months’ income for the poorest 20 percent.18 Yet

cooking with gas can be the lowest cost alternative

when both capital and operating costs are included.

In Raipur, India, the cost of cooking with LPG is less

than that for wood for household discount rates of 30

percent or less; yet many households continue to use

wood, presumably because effective household discount rates are higher19 (the capital cost of gas stoves

was cited as a major reason for the failure to switch

from wood to LPG for cooking).

Because of the high cost of LPG cooking, charcoal and kerosene are widely used as an intermediate

step in the transition from wood to gas stoves.

Charcoal is very popular in some urban areas. For

example, it is the fuel of choice in urban Kenya (see

figure 3-2) and Senegal-which have a tradition of

charcoal production and use remaining from the

historical Saharan trade caravans.20 Consumers

ITSamuel F. Baldw@ BioMss Stoves: Engineen”ng Dew”gn, Development, and Disserm”nation (Adingtoq V!: VITA, 1986); Sam B~dti et ~.,

“Improved Woodburning Cookstoves: Signs of Success,” AMBZO, vol. 14, No. 4-5, 1985.

lg&r~d hack Household Energy in South An-a (New YorlG NY: Elsevier Applied Science, 1987).

lgJ. Dunkerley et al., ‘‘Consumption of Fuelwood and Other Household Cooking Fuels in Indian Cities,” Energy Policy, January/February 1990, pp.

92-99. “Discount rates” are a measure of the time value that households place on their available cash income.

WorldBardG Energy I@wtrnen4 “Review of Household Energy Issues in Afiicz” draft report, May 1987, p. 3, p. 1.6.
54 ● Energy in Developing Countries

prefer charcoal to wood because it gives off less

smoke, 21 blackens pots less, requires little tending of

the fire, and in some areas costs less.22 At the

national level, however, cooking with charcoal

consumes far more forest resources than cooking

directly with wood, due to the low energy efficiency

of converting wood to charcoal-typically just 40 to

60 percent and often much lower.23

Kerosene is usually the next step up in the progression of cooking fuels. In many areas, kerosene

prices-often subsidized or freed by the government—form a reasonably effective cap on the price

of wood and charcoal.24 Consumers switch between

these fuels according to price and availability.

LPG or natural gas is often the final step in the

progression in cooking fuels. LPG is widely used by

higher income groups in many urban areas, and

natural gas is widely used where it is available. In

Dhaka, Bangladesh, for example, over 50 percent of

the urban population use natural gas; less than 10

percent use kerosene; and none use charcoal.25 In

some cases, electricity is also used for cooking by

the highest income groups.

As households make the transition from wood to

modern fuels, overall energy use for cooking can

vary dramatically, depending on the choice of

technology and the situation in which it is used.

Total household energy use for cooking with kerosene (see figure 3-4) or with LPG can be significantly less26 than that for wood or charcoal, due to

the higher efficiency of kerosene and gas stoves.27

Total household energy use for cooking with kerosene or LPG is also significantly less than for

cooking with charcoal or (non-hydro) electricity,

due to the low conversion efficiency of wood to

charcoal and of fuel to electricity.28

The transition to modern stoves and fuels thus

offers users many benefits-reduced time, labor,

and possibly fuel use for cooking, and reduced local

air pollution. Means of lowering capital and operating costs and ensuring the reliability of supply are

needed if the poor are to gain access to these clean,

high-efficiency technologies. At the national level,

the transition to modern stoves and fuels could

improve the local environment29 and significantly

reduce biomass energy consumption for cooking; to

realize these benefits, however, could impose a

substantial financial burden on poor nations.

A large-scale transition to LPG would require a

significant investment in both capital equipment and

ongoing fuel costs. optimistically assuming that the

cost of LPG systems would average $10 per capita,

the investment would be roughly 3.5 percent of GNP

and 20 percent of the value added in manufacturing

zlck@~stov= Ca however, give off hi@ levels of carbon monoxide-a serious health hazard in inad~uately ventilated kitchens--but Ws dws

not cause as much obvious discomfort to the user as the smoke from a wood fire.

22Douglas F. Barnes, World Bar& Household Energy Unit Industry and Energy Departmen4 “Undemamiing Fuelwood prices ~ Developing

Nations,” Oct. 31, 1989, table 1. Conversion to dollazs per unit of energy was done using 30 MJ/kg for charcoal, and using 700 kg per cubic meter

multiplied by 16 MJ/kg for wood with typical moisture contents observed in the market.

~~eenergyefflciencyof the conversion process is variously given as 15 percerlt in ~“a, 24percent in Kenya withan additional loss of 5 percent

of the charcoal itself during distribution% 29 percent in Senegal and Ethiopia, and over 50 percent in Brazil with brick kilns. Advanced retorts are claimed

to be capable of achieving 72 percent energy efficiencies in converting wood to charcoal if there is complete recovery of all the gaseous byproducts.

See E. Uhi@ Preliminary Charcoal Survey in Ethiopia, U.N. Economic Commission for Afriw FAO Forest Industries Advisory for Africa, Dec.

M75-1 122, 1975,30 pp.; M.J. and M.L. Luhanga, Energy Demand Structures in Rural Tanzuru”a, Department of Electrical Engineering, University of

Dar-es-Salaam, Tanzzmiq 1984; Phil O’Keefe, Paul Rask@ and Steve Bemow, Energy and Development in Kenya: Opportunities and Constraints

(Sweden: Beijen Institute, 1984); G.E. KarclL Carbonization: Final Technical Report of Forest Energy Specialist, UNFAO, SEN/78/002, 1980.; T.S.

Wood, Report on Domestic Energy Usefor Cooking (Energy Assessment Missio~ Ethiopia) (Washingto~ DC: World Ba~ 1983), p. 33; FLORAS~

Man-h-fade Forestsfor Wood and Charcoal in Brazil (Mi_nas Gerais, Brazil: Florestal Acesita, S.A., Belo Horizonte, October 1983), p. 53.

24Doug~ F, Barnes, “Understanding Fuelwood Prices in Developing Nations,” op. cit., footnote 22.

~MJ. ~or, “Fuel ~ketsin UrbanB~ladm~” WorldDevelopment, VO1. 14, No. 7, pp. *65-872.

XNot ~ tie potenti~ efficiencyg~ of LPG may bere~dby the vex-y poor. For example, one-third to One-halfof the poor fi~lside s~nty tow

of Rio de Janeiro own just one LPG bottle. To avoid the risk of running out of gas and having no substitute, many households exchange their gas bottles

before they are completely empty. See Alfredo Behrens, Household Energy Consumption in Rio De Janeiro Shanty Towns (Rio de Janerio, Brazil:

Colegio da America Latina, 1985).

zT~practice, howevw, the ~v~s~~LPG are not quite as large as would be expected from the higher efficiency ~dbetter con~l of these stoves.

This may be due, in part, to less precise control of the stove; to taking advantage of greater useful energy; and other factors. See Kevin B. Fitzgerald,

Douglas Barnes, and Gordon McGranaha~ “Interl%el Substitution and Changes in the Way Households Use Encxgy: The Case of Cooking and Lighting

Behavior in Urban Java,” U.N. Working Paper on Interfuel Substitution Analysis, June 13, 1990.

2SO~er facton tit~wthouwhold enmm use for cooking ~clude tie size of ~ehousehold, tie die~ adtie amount of processed or prepaZedfOOdS

eaten.

2!qt ~gh~ however, incmme global carbon dioxide emissiom.
Chapter 3-Energy Services in Developing Countries .55

Figure 3-4—Direct Energy Use for Cooking in West

Java, Indonesia

Per-capita energy use, MJ/day

35 ~—–———- — I

5 I o L T -- - 1 !

Low Lower middle Upper middle High

Income group

‘

– Woo d ~ Kerosene

This figure compares energy use in households using only wood

with that in households using only kerosene within the same

income class. Households using kerosene consume roughly half

as much energy as households using wood.

SOURCE: M. Hadi Soesastro, “Policy Analysis of Rural Household Energy

Needs in West Java,” M. Nurul Islam, Richard Morse, and M.

Hadi Soesastro (eds.), f?ura/ Energy to Meet Development

Me&: Asian Village Approaches (Boulder, CO: Westview

Press, 1984).

for the nearly three billion people in the lowest

income countries.30 The LPG used31 would be

equivalent to one-fourth of the total commercial

energy consumption today by these countries and

would be a significant fraction of their export

earnings. 32 Significant economic growth is needed if

these costs are to be absorbed.

Costs would be even higher if electricity were

used for cooking. Direct capital costs for electric

burners typically approach $100 per household or

more. Moreover, at the national level, the capital

cost of installing generation, transmission, and

distribution equipment to power electric burners is

much greater, perhaps several thousand dollars per

household. 33 If relatively few households are using

electricity for cooking, these high capital costs are

partially offset by the numerous other uses for

Figure 3-5-Daily Load Profiles for Cooking Energy,

Pondicherry, India, 198 0

Per-capita power demand for cooking, watts

1,200 -

1,000

/ n

800-

600-

400-

200-

0

,~ J \

r—T–—— T

~ —–T -r ~– r—T -

3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

Hour of day

This figure illustrates the highly peaked power demand for cooking

energy as measured in a village survey.

SOURCE: C.L. Gupta, K. Usha Rae, and V.A. Vasudevaraju, “Domestie

Energy Consumption in India (Pondicherry Region),” Energy,

vol. 5, pp. 1213-1222.

electric power throughout the day. If a significant

fraction of households switch to electricity for

cooking, however, the highly peaked energy demand

for cooking (see figure 3-5) will overwhelm other

baseload applications, and these costs must increasingly be assigned to cooking alone.

Lighting 34

Lighting accounts for only a small fraction of total

national energy use in both developing and industrial countries. In Kenya, for example, just 1.7 percent of national energy use is for domestic lighting

(app. 3-A). Lighting does, however, account for a

significant fraction of total electricity use, and the

electricity sector is very capital intensive (see ch. 4).

Despite its relatively low energy use, lighting

merits particular attention as it plays a very impor-

~orld Brmlq World Development Reporr, 1989 (New York NY: Oxford University Press, 1989), tables 1 and 6.

slAssuming aper-eapitapower rate for cooking with LPG systems of 100 watts. This is comparable to that seen in the United States and about twice

that seen in European countries. It is likely that people in developing counties would continue to eat less processed food, less restaurant food, and

probably more grains and so would continue to use somewhat more fuel than is used in households in the industrialized countries. Energy use rates for

household cooking in different countries are given in K. Krishna Prasad, “Cooking Energy,” workshop on end-use focused global energy strategy,

Princeton University, Princetoq NJ, Apr. 21-29, 1982.

szWorldB@ WorZdDeve/op~ntReport, 1989, op. cit., footnote 30, table 5. Kilograms of oil e@wdent hive been converted m energy at42 ~/k8.

33Ass@ a @powm de~dof 2 kw. A pe~power &ud is assumed here rather than an average power as for the wCue above, b-use

electric power systems cannot easily store power and must be able to meet peak demands.

~~cip~ sowes forthe~omtionin this ~tionare Robert vander Piss and A.B. de Graaf, World BaM “A Comptisonof Lamps for Domestic

Lighting in Developing Countries,”energy series paper No. 6, June 1988; and Robert van der Plas, World Bam “Domestic Lighting, ” Energy Sector

Management and Assessments, Industry and Energy Department, working paper No. WPS 68, November 1988.
56 ● Energy in Developing Countries

tant social role in domestic life and in commerce and

industry, making activities possible at night or

where natural lighting is inadequate. As rural

incomes increase, or as people move to urban areas

and gain greater access to modern fuels and electricity, lighting services and the energy used to provide

them increase dramatically.

Lighting technologies follow a fairly clear technological progression in performance, efficiency,

and cost (see figure 3-6). Consumers’ choices of

lighting technologies largely follow the same progression as household incomes increase and as

electricity becomes available.

In traditional rural areas, people are often limited

to the light available from wood fires, frequently

obtained in conjunction with cooking. Kerosene

wick lamps are usually the first step up in the

progression. These may be as simple as a wick in a

jar of kerosene, or as complex as a hurricane lamp

with a glass chimney .35 Glass chimney lamps

generally provide more light and at a higher efficiency than open wick lamps. Glass chimney lamps

also cost slightly more-a few dollars-and use

somewhat more fuel. These additional costs can be

a substantial barrier to their use in rural areas. For

example, a survey of six villages in Bangalore, India,

found that three-fourths of the households used

simple open-wick lamps, and only one-fourth used

lamps with glass chimneys.36

The light provided by wood fires, candles, or

kerosene wick lamps is sufficient to find one’s way,

but is generally inadequate for tasks such as reading

or fine work. Using two lamps doubles the cost, but

does not come close to providing adequate light to

work by. Thus, the poorest households tend to use

just one lamp. Wealthier households may add an

additional lamp or two for other rooms in the house

or move up to a kerosene mantle light; however, the

amount of kerosene used per household does not

generally increase in proportion with income. As a

result, the amount of kerosene used for lighting is

similar (within a factor of two or so) across different

Figure 3-6-Light Output and Efficiency of Various

Lighting Technologies

Flux (lumens) Device efficiency (lumens/watt)

1,000 I

,,+ 100

800

L A 10

800

400 I

Wood Candle Wick Mantle lncandes- FlouresLighting technology cent cent

.

— Flux (Iumens) + Device efficienc y

Includes the candle, kerosene wick lamp, kerosene mantle lamp,

60-watt incandescent lamp, and 22-watt standard fluorescent

lamp. No value is given for a wood fire, as its light output depends

on size and other factors. The light output of candles and

kerosene lamps are similarly highly variable; the values listed are

representative. Only the efficiency of the device (plus ballast) itself

is considered. System efficiencies-induding refinery losses in

kerosene production and generation, transmission, and distribution Iosses for electricity--will be considered in a later report of this

OTA study.

SOURCES: Robert van der Plas, Wrid Bank, “Domestic Lighting,” Energy

sector Management and Assessments, Industry and Energy

Department, working paper No. WPS 68, November 1988.

Van der Plas cites the efficiency of electricity production as 30

percent, but this factor is apparently not taken into aooount in

the incandescent light effideney figure of 12 lm/W. See, for

example, Samuei Berman, “Energy and Lighting,” David

Hafemeister, Henry Kelly, and Barbara Lsvi (ads.), Energy

Soutces: Conservation and Renewable (New York, NY:

American Institute of Physics, 1985). Berman gives the output

of a 1OO-W incandescent as 1,600 lumens and a 50-W

fluorescent as 3,300 lumens. The efficiencies shown here are

slightly iowereorresponding to the lower, assumed wattage of

the light. See also Terry McGowan, “Energy-Effiiient Lighting,” Thomas B. Johansson, Birgit Bodlund, and Robert H.

Williams (eds.), E/ectb”cify: Eftkient En#Jse and New Generation Ttinologie and Their Planning Impkations (Lund,

Sweden: Lund University Press, 1989).

income groups and in different regions of the

world. 37

Despite the drawbacks of kerosene wick lamps,

they are a predominant technology in poor rural and

urban areas. Although their light output is low, the

capital and operating costs of kerosene wick lamps

are also low (see figure 3-7). Further, kerosene can

be purchased in small quantities as family finances

qs’l”he light given off by wick lsmps &pends on a host of factors, including size, condition of the wick (unraveled or uneven), ~d the ~Ount of soot

deposited on the glass chimuey (if present).

~AS~, “Rur~ Energy Consumption Patterns: A Field Study,” Bangalore, ~dti,1981.

qT~r~d~achad ~cia GoWe% WorldB- “Hou~hold Energy Handwk, ” t~hni~ paper, No. CT, 1987; suli~ siwatibau, Rura/Energy

In Fiji (Ottaw& Canada: IntemationaJ Development Research Center, 1981); Girja Sharan (cd.), Energy Use in Rura2 Gujurat (New Dethi: Oxford and

IBHPublishing Co., 1987). The Gujurat study found that one of the few variables affecting kerosene use was the number of rooms per household. Even

this, however, was a relatively weak relationship.
Chapter 3--Energy Services in Developing Countries ● 57

Figure 3-7--Costs of Various Lighting Technologies

Total cost to operate ($/hr)

““’ ~

0.08

1 r-l

New installation

0.06 -

0.04 -

0.02 -

. 1

Marginal cost

Wood Candle Wick Mantle Incandescent Flourescent

Lighting technology

Cost per light output ($/lumen)

‘ “

000E-0 3

r

—

\

–-– -

”

-–— -- -

< \ New installations

1.000’ -04

4 w ’

1.000’-0 5

I

“\. \

‘1

x.

Marginal cost

1 .000’ -06 -—-r — T––— -–r -- -–T–

Wood Candle Wick Mantle Incandescent Fluorescent

Lighting technology

(A) Direct costs to the consumer of operating various lighting technologies per hour of service. (B) Direct costs to the consumer of various

lighting technologies per unit of light output. The costs shown include only cash expenditures; they do not include labor costs for maintaining

kerosene lamps, etc. The high value for electric lights shows the effect of applying all the grid connection charges to a single light

corresponding to the situation faced by the poor rural household that will initially use but one or two lights. The low value for electric lights

ignores the cost of grid connection charges, corresponding to the marginal cost of adding additional lights after being connected to the grid.

The assumed discount rate is 10 percent. In practice, individuals in both the developing and industrialized world tend to apply much higher

discount rates when making investment decisions in energy-conserving technologies. Rates observed in the United States are typically

in the range of 40 to 80 percent. Similarly, high effective discount rates have been observed in developing countries. If higher effective

discount rates are applied, the higher capital costs of kerosene mantle lamps and, especially, electric grid connections will tend to present

more of a barrier to investment.

SOURCES: Derived from figures 3-6 and 3-7A. See also: Harry Chernoff, “individual Purchase Criteria for Energy-Related Durabtes: The Misuse of Life Cycle

Cost,” Energy Journal, vol. 4, No. 4, October 1983, PP. 81-86; David French, “The Economies of Renewable Enerav Svstems for DeveloDina “. . , “

Countries,” ‘Washington, DC, June 1979.

. .

permit. Kerosene wick lamps are thus well matched

to the reality of rural life in developing countries,

where capital and resources are sharply limited.

Wood fires and/or kerosene wick lamps are the

primary sources of light for more than two billion

people worldwide.

Next in the progression are butane or pressurized

kerosene mantle lamps. These are much like the gas

lamps used for camping in the United States. Mantle

lamps give substantially more light and are more

efficient than wick lamps; they also cost more to

purchase and operate, tend to be hot and noisy, and

can cause considerable glare.

Finally, in contrast to kerosene lamps or other

nonelectric lighting technologies, electric lighting is

clean, relatively safe, easy to operate, efficient, and

provides high-quality light. People in rural areas and

small towns of developing countries place electric

lighting high on their list of desired energy services.

For example, a survey of 320 households in several

villages and small towns of Nigeria found that 90

percent ranked electricity--primarily for lighting—

as their top choice in desired energy services.38

Even where electric lighting is available, however, the high cost of connecting to the electric grid

creates a substantial barrier for poor families that use

only one or a few lightbulbs (see figure 3-7),39 and

this substantially slows penetration. A study in

Gujurat, India, found that 10 years after villages had

gained access to the electric grid, less than a third of

the households had connected; this increased to

about two-thirds after 20 years.40 Uncertain electric

supply in many developing countries-including

blackouts and brownouts-also tends to discourage

potential users and forces those who have connected

to the grid to simultaneously maintain alternative

kerosene lighting systems.

Sslljwwd I. Onyebuchi, “Analysis of Rural Energy Choices in Nigeria,” Natural Resources Forum, vol. 12, No. 2, 1988, pp. 181-186.

s~i~3-7 tends t. ~ders~te tie barrier tit grid commtion costs present to people in poor rural SKXM. The perceived ~dus@Y the r~ costs

to fmncecormection charges areoftenmuchhigher in developing countries than the 10 percent disemmt rate assumed for this figure. Using more realistic

effeetivediscount rates of 50 percent the cost of eleetric Iighting-ifthe villager could raise the money at sil-peroperating hour would rise from $O.07

to $0.34, compared to $0.02 for a kerosene mantle light and $0,01 for a kerosene wick lamp. The choice of kerosene wick or mantle lamps is thus logical

given the f~ncial constraints that the poor face.

4oGya s~m(~.), Energy Use in Rural Gujurat, Op. cit., footnote 37.

33-718 0 - 90 - 3
58 ● Energy in Developing Countries

Electricity use for lighting rises rapidly with

household income. For example, in South Bombay,

India, rates of household electricity use during the

evening varied from 93 watts for the lowest income

group to 365 watts for the highest income group.4l

The “choice of electric lighting technology also

varies as incomes increase. Low-income households

in South Bombay installed more conventional fluorescent lights-despite their higher capital cost—

and operated them more intensively due to their

lower operating costs. As incomes increased, households shifted away from the harsh light of conventional fluorescent to the more natural light of

incandescent (see figure 3-8).42

As incomes increase with economic development,

households begin to buy other appliances-radios,

TVs, fans, refrigerators, and air conditioners. Electricity use for lighting usually continues to increase,

but it becomes only a small fraction of total

residential electricity use (see figure 3-9). Electricity

use for lighting in the commercial and service

sectors also grows rapidly as the economy expands.

The demand for lighting has also continued to

increase in the industrialized countries over the past

30 years as incomes have increased. Today, the

average rate of lighting use ranges from roughly 20

to 100 million lumen-hours per capita per year

(Mlmhr/cap-yr) in the industrial countries.43 In

comparison, annual household light production in

South Bombay varies with household income from

.

44 about 1 to 3 Mlmhr/cap-yr, light production in the

commercial sector might double these numbers.

This is equivalent to a per-capita consumption level

that is only 10 to 30 percent of the lowest levels

among industrialized countries.

If lighting services equal to half the minimum

level observed in the industrialized countries-10

Mlmhr/cap-yr--are to be provided in developing

countries, then per-capita demand for lighting electricity will be about 500 (kWh) kilowatthours per

Figure 3-3-Changes in Capacity and Type of Installed

Electric Lighting Per Household With Income Level in

South Bombay, India

Installed wattage, kW Percent fluorescent

1.6 I I 50

1.4-

1.2-

1 -

0.8 -

0.6 -

0.4 -

0.2 - I

20

10

I 0 ! I 1 0

RS 0-1000 RS 1000-2500 RS 2500-4000 RS 4000-

Income group

— Installed wattage + percent fluorescent

lnstalled wattage per household and the fraction of installed

wattage that is fluorescent (the remainder is incandescent) is

shown versus household income in rupees. The intensity of use

of this installed wattage varied with the type of lighting and the

household income. The lowest income group used 80 percent of

their installed capacity of fluorescent and 45 percent of their

incandescent during the evening. The highest income group

used just 25 percent of their installed capacity of both fluorescents

and incandescents during the evening.

SOURCE: Aehok Gadgil and Bhaskar Natarajsn, “Impact of SoeioEeonomic and Arehiteetural Factors on Peak Eleetrieity Demand: A Case Study of South Bombay,” Energy, vol. 14, No. 4,

1969, pp. 229-236.

year. This is equivalent to an evening power demand

of perhaps 150 watts per capita.45 If that level of

evening demand occurred at the utility system peak

load, as is typical in developing countries, then the

capital cost to provide electricity for lighting would

be roughly $300 per person.46

Space Conditioning, Refrigeration, and

Other Appliances

Space Conditioning

Heating residential or commercial buildings will

never bean important energy service in the majority

of developing countries since most have tropical

climates. Space heating will be important in some

dlc~c~t~~m data in Ashok Gadgil and Bhaslmr Nawajn, “Impact of Socio-Economic and Architectural Factors on Peak Electricity Demand:

A Case Study of South Bombay,” Energy, vol. 14, No. 4, 1989, pp. 229-236. The lowest income group uses 80 percent of their installed 71 watts of

fluorescent and 45 percent of their installed 81 watts of incandescent; the highest income group uses 25 percent of their installed 1,460 watts of

fluoreseents and incandescent.

42~s p~culw case con~asts ~th the more typic~ si~tio~ as discussed for cooking, where the poor ae P*CUkWIY sensitive to f~t costs.

43Terry McGowaW “Energy-Efficient Lighting,” in Thomas B. Johansso~ Birgit Bodlund, and Robert H. Williams (eds.), Electn”city: E@cient

En&Use and New Generation Technologies, and Their Planning Implications (Lund, Sweden: Lund University Press, 1988).

~Calcfited from Gad@ and Natarajan, op. cit., fOOtIIOte 41.

45~s ~swes tit li~t Ouqut is my split ~~=n in~ndes~nt and fluoreswnt fighfig, ~d tit the de~nd is h the s hews of the evening.

~Assumin g an installed capital cost for the system of $2,000 per kW of generating capacity.
Chapter 3-Energy Services in Developing Countries . 59

Figure 3-9-Household Electricity Use for Lighting

v. Household Income, in Brazil

Electricity use, Brazil (kWh/household-month)

400 T - -

300-

200-

100-/ /

o 1 I I 1 —— ~

MWU O-2 MWU 2-5 MWU 5-10 MWU 10-20 MWU 20

income group

— Total electricity + Lighting electricity

This graph shows that electricity use for lighting continues to grow

with income even in a relatively properous developing country

such as Brazil. Lighting electricity is, however, only a small fraction

of total household electricity use in this case. MWU are minimum

wage units.

SOURCE: Aehok Gadgil and Gilberto De Martino Jannuzzi, Conservation

Potential of Compact fluorescent Lamps in Inc#a and Brazil,

Lawrence Berkeley Laboratory and Universidade Estadual de

Carnpinas (Brazil: June 23, 1989).

areas, however, such as mountainous regions and

high-latitude areas like northern China. Beijing, for

example, has about the same annual average low

temperature as Chicago. Nearly 20 percent of

China’s total annual coal consumption and 5 percent

of its annual biomass consumption are used for

space heating (app. 3-A).47

In China, residences rarely have any insulation

and often have large gaps around doors and windews.48 Indoor temperatures in these homes are

controlled not by a thermostat or by comfort

requirements, but by fuel supply-and fuel, though

cheap, is scarce. In Kezuo county, Northeast China,

for example, average indoor temperatures are at the

freezing point during the winter, compared to

average outdoor temperatures of–3‘C to-5 oC with

lows of –25 °C.49 Additions to coal supply, more

efficient stoves, or better wall insulation would thus

result mainly in comfort improvements but not in

energy savings.

Similarly, although many developing countries

have hot climates,50 little energy is used at present

for space cooling in developing countries. Traditional building designs somewhat moderate the

extremes in temperature through natural ventilation

and other techniques that make use of local materials

and do not require additional energy inputs.51

Increasing urbanization and the use of commercial

building materials, however, have made these traditional practices less practical and less popular.

Active space ventilation by electric fans has become

popular in many areas where there is reliable electric

service and costs are affordable. For example,

electric fan ownership in Beijing, China, jumped

from 47 percent of households in 1981 to 77 percent

in 1984.52

Air conditioning in residences is a luxury item

found only in the highest income households in

developing countries (see figure 3-10).53 In contrast,

60 percent of all homes in the United States-nearly

all who need it—have air conditioners.54 A substantial proportion of commercial, institutional, and

government buildings in developing countries are

air conditioned.

Air conditioning systems in developing countries

are also often less efficient than those in industrialized countries. Buildings usually are poorly insulated, with large amounts of air infiltration; and air

conditioners are generally less efficient than those in

the west and are poorly maintained and controlled.

‘TVac~v sti,“e’swern,” contractor report prepared for the Office of Technology Assessment 1990.

4SRo&~M. w~wtm,“Energy-ConservationS tin&r& for Buildings inC~” Energy, vol. 13, N0. 3,1988, pp.265-274; RobertM.W~

and Chang Song-ying, “Energy Conservation in Chinese Housing,” Energy Policy, vol. 15, No. 2, pp. 158-168.

@World B@<*-:Co~~-~velR~ ~ergy Assessmen~: A Joint Study of ~~and -se-,’ Activity Completion Report No.

101/89, May 1989.

~~50 of tie ~orld~~ hott~t ~ties ~in tie devdopingworld. me hottest is Djibouti, wi& SII av~ge annual high temperature of 113 ~. NO!M

of the 50 coldest cities is in the developing world. See V. Showers, World Facts andFigures (New Yo& NY: John Wiley& Sons, 1979).

51LfiJ=Yuq ~~Tm&tio~Housing: A solution to Hopelessness in & ~ world: me Malaysian ~ple,” T&&OZOg@ VO1. 18, No. 1,

1988, pp. 16-23; Mehdi N. Bahadori, “Passive Cooling Systems inhmiankchitecture,” Scient@cAmerican, vol. 238,1978, pp. 144154; R,K. Hill,

Utilization of Solar Energy For an Improved Environment Within Housing For the Humid Tropics (VictoriA Australia CSIRO, 1974).

52J. Sa~Ye, A. G~~ and L. sc~PPerj “Energy Demand in Developing Countries: A Sectoral Analysis of Recent Trends,” Annual Review of

Energy, vol. 12, 1987, pp. 253-281.

53Jayant Sathaye and Stephen Meyers, “Energy Use in Cities of the Developing Countries,”Annual Review of Energy, 1985, vol. 10, pp. 109-133.

54~erm~omtion A*~tion, HoW”ng Characteristics 1984, DoE~-0314(84)(WSS~C)UDC: U.S. G’OV ernment Printing Office,

October 1986), p. 5.
60 ● Energy in Developing Countries

Figure 3-10-Electric Appliance Ownership in Urban

Malaysia by Income Group, 1980

Penetration by income group, percent

100 J

8 0 -

8 0 -

<

40-

20-

0+

Bottom 3% Lower 20% Middle 28% Middle 29% Upper 15% Top 5%

income group

— Refrigerator s + Air conditioners + Water heaters

This figure shows the rapid penetration of refrigerators, air

conditioners, and water heaters as household incomes rise. The

incomes (percentage of households) are in ascending order:

150-299 Malaysian dollars per month (M$/month) (3 percent); M$

300-599 (20 percent); M$ 600-999 (28 percent); M$ 1,000-1,999

(29 percent); M$ 2,000-4,999 (15 percent); and M$ 5,000+ (5

percent).

SOURCE: Jayant Sathaye and Stephen Meyers, “Energy Use in Cities of

the Developing Countries,” Annua/ Review of Enemy, vol. 10,

1965, pp. 109-133.

Figure 3-12—Refrigerator Ownership in

Beijing, China, 1981-1987

Percentage of households

70

6 0 -

5 0 -

4 0 -

3 0 -

2 0 -

1 0 -

0 c 1 ! 1980 1982 1984 1986 1988

This figure shows the rapid penetration of refrigerators into the

household sector over just a 6-year period.

SOURCE: Stephen Meyers and Jayant Sathaye, “Electricity Use in the

Developing Countries: Changes since 1970,” EneWy, vol. 14,

No. 8, 19S9, pp. 435-441, table 6.

Figure 3-1 l—Electric Appliance Ownership

in Urban Java, 1988

Penetration by income group, percent ,,20 ~—-–—— —

“ ~

Low Middle High

Income group

‘- Light s + Iro n + B&W/Color T V

‘

- F a n+ Refrigerato r + Water pump

This figure shows the rapid penetration and relative importance

within household purchasing patterns of lights, TVs, irons, fans,

refrigerators, and water pumps. Income groups (share of households) in ascending order are: less than 75 (Rupees)/month (24

percent), 75-120 Rp/month (22 percent), 121-185 Rp/month (21

percent), 186-295 Rp/month (14 percent), and greater than 295

Rp/month (9 percent).

SOURCE: ke Schipper and Stephen Meyers, “Improving Applianoe

Efficiency in Indonesia,” Energy Po/icyforthcoming.

Figure 3-13-Reduction in the Real Cost of

Refrigerators Over Time in the United States

Real cost of refrigerators, 1989=1.00

7 1 J

6 -

5 -

4 -

3 -

2 -

1 -

0 -

0

k

1940

1950

1 i 1 1 50 100 150 200 250

Cumulative production volume (millions)

Over the past 40 years, the real price of refrigerators has dropped

by almost a factor of 5. For developing countries, such price

reductions would allow households to invest in refrigerators at a

much earlier point in time than was the case for the United States

and other industrialized countries at a similar level of development.

SOURCES: Rick Bahr, Bureau of Labor Statistics, U.S. Department of

Labor, personal communication, July 9, 1990 (CP1/

refrigerators); John Chirichiello, National Science Foundation

SRS Computer Bulletin Board, personal commun”mtion, July

6, 1990 (GNP deflator, 1953-19S9); U.S. Department of

Commerce, Bureau of the Census, “Historical Statistics of the

United States: Colonial Times to 1970” (Washington, DO: U.S.

Government Printing Office, 1975), p. E1-12 (GNP deflator,

1935-53).
Chapter 3--Energy Services in Developing Countries . 61

Table 3-6-Residential Nonheating Electricity

Intensity in Selected Countries, 1970 and 1986

(kilowatthours per capita)

Country 197 0 198 6

India . . . . . . . . . . . . . . . . . . . . . . .

Indonesia . . . . . . . . . . . . . . . . . . .

Pakistan . . . . . . . . . . . . . . . . . . . .

Philippines . . . . . . . . . . . . . . . . . .

Thailand . . . . . . . . . . . . . . . . . . . .

Malaysia . . .: . . . . . . . . . . . . . . . .

Mexico . . . . . . . . . . . . . . . . . . . . .

South Korea . . . . . . . . . . . . . . . . .

Brazil . . . . . . . . . . . . . . . . . . . . . . .

Argentina . . . . . . . . . . . . . . . . . . .

Venezuela . . . . . . . . . . . . . . . . . .

Taiwan . . . . . . . . . . . . . . . . . . . . .

Japan . . . . . . . . . . . . . . . . . . . . . .

West Germany . . . . . . . . . . . . . . .

United States . . . . . . . . . . . . . . . .

7

8

10

3 4

17

37

75

2 5

9 0

210

158

163

—

—

—

25

3 3

5 9

78

1 1 0

184

190

248

261

307

422

557

975

1,210

3,050

—Not available or not applicable.

SOURCE: Stephen Meyers and Jayant Sathaye, ’’Electric.Hy Use in the

Developing Countries:Changes Since 1970; Energy, VOI.14,

No. 8, 1989, pp.435-441.

The potential for increased energy use for space

cooling is very large. The United States now uses

about 1,400 kWh of electricity per person per year

for space cooling.55 If India used this much electricity per person for space cooling, its total annual

electricity generation would have to increase to

more than five times present levels.56 The hotter

climate of India could increase these requirements

still more.

Refrigerators and Other Appliances

Electricity-using appliances--refrigerators, televisions, washing machines, etc.—are rapidly penetrating the residential sector of developing countries.

Factors contributing to this explosive growth include urbanization, increasing electrification in rural

areas, economic growth, improved access to appliances, and decreasing real costs of appliances—

which make them affordable to a broader segment of

the population than ever before. Factors limiting

appliance penetration include the lack of electric

service, particularly in rural areas. In Brazil, for

example, 90 percent of urban households but only 24

percent of rural households have electric service.57

The rapidly increasing use of household appliances in the developing countries places additional

demand on electric power infrastructures that are

typically already short of capacity. Further, much of

the residential demand comes at peak times. A

review of 13 of the largest developing countries for

the period 1970-86 found that the growth rate of

electricity consumption was highest in the residential sector—averaging 9.9 percent annually, compared to 8.3 percent annual growth in the industrial

sector. 58 Table 3-6 shows electricity intensity for the

residential sector in selected developing and industrialized countries. Even the most advanced developing countries use, on average, just a small fraction

of the electricity consumed by Americans. Electricity consumption by the economically well off in

developing countries, however, differs little from

that found in the United States or Europe.

Lights are usually the first appliance installed

when a household gets electric service. Acquisition

of other appliances varies by household income and

region (see figures 3-10 and 3-1 1). In India, fans are

typically among the first appliances acquired, followed by televisions and refrigerators. In Brazil,

even relatively poorer, newly electrified households

often have televisions and refrigerators, as these

appliances are comparatively inexpensive and are

available secondhand.59

Refrigerator ownership is at present quite low in

most developing countries. In China, for example,

less than 1 percent of households have refrigerators,

although refrigerator ownership has been growing

rapidly in Beijing (see figure 3-12). In Brazil, 63

percent of households have refrigerators.a In contrast, in the United States, 99.7 percent of households have refrigerators.G1

55GSS Rese~h IIIstitute, Stiategic ~ysis and Energy Forecasting Divisio~ Baseline Projection Data Book (WaShin@OQ DC: GSS Research

Institute, 1988), pp. 37, 120.

56TStS Energy ResWchrnsti@te, TERIEnergy Data Directory and Yearbook (TEDDY) 1988 (NCW DelM India: ISW, p. ’73.

57Gilberto De l&u-tino J~uzzi, “Residenti Energy Demand in Brazil by IIKome CISSSeS,” Energy Policy, vol. 17, No. 3, p. 256.

58Stephen Meyemand Jayat Satiye, “E1ectrici~USe intheDeve@ingCOun~~: Changes Since 1970, ’’Energy, VO1. 14, No. 8,1989, PP. 435-1.

59A. Ga@il and G. De Martin. 0 Jannuzzi, Conservation Potem.al of Compact Fluorescent Lumps in India andBrazil, LBL2721O (Berkeley, CA:

Lawrence Berkeley Laboratory, July 1989), p. 5.

@Howard S. Geller, “Electricity Conservation in Brazil: Status Report and Analysis,” contractor report prepared for the Ofilce of Technology

Assessment, March 1990, p. 17.

GIEner~ ~o~tion Administration Housing Characteristics 1984, Op. Cit., fOOhlOte 5A, p. Is.
62 ● Energy in Developing countries

The refrigerators used in developing countries are

typically half the size of American refrigerators, or

smaller. They are also much less efficient than the

best refrigerators now commercially available (the

average refrigerator used in the United States is

similarly much less efficient than the best available).

In Indonesia, most refrigerators are assembled locally from imported components and, in general, do

not take advantage of proven energy efficiency

features such as rotary compressors and increased

insulation. 62 The efficiency of Brazilian refrigerators is being improved--electricity consumption by

the average new model was reduced by 13 percent

between 1986 and 1989--but they are unable to

make use of the very efficient motor-compressors

(which Brazil manufactures and exports), as these

units cannot tolerate the voltage fluctuations found

in Brazil.63

Advances in materials and manufacturing techniques, coupled with a growing secondhand market,

are forcing down the first cost of refrigerators and

other appliances. The real cost of new refrigerators

in the United States, for example, has plummeted b y

a factor of nearly 5 over the past 40 years (see figure

3-13). This trend should make many household

appliances affordable to a much larger share of

developing country populations than was the case

for today’s industrialized countries at a comparable

level of development—a generation or more ago. As

a result, energy use could increase significantly

above the historical record in the near to mid-term.

For example, the average new refrigerator in the

United States uses about 1,000 kWh of electricity

per year.64 If every household in China had a

U.S.-style refrigerator, an additional 200,000 gigawatthours (GWh) of electricity per year-or the

output of about 50 full-size coal-burning power

plants—would be required, at a cost for the power

plants alone of about $100 billion.65

The Industrial Sector

The industrial sector typically consumes 40 to 60

percent of total commercial fossil energy in developing countries (see table 3-l);66 it also makes heavy

use of traditional biomass fuels-often traded in

commercial markets. The primary energy services

required by industry are process heat and mechanical

drive. These services will be treated generically

here; in a later report of this OTA study, they will be

examined as specific parts of integrated industrial

processes.

Firms in the industrial sector of developing

countries today vary widely in size and sophistication. Atone end of the spectrum are small traditional

firms that use relatively energy-inefficient and

low-productivity manufacturing technologies.67 At

the other end are large, modern firms, often with

multinational parent companies, that have worldclass manufacturing capabilities.

Manufacturing operations typically fall into three

broad size categories-household or cottage, small

workshops and factories, and large-scale industry.

Over time, a few smaller companies tend to grow

into large ones as the transport infrastructure improves and incomes rise, increasing the size of

markets and providing economies of scale that turn

the advantage to larger firms.68

In many developing countries, one-half to threequarters of manufacturing employment is in household-scale establishments, with the remainder divided between medium and large operations. Much

of the employment in the small traditional (and

largely rural) household industries is seasonal labor

available during the nonagriculturally active times

of year. Typically one-fourth to one-third of rural

62~e Schippm, ~~Effl~mt Household El~~ci~ use in Indonesi~” Lawrence Berkeley Laboratory, draft repo~ Jan- 1989, P. 3) ~tion o

n

“Conservation Potential.”

G3Howmd S. Geller, Electn”ci~ Conservation in Brazil: Status Report and Analysis, Op. Cit., footnOte @P. 29.

MHow~d S. Gefler, “Residential Equipment Efficiency,” contractor report prepared for the Off& of Technology Assessmen4 May 1988.1990,

NAECA standard.

6SA~~_: 5 ~ople perhouaehold, 45 percent load factor, no @a nsmission and distribution losses, and a capital cost of $2,000 per kW of installed

capacity.

66J. Satiye, A. G~~di, L. Sc~pWr, ‘~~er. De~nd in Developing co~&ies: A secto~A@@ of Recent Trends,” op. cit., foo~ote 52,

table 5.

67~thou@ they me s~l~d often use fitde modern technology or me~ods, these ~ufacturing enterprises me not inefficient h SOme respects.

High tmnsportandmarketingc osts and small market size might greatly raise the cost to larger, modern fixms if they should try to enter these small village

markets, making them the higher cost producers.

68De~s ~derson,World B@ “S~~us~in ~velop~gcountries:some Issues,”SWWOIIC@ Paper No. 518, 1982.
Chapter 3--Energy Services in Developing Countries . 63

Table 3-7-Kenyan National Energy Use by Fuel, 1980 (percent of total)a

Commercial Biomass fuels

Energy service fuels Wood Charcoal Other Total

Household . . . . . . . . . . . . . . . . . . 2.9 46.3 6.6 2.7 58.5

Cooking/heating . . . . . . . . . . . . 1.0 46.3 6.1 2.7

Lighting . . . . . . . . . . . . . . . . . .

.

1.7 — —

Other . . . . . . . . . . . . . . . . . . . . .

. —

0.2 — 0.5 — —

Industry . . . . . . . . . . . . . . . . . . . . . 8.6 14.5 1.0 24.1

Large . . . . . . . . . . . . . . . . . . . .

—

8.6 5.3 0.3

Informal urban . . . . . . . . . . . . . —

— —

0.1 0.6

Informal rural . . . . . . . . . . . . . . —

— —

9.1 0.1 . —

Commerce . . . . . . . . . . . . . . . . . . 0.6 0.5 0.1 — 1.2

Transportation . . . . . . . . . . . . . . . 13.7 — — — 13.7

Agriculture . . . . . . . . . . . . . . . . . . 2.5 — — — 2.5

Total . . . . . . . . . . . . . . . . . . . 28.4 61.3 7.6 2.7 100.0

—Not available or not applicable.

a Total national energy consumption .332 million gigajoules; per capita power consumption=658 watts.

SOURCE: Phil O’Keefe, Paul Raskin, and Steve Bernow(eds.), Energy andDeve/opmentin Kenya: Qmortunities and Constraints fUddevalia. Sweden: tiijer

Institute and Scandinavian Institute of African St~ies, 19&).

nonfarm employment is in manufacturing.@ This is

an important source of income and employment for

the rural and poor urban sectors.70

Process Heat

Many commercial and industrial processes require heat—ranging from the low-temperature heat

used to dry food by cottage industry to the hightemperature processes used by large industries to

produce steel and cement. The efficiencies of these

processes are typically much lower than those found

in industrialized countries.

Traditional Process Heat Technologies

Biomass is used extensively in both traditional

rural and more modern industry in developing

countries. In Kenya, for example, large industry

accounts for about 8.6 percent of national energy use

in the form of commercial fuels, and 5.6 percent of

total national energy consumption in the form of

. s , .

biomass (wood and charcoal). Informal rural and

urban industries use little or no commercial fuel, but

they account for about 10 percent of total national

energy use in the form of biomass (see table 3-7).

Rural applications include beer brewing, blacksmithing, crop drying, and pottery firing (see table

3-8).

Estimates of the use of biomass energy for

industrial processes are similarly high elsewhere.

Tobacco curing uses 11 percent of all fuelwood in

Ilocos Norte, Philippines, and represents 17 percent

of the national energy budget in Malawi.71 In

Indonesia, the brick, tile, and lime industry consumes roughly 2.5 percent of national energy use.72

Beer brewing uses 14 percent of the total fuelwood

consumed in Ouagadougou, Burkina Faso.73 Overall, biomass fuels supply up to 40 percent of the

industrial energy used in Indonesia, 28 percent in

Thailand, 17 percent in Brazil, and similarly large

fractions in many other countries.74

@?DennisAnderson and MsrkI-eiserso~ “RurslNonfsrmErnployment in Developing Countries,” Economic DevelopmentandCultural Change,voL

28, No. 2, 1980, p. 245, table A2, cited in Donald W. Jones, Energy Requirements for Rural Development (Oak Ridge, TN: Oak Ridge National

Laboratory, June 1988).

%inyinnachuta and S.V. Sethuraman (eds.), Rural Small-Scale In&sm.es andEmployment in Aj%ica andAsia (Geneva: International Labor Office,

19s4).

TIE.L.H= “The Demand for Woodfuels by Cottage Industries in theprovinee of Ilocos Norte, Philippines,” Energy, vol. 9, pp. 1-13, 1984; E.M.

Mnzavz “VillageIndustries vs. Savannah Forests,” UNASYLVA, vol. 33, No. 131,1981, pp. 24-29; E.M. Mnzmq “Fuelwood and Charcoal in Afriw”

W. Paley, P. ChsrtierandD.O. Hall (eds.),Ener~fiornBiomass @mdon: Applied Science Publishers, Ltd., 1980); M.J. Mwandosyasnd M.L. Luhan~

Energy DemandStructures in RuraZ Tanzania (PrincetoU NJ: Center for Energy and Environmental Studies, Princeton University, and Dar-Es-S_

mnzania: Department of Electrical Engineering, University of Dar-Es-Salaam, 1984).

TWorldB@ Energy Sector Management Assistance program, “Indonesiz Energy Effieiemy Improvement in the BnclG Tile and Lime Industries

on Javz” March 1987.

TsHenri~u~“men ~~~City RUIIS Out of Fue~” UNASIZVA, VO1. 33, No. 133, 1981, pp. 11-20.

TAJoy Dunkerley et al., Energy Strategies for Developing Countries (Baltimore, MD: JOhIIS HOPkiDS UtiversiV Prms, 1981), P. 265.
64 ● Energy in Developing Countries

Table 3-8-Annual Consumption of Fuelwood

and Charcoal in Kenya by Rural Cottage Industries,

GJ/Capita

Industry Fuelwood Charcoal a

Brewing . . . . . . . . . . . . . . . . . . . . . 1.07

Construction wood . . . . . . . . . . . 0.50

Butchery . . . . . . . . . . . . . . . . . . . . 0.2 4

Restaurants . . . . . . . . . . . . . . . . . 0.17

Baking . . . . . . . . . . . . . . . . . . . . . . 0.1 3

Brick firing . . . . . . . . . . . . . . . . . . 0.06

Blacksmithing . . . . . . . . . . . . . . . —

Crop drying . . . . . . . . . . . . . . . . . . 0.04

Tobacco curing . . . . . . . . . . . . . . 0.04

Fish curing . . . . . . . . . . . . . . . . . . 0.0 2

Total . . . . . . . . . . . . . . . . . . . . . 2.27

—

.

0.0 6

0.0 4 —

—

0.06

—

0.16

—Not available or not applicable.

a This does not include the losses in converting wood to charcoal.

SOURCE: Phi10’Keefe,PaulRaskin,and Steve Bernow(eds.) Energyand

Development in Kenya: @ortunities and Constraints (Uddevalla, Sweden: Beijer Institute and Scandinavian Institute of

African Studies, 19S4).

The efficiency with which these tasks axe done

can be quite low (see table 3-9). On close examination, however, the performance of traditional biomassfueled technologies is often found to be carefully

optimized in terms of efficiency, capital, and labor,

given existing materials and technological constraints. An example of this is the traditional brick

kiln in Sudan, which holds as many as 100,000

bricks at a time and gains economies through size

and other design factors. To improve the performance of these technologies usually requires the input

of modem materials and technologies, including

modern means of measuring efficiencies.

Modern Large-Scale Industry

Modern large-scale industries in developing countries are modeled after their counterparts in industrialized countries, but they are often operated at

significantly lower efficiencies. A few energyintensive materials-steel, cement, chemicals (especially fertilizer), and paper-account for much of the

energy used by industry (see table 3-10). The total

energy used to produce these materials will increase

rapidly as developing countries build their national

infrastructures.

Steel—In the OECD countries, the steel industry

typically consumes about one-fifth of the energy

used in the industrial sector.75 Developing countries

such as China, India, and Brazil devote a similar

share-18 percent, 23 percent, and 20 percent,

respectively 76--of industrial commercial energy consumption to steel production. The top 10 producers

account for about 90 percent of the crude steel made

in the developing world; many other developing

countries produce little or no steel.

Per-capita steel consumption increases rapidly as

national infrastructures are built, and then tends to

saturate the market and level off at higher income

levels77 (see figure 3-14). A similar trend has been

found for a wide variety of materials.78 Simply put,

there is a limit to the number of steel-intensive cars,

refrigerators, washing machines, buildings, bridges,

pipelines, etc., a person needs. Eventually, consumption levels tend to plateau at replacement

levels. When these wants for basic materials are

fulfilled, people tend to spend incremental income

on higher value-added materials-such as those

with a high-quality finish--or on less materialintensive but higher value-added consumer goods.

The level of per-capita steel consumption needed

to provide a given service has also been reduced over

time through a variety of technological improvements, including higher weight-to-strength steel

alloys, more efficient motors and engines, better

design, and the substitution of alternative products

such as high-performance plastics. For example, the

tensile strength of steel increased fourfold between

1910 and 1980.79

Overall steel production has been increasing by a

little over 7 percent per year in the developing

countries, while remaining relatively constant in the

industrialized countries. At current rates, steel production by developing countries will overtake that in

the industrialized countries early in the next century.

The energy efficiency of steel production in the

developing countries varies widely. In some cases,

it has significantly lagged that of the industrialized

75-W Y. IMeunier and Oscar de Bruyn KOPS, “Energy Efficiency in the Steel Industry With Emphasis on Developing Countries,” World Bank

technical paper, No. 22, 1984.

T’%id.

‘Per-capita steel eonsumptioninenmses approximately linearly with per-capita income up to several thousand dollars.

T8Ro&fiH. Willi=, fi~Do~WU ~d~H. Ross, ‘c~teri~s, ~uence, and~d~tri~~ergyuse,’ ‘AnnM/R~iW ofEnergy, VO1. 12,1987,

pp. 99-144.

T~ono~cCodssion for EUIOW, Evolution of the Specific Consumption of Steel (New York m: Ufited Nations) 19~).
Chapter 3--Energy Services in Developing Countries ● 65

Table 3-9-Efficiency of Fuel Use In Traditional (Developing Countries) and Modern

(Industrial Countries) Commercial and Industrial Operations

Estimated efficiency of Estimated efficiency of

traditional technology modern technology in U.S.

Activity Location (percent) (percent)

Cooking

Beer brewing

Tobacco drying

Tea drying

Baking

Fish smoking

Brick firing

Foundry work

West Africa

Burkina Faso

Burkina Faso

Tanzania

Tanzania

Sudan

India

Guatemala

Tanzania

Sudan

India

Uganda

Indonesia

15-19

15-17

0.3-0.7

0.5

2.9

12-19

16

3

2-3

8-16

6.4

5-10

3

50-60

79

0.6

—

—

43

—

—

6-11

—

—

40

NOTE: — Not applicable or not available.

SOURCE: For complete list of sources, see app. 3-B.

Table 3-10-Energy Consumption by

Chinese industry, 1980

Final energy use

Sector Exajoules Percent

Basic metals (iron and steel) . . . . . . . . . . 2.38 25.7

Chemicals (fertilizer) . . . . . . . . . . . . . . . . . 2.23 24.1

Building materials (cement, brick tile) . . . 1.44 15.6

Machine building . . . . . . . . . . . . . . . . . . . . 0.82 8.8

Textiles . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.64 6.9

Food, beverages, tobacco . . . . . . . . . . . . . 0.38 4.1

Pulp and paper. . . . . . . . . . . . . . . . . . . . . . 0.25 2.7

Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.12 12.1

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.26 100.0

SOURCE: World Bank, China: The Energy Sector(Washington, DC: 1985).

countries. Integrated steel plants in India and China

currently use, on average, 45 to 53 gigajoules (GJ)

per ton of crude steel produced; integrated steel

plants in the United States and Japan use half as

much energy .80 Some developing countries have

made significant strides to reduce energy use in steel

production. The Brazilians, for example, cut energy

consumption from 34 GJ to 27 GJ per ton of crude

steel between 1975 and 1979,81 and the South

Korean steel industry is among the most efficient in

the world.

Cement—The cement industry typically consumes 2 to 6 percent, and sometimes more, of the

commercial energy used in developing countries.

The use of cement is expected to increase rapidly as

national infrastructures of roads, bridges, buildings,

etc., are built. In general, per-capita consumption of

cement increases approximately linearly with income up to several thousand dollars, and then

saturates and levels off at higher incomes (see figure

3-15). Despite the energy intensity of cement

production, it is one of the least energy-intensive

construction materials when in its final form of

concrete/aggregate (see tables 3-11 and 3-12).

The value of cement is quite low compared to its

weight. Because of this and because the raw

materials for cement—limestone, various clay minerals, and silica sand-are widely available, cement

is usually produced relatively near its point of use.

In the United States, the maximum range for truck

shipments of cement is about 300 km. In developing

countries, where the transport infrastructure is less

well developed, economical transport distances are

often less. In China, for example, 150 to 200 km is

the typical limit of transport; if transport over longer

distance is needed, the construction of a new cement

plant in the local area will be considered.82 Thus, as

a result of inadequate transport infrastructures,

cement plants are often small and relatively inefficient.

The energy required to produce cement varies

widely with the type of production process, quality

W-CS Y. Metier and Oscar de BNp Kops, op. cit., footnote 75; Sven ~tow, “Energy Considerations of Classical and New Iron- and

Steel-Making Technology,” Energy, vol. 12, No. 10/11, 1987, pp. 1153-1168.

BIMaUIim Y. Metier and Oscsr de Bruyn Kops, op. cit., footnote 75.

8% ~p~,“~mat ~d~~ in -“ Rock Products, February 1985, P. 32.
66 ● Energy in Developing Countries

Figure 3-14-Per-Capita Steel Consumption v. GNP for Various Countries

Per capita steel consumption, kilogram

10004

100

10

J

■

●

s

9 . .

●

.

.8

:

● ,m .

9

. 9 ”

●

.

.

●

. . .

‘s

● m

9

m

.

●

9

- w .

- 9 .

● m .

.

.

●

● ●

■ ✎

✎ ✎ ✎ ✎ ● ●

✎

● . 9 ● m

1

I

I I 1

0 5 10 15 20

GNP (thousand 1984 $U.S.)

The saturation of the steel market at higher income levels is readily seen in linear or logarithmic plots.

It is shown herein a semi-log plot so as to better display both low-end and high-end data. Each data point

represents a country,

SOURCE: United Nations, Statist&/ Yewbook 1985/86 (New York, NY: 1988), pp. 550-552, table 130.

Figure 3-15-Per-Capita Cement Production v. GNP for Various Countries

Per-capita cement production, kilogram

10000 j

1

.

1000

.

.

.

m

. .

m

-

.

.

m

. . ● . “

.

.

.

i

1 .

10

/

.

:.

●

●9

■

.

.

1

I

I 1 I

o 5 10 15 2 0

Per-capita GNP (thousands, 1984 $U.S.)

The saturation of the cement market at higher income levels is readily seen in linear or logarithmic plots.

It is shown herein a semi-log plot so as to better display both low-end and high-end data Each data point

represents a country.

SOURCE: United Nations, Stafisticd Ye@ook 198548, (New York, NY: 1988), pp. 524-526, table 116.
Chapter 3--Energy Services in Developing Countries ● 67

Table 3-1 l—Average Energy Intensities of Building

Materials (megajoules per kilogram)

Table 3-12—Energy Intensities of End Products

Using Alternative Building Materials

(megajoules per square meter)

Material Energy intensity

Concrete aggregate . . . . . . . . . . . . . . . . . . . 0.18

Concrete . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.80

Brick and tile. . . . . . . . . . . . . . . . . . . . . . . . . 3.7

Cement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.9

Plate glass . . . . . . . . . . . . . . . . . . . . . . . . . . 25.0

Steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28.0

SOURCE: Mogens H. Fog and I@hore L. Nadkarni, World Bank, “Energy

Efficiency and Fuel Substitution in the Cement Industry With

Emphasis on Developing Countries,” teehnieal paper No. 17,

1983.

of raw materials, plant management and operating

conditions, and other factors. The performance of

cement plants in developing countries also varies

widely and is difficult to characterize simply. Many

plants approach the efficiency of those in the

industrialized countries, depending on when they

were built and the conditions under which they are

operated. Others show significant inefficienciesusing 25 to 50 percent more energy than efficient

plants of the same type and with the same quality of

raw materials input.83

Mechanical Drive

Traditional Drive Power

The productivity of people in many rural and poor

urban areas of developing countries is now limited

by their reliance on human and animal muscle power

for water pumping, grain grinding, agricultural

activities, transportation, and small industry. When

only muscle power is available, many hours can be

spent simply on “enabling” activities, such as

hauling water or grinding grain, rather than on

directly economically productive activities. Productive activities themselves are sharply limited by the

efficiency and total output of muscle power. If the

productivity of people in rural areas of developing

Structure Concrete Steel Asphalt Brick

Building wall . . . . . . . . 400 — — 600

Bridge (per m2

) . . . . . . 4,000 8,000 — —

Roadway (per m2

).... 800 — 3,000 —

— Not applicable or not available.

SOURCE: Mogens H. Fog and Kishore L. Nadkarni, Wotid Bank “Energy

Effieieney and Fuel Substitution in the Cement Industry With

Emphasis on Developing Countries,” T=hnieal Paper No. 17,

1988.

countries is to be increased, modem motor drive

technologies and supporting infrastructures must be

made available at affordable costs. As these technologies are adopted, energy use-especially electricity—

will increase rapidly.

A person’s power output and energy efficiency

are low. The basal metabolism of a person is about

100 watts; for each unit of work output, an additional

4 to 5 units of food energy must be consumed.84

Working 8 hours a day at a rate of 50 watts of output,

a person consumes about 15 megajoules (MJ) of

energy and produces 1.5 MJ of work output, for a

daily (24-hour) average efficiency of 10 percent.85

Much of the labor expended in developing countries is not directly productive, but is instead for

‘‘enabling’ activities-that is, domestic chores.

Hauling water from the village well can take 0.5 to

3 hours per household each day, with a corresponding energy input in the form of food of 0.3 to 3.0

MJ.86 The poorest households must often go further

and thus have less available time to haul water,

resulting in much lower water usage even with

greater effort (see table 3-13). Water could instead

be pumped by a motor and piped to the home using

just 3 to 5 percent as much energy .87 For electricity

priced at $0.10 per kWh, the direct energy cost for

83Mogem H. Fog and~shore L. IWUUEi@ EnergyE@a.en~ andFuel Substitution in the CementIndus~ Wi#EWhasis on D~eloping Countries

(Washington, DC: World Banlq 1983), see figure 5-1, p. 39.

S4w. ~mdmq~fl=R~~~h Group, ~t~tio~ Development Re~~h cen~, ottsw~ _ “1S Them a Vicious CyCle Of h3W F@

Energy Intake and Low Human Output?” July 1984 (Mimeo); ChristopherHum4 Energy Research Group, International Development Researeh Center,

Ottawz Canada, “Human and Animal Energy in Transition: The Changing Role of Metabolized Energy in Economic Development” June 19S4

(Mimeo); Roger Revelle, “EnergyUseInRural India,” Science, vol. 192, June 4, 1976, pp. %9-975.

gsFor a co~~r~, see G.M.O. Maloiy et d., “Energetic Cost of Carrying bads: Have African Women Discovered an Economic Way?” Nature,

vol. 319, Feb. 20, 1986, pp. 668-669.

86~ ~ s~dy of Gu@t,~fiq tie time rw~~ to fe~h water was found to vary ffom 0.5 hour to more * 3 ho~ per day, wi~ ~en=we of

100 to 800 kcal/day. Household washing takes 4.5 to 6.3 hours per week and is as strenuous as hauling water. Girja Sharan (etI.), Energy Use in Rural

Gujurat, op. cit., footnote 37.

871t ~ often ~~ tithe sw~ ~taaction provid~by activities such ss fomging for fielwood, ti~ water, grti @.id@, ~d OtherS h SIl

important element of village life and should not be tampered with naively. One notes, however, that village women spend 10 to 12 hours per day in such

activities. Surely they would not object to such social interaction while having a leisurely eup of tea instead.
68 ● Energy in Developing Countries

Table 3-13-Average Daily Household Consumption

of Water, Gujurat, India

Consumption

class (liters per day)

Landless . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

Less than 2 ha.. . . . . . . . . . . . . . . . . . . . . . . 126

Less than 2-4 ha.. . . . . . . . . . . . . . . . . . . . . 134

Less than 4-10 ha.. . . . . . . . . . . . . . . . . . . . 161

More than 10 ha. . . . . . . . . . . . . . . . . . . . . . 256

SOURCE: Girja Sharan (cd.), Energy Usein Rura/ Gu@t(New DelhL

Oxford and BH Publishing Co., 1987).

the typical 1.5 hours spent hauling water would be

just one-fifth of a penny ($0.002). Thus, lack of

access to capital has significant impacts on labor and

energy use.

Similarly, in Africa, to pound maize or millet by

hand can take 1 to 2 person-hours per day per

household. 88 This requires perhaps 1 MJ of energy

(at 300 watts of input). A typical motor-driven mill

can do the same job in a minute or less, with an

energy expenditure of less than 0.2 MJ--or 0.05

kWh. This is less than one-half of a penny ($0.005)

worth of direct energy (at $0.10 per kWh) for 1 to 2

hours’ worth of hard labor. The capital costs in these

cases, of course, are a serious barrier to investment;

but with the time saved, the person might have done

something more productive, such as make handicrafts for market.

The advantages of mechanical processing of

grains has led to a rapid transition in many parts of

the world. In Java, Indonesia, for example, the

fraction of rice processed by hand dropped from

perhaps 80 percent to less than 40 percent between

1971 and 1973.89 This freed many women from the

chore of grinding grain; it also cost many of the

poorest households an important source of income

earned by hand pounding rice for wealthier households.90 The introduction of mechanical rice milling

in Bangladesh in the early 1980’s was estimated to

displace an additional 100,000 or more poor women

per year from their traditional part-time employment

at hand pounding rice. For the poorest, landless

women, this represented roughly half of their annual

income and 15 percent of family income.91

The power output and efficiency of draft animals

are similarly limited in performing typical farm

tasks. A typical 500-kg ox or buffalo has a basal

metabolic rate of about 1,000 watts.92 Average net

output over a 6-hour working day is typically 250

watts, and the net efficiency while working is 29 to

39 percent, which drops to about 10 percent over the

24-hour working day. A typical draft animal might

work just 40 days per year as many of the jobs

formerly done by draft animals-pumping water,

crushing sugar cane, hauling goods to market-have

already been taken over by modern motor-driven

equipment. At such a low rate of usage, the

efficiency of a draft animal is 2 percent or less on an

annual basis. These efficiencies are raised somewhat

when the value of the animal’s dung, milk, meat, and

leather is included.93

The low power output and efficiency of a draft

animal severely restricts the potential work that can

gsfi~hu P@@,Yves Bigo~ ~dHans P. Binswanger, Agricultural Mechanization and the Evolution of Farming systems in Sub-i$aharan ~’ca

(Baltimore and Londom Johns Hopkins University Press for the World BanlG 1987); Mead T. C@ “The Economic Activities of Children in a Village

in Bangladeak” Population andDevelopmentReview, vol. 3, No. 3, September 1977, pp. 201-227; A.S.B- “ChoosingTeehniques: Handpounding

V. Machine-Milling of Rice: An Indian Case,” O#ord Economic Papers, vol. 17, No. 1, March 1965, pp. 147-157; Margaret Haswea Energy for

Subsistence (Lmdorx MacMillan Press, Ltd., 1981).

S9C. Pet~T~~,“choi& of ‘f&hniwe ~M~ _onJav~” ml K. Eicherand Jo~ M. S-Q (~.),Ag~c~~aZD~e/op~~ in the Third

World (Baltimore, MD: Johns Hopkins University Press, 1984), pp. 278-288. See also A.S.B- “Choosing Techniques: Handpounding V.

Machine-Miliing of Rice: An Indian Case,” op. cit., footnote 88.

~illiamL. Collier et al., “A Commen6° in Carl K. Eicher and John M. Staatz (eds.), Agricuhura/ Development in the Third WorM (Baltimore,

MD: Johns Hopkins University Press, 1984).

91Glo~L. Scottand ww~, WOrldB@ C’The ~actof ‘1’’~~olo~choice OnR~ women inBang~&~ problems ati oppo~ties,”

Staff Working Paper No. 731, 1985.

~Pe@r~~~U~dAnthonySmi@ “ABetterB~tofB~~’ NeWS~entist, Apr. 21, 1988, pp. 49-53. oxen~d~~~~ zjoul~ ~lnlCk!r

travekxlperkg of body weight (2 J/m&g). Asrumal . weighing 500 kg and wdki.ng at 1 m/s will use an extra kW, approximately doubling its resting

metabolic rate. Most agricultural animals move at 0.6 to 1.1 m/s. . Aurnala use more energy for carrying loads than they do for carrying their own weight

ranging from 2.6 to 4.2 J/m/kg. See alao A.R. Rae, “Bioenergetics of Bullock Power,“Energy, vol. 9, No. 6, 1984; N.H. Ravindranathet al., “AnIndian

Village Agricultural Ikosyste~Study of Ungra Village. Part I. Main Observations,” op. ci~, footnote 5; Amulya Kumar N. Reddy, “AnIndian

VillageAgrieuituralEcosystem—Case Study ofUngraVillage. PartII. Discussion” op. cit., footnote5. They estimstetheefficieneyof anhdianbulloek

as 8.7 pereent when working full time, or if working just 20 days per year as observed, the bullock would have an overall efficiency of 0.5 pereent.

93N.H. Rafi&~th~d H.N. q% “Bioms Based E!ZUXgy System fora South Indian Village,” Biomass, vol. 9, No. 3, 1986, pp. 215-233.

Draft animal efficiency is 3.5 Perce@ including nitrogen in manure for fertiker. Without nitroge~ the efficiency is 2.0 pereent.
Chapter 3--Energy Services in Developing Countries ● 69

Table 3-14-industrial Electricity End Use in Brazil, 1984

Percent of total Fraction of subsector total for each end use (percent)

industrial electricity Process Direct ElectroIndustry consumption Motor heat heat chemical Light Other

Nonferrous metals . . . . . . . . . . . . . . . . . . . .

Iron and steel . . . . . . . . . . . . . . . . . . . . . . . .

Chemicals . . . . . . . . . . . . . . . . . . . . . . . . . . .

Food and beverage . . . . . . . . . . . . . . . . . . .

Paper and pulp . .’...... . . . . . . . . . . . . . . .

Mining/pelletization . . . . . . . . . . . . . . . . . . .

Textiles . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Steel alloys . . . . . . . . . . . . . . . . . . . . . . . . . .

Ceramics . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cement . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Total a 

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

20.9

12.4

11.9

9.0

6.5

5.6

5.3

4.8

3.9

2.7

17.0

100.0

32

1

79

6

87

50

89

7

65

91

76

49

1—

5

78

8

.

4

—

—

—

2

10

35

98

4

16

2

49

1

92

34

6

16

32

32—

9—

—

.

—

.

.

1

1

3

1

3

1

5

1

1

3

5

2

—

—

3

1—

.

1

1—

—Not available or not applicable.

a Total industrial electricity use was 105 terawatthours.

SOURCE: Howard S. Geller, “Electricity Conservation in Brazil: Status Report and Analysis,” contractor report prepared for the Office of Technology

Assessment, March 1990.

be done. To irrigate a l-hectare rice crop, for

example, requires the work output of two bullocks,

which in turn require the fodder produced from 2

hectares of crop.94 By himself, the individual farmer

could not, however, pump this much water by hand

in an entire year.

Modern Drive Technologies

Electric motor drive consumes an estimated 58 to

68 percent of the electricity used in the United

States, and an even higher percentage in the industrial sector alone.95 Motor drive is similarly important in developing countries (see tables 3-14 and

3-15). Electric motors are the workhorses of modern

industrial society. They run home refrigerators;

drive office air conditioners; power industrial pumps,

fans, and compressors; and keep city water supplies

flowing.

The efficiency, convenience, and high degree of

control of electric motors provide dramatic efficiency and productivity improvements in industry.%

This led to a rapid transition in the industrialized

countries from water- and steam-powered drive to

electric drive in the early 1900’s;97 and the electricity intensity of industry continues to increase today

in industrialized as well as developing countries.

The efficiency of electric motors is generally

fairly high in the industrialized countries, but can be

significantly lower in developing countries due to

the use of lower quality materials for construction

and improper techniques for maintenance, repair,

and rewind.98 Figure 3-16 compares the efficiency of

electric motors in Brazil, India, and the United

States.

Higher efficiency motors are sometimes readily

available in developing countries but cannot be used

because of the poor quality of the electric power

available. In Brazil, for example, the largest manufacturer of small motors exports more efficient

models than those sold at home. These highefficiency motors99 cannot be used in Brazil due to

the excessive variation in the power line voltage.

%eoffrey Barnard and Lars Kristoffersou Agricultural Residues as Fuel in the Third World (London: Earthscanj 1985).

qss~uel F. Baldw@ “Energy-EfticientEleetric Motor Drive Systems, “ in Electricity: E@cient E&-Use and New Generation Technologies and

Their Planning Zmp2ications (Lun& Swedem Lund University Press, 1989).

MSsmuelF.B~dw@ “meMateria Revolution and 13nergy-~lcient Electric Motor Drive SyStCmS,” Annual Review ofEnergy, vol. 13,1988, pp.

67-94; W.D. Devine, Jr., “Historical Perspective on Electrification in Manufacturing,” S. Schurr and S. Sonenblum (e&.), Electricio Use: Productive

E~ciency andEconomic Growth (Palo Alto, CA: Electric Power Research Institute, 1986).

~S~uel F. Baldw@ ‘The Materials Revolution and Energy Eft3cient Motor Drive SySt-, “ Annual Review of Energy, vol. 13, 1988, p. 67-94.

9$S~UelF. B~dwinsnd~e Finlay, Princeton TJniversity, Center for Energy and fivironnlental StUdieS, “Enexgy-EfflcientElectric Motor Drive

Systems: A Field Study of the Jamaican Sugar Industry,” working paper, No. 94, February 1988. In particular, when motors are rewound they are

sometimes simply put onanopenfn to burn the insulation off the windings rather than in temperature-controlled ovens, This can damage the insulation

between the core laminations and lead to greater losses.

99’I’he efllciency of these motors is equivalent to the standard efilciency in the industrialized countries.
Table 3-15-Projected Electricity Consumption in India by Sector and End Use, 1990

(percent of total national electricity use)

Industrial process Space conditioning

Motor Process Cooling/ Appliances

Sector Total a drive Electrolysis heat Lighting ventilation Heating Refrigeration Other Miscellaneous

Residential . . . . . . . . . . . . . . . . . . 13.0 — — — 4.2 3.5 1.5 1.0 2.9

Urban . . . . . . . . . . . . . . . . . . . .

—

10.4 — — — 2.9 2.9 1.2 1.0 2.4

Rural . . . . . . . . . . . . . . . . . . . . . 2.6 — — —

—

1.3 0.5 0.3 — 0.5

Commercial . . . . . . . . . . . . . . . . .

—

11.2 — — — 4.8 1.6 1.5 0.4 0.8 2.1

Agriculture . . . . . . . . . . . . . . . . . . 18.4 18.4 — — —

Industrial . . . . . . . . . . . . . . . . . . . . 54.8

— — — —

33.4 10.8

—

5.5 5.1

Primary metalsb... . . . . . . . . .

— — —

17.2

— —

6.4 6.9 3.0 0.9

Chemicals . . . . . . . . . . . . . . . .

— —

13.8

— — —

8.8 3.6 0.1 1.3

Textiles . . . . . . . . . . . . . . . . . . .

— —

10.2 7.8 —

— — —

0.4 2.1

Coal, cement . . . . . . . . . . . . . . 6.8

— — —

5.8 —

— —

0.5 0.4

Secondary metalsc . . . . . . . . . 3.4

— — — — —

1.5 0.2 1.4 0.2

Paper .. .. ... ... ... .... . . 3.4

— — —

3.0 —

— —

0.1 0.3

Railway traction . . . . . . . . . . . . . . 2.6

— — —

2.6 — — —

— —

— — — — —

Total . . . . . . . . . . . . . . . . . . . . . . . 100.0 54.4 10.8 5.5 14.5 5.1 1.5 1.9 1.8 5.0

Motor drive . . . . . . . . . . . . . . . . . . 61.4 54.4 — — — 5.1 — 1.9 —

—Not available or nonapplicable.

a Total national consumption is projected to be 249.1 terawatthours in 1990.

b Aluminum, nonferrous, iron, and steel.

C lron andsteel.

SOURCE: Ahmad Faruqui, Greg Wilder, and Susan Shaffer, “Application of Demand-Side Management (DSM) To Relieve Electricity Shortages in India,” contractor report prepared for the Office

of Technology Assessment, April 1990.
Chapter 3--Energy Services in Developing Countries . 71

Figure 3-16-Efficiency of Electric Motors in the United States, Brazil, and India

Motor efficiency, percent

95

90

85

80

75

70

65

I d

A

I I I I I I I I I

I

1 10

Electric motor

— Brazil standard eff. + Brazil high

100

size, HP

eff. ~ India manufacturer

~ India field test + USA high eff.

This figure shows the efficiency for motors in Brazil, India, and (high-efficiency only) the United States.

Note the large difference in motor efficiency as measured in field tests and as cited by manufacturers

in India.

SOURCES: Un/tsd Btates: John C. Andreas, Energy-EMcient E/ectric Motors (New York, NY: Marcel Dekker, 1982).

Brezik Howard S. Geller, “ElectricityConservation in Brazil: Status Report and Anaiysis,’’contractor report

prepared for the Office of Technology Assessment, March 1990; Irxfk: S. Anand, and V.S. Kothari,

Characterization of Electric Motors in Industry and Enetgy Conservation Potential in India (New Delhi,

India: Tata Energy Research Institute, no date).

This firm has also developed motors with efficiencies comparable to the highest performance motors

in industrialized countries.l00

Although the efficiency of electric motors themselves can be quite high, the efficiency of the overall

system is generally low. For example, the conversion of coal to electricity typically results in the loss

of two-thirds of the input coal energy. There are

additional losses throughout the system, with the

resulting net output as low as 5 percent of the input

energy (see figure 3-17). Significant energy savings

are possible through the use of better technologies

and better control strategies throughout the system.

Barriers to Efficiency Improvements

A number of factors limit the efficiency, productivity, and performance of industrial operations in

developing countries: plants that are too small to be

efficient; technologies that are of low quality and

often obsolete; raw materials that are of low quality;

inadequate national infrastructures; lack of foreign

exchange to purchase critical components not available locally; and a lack of skilled technicians,

engineers, and managers.

The average U.S. paper mill, for example, has an

annual capacity of 100,000 tons, whereas in Latin

America, Africa, and Asia (except Japan), the

average capacities are 18,000,9,000, and 5,000 tons,

respectively. These smaller scales can lead to

significant inefficiencies. Studies indicate that a

paper mill with an annual capacity of 30,000 tons

can consume from 30 percent to as much as 100

percent more energy/steam respectively per unit

output than a mill with a capacity of 150,000 tons.lO1

In addition, a variety of energy-conserving technologies, such as waste heat recovery systems and

l~owmdS. ~ller, “Electricity Conservation in Brazil: Status Report and -ysk,” contractor report prepared for the OftIce of Technology

Assessment, March 1990.

IOIA@ew J, Ew@, “~~~~lciency tithe IMp and Paper Industry with Emphasis on Developing Countries,” World Btitechni~ PaPr, No.

M, Washin@oIL ~, 1985, p. 45.
72 ● Energy in Developing Countries

Figure 3-17—Energy Losses in an Example Electric

Motor-Driven Pumping System in the United States

Fraction of input coal energy remaining

1 0 0

80 r

6 0 -

40-

20-

- Generation (33%)

Transmission and distribution (90%)

~

Motor (91%)

/

Shaft coupling (98%)

Pump 77% Throttle valve 66%

/

L ,

L .

-Piping (

o i I 7—77— r—— –

0 1 2 3 4 5 6 7 8

Point along the pumping system

b)

35%)

This figure shows the useful energy remaining at each stage of a

pumping system. The values in parentheses are the efficiencies of

the particular device at each stage.

SOURCE: Samuel F. Baldwin, Enwgy-E#kx”ent E/ectrk Motor Drive Systems, in Electricity: Efficient End-Use and New Gene@ion

T&nologies and Their Planning Implications (Lund, Sweden:

Lund University Press, 1989).

cogeneration systems, become financially less attractive or even uneconomical at smaller scales.

The raw materials available to industries in

developing countries are often of low quality. For

example, coal resources in India are poor, providing

blast-furnace coke with an ash content that typically

ranges from 21 to 27 percent. This lowers the energy

efficiency of the steelmaking process as well as

potentially interfering with steel production.102

Inadequate national infrastructures also reduce

efficiency and productivity. Frequent electric power

brownouts or blackouts are particularly damaging.

In Ghana, for example, the GIHOC Brick and Tile

Co. had 152 hours of electricity outages in 1986.

When an outage occurs, the fuel oil feed to the kiln

burners is cut off and the fire must be stoked with

wood. This is a haphazard process and significantly

reduces the quality of the fried bricks.103

The lack of foreign exchange to buy spare parts

can also be a serious handicap. This has been an

important factor in the decline of the Tanzanian

cement industry, which operated at just 22 percent of

rated capacity in 1984.104

Assistance may be useful at several levels. The

efficiency and productivity of traditional rural industries might be significantly increased in a costeffective reamer with the introduction of a limited

set of modern technologies and management tools.

To do this, however, is extremely difficult due to the

small and scattered nature of traditional rural industries and the large extension effort needed to reach

it. Large industry in developing countries has many

of the same needs-technical, managerial, and

financial assistance--but can be reached more

readily. International aid agencies and a few nongovernmental organizations are providing such assistance to the extent that their funds allow.

Dramatic improvements in the energy efficiency

and productivity of basic materials processing technologies are also still possible-even beyond the

levels currently achieved in the industrialized countries. Research is going on in this area, but much

more could be done. Much of the current research is

focused on higher value-added specialty materials

and high-grade finishing rather than on primary

processing. 105 Developing countries, however, have

little capital to undertake the research needed to

improve their industrial processes, and few international agencies support research of this kind.

The Traction (Agricultural) and

Transportation Sectors

Traction and Agriculture

Agriculture entails a series of operations: soil

preparation, sowing, weeding, harvesting, and postharvest storage. In traditional agriculture, these

operations are performed by manual labor with, in

some cases, assistance from animals. As agriculture

increases in scale and is commercialized, many of

these operations are done by machines.

Agriculture is by far the largest employer and

goods-producing economic sector in the poorer

developing countries. In sub-Saharan Africa, for

example, 75 percent of the work force is engaged in

lo?Bnergyancl Environmental &UdySiS, k., “Conserv@ Process HeatinPrimary Industries of India and -“ contractor report prepared for the

~ce of Technology lkW3SSlne13~ April 1990.

~os~p~orldB* ~eWS=tor -gemmt~sis~ce fio~“G-: EQergy ~o-tionin bIII&w_@ Seetor,” JWW 1988.

IWD.F. Stew@~B,M~@ “StrategiesforMeetingThnzama“ ‘sFuture C!ementNeeds,” NaturulResourcesFonun, November 1989, pp. 294-302.

IOSRO~ H. WilliamS, prince~n University, personal communication Feb. 1, 1989.
Chapter 3--Energy Services in Developing Countries ● 73

agriculture, compared to just 2 percent in the United

States. Agriculture also provides a significant fraction of GDP in developing countries--one-third of

GDP for the nearly 3 billion people in low-income

countries 106 (see table 3-16).

Agriculture in the lowest income countries is

largely by small, family farms using human and

animal power and organic fertilizer with little access

to or knowledge of modern inputs such as chemical

fertilizers, hybrid seeds, or mechanical drive. Ethiopians, for example, use on average just 4 kg of

chemical fertilizer per hectare of cropland, while the

English use 368 (see table 3-16). Low soil fertility

and inadequate or irregular rainfall sharply limit the

productivity of low-input farms in developing countries.

There is a general trend toward larger farms,

greater mechanization, and greater use of commercial inputs in many developing countries, resulting

in greater productivity but at the cost of greater

direct and indirect energy inputs. India, for example,

nearly doubled its irrigated area between 1950 and

1984 in order to reduce its vulnerability to poor

monsoons. 107 Increased irrigation and use of highyield variety crops have contributed to increases in

both absolute and per-capita agricultural production.108

China has similarly moved toward greater mechanization and use of modern inputs. Agriculture in

China is sharply constrained by land availability—

only about 10 percent of the land can support

crops-yet per-capita production increased by 18

percent from 1979 to 1983 with little increase in

cultivated area.l09 Improved water control and

distribution, increased use of tractors and fertilizers,

and the adoption of new crop varieties contributed to

this achievement.110

Traditional Shifting Agriculture

Traditional shifting agriculture begins with forestfallow systems, in which plots of forest land are

cleared and cultivated for a few years and then left

fallow for 20 years or more. Clearing by fire requires

little labor, and stumps are left for rapid regrowth

during fallow. Because the ground underneath tree

cover is soft, no further labor is required before

sowing, and because the forest cover has long

suppressed weeds, few seeds remain and little

weeding is needed. Such burning does, however,

effectively lead to very large agricultural energy

intensities due to the large amount of forest cover

that is burned off.lll

With increasing population density, the fallow

period becomes shorter. As a result, regrowth during

the fallow period is reduced to bush, and finally to

grass. Since fire does not kill roots, extensive hoeing

and weeding become necessary. Inputs of organic

fertilizer are needed to maintain soil fertility, and

there is a shift from simple addition of organic

material to more complex comporting and manuring

techniques. Further increases in population lead to

annual cultivation and eventually multiple cropping.

(In the humid tropics, however, soils tend to be poor

and easily eroded and leached, and the potential for

continuous cultivation is limited.112) As the need for

hoeing and weeding increases it becomes advantageous to go to the extra effort of destumping the land

and obtaining, training, and maintaining animals or

mechanical agricultural technology.113

There are a number of potential advantages

associated with the use of animal or mechanical

traction for agriculture. Properly done, tillage improves the condition of the soil for crop growth—

increasing porosity, aeration, root penetration, and

water infiltration while reducing evaporation. Exl~world B@Wor&f Development Repo~ 1990 (lNew York NY: Oxford university -ss, 19$0.

107~ ~e~Re~h ~titute, T.EMEnergy Data Directo~ and Yearbook (T~DY) 1988, Op. Cit., fOOtiOte 56, P. 128.

108Fo~ ~Agri~@e (lrg-tion of the United Nations, “The State of Food and Agriculture, 1984,” Rome, Italy, 1985, p. 137.

l@Ibid.

11OC. Howe, China’s Economy (New YorlL NY: Basic Books, kc., 1978).

111A. T- RUIIIW, “why Shifting Cultivators Keep Shifting: Understanding Farmer Deeision-Making in Traditional Agmfor@ry Systems,”

Community Forestry: Some Aspects, UNDP THA/81~ (Bangko~ Tbadan “ d: Environment and Policy Institute, East-West Center, Honolulw and

UNFAO Regional OffIce for Asia and the Paeif3c, 1984).

llz~abhu w,Yves Bigot ~d~p. Binswqer, Agn”cu[~raIMec~~”mtion ad the Evol~”on of Fu~”ng sytie~ in Sub-Saharan A&”ca,

op. cit., footnote 88.

llq~bhuping~i et& ibid. me e=ct ~itionpo~t fim~d to m~d then~ctor t~ology@, of co-, depend olln~ us factors,

including how difficult the soil is to work the vslue of @ me@ hides, and other serviees provided by cattle; the use of manure; the cost of tmining

and main-~; the cost of destumping and otherwise preparing fields and weeding; the length of time that animals w be * the risk of

disease such as trypauosomiasis (transmitted by the tsetse fly); and many others.
Table 3-16--Agricultural Indicators for Selected Countries

GNP/Cap Agricultural GDP as Agricultural employment as Percent of farms larger Fertilizer Crop yields (kg/ha)

Country (1987) percent of total GDP percent of total employment than 5 ha (kg/ha) Cereal Roots/tubers

Ethiopia. . . . . . . . . . . . . . . 130 45 — 4 4 1,081 2,827

Zambia . . . . . . . . . . . . . . . 250 13 — — 14 1,747 3,687

India . . . . . . . . . . . . . . . . . 300 30 61 9 43 1,590 14,268

China . . . . . . . . . . . . . . . . . 290 26 57 — 176 3,891 15,614

Brazil . . . . . . . . . . . . . . . . . 2,020 10 36 63 35 1,719 12,072

UK ...0 . . . . . . . . . . . . . . . 10,420 2 2 83 368 6,081 36,072

U.S.A. . . . . . . . . . . . . . . . . 18,530 2 2 90 101 4,618 31,215

— Not available or not applicable.

SOURCES: World Bank Wbdd Deve/oprnent F@or_t 1989(New York, NY: Oxford University Press, 19S9).

Food and Agriculture Organization of the United Nations, The State of Food andAgtiu/ture 1984 (Rome: FAO, 1965), pp. 163-165, 17S-160.

Tata Energy Research Institute, TER/ Energy Data Dhctoryand Yearbook 7988(N6w Delhi, India: Tata Energy Research Institute, 1969), p. 123.

World Resources Institute, WwkfResources f988-89(New Yo~ NY: Oxford University Press, 19S6), pp. 272-277.
Chapter 3--Energy Services in Developing Countries . 75

Box 3-A—The One-Ox Plow1

Many farmers in developing countries are unable to support the two draft animals needed to pull a traditional

plow. Although half of the households in Bangladesh keep cattle, only a quarter have two or more. In Ethiopia, only

a third of the farmers own two draft animals-and many of these are lost in the periodic droughts. At peak cultivation

times, these farmers must then rent or borrow a second animal and maybe delayed in planting their crops, which

depend critically on catching the sparse and irregular rains in a timely manner-both for making maximum use of

the nitrogen released with the first rains (see ch. 2) and for reaching maturity with the last rains.

Researchers at the International Livestock Center for Africa (ILCA) in Addis Ababa, Ethiopia, responded to

this situation by redesigning the traditional double yoke for a single ox: experiments showed that one ox could pull

with 70 percent of the force of two.

In the field, however, Ethiopian farmers quickly converted the one-ox plows back into the traditional two-ox

form. On examination, researchers found that the traditional two-ox form had a number of advantages. Farm oxen

were not as well fed nor as strong as those which had been tested at the ILCA headquarters and could not pull as

hard; and two oxen were able to steady each other when one stumbled. The rigid coupling of the traditional two-ox

plow also enabled the farmer to steer the oxen and to shift some of the weight of the plow to the oxen during a turn.

In contrast, the single ox yoke used a flexible rope harness which reduced the farmer’s ability to steer the animals

and forced him to carry the full weight of the plow when turning. The one ox plow also had a skid to regulate the

depth of the cut: it broke easily but could not be repaired by the farmers themselves.

Further, where the quality of the feed is very poor-a common situation in many tropical areas-working

animals are unable to compensate for their energy expenditure by eating more and consequently lose weight. A

working animal also has a 10 percent higher basal metabolic rate than a nonworking animal-requiring more food

just for maintenance. In this case, it may be better to use two oxen to do “what little they can without losing too

much weight rather than to have one ox which soon becomes exhausted beyond recovery. ”

As one researcher at the ILCA noted, “It might have occurred to us that if Ethiopian farmers hadn’t invented

something as simple as the one-ox plow in 3,000 years of agriculture, they probably had reasons. ”

Some have similarly thought that the same animal might be used to provide both labor and milk. Experiments

in Costa Rica showed that cows could, in fact, provide both—if fed adequately. Tropical pastures, however, are not

adequate. To provide the animal a sufficient diet for such a high rate of energy expenditure required concentrated

feed supplements such as grain. This could create a direct conflict over food between draft cows and people in many

parts of the world.

llXbontMaCKenzie, “Ethiopia’swdto the plough,” New Scientist, Oct. 1, 1987, pp. 52-55; Peter Lawrence and Anthony Stit4 “A

Better Beast of Burde~” New Scientist, Apr. 21,1988, pp. 49-53; A.K.M. Abdul Quaderand K. Ikhtyar Ornar, Commonwealth Science Council,

“Resources and Energy Potentials in Rural Banglade@” technical publication series No. 191, Imndo~ 1986.

periments show that yields can be increased by Peasant farmers have responded to their often

plowing. 114 In practice, however, little increase is difficult circumstances in varied ways—both logical

observed as farmers tend instead to focus on (see box 3-A) and frequently ingenious. For examincreasing cultivated area115 or on saving labor, pie, around 1925-1930, animal traction began to be

rather than improving the quality of their tillage. In used in northwestern and central Senegal and

West Africa, the soils are so hard they often cannot northern Nigeria for peanut cultivation. The light,

be plowed (without damage to equipment) until the sandy soils of Senegal do not require plowing, and

as the growing season is so short, rapid planting of rains begin, but then any delay reduces the available peanuts while the soil is moist is essential. Conse- growing time and risks a shortage of water when quently, seeders are used by the peasants so that

plants reach maturity.116

larger areas can be cultivated within the available

Ildprabhu ping~i, yves Bigot, and Hans P. Binswimger, Agn”cultural Mechanization and the Evolution ofFarma”ng SySte?nS in Sub-Saharan&I”ea,

op. cit., footnote 88; Peter Munzinger, Anz”nud Traction in Afi”ca (l%chbom, West G ~y: GTZ, 1987), p. 279.

lls~seneg~ tie average expansion ofagric~~ area by the introduction of draft animals to smallholders is 1(K) to 160percenG inWthe av~ge

expansion is 150 to 200 percent. Peter Munzinger, Animal Traction in Aflca, op. ci~ footnote 114, p. 287.

116~bhu Pingali et al., op. Cit., footnote 88.
76 ● Energy in Developing Countries

time. Horses are used instead of oxen, since the

greater power of oxen is not needed (there is no

plowing) and horses are faster, further increasing the

planted area. In Nigeria, where peanuts are grown in

mid-slope regions on soils highly susceptible to

erosion, ox-drawn ridgers are used to control the

erosion.117

Modern Commercial Agriculture

As population grows agricultural productivities

must be raised. Modern inputs are needed to achieve

this. Commercial fuel inputs to agriculture include

mechanized land preparation, mechanized irrigation, and synthetic fertilizers.118

The degree of mechanization varies widely, but

generally increases with per-capita income. Mechanization reduces the time and labor needed for

preparing, planting, and harvesting crops. In favorable areas, it also aids double cropping. The tractors

themselves come in many forms—in China the most

popular is probably the “Worker-Peasant,” a 7-hp

garden tractor. In India, where the number of tractors

almost doubled from 1972 to 1977,119 the most

popular is a 30-hp diesel.

Irrigation is most commonly done with either

electric motor or diesel driven pumps. Electric

pumps are quite reliable (although subject to interruptions in the electric power grid) and convenient,

and are often the lowest cost alternative. Dieselelectric pumping systems, in which diesel generators

produce electricity that is then used to drive electric

pumps, and direct diesel and gasoline-powered

pumps are more often used where no electric grid is

available. These are much less mechanically dependable than electric pumps.

In China, irrigation is a significant consumer of

electricity. It is estimated that 70 percent of the

electricity consumed in rural areas is for irrigation,

with the remainder used for food processing, various

rural industries, and lighting.120 In India, the number

of electric pump sets for irrigation has grown rapidly

(see figure 3-18), and the electricity consumption for

these pump sets has gone from 4,470 GWh in

Figure 3-18-Use of Agricultural Pumpsets in India,

1950-1990

Number of pumps by type (millions)

7

I

1950 1960 1970 1980 1990

— Electric pump sets + Diesel pump sets

+ Animal-powered pump

SOURCE: Tata Energy Research Institute, TER/ EiieWy Data Directory

and Yearbook (TE/2DYjl 7988 (New Delhi, India: 1989), footnote

56.

1970-71 to 23,420 GWh in 1985-86. The number of

diesel pump sets has also grown, but they still are

fewer in number than the electric units.121

Transportation

The transportation sector accounts for a quarter or

more of total commercial energy use in most

developing countries-India and China being the

most notable exceptions (see table 3-l). Most of this

transport energy is from oil. Energy use for transportation in the developing world is expected to grow

rapidly in the future, as increasing urbanization and

incomes (see figure 3-19) lead to increased demand

for transportation services. This will increase the

outflow of scarce foreign exchange for the oilimporting countries, and will also require considerable investment in roads and related infrastructure.

Transportation can be provided by air, rail, road,

or water. Inmost of the developing world, as well as

in the industrialized world, road technologies provide most transport services. Notable exceptions are

India and China, which have large rail networks.

In rural and poor areas of the developing world,

walking is the principal transport “technology.”

The advantages of walking are many-it requires no

capital investment, it is not restricted to roads, and

lly~ido

118’IMs excludes emrgy used for ferlher production and that used for crop preparation both of which we include under industrial energy use.

11-_~-hInstitute, TEDDY 1988, op. cit., footnote 56, p. 137.

1%. Howe, Chim’s Economy, op. cit., footnote 110, p. **.

121~ 1983~, fore-le, Mm we= about 5.3 fion electric p~pSe& ~d3.1won~esel pump sets ill hldi~ SOIIM Of thCSC dieSCl UllitS WerC

used as backups for the electric units. ‘lMaEnergy Research Institute, T~DY1988, op. cit, footnote 56, p. 135.
Chapter 3--Energy Services in Developing Countries ● 77

Figure 3-19-Passenger and Freight Transport v. GNP for Selected Countries, 1960-81

Passenger traffic and GNP per capita

10,000

r

1

I I I I I I 1

I

I 1 I I I 1 1

U.S.A.

/B’”dia //

Japan

1

14

t 1 I I I 1 1

100 1,000 10,000

GNP per capita (1979-1981 constant use)

Total freight and GNP for selected countries, 1980-1981

1,000

100

10

1-

1 I 1

1 I I

U.S.S.R.

I I I 1 1 1 , I I I I I I 1 1

10 100 1,000

I

GNP (BIL.US$)

This figure shows how passenger and freight transport energy use have increased with GNP for seven countries. The individual data points

are for specific years.

SOURCE: J. Venny and L. Uy, “Transport in China,” World Bank staff working paper, No. 723, Washington, DC, 1985.
78 ● Energy in Developing Countries

it requires no fossil fuels. On the other hand, it is

slow, tiring, and requires energy in the form of food.

Animal technologies, such as bullock carts, are

sometimes faster, have a much greater freight

capacity, and involve less work for people. Capital

investment in the bullock and cart is required,

however, as well as an operational cost for feed.

These two technologies-walking and domesticated

animals-are the principal means of transport in

many poorer and rural areas, particularly in Africa

and Asia.

Bicycles are a popular transport technology,

especially in China, where from 50 to 90 percent of

urban vehicle trips are made by this mode.122 The

frost cost of a bicycle can be a barrier-a new bike

costs the equivalent of 7 to 8 months’ wages in

Tanzania, for example-but in some areas bicycles

can be bought on credit. In India, government

employees are entitled to loans for vehicle purchase,

which can be used to buy a bicycle. Bicycles work

well in congested urban areas, where they have some

advantages over private automobiles-they are easier to park and store, less expensive to own and

operate, and do not contribute to air pollution. Their

range and freight capacity, however, are limited.

The technological leap to the internal combustion

engine allows for much higher speeds, longer

distances, larger freight capacity, and greater comfort. The disadvantages of the internal combustion

engine are technological complexity, movement

largely constrained to roads, high first cost and

operating cost, and environmental damage due to

fossil fuel burning. There are also secondary effects,

such as injury and death due to accidents and land

use for roads and parking. Despite its disadvantages,

the internal combustion engine is the dominant

transport technology in the industrialized and developing world, and its use is growing rapidly.

Passenger Road Transport Technologies

Mechanized passenger road transport in the developing world is performed by a wide range of

technologies, including mopeds, private autos, and

buses. Developing countries have only about 1

percent as many autos per personas does the United

States (see table 3-17), but their automobile fleets

are growing rapidly. Further, the scrappage rate (the

fraction of vehicles retired each year) is very low in

developing countries, due to the high value placed

Table 3-17—Passenger Fleet Size and Growth

in Selected Countries

Average annual

Automobiles per growth in automobile

Country 1,000 people, 1986 fleet size, 1982-86

China . . . . . . . . . . . . . .

India . . . . . . . . . . . . . .

Kenya . . . . . . . . . . . . .

Thailand . . . . . . . . . . . .

Brazil . . . . . . . . . . . . . .

Japan . . . . . . . . . . . . .

West Germany . . . . . .

United States . . . . . . .

0.7

1.8

8.9

21.9

87.0

234.0

444.8

673.4

41.6

8.2

3.2

8.8

8.9

3.0

3.3

2.4

SOURCES: Fleet size and growth from Energy and Environmental Anaiysis, Inc., “Poliq Options for Improving Transportation Energy

Efficiency in Developing Countries,” contractor report prepared for the Office of Technology Assessment, March 1990.

Population from World Bank, IWw/dDeve/oprnentl %porf 1989

(New York, NY: Oxford University Press, 1989). Figures forthe

United States include both autos and Iighttrucks; data arefmm

Oak Ridge National Laboratory, Transportation Energy Data

8ook, Edition 10, ORNL-6565 (Oak Ridge, TN: Oak Ridge

NationaJ Laboratory, September 1989).

on any vehicle that runs. Therefore, choices made

now as to the energy efficiency of new vehicles in

developing countries are doubly important-these

vehicles will soon be the majority of the fleet and

they will be on the road a long time.

Although their technical efficiency (vehicle kilometers traveled per liter of fuel consumed) is lower,

vehicles in developing countries average a much

higher load factor (persons per vehicle) than those in

industrialized countries. Buses are chronically overloaded, and mopeds and motorcycles designed for

one often carry two or more. Shared ride technologies, such as jitneys, are commonly filled beyond

rated capacity. This increases the efficiency of the

transportation system i-n terms of passengerkilometers per liter of fuel consumed, but reduces

safety and comfort.

The vehicles themselves are often less energyefficient than those found in the industrialized

world. They are often based on designs that emphasize sturdiness and dependability under adverse

conditions (poor roads, chronic overloading, little

maintenance) over energy efficiency.

Freight Road Transport Technologies

Road freight movement in the developing world

is provided mostly by diesel trucks (with the

exception of China where much of the truck fleet

uses gasoline) and these trucks account for over half

Izzworld B@‘cGridlock Weary, Some ‘lbrn to Pedal power,” The Urban Edge, vol. 14, No. 2, March 1990.
Chapter 3--Energy Services in Developing Countries ● 79

Table 3-18-Energy Efficiency of Trucks in Selected Countries

Energy consumption

Country/ Capacity (megajoules per metric ton

region Truck name (metric tons) per kilometer)

OECD Mercedes Benz 1217 (1979) 7.0 1.0

OECD Man-VW 9136 (1980) 5.9 1.0

India TATA 1201 SE/42 5.0 2.1

India Ashok Leyland Beaver 7.5 1.6

China Jiefang CA-10B 4.0 2.3

China Dongfeng EQ140 5.0 1.8

NOTE: OECD and Indian trucks use diesel, Chinese trucks use gasoline.

SOURCE: J. Yenny and L. Uy, World Bank, “Transport in China,” staff working paper No. 723, 19S5, p. 70.

the energy used for road transport in the developing

world. 123 The movement of height is required for

most economic activity, and in many developing

countries the prices of diesel fuel are kept lower than

gasoline prices. In the United States, for example,

gasoline and diesel prices at the pump are almost the

same, while in India diesel is slightly less than half

the price of gasoline.124

Trucks in the developing world are relatively

inefficient, requiring 1.5 to 2.5 times as much energy

to move one ton of freight one kilometer as

comparable trucks in the OECD countries (see table

3-18). In developing countries, however, trucks

must cope with more difficult operating conditions:

the roads are typically congested and poorly maintained, aggravating technical inefficiency and accelerating wear.

Rail Technologies

Railroads are significant providers of transport

services only in India and China, and in these two

countries the rail share of total transport is declining

rapidly due to the much faster growth of road

transport. In China, for example, the share of

passenger traffic using railways dropped from 69

percent in 1965 to 48 percent in 1987. Railway

freight transport shows the same trend of decreasing

relative use.125 Similarly, India shows a mode shift

toward roads and away from rail for both passenger

and freight traffic.126

Despite these modal shifts, the rail systems in

both countries still account for significant energy

use. China and India have extensive rail networks

that consume, respectively, 72 percent and 29

percent of transportation energy (see app. 3-A). The

Indian rail system, although in relative decline, still

carries a significant amount of freight and passengers (see table 3-19), using a mix of steam (being

phased out), diesel, and electric locomotives.

Implications for Energy Demand

Road transport-private autos for passengers and

trucks for freight--has become the dominant mode

of transportation in developing countries. Increases

in population, income, and auto ownership rates

(autos per person) combine to yield a rapid increase

in the number of private vehicles. Increasing urbanization leads to greater congestion, which reduces the

efficiency of private vehicles. Urbanization, economic growth, and industrialization require large

increases in freight movement, as producers move

farther from markets. The net effect of these factors

will be an increase in the energy needed to provide

transportation services.

Improvements in the energy efficiency of developing world transport systems can be made in

several areas. Road-going vehicles in the developing

world are less energy-efficient than comparable

vehicles in the industrialized world, suggesting that

efficiency gains can be made in the vehicles

lmTmcIKs account for 50 to 75 pmcent of meqly consumed for road transport in the developing worl~ compared to 30 to 35 percent for many

industrialized countries. Clell G. Harrsl, “Meeting the Transportation Aspirations of Developing Countries: Energy and Environmental Effeets,”

Proceedings of the Energy and Environment in the 21st Century Conference (Csmbn“dge, MA: Massachusetts Institute of Technology, March 1990).

l~fierW~omtionA*~tioQInter~tio~/Energy A~/1988, DOE/EIA-0219(88) (Wash@toQ ~:U.S. ~v~nm~t~ting Office,

1989).

12sp. Kuirun and S. Guojie, ‘‘Overview of Transport Development in Chimq” papex presented at the New Energy Technologies Transportation and

Development Workshop, Ottawa Canadz September 1989.

126JOY Dunkerley, Irving Hock Charu Gadhdq K@ ‘rh~ “Energy and Transport-’IheIndian Experience,’ PaciicandAsianJournal ofEnergy,

1987, pp. 1-12.
80 ● Energy in Developing Countries

Table 3-19-Comparison of Rail Systems in China,

India, and the United States

United

China India States

Length of rail network (km) ......53,000 62,000 235,000

Rail energy use (percent of

total transport energy use) . . . . 51 27 3

Percent of freight traffic carried

by rail . . . . . . . . . . . . . . . . . . . . . . 45’ 47 30

Percent of passenger traffic

carried by H-l . . . . . . . . . . . . . 55 22 1

SOURCES: P. Kuirun and S. Guojie, “Overview of Transport Development

in China,” paper presented at the New Energy Technologies

Transportation and Development Workshop, Ottawa, Canada,

September 1989; Tata Energy Research Institute, TER/

Energy Data Directory and Yearbook (TEDDY) 1988 (New

Delhi, India: 1989); International Energy Agency, I#tld Energy Statistics and Ba/ances: 198 f-87 (Paris: OECD, 1989);

Oak Ridge National Laboratory, TranspMdion Energy Data

Book: E&ion 70, ORNL-8585, 1989; Association of American

Railroads, Railroad Facts 7989 (Washington, DC: American

Association of Railroads, 1990).

themselves. Improvements in the transportation

infrastructure, such as improved roads and reduced

congestion, can also increase energy efficiency.

Mode choices, such as a movement away from

private autos and motorcycles to buses and bicycles,

can help. Of course, all these options have benefits

and costs: these will be explored later in this OTA

study. The important conclusions for this section,

however, are that the demand for transportation

services is increasing rapidly, technologies in use

today are not as efficient as they could be, and the

energy impacts of technology choices made today

will be felt far into the future.

Conclusion

This survey of energy services and how they are

provided in developing countries reveals three

common characteristics. First, each service is provided by a wide range of technologies and fuels.

Cooking is provided by technologies ranging from

open frees to microwave ovens, with a large number

of possibilities in between. The range of passenger

transport services is similarly wide, varying from

foot to jet passenger airplanes. Second, there is in

almost all cases a well-established transition between technologies, depending on two main factors--

income and availability of fuel supplies. Third, the

services are currently being provided by technologies whose efficiency could usually be significantly

improved.

The following chapter will examine how the

many types of energy used in developing countries—

fossil fuels, electricity, and biomass fuels--are

provided, including domestic production, imported

supplies, the energy distribution system, and the

energy conversion sector.
Chapter 3--Energy Services in Developing Countries .81

Appendix 3-A—Energy Balances for

Selected Developing Countries

The following energy balances begin with International Energy Agency (IEA)127 energy production, trade,

and stock change totals for commercial fuels. This

provides a common framework for evaluating individual

countries and for comparing different countries. Biomass

fuels for the traditional sector are not included in the

country-specific IEA data and so are separately added

based on country specific field survey data. The year

chosen for each country is determined primarily by the

year for which the biomass energy data is available.

In contrast to the IEA procedure, energy supply

production, conversion, and transformation losses are not

separately tallied in the energy balances presented here.

Instead, these losses are carried forward into the sectoral

breakdowns in proportion to the IEA sectoral breakdown

of energy use. This more accurately indicates sectoral

energy usage by showing the losses incurred in providing

energy to each sector.

Electricity is initially divided into two categories in the

following energy balances: nonthermal and thermal.

Nonthermal electricity is given in terms of the electric

power output--the joule equivalent of kWh. Thermal

electricity is given in terms of thermal energy input; losses

incurred in generation, transmission, and distribution are

kept in the total. Nonthermal and thermal electricity

quantities, therefore, can not be directly compared.

The IEA convention for electricity production divides

the hydroelectric output in kWh by 0.385 in order to make

hydroelectric power appear to be on the same “thermal

equivalent” input basis as thermally generated electricity

when listed on the basis of fossil fuel input. The IEA

subsequently multiplies the sum of hydroelectric “thermal equivalent” and thermal electric inputs by 0.385 to

get an electric power output in kWh. Thermal and

hydroelectric “thermal equivalent” losses are lumped

together as an energy production loss.

This convention of “thermal equivalents” leads to a

large misrepresentation in the energy balances for hydrorich countries such as Brazil. The procedure used here

avoids the IEA convention of assigning a thermal

equivalent for hydroelectric or other nonthermal power. It

also carries the losses in thermal generating plants

through to the end-use sectors as noted above. At the

sectoral level, the thermal and nonthermal electricity are

added together directly to indicate the average amount of

energy, including fossil fuel, used by each sector. These

figures are shown in brackets to denote that the figure is

a sum of nonthermal electricity output and thermal energy

input. This procedure lowers the energy supply totals

compared to those usually found in the literature.

Percentage breakdowns by end-use sector are based on

the IEA data; percentage breakdowns by energy service

within end-use sectors are based on country-specific

surveys as noted. The end service breakdowns are the best

estimates that OTA could make given the poor quality and

paucity of available data These breakdowns are provided

here only as an indication of the relative importance of

selected energy services; they should not be construed to

be a precise quantitative measure of the energy consumed

in delivering these services or to be a precise listing of

energy services and their interrelationships. Some important energy services and fuel mixes are overlooked in

many of the available energy service breakdowns. For

example, lighting and the use of traditional fuels are

largely left out of the industrial sector. In addition, a

number of important energy services are generally left out

of the breakdowns: an example might be the use of

animals for traction in agriculture and the use of crop

residues to feed them.

lz’7~te~o~ mum Agency, WortiE~rgy Statistics and Balances: 1971-87 @tiS: OECD, 1989).
82 ● Energy in Developing Countries

Table 3A-l—Brazil: Energy Supplies and Services, 1987 Exajoules (1018 Joules= 0.9478 Quad)

and Percent of National Total

Fossil fuels Eleotricity Biomass

Cane/ Wood/

Energy supplies coal Oil Gas Nonthermal Thermal alcohol’ Charcoal Other Total —Production . . . . . . . . . . . . . . .

Trade/stock change . . . . . . . .

Electric generation . . . . . . . . .

Nonenergy . . . . . . . . . . . . . . .

Total energy . . . . . . . . . . . . . .

Percent of total . . . . . . . . . . . .

Energy services

Residential . . . . . . . . . . . . . . .

Residential . . . . . . . . . . . . . . .

Cooking/heating . . . . . . . . .

Lighting . . . . . . . . . . . . . . .

Refrigeration . . . . . . . . . . . .

Television . . . . . . . . . . . . . .

Air conditioning . . . . . . . . .

Other . . . . . . . . . . . . . . . . . .

Commercial c . . . . . . . . . . . . .

Commercial . . . . . . . . . . . . . .

Cooking/heating . . . . . . . . .

Lighting . . . . . . . . . . . . . . .

Refrigeration . . . . . . . . . . . .

Air conditioning . . . . . . . . .

Other . . . . . . . . . . . . . . . . . .

Industrial . . . . . . . . . . . . . . . .

Industrial . . . . . . . . . . . . . . . . .

Motor drive . . . . . . . . . . . . .

Process heat . . . . . . . . . . .

Lighting . . . . . . . . . . . . . . .

Electrochemical . . . . . . . . .

Transport . . . . . . . . . . . . . . . .

Transport . . . . . . . . . . . . . . . .

Road . . . . . . . . . . . . . . . . . .

Rail . . . . . . . . . . . . . . . . . . .

Air . . . . . . . . . . . . . . . . . . . .

Other . . . . . . . . . . . . . . . . . .

Agriculture . . . . . . . . . . . . . .

Agriculture . . . . . . . . . . . . . . .

0.124

0.315

-0.044 —

0.40

6.6%

—

—

—

—

—

—

—

—

—

—

—

0.40

6.58% —

6.5 % —

0.00(O* —0 *

—

—

—

—

1.55

1.040

-0.073

-0.167

2.349

38.6%

0.202

3.3%

3.3%

—

—

—

—

—

0.026

0.42%

0.42%

—

—

—

—

0.56

9.22%

—

9.22%

—

—

1.417

23.3%

20.4%

0.43%

1.74%

0.77%

0.146

2.4%

0.112

—

—

—

0.112

1.8%

0.007

0.1%

O.1%

—

—

—

—

—

0.003

0.05%

0.05%

—

—

—

—

0.10

1.65%

.

1.65%

—

—

—

—

—

—

—

—

—

—

0.681 —

0.023 —

— 0.117

—

(0.821 )

–

.

(0.169)

2.8%

0.77%3

0.67%

0.90%

0.1 7%

0.09%

0.21 %

(0.159)

2.62%

0.20%

1.1570

0.45%

0.52%

0.29%

(0.46)

7.57%

3.7170

3. 18%

o.15?40

0.53%

(0.005)

0.08%

—

0.08%

—

—

0.026

0.43%

0.91

—

—

-0.02

0.89

14.6%

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

0.44

7.24%

.

7.24%

—

—

0.44

7.24%

7.24%

—

—

—

—

—

1.39

—

—

—

1.39

22.9%

0.48

7.9%

7.9%

—

—

—

—

—

0.018

0.3%

0.3%

—

—

—

—

0.75

12.3%

—

12.3%

—

—

—

—

—

—

—

—

0.126

2.1 %

0.13

-0.01

—

—

0.12

2.0%

—

—

—

—

—

—

—

—

—

—

—

—

.

.

—

—

—

—

—

—

—

.

—

—

—

—

—

—

—

4.90

1.37

0.00

-0.19

6.08

100’YO

0.86

14.1%

1 2.1%

0.7%

0.9%

0.2%

0.170

0.2%

0.21

3.5%

1 .O%

1.270

0.5%

0.5%

0.3%

2.71

44.6%

3.7%

40.2%

0.2%

0.5%

1.86

30.6%

27.6%

0.5%

1 .7%

0.8%

0.30

4.9%

—Not available or not applicable.

() data in parentheses is sum of nonthermal energy output and thermal energy input.

a The use of bagasse for energy production(cogeneration)isdivided proportionately betweenindustrialpprocess heat and road transport. Electricity generation

within the cane industry is not given separately.

b This is mostly for water heating(10 TWh). Only O.5 TWh were for cooking.

cExcludes public buildings.

SOURCES: Adapted from international Energy Agency, Wodc/Energy Statistics and Balances: 1971 -87(Pans: OECD, 1989); and Brazilian Ministry of Mines

and Energy, Natina/ Energy Ba/ance for Brazi7 1988 (Brasilia, 1988), provided by Howard S. Geller, American Counal for an Energy Efficient

Economy, Washington, DC, and Sao Paulo, personal communication, Mar. 8,1990.
Chapter 3--Energy Services in Developing Countries ● 83

Table 3A-2-China: Energy Supplies and Services, 1987 Exajoules (1018 Joules = 0.9478 Quad)

and Percent of National Total

Fossil fuels Electricity Biomass fuels

Energy supplies coal Oil Gas Nonthermal Thermal Crop Wood Dung Biogas Total

0.15

—

—

—

0.15

0.5%

0.15

0.5%

0.4%

0.1%

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

0.03 —

—

—

0.03

0.1%

0.03

0.1%

0.1%

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

31.0

-2.2

-0.15

28.7

100%

12.4

43.%

31 .4%

10.3%

1.370

0.77

2.7%

14.7

51 .3%

37.8%

13.5%

1.24

4.3%

0.8%

2.4%

—

1.270

1.92

6.7%

- . . . .- .- - -- - -- - -- - . - -

Production . . . . . . . . . .

Trade/stock change . .

Electric generation . . .

Nonenergy . . . . . . . . . .

Total energy . . . . . . . .

percent of total . . . . . .

18.15

-0.80

-3.15

5.32

-1.40

-0.59

-0.15

3.18

11.170

0.12

0.4%

—

—

0.4%

0.27

0.9%

1.77

6.2%

3.4%

2.8%

0.57

2.0%

0.8%

—

—

1 .2%

0.44

1.570

0.46

—

-0.02

0.33 —

— 0.00

— 3.76

—

(4.10) –

14.3%

3.4

—

3.2

—

—

—

3.2

1 1.2%

3.2

1 1.2%

10.5%

0.7%

.

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

14.20

49.5%

—

0.44

1.570

—

3.4

11.870

Energy services

Residential . . . . . . . . .

Residential . . . . . . . . .

Cooking . . . . . . . . . .

Space heating . . . . .

Lighting . . . . . . . . . .

5.23

18.2%

8.7%

9.5%

—

0.07

0.2%

0.2%—

(0.27)

0.94%

3.3

11 .5%

11.5%

—

—

—

0.94%

Commercial/public . . .

Commercial/public . . .

0.31

1.1%

9.41

32.8%

32.8%

—

(0.19)

0.66%

(3.06)

10.7’YO

0.00

—

0.37

1 .3%

1 .3%

—

0.00

—

—

0.1

0.3%

0.3%

—

Industrial . . . . . . . . . . .

Industrial . . . . . . . . . . .

Process heat. . . . . .

Mechanical drive . .

—

10.7%

(0.08)

0.285

Transport. . . . . . . . . . .

Transport. . . . . . . . . . .

Road . . . . . . . . . . . .

Rail . . . . . . . . . . . . .

Air . . . . . . . . . . . . . .

Other . . . . . . . . . . . .

0.59

2.1 %

—

—

2.1 %

—

0.00

—

0.28%

—

—

—

—

—

—

0.00 —

Agriculture . . . . . . . . . .

Agriculture . . . . . . . . . .

0.98

3.4%

(0.50)

1 .7%

—

—

—

—

— Not available or not applicable.

( ) data in parentheses is sum of nonthermal energy output and thermal energy input.

SOURCE: Adapted from International Energy Agenoy, 144w# Energy Sfafisfks and Ba/ances: 1971-87 (Pwis: OECD, 1989); and Vadav 8mil, “Ohina’s

Energy,” contractor report prepared for the Office of Technology Assessment, 1990.
84 ● Energy in Developing Countries

Table 3A-3-lndia: Energy Supplies and Services, 1985 Exajoules (1018 Joules = 0.9478 Quad)

and Percent of National Total

Fossil fuels Electricity Biomass

Energy supplies coal Oil Gas Nonthermal Thermal Wood Dung Crop Total

Production . . . . . . . . . . . . . . .

Trade/stock change . . . . . . . .

Electric generation . . . . . . . . .

Nonenergy . . . . . . . . . . . . . . .

Total energy . . . . . . . . . . . . . .

percent of total . . . . . . . . . . . .

Energy services

Residential . . . . . . . . . . . . . . .

Residential . . . . . . . . . . . . . . .

Cooking/water heating . . . .

Lighting . . . . . . . . . . . . . . .

Appliances . . . . . . . . . . . . .

Commercial/pubiic . . . . . . . . .

Commercial/pubiic . . . . . . . . .

Cooking/heating . . . . . . . . .

Lighting . . . . . . . . . . . . . . .

Appliances . . . . . . . . . . . . .

industrial . . . . . . . . . . . . . . . . .

industrial . . . . . . . . . . . . . . . . .

Process Heat . . . . . . . . . . .

Motor Drive . . . . . . . . . . . . .

Lighting . . . . . . . . . . . . . . .

Appliances . . . . . . . . . . . . .

Transport . . . . . . . . . . . . . . . .

Transport . . . . . . . . . . . . . . . .

Road . . . . . . . . . . . . . . . . . .

Rail . . . . . . . . . . . . . . . . . . .

Air . . . . . . . . . . . .. .:.....

Agriculture a . . . . . . . . . . . . . . .

Agriculture . . . . . . . . . . . . . . .

Motor Drive.... . . . . . . . . .

Traction . . . . . . . . . . . . . . .

3.16

0.03

-1.29

1.29

0.48

-0.11

-0.09

1.57

18%

0.39

4.4%

1.9%

2.1%

—

0.03

0.3%

0.3%

—

—

0.40

4.5%

3.1%

0.8%

—

—

0.77

8.7%

7.1%

0.7%

0.8%

0.15

1.7%

1.0%

0.7%

0.17 0.20 — — 0.00 — 1.450.87 —1.2

—

—

—

1.2

13%

1.2

14%

14%

.

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

.

—

1.6

—

—

—

1.6

18%

1.6

18%

18%

—

—

●

*

*

—

—

—

—

—

—

—

—

—

—

—

.

—

—

—

—

—

8.5

0.5—

-0.09

8.9

100%

4.2

47%

4370

3.9%

0.4%

0.20

2.2%

1.1%

0.4%

0.6%

3.1

35%

23%

10.8%

0.5%

0.5%

1.0

11.8940

7.1%

3.8%

0.8%

0.43

4.8%

4.l%

o.7%

—

-0.05 —

0.12

1.3%

— —

(1.65)/19% –

—

0.87

10%

1.90

21%

0.06

o.7%

0.6%

0.007

0.0870

0.08%—

—

0.78

8.8%

8.8%

—

—

1.8% — o.4%

0.02

0.2%

0.2?!

(0.09)

.

1.0%

0.4%

0.6%

0.05

0.6% — 0.6% — —

—

1.61

18%

18%

0.113

1.3%

1.3%

(0.97)

10.9%

0.04

0.5%

0.5%—

—

10.0%

0.5%

0.5%

— —

—

—

0.23

2.6%

(0.04)

0.5%—

0.5%—

— —

—

—

2.6% — —

— —

0.003 (0.28)

3.1%

3.1%

—

—

—

—

—

0.03% —

— —

— — —

—Not available or not a aplicable.

() data in parentheses is sum of nonthermal energy output and thermal energy input.

● Small.

a baseline data from the international Energy Agency for petroleum use in agriculture have been modified to correspond better with TERl energy data.

SOURCE: Adapted from international Energy Agency, 144rkj Enqgy Statistics and Ba/ances: 197f-87(Paris: OECD, 1989); Tata Energy Researoh

Institute, TEDDY op. cit., footnote 58; and Aehok Desai, contractor report prepared for the Office of T6chnoiogy Assessment and personai

communication.
Chapter 3-Energy Services in Developing Countries ● 85

Table 3A-4-Kenya: Energy Supplies and Services, 1980, Petajoules (1015 Joules) and Percent of National Total

Fossil fuels Electricity Biomass fuels

Energy supplies coal Oil Gas Nonthermal Thermal Wooda Residues Total

Production . . . . . . . . . . . . . . .

Trade/stock change . . . . . . . .

Electric generation . . . . . . . . .

Nonenergy . . . . . . . . . . . . . . .

Total energy . . . . . . . . . . . . . .

percent of total . . . . . . . . . . . .

Energy services

Residential . . . . . . . . . . . . . . .

Residential . . . . . . . . . . . . . . .

Cooking . . . . . . . . . . . . . . .

Lighting . . . . . . . . . . . . . . .

Commercial . . . . . . . . . . . . . .

Commercial . . . . . . . . . . . . . .

Cooking/heating . . . . . . . . .

Lighting . . . . . . . . . . . . . . .

Industrial . . . . . . . . . . . . . . . . .

industrial . . . . . . . . . . . . . . . . .

Informal . . . . . . . . . . . . . . .

Formal. . . . . . . . . . . . . . . . .

Transport . . . . . . . . . . . . . . . .

Transport . . . . . . . . . . . . . . . .

Road . . . . . . . . . . . . . . . . . .

Rail . . . . . . . . . . . . . . . . . . .

Air . . . . . . . . . . . . . . . . . . . .

Agriculture . . . . . . . . . . . . . . .

Agriculture . . . . . . . . . . . . . . .

—

0.42

—

0.42

0.1%

—

—

—

—

—

—

—

—

0.42

0.1%

.

0.1%

—

—

—

—

.

—

—

—

78

-6.1

-2.3

70

17.1%

6.84

1.67%

0.53%

1.14%

0.75

0.18%

0.05%

0.13%

16.5

4.o%—

4.0%

43.3

10.6%

6.9%

0.6%

2.8%

6.6

1.6%

— 3.82 —

0.44 —

— 6.1

320

—

9.3 333

79

0.0

-2.3

410

100%

—

— —

—

320

7 8%

—

9.3

2.3%

—

—

—

(2.19)

0.53%

0.32%.

0.21%

(1.92)

0.47%

253

62%

62%.

—

9.3

2.3%

2.3%.

271

67%

65%

2%

6.2

1.5%

0.9%

0.6%

—

—

—

— —

3.5

0.85%

0.85%

—

—

—

—

—

—

—

— —

— 0.47%

56

13.6

9.4%

4.2%

76

18.5%

9.4%

9.1%

43.1

10.6%

6.9%

0.6%

2.8%

7.7

1 . %

(3.23)

0.79%

—

0.79%

— —

—

—

—

—

—

—

—

—

—

—

—

—

—

— —

—

(1.06)

0.26%

—

— —

—

—

—

—

() data in parentheses is sum of nonthermal energy output and thermal energy input.

a Includes both commmercial and noncommercial uses of wood;does not include wood used as a feedstock or as a construction material..Alsoincludes charcoal

that is produced from wood.This conversion takes roughly 110PJ of wood and converts it into about 27 PJ of charcoal, of which about 1.3 PJ is lost during

distribution.

SOURCE: Adapted from International Energy Agency, Mwk/EnergySt#Mics and Bakmces: 1971 -87(Paris: OECD, 1989); and “Energy and Development

in Kenya,” Eds. Phil O’Keefe, Paul Raskin, and Steve 13ernow, Beijer Institute, Royal Swedish Academy of sciences, Stockholm, Sweden, 1984.
86 ● Energy in Developing Countries

Table 3A-5-Taiwan: Energy Supplies and Services, 1987, Petajoules (10115 Joules) and Percent of National Total

Fossil fuels Electricity Biomass

Energy supplies coal Oil Gas Nonthermal Thermal wood” Total

Production . . . . . . . . . . . . . . .

Trade/stock change . . . . . . . .

Electric generation . . . . . . . . .

Nonenergy . . . . . . . . . . . . . . .

Total energy . . . . . . . . . . . . . .

percent of total . . . . . . . . . . . .

Energy services

Residential . . . . . . . . . . . . . . .

Residential . . . . . . . . . . . . . . .

Cooking/water heating . . . .

Lighting . . . . . . . . . . . . . . .

Refrigeration . . . . . . . . . . . .

Television . . . . . . . . . . . . . .

Fans/air conditioning . . . . .

Commercial/public . . . . . . . . .

Commercial/public . . . . . . . . .

Cooking/water heating . . . .

Lighting . . . . . . . . . . . . . . .

Air conditioning . . . . . . . . .

Other Appliances . . . . . . . .

Industrial . . . . . . . . . . . . . . . . .

Industrial . . . . . . . . . . . . . . . . .

Transport . . . . . . . . . . . . . . . .

Transport . . . . . . . . . . . . . . . .

Road . . . . . . . . . . . . . . . . . .

Rail . . . . . . . . . . . . . . . . . . .

Air . . . . . . . . . . . . . . . . . . . .

Other . . . . . . . . . . . . . . . . . .

Agriculture . . . . . . . . . . . . . . .

Agriculture . . . . . . . . . . . . . . .

38.9

363

-220

.

182

13.7%

0.14

● YO —

—

—

—

—

0.12

● ’YO

● VO —

—

—

180

13.6%

—

—

—

—

—

—

—

—

5.4

758

-58.3

-46.8

658

49.6%

46.3

3.5%

3.5%

—

—

—

—

31.6

2.4%

2.4%

—

—

—

314

23.7%

222

16.7%

15.O%

0.1%

1.0%

0.6%

37.3

2.8%

42.3

—

—

—

42.3

3.2%

19.6

1.5%

1.5%—

—

—

—

4.0

0.3%

0.3%—

—

—

18.5

1.4%

—

—

—

—

—

—

—

—

145 —

— —

— 278

—

(423) –

31.9%

(87.5)/6.6%

0.3%

I.O%

1.9%

1.2%

1.5%

(&.22

0.1%

1.2%

1.1%

1.2%

(255)

19.2%

(2.7)

0.2%—

O.1%●

●

(13.0)/1.0%

.

21

.

21

1.6%

21

1.6%

1.6%—

—

—

0.3—

● %

—

—

—

—

—

—

—

—

253

1121

0

-47

1326

100.%

175

13.2%

6.9%

1.0%

1.9%

1.2%

1.5%

83.2

6.3%

2.8%

1.2%

1.1%

1.2%

767.5

57.9%

225

17.O%

15.0%

0.2%

1.0%

0.6%

50.3

3.8%

—Not available or not applicable.

() data in parentheses is sum of nonthermal energy output and thermal energy input.

● Small.

aCharcoal is includedunder wood. The charcoal conversion effiency is assumed to be a relatively high level of50 percent by energy.

SOURCE: Adapted From International Energy Agency, 14bti Energy Stafisk and Ba/ances: 197f-87(Paris: OECD, 19S9); and personal communication,

Dr. Gwo-Tzeng, Energy Research Group and Institute of Traffic and Transportation, National Chiao Tung University, Taipei, Taiwan.
Chapter 3--Energy Services in Developing Countries ● 87

Table 3A-6-United States: Energy Supplies and Services, 1985,a Exajoules (1018 Joules =0.9478 Quad)

and Percent of National Total

Fossil fuels Electricity Biomass b

Commercial/public . . . . . . . . .

Commercial/public . . . . . . . . .

Space conditioning . . . . . .

Water heating . . . . . . . . . .

Lighting . . . . . . . . . . . . . . .

Industrial . . . . . . . . . . . . . . . . .

Industrial . . . . . . . . . . . . . . . . .

Heatf . . . . . . . . . . . . . . . . . .

Motor Drive . . . . . . . . . . . . .

Off-Highway transport . . . .

Transport . . . . . . . . . . . . . . . .

Transport . . . . . . . . . . . . . . . .

Road . . . . . . . . . . . . . . . . . .

Rail . . . . . . . . . . . . . . . . . . .

Air . . . . . . . . . . . . . . . . . . . .

Other . . . . . . . . . . . . . . . . . .

19.6

-1.8

-14.8

—

3.0

4.4%

0.1

O.1%

—

—

—

—

—

0.1

0.2%

—

—

—

2.6

3.8%

3.8%

—

0.9%

—

—

—

—

—

—

—

—

20.9

8.9

-1.1

-1.8

26.9

39%

1.5

2.2%

2.0%

0.2%

—

—

—

1.2

1 .7%

1.6%

0.1%

—

4.3

6.2%

(11.8%)9

—

—

19.3

28.%

23.1%

0.7%

3.9%0

0.3%

0.6

0.9%

1.2

-3.0

—

14.7

21.3%

5.3

7.7%

5.3%

1.8%

0.5%

—

0.1%

2.9

4.2%

2.9%

0.1%

—

Energy supplies coal Oil Gas Nonthermal Thermal Wooda Total

Production . . . . . . . . . . . . . . . 16.5 2.53 c — 2.80 62.3

Trade/stock change . . . . . . . .

Electric generation . . . . . . . . .

Nonenergy . . . . . . . . . . . . . . .

Total energy . . . . . . . . . . . . . .

percent of total . . . . . . . . . . . .

Energy services

Residential . . . . . . . . . . . . . . .

Residential . . . . . . . . . . . . . . .

Space conditioning . . . . . .

Water heating . . . . . . . . . .

Cooking . . . . . . . . . . . . . . .

Refrig/Freezers . . . . . . . . .

Lighting/Other e 

. . . . . . . . . .

6.5

9.4%

—

—

—

0.06 d —

— 18.9

—

(21.5) –

31.2%

(7.6)

11.%

4.3%

1.5%

0.7%

1.6%

2.8%

(6.6)

9.6%

6.1%

0.1%

2.5%

(7.3)

10.6%

1.2%

7.1%

—

(0.03)/*%

—

● %—

—

-0.02

2.8

4.1%

1.0

1.5%

1.5%—

—

—

—

—

—

—

—

—

1.8

2.6%

2.6%—

—

—

—

—

—

—

—

—

—

8.4

—

-1.8

68.9

100%

Agriculture h 

. . . . . . . . . . . . . . .

Agriculture . . . . . . . . . . . . . . .

—Not available or not applicable.

()data in parentheses is sum of nonthermal energy output and thermal energy input.

“Small.

aNote that the lEA data used as a framework for this energy balance differs slightly from official U.S. energy statistics. See, for example, Energy lnformation

Administration, Month/yGwrgy Review, January 1990.

b split 58 percent Nuclear and 42 percent Hydroelectric and other (geothermal, solar, etc.).

d Imports of electricity into the United States are primarily hydroelectric based power from Canada.

e lncludes clothes washers and dryers, dishwashers, lighting, and miscellaneous.

f lncludes fuels USed for cogeneration applications.

g0il and gas applications are combined here.

h This does not include indirect inputs (fertilizer, etc.).

—

—

15.5

22.5%

13.1%

3.5%

1 .2%

1.6%

2.9%

10.8

15.7%

10.6%

0.3%

2.5%

22.5

32.7%

19.4%

7.1 %

0.9%

19.3

2 8%

23.1 %

0.7%

3.9%

0.3%

0.6

0.9%

SOURCE: Adapted from International Energy Agency, WbddEnergy Statistics and6a/ances: 1971 -87( Paris: OECD, 19S9); and Paui D. Holtberg, Thomas

J. Woods, Marie L. Lihn and Nancy C. McCabe, Baseline %ojection Data Book: 1989 GR/ Baseline Projection of U.S. Energy Supp/yandDernand

to 2010 (Washington, DC: Gas Research institute, 1990).
88 ● Energy in Developing Countries

Appendix 3-B—Sources for Table 3-9

As used here, efficiency is approximately the first-law

efficiency; that is, the total heat transfer to the material

being processed divided by the heat input to the system.

This is to be contrasted with the second-law efficiency,

which compares the heat transfer achieved in the process

with the maximum possible heat that could be transferred

for the same purpose by any system using the same energy

input. For more information, see Efficient Use of Energy,

AIP Conference Proceedings, No. 25, American Institute

of Physics, New York 1975.

Cooking: The primary source for traditional and

modern cooking technologies is Samuel F. Baldwin,

Biomass Stoves: Engineering Design, Development, and

Dissemination, op. cit., footnote 17. An enormous range

of efficiencies have been reported for the open fire,

ranging horn 2 to 30 percent. A list of some 45 reports on

traditional cooking technology efficiencies was developed by Jas Gill in 1981 and is cited in K. Krishna Prasad,

Woodburning Stoves: Their Technology, Economics, and

Deployment (Geneva: 1983). International Labor Organization, World Employment Programrne Research. Most

of these reports, however, do not cite a source, nor any

details as to how such an efficiency figure was derived.

Traditional Beer Brewing: Data are from Frans

Sulilatu, “Improved Beer Cookers In Burkina Faso,”

Boiling Point, No. 10, pp. 10-14, August 1986. This is the

thermal efficiency of heating the brew to boiling, not for

the entire brewing process. In Burl&a Faso, West Africa,

traditional dolo (beer) cookers using 80-liter clay jars

have thermal efficiencies of 17 percent with a power

output of 80 kW for a cooker with four jars arranged in a

square, and 15 percent at 35 kW with the jars arranged in

a line with fires between adjacent jars. Simple improvements in stove design and the use of aluminum pots raised

efficiencies up to as high as 53 percent.

The efficiency of the brewing process can also b e

determined by calculating the total amount of useful

energy provided. Mnzava, cited below, has estimated that

0.12 to 0.5 m3 of fuelwood are needed to brew 100 liters.

Assuming that 1 m3 of stacked fuelwood weighs 500 kg

and has an energy content of 16 M.J/kg for a total of 8 GJ;

and assuming that the energy is used to bring the water to

a boil once to sterilize it and then to maintain its

temperature at a low level while it ferments; the energy

required to heat 100 liters of water to a boil from ambient

(20 ‘C) is 100(80)4.186=14 MJ. This gives an efficiency

range of 0.3 to 0.7 percent for the beer-brewing process.

This very low efficiency compared to the thermal

efficiency found for dolo cookers in Burkina Faso maybe

due to the long, low temperature heating needed to

concentrate the mash as well as for other operations. See:

E.M. Mnzav~ “Fuelwood and Charcoal In Africa,” W.

Palz, P. Chartier, and D.O. Hall (eds.), Energy From

Biomass, 1st E.C. Conference on Biomass, Brighton, East

Sussex (London: Applied Science Publishers, Ltd., 1980).

Modern Beer Brewing: Data are from Bernard B.

Hamel et al., “Energy Analysis of 108 Industrial Processes,” 1980. The figure of 79 percent is theoverallboiler

efficiency for a modern brewery. This boiler provides

process steam, hot water, and other heating services. The

efficiency of the cooking process is somewhat reduced

from this level, but no separate estimate was available.

The value of 6 percent is based on a total energy

demand for a brewery found by Harnel et al., of 1,439 Btu

per pound of beer produced or, equivalently, 3.35 MJ/kg

compared to the energy required to heat the brew to

boiling a single time to sterilize it—as in the comparison

made for the traditional technology.

Tobacco Drying: The estimate of tobacco drying

efficiency is from M.J. Mwandosya and M.L. Luhang~

Energy Use Patterns In Tanzania, Center for Ener~ and

Environmental Studies, Princeton University, Report No.

180, February 1985; and M.J. Mwandosya and M.L.

Luhang~ “Energy Demand Structures in Rural Tanzania,’ Department of Electrical Engineering, University of

Dar-es-Salaam, Tanzania, 1984.

Traditional Tea Drying: Tea drying is based on the

data in Mwandosya and Luhang~ listed above. They

estimate that 150 kg. of green tea requhes 9.4 GJ of

fuelwood, resulting in 30 kg. of dried tea. To evaporate

120 kg of water requires 2,260( 120)kJ = 271 MJ of

energy, for an efficiency of 2.9 percent.

Traditional Baking: For traditional bakeries, Ahmed

and Elamgzoub found 0.5 to 0.8 kg of wood used per kg

of flour. Typical ratios for bread are 720 g flour, 500 g

liquid, and 50 g sugar input per kg of bread output. With

specific heats of 1.8 kJ/kg ‘C for flour, 4.186 kJ/kg ‘C for

water, and arbitrarily assuming 4.0 kJ/kg ‘C for sugm, and

noting that approximately half the water evaporates, the

rest remaining in the bread (Geller); then the energy

required to bake 1 kg of flour into bread at 190 ‘C is:

(1.0)(1.8)(170) + (0.7)(4.186)(80) + (0.35)(2260) +

(0.35)(4.186)(90) + (0.09)(4.0)(170)= 1.5 MJ, where it

was assumed that the specific heat of the water remaining

in the bread, 0.35 kg, remained 4.186 and the chemical

reactions and heating of the vaporized steam were

ignored. By comparison, 0.5 to 0.8 kg wood have an

energy content of 8 to 13 MJ. Abdel Salaam Ahmed and

El Sheikh Elamgzoub, Survey of Fuelwood Consumption

in Khartoum Province Industries (Khartoum, Sudan:

National Energy Administration, Ministry of Energy and

Mining for the Energy Research Council, Sudan Renewable Energy Project, April 1985. Howard S. Geller and
Chapter 3--Energy Services in Developing Countries ● 89

Gautam S. Dutt, “Measuring Cooking Fuel Economy”,

Wood Fuel Surveys (Rome: 1983). Food and Agriculture

Organization of the United Nations, GCP/INT/365/SWE.

Reddy and Reddy found that 0.583 kg wood were used

to cook 1 kg of maida, corresponding to an efficiency of

16 percent. Amulya Kumar N. Reddy and B. Sudhakar

Reddy, “Energy Use in a Stratifkd Society: Case Study

of Firewood, in Bangalore,’ Economic and Political

Weekly (India), vol. 18, No. 41, Oct. 8, 1983.

Shirey and Selker list the efficiencies of a number of

traditional and modem ovens used in a variety of

countries. Ovens in Somalia Sudan, Guatemala, Zimbabwe, and Sri Lanka have typical measured efficiencies

of 1 to 3 kg wood per kg flour, giving efficiencies, as

calculated above, of 3 to 8 percent. In contrast, an

improved wood-fired Somali oven is cited as using 0.16

kg of wood to cook 1 kg of flour into bread-an efficiency

of 58 percent; and modem natural gas ovens are listed as

baking 360 kg of flour into bread using 1 GJ of energy

-an efficiency of 54 percent. E. Shirey and J. Selker,

“Bread Ovens,” Boiling Point, No. 10, pp. 18-21,1986.

Modern Bakeries: Ho, Wijeysundera, and Chou found

first-law efficiencies for a modem industrial bakery in

Singapore to be 43 percent for the entire process,

including preparation of the dough. Second-law efficiencies were also calculated and found to be 15.5 percent.

J.C. Ho, N.E. Wijeysundera, and S.K. Chou, “Energy

Analysis Applied to Food Processing,” Energy VOL 11,

No. 9, 1986, pp. 887-892.

Fish Smoking: Mwalyosi estimates that smoking 1 kg

of fresh fish requires 4 to 5 kg dry wood. If 70 percent of

the fish is assumed to be water, then it requires (2,260

kJ/kg)(O.7 kg)= 1.6 MJ to evaporate the water compared

to (4 to 5 kg)(16 MJ/kg) = 64 to 80 MJ of wood to

accomplish the task for an efficiency of 2.0 to 2.5 percent.

Raphael B. Mwalyosi, ”Management of the Mtera Reservoir in Tanzania,” AMBIO, vol. 15, No. 1, 1986, pp.

30-33.

Traditional Brick Firing: Schmitt estimates 1.36 MJ

of energy is required per kg of brick produced in order to

evaporate moisture from the raw brick (after drying in the

sun) and heat it to a firing temperature of 850 ‘C, and an

additional 0.2 to 0.4 MJ/kg is needed for the chemical

reactions. Based on observations at six sites, an average

of 2.5 MJ fuelwood and other organic matter were used

per kg of brick produced, for an efficiency of (0.2 to

0.4)/2.5 = 8 to 16 percent. It should be noted that these

results were for very large kilns, firing typically 100,000

bricks at a time. Klaus Schmitt and Werner Siemers,

Energy From Agricultural Residues and Energy Utilization In Small Scale Industries In The Sudun, Section 5.4,

“Brick Kilns” (Gottingen, Sweden: for the National En33-718 0 - 90 - 4

ergy Administration of Sudan, Khartoum, September

1985).

Gandhi found an efficiency of 6.4 percent for brick

kilns in India, representing the irreversible reactions that

take place during firing. Theoverallheat ba.lancefound by

Gandhi fora Bull’ strench was: energy in= 3.88 MJ +0.29

MJ in carbon in brick energy out is 61.4 percent in dry

exhaust; 16.9 percent in moisture in exhaust; 6.4 percent

in irreversible reactions; 4.0 percent in heat loss of CO;

0.3 percent in carbon in ash; and other heat losses (by

difference) of 11 percent-presumably, much of this loss

was through the kiln walls. Other types of kilns require

horn 2 to 18 MJ/brick for firing. With an average brick

size of 108 in3 or 108(16.387) cm3 and an average brick

density of 1,800 kg/m3, this gives an energy requirement

of 2 to 18 MJ/3.18 kg or 0.637 to 5.7 MJ/kg. Sunita

Gandhi, “The Brick Industry in India: Energy Use,

Tmdition and Development,” Ph.D. Thesis, Trinity

College, Cambridge, October 1986.

The brick and tile industry in Uganda uses 0.5 to 1.8

stacked cubic meters of wood per metric ton of brick

produce~ with 7,650 MJ/m3 for eucalyptus at 510

kg/stacked m3 to give, at best, 3,800 MJ per metric ton of

brick output. Potential energy savings of 35 percent may

be possible simply with better fiig techniques and kiln

construction, and by the introduction of small cavities and

organic materials into the brick to reduce mass and

improve the uniformity of firing. Using the figures for

Sudan, this gives an efficiency of about 5 to 10 percent

when assuming the chemical reactions need 0.2 to 0.4

MJ/kg; using the figures for India this gives an efficiency

of about 2 percent. ‘‘Uganda: Energy Efficiency Improvement in the Brick and Tile Industry,’ World Bank/UNDP

Energy Sector Management Assistance Program, March

1989.

Modern Brt”ck Industry: Assumin g the same range as

for Sudan, that irreversible chemical reactions for the

process are 0.2 to 0.4 MJ/kg of fired bric~ a modem brick

factory has an efficiency of 6-11%. The relatively high

observed efficiency of the traditional process relative to

modem kilns is largely due to substantial underfiring in

traditional kilns and corresponding low-quality product.

Calculated from Bernard B. Hamel et al. “Energy

Analysis of 108 Industrial Processes,” op. cit.

Traditional Foundry Work: In Indonesia, an estimated

1 kg of charcoal is used per kg of aluminum melted and

cast into pots. From the CRC Handbook of Chemistry and

Physics, the melting point of aluminum is 933 OK and its

specific heat varies linearly with temperature from CP=0.9

kJ/kg‘Cat300‘K to 1.19kJ/kg‘Cat933‘K. The energy

needed to heat it to its melting point is then given by

MCPDT=658 kJ/kg. To melt the aluminum requires an

adchtional 398 kJ/kg (CRC Handbook). The total process
90 ● Energy in Developing Countries

then requires 1,056 kJ/kg. Charcoal has a calorific value Modern Foundry work: Figure of 40 percent is from

of about 33 M.T/kg. The process is therefore about 3 Bernard B. Hamel et al., “Ener~ Analysis of 108

percent efficient. World Ba~ Indonesia: Issues and Industrial Processes,’ op. cit. above, p. 282.

Options in the Energy Sector, UNDP/World Bank Energy

Sector Assessment Program Repor& No. 3543 -IND, November 1981.
Chapter 4

Energy Supplies in the

Developing World

.
Contents

Page

Introduction and Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93

The Overall Primary Fuel Mix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93

Coa l ... ... ..*. .., ,.. .*. ... **. ... ... ... ,., ... ..*, +.**, ,o, *.** **, , 8 ** **, * 4 * + o.**, o a 95

Oil ... ..*. **. *.. ... ... ... ... ... ... *.. ... ... ... ... ... .*** .*aa o * * * . * * * * * * . * +.*.+..*. 96

Refineries and Distribution ... .*+. *.. ... ... ... ..*. ... ..*. ... ... ... .*** +*@q. .. .$++ 98

Natural Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99

Biomass Fuels ... .*. ... ... .,. .*. .,. ... ... ..+ee** +o**. ,+o*. *., .**, ,,+

, ,*, .**, e*, $ 100

Biomass Resource Base ... ... ... ... ... ... *.. ... ... *.. *.. ... *.. .*. .**. o ***+4.*.. 101

Rural Biomass Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101

Commercial Biomass Markets ... ... ... ... ... ... ... ... ... ... ,4

. ,@. *.. .,q+ ****c+* 101

charcoal ... ..*. ... ... ... ... .*. ... ... ..** ... ... ... ..** ... ..*. *+*4 *.+. ***. +.*. e 102

Biomass Pricing ... ... ... ... ... *.. ... ... ... ... ... ... ... ... ..*. .@** Go. *******e* 102

Electricity ... ... ... ... ... ..*. ... ... ... ... ... ... ..+. ... ... ... +*+. *@** *.** e<*aoo. *e 103

Electricity Generation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103

Electricity Transmission and Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104

Institutional Issues ..*. *.. ... ... ... ... ... ... ... *.. ... ... ..*o

. *.*. .+. * e . **+**..+@ 105

Electricity Consumption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

outlook for Improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Box

Box

4-A. Refinery Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Figures

● ☛✎✎✎✌☛✎✌☛ 106

. . . . . . . . . . 106

Page

. * *.*...... 99

Page

4-1. Energy Supply Mix in the Developing World and in the United States, 1987 . . . . . 94

4-2. Energy Supply Mix for Selected Regions of the Developing World, 1987 95

4-3. Primacy Energy Production, Consumption, and Exports in the

.. +.*.*.

Developing World, 1985 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95

4-4. Oil Consumption by End Use in the Developing World and in the

United States, 1985 ... ... ... *.. ... ... ... ... ... ... ..+* ... *.. **. ..*+ .q * *Q**+*.+, 97

4-5. Electricity Generation by Fuel Type in Selected Regions of the

Developing World, 1987 ... ... *.. ... ... ... ... ... .*. ..+

. **c a * . . . * * * * * *+*.**.*+ 103

4-6. Electricity Consumption by Sector in Selected Regions of the

Developing World, 1985 *.. ... ... ... ... *.. ... ... .*** ... .e

. ... .*. *+*+ ... .. m*** 106

Sector,

Tables

Table

4-1. Energy Supply Mix, 1987 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4-2. Oil Consumption by End-Use Sector, 1985 . . . ., * * *..*.....

4-3. Biomass Energy Resources in Selected Developing Countries

4-4. Electricity Generation by Fuel, 1987 . . . . . . . . . . . . . . . . . . . . . . .

4-5. Electricity Consumption by 1985 . . . . . . . . . . . . . . . . . . .
Chapter 4

Energy Supplies in the Developing World

Introduction and Summary

This chapter provides an overview of the energy

supply sector in the developing world—the processes and technologies by which energy is produced,

converted from one form into another, and delivered

to users. The energy supply sector is critical for

economic development for two reasons: first, economic growth depends on the availability of reliable

sources of energy; and second, the energy supply

sector absorbs a large share of investment--over 40

percent of the total public investment in some

developing countries,l and about 15 percent of

foreign assistance.

2 The energy supply sector also

relies heavily on other resources that can be scarce

in the developing world, including skilled labor and

management, water, and land.

The energy supply sector is critical to economic

development. Economic growth depends on the

availability of reliable sources of energy, and the

energy supply sector absorbs a large share of public

and foreign aid investment.

The developing countries use a wide range of

energy sources. Coal is the largest primary energy

source in developing countries, due mainly to the

coal-based energy sectors of China and India, the

two largest energy consumers in the developing

world. Excluding China and India, oil and electricity

are the mainstays of commercial energy supplies in

developing countries. In rural and poor urban areas,

traditional biomass fuels are the primary energy

source.

Although the developing world as a whole is a net

oil exporter, the exports originate from a relatively

small number of countries. Most of the countries in

the developing world depend heavily on imported

oil, and these imports consume a large fraction of

export earnings.

The commercial energy supply system--coal, oil

and gas, and electricity-requires large amounts of

foreign exchange, skilled labor, and trained management. It is characterized by state ownership, in

contrast to supplies of traditional fuels, which are

largely in private hands.

Commercial energy supplies in many countries

are unreliable and of poor quality due to operational

inefficiencies, rapid increases in energy demand,

problems of reaching dispersed populations served

by inadequate transport systems, and inappropriate

pricing and allocation systems.

Operational efficiencies in the energy industry are

somewhat lower in many developing countries than

in the industrial countries. This record of “poor”

performance often reflects the older equipment and

difficult conditions under which energy facilities

operate. The existence of such differences between

operational efficiencies in reasonably standardized

operations suggests that improvements are possible

if some of these obstacles can be overcome.

Generalizations about energy supplies in developing countries obscure the heterogeneity of the

developing world. Performance standards vary considerably between countries, as do prospects for

expanding energy supplies in the future.

The Overall Primary Fuel Mix

According to the International Energy Agency

(IEA), coal supplied 35 percent of the developing

world’s primary energy3 in 1987 (table 4-1 and

figure 4-l), followed by oil (31 percent), biomass

fuels (19 percent), primary electricity (mostly hydropower) (8 percent), and natural gas (7 percent). Some

analysts believe instead that biomass is in fact the

largest source of energy, supplying up to one-third

of primary energy in the developing world.

IM. M~inghe, Elecwic Power Econonu”cs (London: Buttenvorths, 1990.

World Banlq AnnzualReport 1989 (M%hin@oq DC: 1989). Data include ordy International Development Authority (IDA) andrnternationaI Bank

for Reconstruction and Development (lBRD) lending in fiscal year 1989.

3“-energy” refers to fuelsin the~ mW state> before they are processed into forms suitable for use by fti conmm ers. Primary fuels include

coal, o~ gas, biomass, and electricity generated from nuclear, hydro, geothermal, and solar sources. “Fi.oa.l energy,” suitable for end-use COnsumptiom

includes electricity generated from fossil fuels as well as primary electricity. For countries with fossil fuel electricity generation facilities, the amount

of electricity in the fti energy mix is therefore higher than in the primary energy mix, and the amounts of fossil fuels are lower by the amounts used

to generate electricity. Electricity generated fi-om fossil fuels is not included in primary energy in order to avoid double counting.

–93–
94 . Energy in Developing Countries

Table 4-l—Energy Supply Mix, 1987 (percent)

Rest of Total

developing developing United

Fuel China India Brazil world world States

coal . . . . . . . . . . . . . . . . . . . . . 70 38 6 17 35 24

Oil ........ ’... . . . . . . . . . . . 17 22 38 41 31 41

Natural gas . . . . . . . . . . . . . . . 2 3 2 12 7 22

Other . . . . . . . . . . . . . . . . . . . 4 5 26 8 8 9

Biomass fuelsb . . . . . . . . . . . . 7 33 28 22 19 4

Total (percent) . . . . . . . . . . 100 100 100 100 100 100

Total (exajoules) . . . . . . . . 26.7 9.6 6.9 42.0 85.2 77.9

a lncludes hydropower, nuclear, geothermal, solar, and electricity produced from biomass. Converted at heat equivalent.

b Note that these estimates for the share of energy supplied by biomass are lower than that indicated by detailed field surveys. See, for example, figure 3-1

and app. 3-A.

NOTE: Total may not add to 100 percent due to rounding.

SOURCE: International Energy Agency, 14kwki&rergy Statistics andl?ahnces 1971 -1987 (Pans: OECD, 1989); IEA, Energy Ba/ances of OECD Countries

1987-1988 (Paris: OECD, 1990).

Figure 4-l—Energy Supply Mix in the Developing World and in the United States, 1987

(exajoules)

Coal

Other+ Natural gas

6 . 8 6 . 0

Developing world

Oil

26.4

,i Biomass

16.2

Oil

31.9

ass

1

gas

Other* 17.1

7.1

United State s

“Includes hydropower, geothermal, other renewable, and nuclear converted at heat equivalent. Biomass numbers

may be underestimates, see text, and alternative source, figure 1-2.

SOURCE: International Energy Agency, Wor/dEnergy Statistics and Ba/ances 1971- 1987 (Parfs: OECD, 1989); IEA,

Energy Ba/ances of OECD Countries 1987-1988 (Paris: OECD, 1990).

The relative shares of these energy sources in the

overall energy supply mix vary significantly across

different regions and countries, due in part to

unequal endowments of energy resources. Coal

supplies about half of the energy requirements for

developing countries in Asia, due largely to high

levels of coal consumption in China and India4 (table

4-1 and figure 4-2). Oil is the major source of

commercial primary energy for most countries of the

developing world, India and China being the notable

exceptions. Natural gas supplies a relatively small

fraction of energy in the developing world, although

in countries with well-developed resources, gas

often represents an important source of energy (in

Mexico, for example, natural gas supplies 20 percent

of the primary energy consumed).s Biomass fuels

are a significant energy source throughout the

developing world, particularly in rural areas and in

the poorest countries.

Overall, the developing world produces more

energy than it consumes, and significant amounts of

both oil and gas are exported from developing

countries (figure 4-3). There are, however, major

disparities among countries: only a few developing

countries export energy, and most import over 50

percent of the commercial energy they consume.

d~temtio~ Energy Ag~~ @A), W~rldEnergy Statistics and Balances 1971-1987 (Ptis: OECD, 1989), ~kg 1987 dti. ~s includes ~

estimates for biomass consumption and converts electricity to energy units at the heat equivalent,

SIbid.
Chapter 4-Energy Supplies in the Developing World ● 95

Figure 4-2—Energy Supply Mix for Selected Regions

of the Developing World, 1987

50

40

30

20

10

0

Exajoules

n

,,, ;, ,. ,., :.,:, ~ Biomas s

= Other *

~ Natural gas

~ Oi l

!ZZZ2 Coal

China India Brazil Rest of

developing world

‘Includes hydropower, geothermal, other renewable, and nuclear converted at best equivalent. Biomass numbers maybe underestimates, see

text.

SOURCE: International Energy Ageney, W’or/d Energy Statistks and

Ba/ances 1971 -1987 (Pans: OECD, 1989).

Coal

Coal production and consumption in the developing world are concentrated in a relatively small

number of countries. China, India, South Africa,

South Korea, and North Korea are responsible for 96

percent of the total coal production in the developing

world. China alone accounts for 65 percent of

developing world coal production and 27 percent of

world coal production.6

The largest consumer of coal in the developing

world is industry, which accounts for over 40

percent of total developing world coal use.7 The bulk

of the industrial coal use is in China. Other significant coal-consuming sectors are electric utilities,

transportation (coal-burning locomotives), and the

residential sector in China, where coal is used for

cooking and space heating.

Rates of coal production are growing rapidly.

Hard coal production in Asia grew at an average

40

30

20

10

0

Figure 4-3-Primary Energy Production,

Consumption, and Exports in the

Developing World, 1985

Total production (exajoules)

I I

Coal Oil Natural gas

~ Net exports

ISI!II! Consumption

SOURCE: International Energy Agencyp Worid Energy Statistics and

Ba/ances 1971 -1987 (Paris: OECD, 1989).

annual rate of 5.7 percent from 1980 to 1987, and

lignite production grew at 8.9 percent during the

same period.9 This growth is expected to continue.

Coal quality in the less developed world varies

widely, both within and among countries.10 In India

and China, most coal has a relatively low sulfur

content but a high ash content.ll There are few

washing and sorting processes at coal mines, so the

quality of coal supplies is unpredictable. In China,

for example, less than one-fifth of all coal mined is

cleaned before combustion. The rest is used raw,

limiting the efficiency of combustion.

The coal industry accounts for about 16 percent of

total commercial energy investment requirements in

low-income developing countries.12 In India and

China, the largest coal users, domestic sources

finance most of this investment.

Government-owned entities are responsible for

most coal mining, transport, and distribution in

developing countries. In China, the Ministry of Coal

6rbid., p. 59, 1987 production of hard cod o~Yo

mid., 1985 data. The United States, in contrasl uses most of its coal for electricity generation.

8A~ ~hom fi fiWe 43, net ~o~ expom me fisi@lc~~ so for the developing world as a whole COd production is the same as COal CO~ption.

Some individual developing countries do trade in coal-e.g., South Africa is a coal exporter and the Repubtic of Korea is a coal importer.

%?A, op. cit., footnote 4.

l~e ~po~t at~butes of ~~p~~ener= demity (~ic~y mem~ed in Jo~eS per Mogr~ or Btu ~r Poud), S@IU content and mh

content.

llTa~ J?nerw Research ~ti~te, T“~ Energy D~t~ D~~ecr~~ u~~ yeu~~~~~ ]$)SS (New De~ ~dia: 1989); Vaclav Smil, “chhii’s Energy,”

contractor report prepared for the OffIce of Technology Assessment, 1990.

Izworld B@ The Energy Transition in D~el~ping Counm”es (w~hingtoq w: 1983), p. 68. For period 1982-92.
96 ● Energy in Developing Countries

Industry controls about 600 of China’s 20,000

mines, grouped under 84 Coal Mine Administrations

or Coal Industry Companies. The remaining, mostly

smaller mines are run through local governments at

the provincial, county, or prefecture level, or as

collective township and village enterprises. In India,

the government-owned Coal India Corp. accounts

for 87 percent of production. Coal India, with

675,000 employees, claims to be the world’s largest

single corporate employer.13 The allocation of supplies is also in the hands of a government entity.

Although coal mining technologies in the developing world are diverse, the major coal producer

-China-relies heavily on manual labor.14 About

two-thirds of the extraction from large mines in

China depends on manual labor, as does virtually all

production from locally run mines and small private

pits. Not surprisingly, labor productivities are very

low, averaging less than 1 ton per miner per shift.

This rate is significantly lower than current U.S.

rates, which average about 10 tons per miner per

shift.15

Although China has considerable experience with

a wide variety of advanced underground mining

techniques and has the ability to produce most of the

machinery required, the country does not have

sufficient capital or technical expertise to modernize

its coal industry completely. However, surface

extraction methods, which can be less expensive, are

being used at many newly developed sites. Five

large pits are now under development in China with

a total initial capacity of 50 million tons per year.

The largest of these should eventually produce up to

60 million tons per year.

Transportation requirements often limit coal production. In China, coal accounts for 40 percent of all

freight movement, most of which is by rail. China’s

already overloaded transport system is struggling to

keep up with its growing coal production. Incomplete and poorly configured networks, backups at

mode transfer points, and breakdowns all contribute

to the unreliability of the coal transport system. As

a result, coal-using industries must stockpile up to a

year’s supply, or turn to other fuels. Similar problems occur in India.l6

Oil

Petroleum products are easy to transport and

versatile in use in all sectors and at all scales of

operation; consequently, they play an important role

in the energy sectors of developing countries. These

attributes led to an average annual growth rate of 4.5

percent for oil consumption in the developing world

from 1971 through 1987.17 Oil consumption is

expected to continue rising by about 3 percent per

year, thereby doubling between 1985 and 2010.18

More than one-third of the oil consumed in the

developing world is used for transportation (figure

4-4 and table 4-2). The share of oil used for

transportation varies from 13 percent in China to 42

percent in Latin America--considerably lower than

the 62 percent share in the United States. The

developing world, compared to the United States,

uses proportionally more oil for electricity generation and for industry. The entire developing world

consumes about 25 percent less oil than the United

States alone.

The bulk of developing world oil production is

concentrated in a few countries—14 developing

countries account for over 90 percent of developing

world oil production. 19 Although the developing

world as a whole is a net oil exporter, the exports

originate from a relatively small number of countries. 20 Most developing countries depend heavily

on oil imports. More than half of the low- and lower

middle-income countries import 90 percent or more

lSIDEA,~c., “cle~co~ Technologies for Developing Countries,“ contractor mportprepared for the Office of Technology Assessme@ May 1990.

ldThis dismssion is dram from Vaclav Smil, “China’s Energy,” op. cit., footnote 11.

IsRelative t. ~Ufitd Smtes, la~r is ch~~r ~d mec~~tionis more expensiv~o one wo~d expt greater U* of ktbor klpllk ~d ksS

mechanization in China than in the United States.

16For emple, one tex~e ~~~ ~d~ is ~nve~ from cod ~ ri~ hm~u a boiler fiel~~ of tie extrew unreliability Of Cod SUpplieS (V.

Kothari, consultan6 Isotem Services, New Delhi, I.m@ personal communicatio~ April 1990).

IT~ op. cit., footnote 4.

18~m s.head ~sc~tte~olmr,lnter~fio~l ~~~~gywo~~s@: Ovemiew of poll Re~o~es &do Alto, CA: StdOrd UIdverSity, Jldy

1989) Intermtional Energy Project.

19These me, h order of d~~ing oil production M~ico,-veneme~ ~don~@Nigeri& Alge~ Liby& Egypt, Brr@ tid~ hfdayS@

Argen@ Colombb and Angola. IE~ op. cit., footnote 4.

~ive countries-Mexico, Nigek Venezuel~ Liby~ and Indonesia-account for over 60 percent of LDC oil exports. IE& op. cit., footnote 4.
Chapter 4--Energy Supplies in the Developing World ● 97

Figure 4-4-Oil Consumption by End Use in the Developing World and in the United States, 1985 (exajoules)

Industry

5 6

ity

Transportation

18.5

Transportation

8.4

Transformation*

Developing worl d

-,nd-tr4.2y

J

Electricity y

1.2 . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . .

. . . . . . . . . . . . . . .

. . . . . . . . . . . . . . .

. . . . . . . . . . . . . .

. . . . . . . . . . . . . .

::::::::::::. Other** . . . . . . . . . . . . .

. . . . . . . . .

. . . . . . . .

. . . . . . . .: :::. 6.1

. . .

Transformatlon*

1.2

United State s

*Refinery use and losses.

● *Residential, agricultural, and nonenergy.

SOURCE: International Energy Agency, Wodd Energy Statistics and6a/ances 1971 -1987 (Paris: OECD, 1989) IEA, Energy /3a/ances of OECD Countries

1970/1985 (Pans: OECD, 1987).

Table 4-2-Oil Consumption by End-Use Sector, 1985 (percent)

Total

Latin developing

Sector Asiaa China Africa America world United States

Electricity . . . . . . . . . . . . .

Transformationb . . . . . . . .

Industry . . . . . . . . . . . . . . .

Transportation . . . . . . . . .

Otherc . . . . . . . . . . . . . . . .

Nonenergy d

. . . . . . . . . . .

Total (percent) . . . . . . .

Total (exajoules) . . . . .

12

10

24

35

16

3

100

7.5

15

10

40

13

19

4

100

3.9

13

5

18

41

17

6

100

3.5

12

10

16

42

16

4

100

9.1

13

10

23

35

16

4

100

24.0

4

4

14

62

11

6

100

29.9

a excluding China.

transformation includes losses, refinery use, and statistical differences.

c Other is largely residential and agriculture.

d Non-energy use includes waxes, asphalt, and lubricants.

NOTE: Totals may not add to 100 percent due to rounding.

SOURCE: International Energy Agency, Wonkf Energy Statistics and Baiances 1971 -1987 (Paris: OECD, 1989); IEA, Energy Balances of OECD Countries

1970/1985 (Paris: OECD, 1987).

of their commercial energy; almost all of the imports

are in the form of oil (see app. 1A). By comparison,

the United States imports about 17 percent (net) of

its energy, of which 90 percent is in the form of oil

or oil products. 21 The continued expansion Of oil

consumption imposes an economic burden on developing countries, either in the form of foreign

exchange for imported oil or for investment in oil

exploration and development. Investment in the oil

supply infrastructure is comparable with that in the

electricity sector, each accounting for about 40

percent of total commercial energy investment in the

developing world.22

In most developing counties, natural resources

such as oil and gas are considered state property.

Ownership or other economic rights to these natural

resources are not bought and sold with the surface

rights (as in the United States), but are reserved for

the state to exploit or to contract out to third parties.

Inmost oil-exporting developing countries, supreme

authority over oil and gas is legally vested in a

central government entity-(e.g., the Ministry of Oil

in Egypt or the Ministry of Petroleum and Minerals

in Oman), which delegates sectoral oversight and

operational responsibility to a national oil company

(e.g., the Egyptian General Petroleum Corp.). In

Zl~erW ~o~tion Adrninis~tion (HA), Monthly Energy Review December 1989, DOE/EIA-0035(89/12) (wa$~o~ ~: Us. Governrn@

Printing 0t31ce, February 1990).

~World Banlq op. cit., footnote 12, p. 68.
98 ● Energy in Developing Countries

practice, however, there are wide disparities among

different countries in the actual relationships among

executive power, sectoral ministries, and national

operating entities. In oil-exporting countries, such as

Argentina and Algeria, the national operating companies have more power than the ministries they

depend on, due to the companies’ autonomous

sources of revenue from significant oil production.

In contrast, in oil-importing countries, such as

Sudan, the national oil companies have little power.

Only the wealthier oil-exporting developing countries invest much of their own money in exploration

and development. All the poorer ones, and the

majority of the others, rely on the international oil

industry for most of the required capital and

technical expertise. The “enabling mechanism”

under which foreign oil companies invest in developing countries varies widely from country to

country, but certain aspects are widespread. Generally, the ministry in charge of the sector authorizes

the national oil company to negotiate exploration

rights with foreign companies. This negotiation may

require the formation of a formal joint venture with

the national company. More typically, however, a

loose relationship is formed in which the two

associates remain entirely separate, with the foreign

party providing all the capital and most of the

technical control of operations. Once a deal is

concluded, it is ratified at the central government

level.

The fiscal arrangements made under these enabling mechanisms have in the past been inflexible,

providing for the same overall rate of government

take on all sizes of fields. These arrangements are

satisfactory for the middle range of expected reserves and costs. When oil fields are larger than

expected, however, the government fails to capture

a reasonable share of the profits on the petroleum

being produced. When fields turn out smaller then

expected-a typical occurrence in many developing

countries-the government share precludes economic development by the foreign operator. This

discourages the development of small fields. A

further discouragement to foreign oil companies for

the development of oil fields for domestic consumption rather than export is uncertainty over the

availability of foreign exchange for the remittance of

profits.

Despite these disadvantages, U.S. oil companies

in recent years have increased their investments

outside North America, particularly in developing

countries. The prospect of adding to corporate

reserves at half the cost of domestic exploration23

apparently more than compensates for the uncertainty of foreign investment.

Refineries and Distribution

Although the world’s oil refining capacity is

concentrated in the industrialized countries, many of

the developing countries, including oil-importing

countries, have considerable domestic refining capacity. Over half of the countries in Africa have

refineries, 24 many of which are hydroskimmers (see

box 4-A). In the developing world, refineries are

usually owned by the government, which acts

through a national oil company, although foreign

companies sometimes manage and operate the

refineries.

The refinery product mix in developing countries

differs significantly from that in the United States,

due in part to the inflexibility of the hydroskimming

technology. In developing countries, between 60

and 70 percent of refinery output is diesel and

residual, compared with 30 percent in the United

States. On the other hand, gasoline accounts for

about half of U.S. production, compared with about

20 percent in developing countries.25 In general,

refineries in developing countries have higher production costs than those in the industrialized world:

average refinery operating costs in Africa are $2 per

barrel, compared to $0.75 per barrel in the rest of the

world.26 Refineries in the developing world also

suffer from large losses due to the use of old,

inefficient technology, as well as poor maintenance.

Refinery losses, which should not exceed 1 percent

23~e ~o~t of fim~g ~ -lof ~fl ~ tie Ufitti s~es is $6, comp~d ~~$3 in tie rest of tie world (Solomon Brothers Inc., Proved Petroleum

Reserves of 30 Large Energy Companies 1980~7 (New Yorlq NY: 1988), p. 14.

~United Nations, 1986 Energy Statistics Yearbook (New York, NY: 1988).

~Ibid.

ZW. Gorton, ‘‘OiI and Gas Development in Third World Countries,’draft contractor report prepared for the Office of Technology Assessment April

1990.
Chapter 4--Energy Supplies in the Developing World ● 99

Box 4-A—Refinery Technology

Crude oil is a mixture of hydrocarbons. In the

simplest refining process, primary distillation (also

known as hydroskimming), crude oil is simply

heated. This causes the lightest hydrocarbons, such

as gasoline and liquid petroleum gas, to boil off

first. As the temperature increases, different products (such as kerosene and diesel oil) boil off. The

residual, known as residual fuel oil, remains. This

relatively simple process does not allow for much

flexibility in the mix of yielded products. For

example, 18 to 23 percent gasoline and 30 to 55

percent residual fuel oil are typical yields from

primary distillation.l

Secondary conversion, which includes fluid catalytic cracking (FCC) and hydrocracking, uses high

temperatures to “crack” large molecules into

smaller ones. This process allows for greater

flexibility in product mix, and is often used to

increase the proportions of lighter hydrocarbons,

such as gasoline and LPG, while reducing the

proportion of residual fuel oil. For example, hydrocracking allows for up to 86 percent (by weight)

gasoline production, compared with 18 to 23

percent for primary distillation.2 However, secondary cracking is relatively expensive and complex.

IL. Wijefleke and A. Ody, “World Refiiery I.ndustry-’rhe

Need for Restructuring,” World Bank Technical Paper No. 32,

Washington DC, 1984, p. 32a.

21bid, p. 33a.

in a properly maintained and operated refinery, often

exceed 2 or even 4 percent in developing countries .27

During the 1970’s and 1980’s, both the structure

and the level of petroleum product prices changed.

As the prices of petroleum products increased, coal,

gas, and hydroelectricity were substituted for residual fuel oil in electricity generation, leading to a

relative decrease in the demand for residual fuel oil.

When the gap between gasoline and diesel prices

widened (due to diesel subsidies and/or gasoline

taxes), consumers switched to diesel cars. As a

result, the structure of demand for petroleum products changed in many countries; the demand for the

middle distillates increased relative to the demand

for gasoline at the top end and residual fuel at the

bottom. Developing country refineries, which typically do not have secondary conversion technology,

could not adjust to these changes. As a result, some

of their surplus petroleum products had to be

exported, often at distress prices, while other products had to be imported.28

Because of these developments in the international petroleum market, several developing countries are producing refined petroleum products at

costs higher than those prevailing on the international market. Up until recently, for example,

Liberia had only one refinery, which was poorly

maintained, inefficient, and in need of upgrading.

An economic analysis of this refinery showed that

importing the refined petroleum products directly

and shutting down the inefficient domestic refinery

would result in net savings of $15 million to $20

million per year (U.S. dollars), equivalent to a gain

of about 2 percent in Liberia’s gross domestic

product (GDP) .29 Several other African countries are

in similar situations.

The distribution system for petroleum products

plays a key role in determining whether or not the

economy has sufficient and dependable fuel supplies. Because large portions of the population are

scattered in rural areas, and transport infrastructures

are frequently inadequate, the distribution systems

in developing countries are often unreliable. In

addition, price controls, supply monopolies, rationing systems, and requirements for uniform pricing in

all areas may further limit the dependability of

petroleum in developing countries.

Natural Gas

Natural gas plays a relatively minor role in the

energy supply system in most developing countries,

supplying only 7 percent of total energy use in the

developing world (see table 4-l). This contrasts

sharply with its role in the industrialized world. In

the United States, for example, natural gas supplies

22 percent of domestic energy consumption. However, gas is an important source of energy for a small

number of developing countries. Five countries—

Mexico, Argentina, Venezuela, China, and Algeria—

zTRefinery losses re~t from lage, evaporation, and spills; they are dkdnct frOIII “Own use” co IISUInptiO& which is Oti iIlttdiOlldly COIISUnled

in the refinery process for hea~ transpo~ and drive. See T. Gorton, op. cit., footnote 26.

XL. Wijetileke and A. ody, “World Refinery Industry-The Need for Restructuring,’ World Bank Technical Paper No. 32, Washington+ DC, 1984.

~.Wilbanks and S. Wright “Energy for Development: ORNL Returnsto the l%ird World,” ORNL Review, No. 3, 1988.
100 . Energy in Developing Countries

account for 58 percent of developing world natural

gas consumption. Natural gas consumption in the

developing world is concentrated in industry, where

it is used both as a fuel and as a feedstock. Natural

gas is also used for electricity generation.

Discovered gas reserves in many developing

countries are not developed. The current production

levels from developed reserves are only 16 percent

of the level that current proven reserves could

sustain.30 Thus, many developing countries import

large quantities of crude or fuel oil while possessing

reserves of natural gas that could serve more

economically and with less harm to the environment. 31

The reasons for the relative underutilization of

natural gas in the developing world lie more in

institutional than in technical or financial constraints. Although gas is associated with oil exploration and development and therefore shares many of

the same problems, it has additional difficulties of its

own. In the exploration phase, due to the fiscal or

contractual terms under which gas is discovered, gas

discoveries are often treated as “dry holes” by oil

exploration companies.32 In the development phase,

gas requires heavy front-end capital investments

(pipelines from producing to consuming regions, or,

in the case of overseas trade, costly facilities and

tankers to liquefy and transport the gas) and longterm agreements between suppliers and consumers.

And the high cost of building distribution systems in

cities deters the development of domestic markets

for natural gas.

The specific requirements of gas development are

particularly difficult for developing countries, where

financing for large capital-intensive projects is hard

to find, and where the main purchaser for the gas is

the state. When the developer is a private foreign

corporation, the problems are complicated by uncertainty that sufficient foreign exchange will be

available for the investor to repatriate profits. This

last difficulty is especially acute in the case of highly

indebted developing countries where the bulk of

scarce hard currency is earmarked in advance for

payments on debt. Unlike the electricity sector,

which shares many of these characteristics, development of natural gas reserves has generally not been

financed by donor agencies.

Biomass Fuels

Biomass fuels are an important source of energy

in the developing countries, supplying over threefourths of the total energy consumed in almost all of

the lower income developing countries.33 The contribution of biomass fuels to total energy supplies in

the entire developing world is unclear. Biomass fuel

consumption is difficult to measure, as much of it

never enters a commercial market. As shown in table

4-1, biomass fuels supply about 19 percent of total

energy according to the International Energy Agency.

Other researchers, however, estimate this number at

33 to 35 percent.34

Biomass fuels are the dominant energy source in

rural areas, and they are also widely used in poorer

urban areas, as well as in some large-scale industrial

processes. These “traditional fuels” consist of

wood (firewood and charcoal), dung (from cattle and

other animals), and crop wastes (e.g., wheat, rice

straw, and sugar cane bagasse). Wood is the most

widely used and preferred fuel due to its superior

combustion characteristics. Its share of total biomass

energy supply varies widely among the developing

countries, according to region and agricultural and

forestry resource base. In many regions of Africa and

Latin America (with the important exception of

Brazil, where bagasse is also used), wood is the

primary form of biomass energy used. In Asian

countries, wood remains the dominant biomass fuel

(accounting for one-half of all biomass consumed in

WorldB* op. cit., foomote 12, p. 36.

SITO mation @t tie SUb-S_~can countries with undeveloped gas fields: Mozambique, Ethiopia, SOmal@ hh&g~Ca, Cote d’Ivohe,

Equatorial Guinez Suda~ Senegal, TanzaniA and Namibia.

3ZBY one es~te, about ~of tie na~~ gas pr~uc~ in the developing world is flared or othenvke witskd. me Compmable n-rfor *-

Europe is 2 percent. A. Mashayekhi, “Natural Gas Supply and Deman din IAXS Developed Countries,” Annual Review of Energy, vol. 13, 1988, pp.

119-129.

33~e role of biomsfiel~ fi tie tom ~tim~pply ~~es ~eady ~o% co~tries, show@ genefiy m inv~se relationship with GNPper capita.

For example, Ethiopia (GNP percapita= $U.S. 130) meets 92 percent of its energy needs with biomass fuels, while Argentina (GNPper capita= $U.S.

2,390) meets only 7 percent of its needs with biomass fuels.

3’lK. Smiti, “meBiofiel T~itio~” Pacific andAsian Journul ofEnergy, 1987, pp. 13-32; P. O’Keefe, J. SOUSS@l, B. MWM1OW, ~d D. SP~ce*

“Wood Energy in Eastern and Southern Afric~” Annual Review of Energy, vol. 14, 1989, pp. 445-468.
Chapter 4--Energy Supplies in the Developing World .101

China, and three-quarters in India), but crop wastes

and animal dung also play a significant role.35

Biomass Resource Base

For a variety of reasons, the fuelwood supply base

is shrinking rapidly. This could have serious impacts

on the populations that depend on forests for fuel,

food, fiber, fodder, and other needs.

The total global annual growth of forest biomass

is subject to great uncertainty, but has been estimated to be about 50 times annual wood consumption or five times total annual energy consumption,

including fossil fuels. Despite this apparently large

average global supply, there are acute and growing

shortages of fuelwood both locally and regionally.

Some regions, such as Asia, have very little forest

stock per capita (table 4-3). Within regions, some

countries are well endowed with biomass energy

resources, while others have totally inadequate

supplies; and within countries themselves, local

abundances and shortages are common. Zaire, for

example, consumes only 2 percent of its sustainable

yield of forest biomass but has serious deforestation

around Kinshasa.36

Despite the uncertainties regarding rates of biomass energy use and supply, it is clear that the

populations affected by fuelwood shortages are

increasing. The United Nations Food and Agriculture Organization (UNFAO) has estimated that the

number of people suffering acute shortages of

fuelwood will increase from about 100 million in

1980 to over 350 million in the year 2000. Such

shortages increase fuel costs for urban dwellers,

lengthen the time spent foraging for fuel by rural

dwellers, and rob the soil of nutrients as people

switch from wood to crop wastes and dung (although

the impact of this nutrient loss maybe limited except

in the much longer term).

Rural Biomass Markets

Much of the biomass fuel supply in developing

countries-especially twigs, branches, dung, and

crop wastes—is gathered locally and used by family

members without entering commercialized markets.

Table 4-3-Biomass Energy Resources in Selected

Developing Countries

Sustainable energy yield

(GJ per capita per year

Crop Animal

Country Wood residues dung

Congo . . . . . . . . . . . . . 570

Brazil . . . . . . . . . . . . . . 350

Zaire . . . . . . . . . . . . . . 135

Argentina . . . . . . . . . . . 123

Thailand . . . . . . . . . . . . 37

Nepal . . . . . . . . . . . . . . 21

Burkina Faso. . . . . . . . 10

India . . . . . . . . . . . . . . 7

Bangladesh . . . . . . . . . 2

China . . . . . . . . . . . . . . —

1

8

1

25

9

7

5

5

4

7

—

16

1

40

4

13

7

6

5

3

— data not available or not applicable

SOURCES: G. Barnard and L. Kristoffereon, AgfkWtura/ ReskJues as Fuel

in the ZWd Wbrki (London: Earthsoan, 1985); D. Hall, G.

Barnard, and P. Moee, Biomass for Enetgy in the Developing

Countriee, Pergamon Preee, 1982. R. Moea and W. Morgan,

Fuelwood and Rural Energy Producbon and Supply in the

Humid Tropics, (Dublin, Ireland: Tyoooiy International Publishing Ltd, 1981).

These supplies are gathered free of charge (if the

considerable cost of the labor used in gathering is not

included) from fields, hedgerows, gardens, and

nearby forest lands. In some cases, however, the

poor may have to “pay” with labor services for the

privilege of gathering biomass fuels from privately

owned land.

Commercial Biomass Markets

Biomass fuels, notably logs and charcoal, are also

traded in commercial markets far from their origin in

government and private forests, farms, or plantations. Low-income urban households and small

commercial enterprises use the bulk of these fuels.

In some cases, however, biomass fuels are used for

advanced industrial applications, as in the case of

charcoal for iron smelting in Brazil. In such cases,

the industrial users often organize the biomass fuel

supplies.

Unlike other forms of energy, supplies of commercialized biomass fuels are largely in the hands of

the private sector. Much of the fuelwood may be

grown on privately owned land,37 and the transport

and distribution charnels for commercialized bioSscrop wastes account for one-hal.fof total traditional energy supply in China ~d just OV= 10 ~entin mdia.~ dung accounts for about 20

pexcent of traditional fuel use in India, PakistaxL and Bangladesh but under 2 percent in China.

~R. MOSS and W. Morgan, Fuelwood and Rural Energy Production and Supply in the Humid fiopics (Dubti b~d: UCOOIY ~~tiod

Publishing Ltd., 1981).

svksev~~~citiw,forexarnple, government lands were found to provide less than IOpereent of total fuelwood supplies (M.-J.mdey,

and A. Reddy, “Fuelwood Use in the Cities of the Developing World: Two Case Studies From Ire@” NaruraZResources Foq vol. 9, No. 3, 1985).
102 ● Energy in Developing Countries

mass, fuels are typically in private hands, as are

charcoal kilns.38

On the other hand, the fuelwood trade is often

subject to government regulation, with strict rules

about cutting trees in government forests and even

on private lands. Although it is believed that such

regulations are not strictly enforced, often because

of the difficulty of enforcement, proscriptions against

cutting trees can discourage the development of

long-term supplies, as farmers and others are unwilling to invest in tree planting for fuelwood if they

have no assurance that they can harvest the trees at

maturity. Fuelwood prices may also be subject to

price controls (in Senegal, for example, charcoal

prices are controlled by the government). And in

some cases, governments may play a role in the

distribution system as well. Compared with commercial fuels, however, the biomass trade is relatively unregulated.

The transport of wood and charcoal to urban areas

is carried out in a variety of ways. In India, poor

women carry head loads of fuel to urban markets; in

Niger, camels carry fuel into the capital city of

Niamey; and elsewhere fuel is carried by bicycle,

animal cart, moped, and other means. In higher

income areas, trucks or trains carry the bulk of the

fuel.

Charcoal

In rural areas, the cutting of fuelwood and its

conversion to charcoal is a major source of income

and nonagricultural employment. Charcoal is made

by stacking the wood, covering it with a layer of dirt,

and letting it burn with a limited supply of air. The

efficiency of converting wood to charcoal in these

simple earthen kilns is quite low, typically ranging

from 40 to 60 percent.39 If a capital investment is

made, ranging from a few hundred dollars for simple

modifications to traditional kilns40 to $100,000 or

more for a modern continuous retort, higher energy

efficiencies can be achieved.

Although it is widely believed that charcoal is

cheaper to transport than wood due to its higher

energy content by weight, detailed studies have

found that the transportation costs for wood and

charcoal are about the same.41 The higher energy

content of charcoal per unit weight is counterbalanced by its lower weight per unit volume.

Despite its higher price, charcoal is widely used in

some countries, particularly in urban areas where

people have cash incomes. A 1970 report from

Thailand, for example, indicated that 90 percent of

the wood cut for urban markets was converted to

charcoal. 42 It has several important advantages over

wood. Charcoal is impervious to insect attack,

unlike some wood species that must be used within

as little as a month of drying to avoid significant

losses to termites.43 AS it is nearly smokeless,

charcoal cooking can be done indoors in relative

comfort without blackening walls or metal pots with

soot. In addition, charcoal causes little smoke

irritation to eyes or lungs. Although it can emit large

amounts of dangerous carbon monoxide and other

pollutants, which is a health hazard in poorly

ventilated kitchens, charcoal causes little obvious

discomfort to the user. Additionally, once lit,

charcoal fires need little attention from the cook,

whereas wood fires require frequent adjusting of the

fuel.

Biomass Pricing

When people move from rural to urban areas in

developing countries, they typically continue to

follow traditional patterns of biomass fuel use. In

contrast to the labor-intensive collection of biomass

fuels in rural areas, however, the urban poor often

have no choice but to purchase fuelwood or charcoal

in commercial markets. In Tanzania, the cost of

purchasing these fuels reportedly ranges as high as

38M. ~, J. Dunkerley, and A. Reddy, Ibid.

sgc~rcoal Production Improvement for Rural Development in Ttiiland @an@o& ~“ d: Royal Thai Government and U.S. Agency for

International Development, 1984); D. Earl CharcoalProduction, Sudan Renewable Energy Project, Energy Research Council, USAID, Report No. 002,

Khartoum, Su&rL February 1984; J. Wartluft and S. White, Comparing Simple Charcoal Proaluxion Technologies for the Caribbean (Arlirigto!L VA:

Volunteers in Technical Assistance, 1984).

~.ChristopherseU G. Karc4 and J. Seve, “Production and Transportation of Fuelwood and Charcoal From Wood Surplus to Deilcit Regions in

Niger: Technical and Economic Feasibility” (Washington DC: Energy/Development International, March 1988).

41T. Wood and S. Baldwiq “Fuelwood and Charcoal Use in Developing Countries, “ Annual Review of Energy, vol. 10, 1985, pp. 407-429.

4ZJ0 hold, ctWood Energy and Rural Communities, ” Natural Resources Forum, vol. 3, 1979, pp. 229-252.

43s~on~ono~ and Bent SoreWW “A Na~~=mSmdy ~T~fi:me~ of B~dilya Vtige,” NamraZResource Forum, VO1. 8, No.

1, 1984, pp. 51-62.
Chapter 4--Energy Supplies in the Developing World . 103

40 percent of the income of poor families.44 More

typically, energy accounts for 5 to 10 percent of the

expenditures of poor households.45

Biomass fuel prices in urban markets often rise

rapidly as wood resources are seriously depleted,

and then closely follow fossil fuel markets. Biomass

costs cannot rise very far above the cost of an

equivalent amount of useful energy from kerosene or

LPG, as users can and will then switch fuels.%

Families that purchase modern stoves and fuels,

however, rarely discard the older stoves. Maintaining both technologies allows easy and flexible

switching between fuels in response to availability

and price. Following the 1973 and 1979 oil price

increases, for example, many people switched back

to wood and charcoal for their cooking needs. In

Malawi the use of kerosene, primarily for cooking

and lighting, declined by 24 percent between 1973

and 1976.47

Electricity

Electrification plays a central role in promoting

economic and social development in any nation. At

the same time, the electricity sector consumes large

amounts of economic, social, and environmental

resources. Accordingly, the electric power sector

receives significant attention and resources from

both developing country governments and international development agencies. For example, the

World Bank directs over 80 percent of its energy

lending to the electricity sector.

Although electricity accounts for less than 9

percent of the energy used by consumers in developing countries,48 electricity production in the developing world is increasing rapidly, at an average

annual rate of 7.6 percent.49 However, this rapid

growth still leaves the developing world at a far

lower level of electricity production than the industrialized world: average annual electricity production in the developing world is about 520 kilowattFigure 4-5--Electricity Generation by Fuel Type in

Selected Regions of the Developing World, 1987

Thousand GWh

600

500

400

300

200

100

0

m Hydro/other*

= Nuclea r

m Natural Gas

U Oi l

- Coa l

Africa Latin America India China

‘Includes hydropower, geothermal, and other renewable.

SOURCE: International Energy Ageney, Wor/d Energy Statistics and

Balances 1971-1987 (Paris: OECD, 1989).

hours (kWh) per capita,50 as compared with the U.S.

figure of 10,500 kWh per capita.51

Electricity Generation

In the developing world, as in the United States,

a variety of fuels and technologies are used for

electricity generation (see figure 4-5 and table 4-4).

Coal use for electricity production in the developing world is concentrated, largely in countries with

sizable domestic coal reserves (India, China, and

South Africa). Similarly, natural gas generating

capacity is found mainly in the few countries where

natural gas is produced domestically. In other

countries, oil is often used for electricity generation.

Hydroelectric facilities range from microhydropower stations with less than 0.1 megawatt (MW) of

capacity to large-scale hydropower plants such as

the 12,600 MW Itaipu facility in Brazil. For countries with hydroelectric potential, hydropower offers

an indigenous source of electricity generation with

very low operating costs, although the capital costs

44E.M. MIWW4 “village Industries vs. Savannah Forests,” UNASYLVA, vol. 33, No. 131, 1981, Pp. 24-29.

ds&r~d ~achand -ia ~wen, “Household Energy Handboolq” World B* TKhnicd Paper No. 67, 1987, p. 50.

~Doug~ F. Barnes, “Understanding Fuelwood Prices in Developing Nations,” World BanlL Household Energy Unit, Industry and Energy

Departmen~ Oct. 31, 1989.

47J. -old, ‘‘Wood Energy and Rural Communities, ” Natural Resources Forurn, vol. 3, 1979, pp. 229-252.

~IEA, op. cit., footnote 4, pp. 112, 120, 124, 128.

d~or the period 1971-87. IEA, op. cit., fOO~Ote 4.

~.S. Agency forrnternational Development PowerShortages in Developing Countries: Magnitude, Impacts, Solutions andtheRole of the Private

Sector (Washingto~ DC: (Mllce of Ermgy, U.S. AID, March 1988), p. 2.

51E~er~ ~o-tion A_s~tio~ Ann~Z Energy Re~”ew, DoE/EIA-oq&$(gg) (washingto~ DC: U.S. Govermnent Prhting ~1~, 1989).
104 ● Energy in Developing Countries

Table 4-4-Electricity Generation by Fuel, 1987 (percent by kWh delivered)

Fuel Africa Latin America China India United States

coal . . . . . . . . . . . . . . . . . . . . . . . . 52 3 68 66 57

oil . . . . . . . . . . . . . . . . . . . . . . . . . 14 24 12 8 5

Natural gas.... . . . . . . . . . . . . . . 14 8

* 1 11

Nuclear . . . . . . . . . . . . . . . . . . . . . 3 1 0 2 18

Hydro/other a . . . . . . . . . . . . . . . . . 18 63 20 23 10

Total (percent) . . . . . . . . . . . . . 100 100 100 100 100

Total(GWh) . . . . . . . . . . . . . . . 283,340 520,290 497,320 217,500 2,732,530

‘Less than l%.

a lncludes hydropower, geothermal, and other renewables.

NOTE: Does not include heat losses. Totals may not add to IOO percent due to rounding.

SOURCE: International Enerav Aaencv, Wm/d,Enenw Statistics and Baiances 1971-1987 (Paris: . OECD, 1989):, EA..Eneruv-.Ba/ances of OECD Countries

1987-1988 (Paris:”OE~D, l“@O). ““

are high. In Latin America, hydropower plays a large

role, supplying almost two-thirds of total electricity.52 More than 90 percent of Brazil’s total electricity supply comes from hydropower.53 In Africa,

almost half of the electricity generated outside of

South Africa comes from hydropower,54 and more

than two-thirds of the countries in Africa produce

electricity from hydroelectric plants.55

Only eight developing countries were generating

electricity from nuclear powerplants as of late

1989, 56 although several more have plants planned

or under construction.57 Nuclear power generation

involves high capital costs, very large scales of

operation, and considerable technical expertise. In

two upper income developing countries, Taiwan and

Korea, nuclear power provides over 40 percent of

total electricity generation. In other countries, however, there have been some difficulties with nuclear

power--e.g., two of India’s three operating nuclear

plants have suffered high outage rates,58 and their

fourth plant has had construction delays of 7 years.

A number of alternative generation technologies

have also been used in developing countries, including cogeneration, geothermal, conversion of solar

energy to electricity, wind-driven generators, and

the burning of waste material. Although these

sources contribute relatively small amounts to total

electricity supplies in the developing world, there is

strong policy interest in expanding the use of these

alternative generating technologies.

The operating efficiencies of electricity generating plants are generally lower in developing

countries than in the United States.59 Although many

factors affect power plant efficiency (notably input

fuel quality), the use of less efficient, poorly

maintained technologies contributes to the low

efficiencies of developing world powerplants.

Electricity Transmission and Distribution

Transmission and distribution systems in the

developing world have relatively high losses. A

recent survey of 76 developing countries found that,

in one-half of the countries surveyed, transmission

and distribution losses (as a share of total generation) exceeded 15 percent, compared with typical

losses of less than 10 percent in the industrialized

countries. 60 These losses include both technical

losses and unmetered consumption (theft).

521E~ op. cit., footnote 4.

%id.

~lJnit~ Nations, op. cit., footnote 24.

ss~id.

56These ~~m~Br@ ~di% Mefico, p~s~q Republic of Kor~ South Afli@ ~d ~WSn. United Nations, “~erW @lorstion ~

Development Trends in Developing Countries,” Report of the Secretary-Genera May 14, 1990.

57~gen~B-_~~M~co,~~~d R~ublic of Korea all had nuclear powerplants under Construction ~ 1989. rbid.

sgTa@ mer~ Research Institute, op. cit., footnote 11.

5~~t~ Natiom Cotierence on T-e ~d Development ~c~),T!chno/ogy Policy in the Energy ~ec~or.’ ]SSUSS, Scope and options fo r

Developing Counzi+es, UNCTADfIT~, June 15, 1989.

‘%bid.
Chapter 4--Energy Supplies in the Developing World ● 105

Institutional Issues

Governments in both the developing and industrialized world generally have taken leading roles in

directing the development and operation of the

electric power sector; this reflects both the importance of electric power in meeting economic and

social objectives and the high cost of electric power

systems.

Because electricity is considered an important

tool within a broader national development strategy61

, developing countries often subsidize electricity prices. In Pakistan, for example, 60 percent of

the cost of electricity is subsidized; in India, the

figure is 20 percent.62 Many countries have subsidies for electricity in selected sectors (e.g., agriculture and residential), reflecting either the political

influence of the subsidized sectors or government

interest in promoting certain economic or social

ends. Although electricity prices nearly doubled

between 1980-81 and 1986-87 in India, for example,

current prices are still far lower than supply costs for

residential and agricultural consumers.63

There may be many reasons for subsidizing

electricity prices in different sectors. For example,

rural electrification is promoted as a means to reduce

migration to cities by improving economic opportunities and lifestyles in rural areas. Supporters argue

that these subsidies benefit society as a whole and

not just rural consumers. Others rogue that there is

no conclusive evidence that rural electrification can

actually produce this benefit.64 Rural electrification

is also seen as ‘a powerful instrument at the disposal

of central governments to foster political stability in

rural areas,” although again the evidence is mixed.65

Subsidized electricity prices also allow electricity

to compete with subsidized prices for alternative

fuels. Similarly, when prices of farm products are

controlled and kept artificially low, electricity prices

(and the prices of other inputs such as fertilizers) are

often subsidized to keep farms operating.66

Subsidized electricity can have negative impacts,

including contributing to power shortages, since

consumers tend to use more subsidized electricity

than they would otherwise. Moreover, price subsidies keep power company revenues at levels inadequate for developing additional supplies and even

for maintaining existing facilities efficiently. Higher

prices, on the other hand, limit supplies to higher

income groups, an outcome that may conflict with

the social goals of electrification.

Capital spending on electricity systems in the

developing world is currently estimated at $50

billion to $60 billion annually.67 Even at that high

level of expenditure, investment is expected to be

inadequate to meet demand. The United States

Agency for International Development (U.S. AID)

has estimated that meeting the growing demand for

electricity will require capital investment of around

$125 billion per year over the next two decades.68

This enormous capital mobilization requirement

represents a large fraction of both total economic

activity and total gross domestic investment in the

developing world. The total economic output of all

lower- and middle-income countries as measured by

GDP was $2,716 billion in 1987, with total gross

domestic investment of $662 billion.69 Much of the

capital costs of electricity plants must be paid in

foreign exchange,70 leading to balance of payment

problems and compounding the problems of high

operating and capital costs in the electric sector.

61ufit~ N8ti~ns ce~tm for Human Setiements @bitat), Guidelines for the ~janning of Rural Settzemnts andrnfim~tire: Electrij?catioA

Methodology (Nairobi, Kenya: United Nations, 1985), p. 43.

6~.s. Agacy for ~ternatio~ Development, Op. Cit., footnote 50, P. 26.

63A. FW~et ~e, Application of De~nd~ide ~a~ge~nt (DS~) to Relieve Elecm”ci~ sho~ges in India, ~ contractor Iepoll pIepaIed fO1

the Otllce of Technology Assessrnen~ April 1990, p. 59.

~For ~ discmsion of ~ese ismes, s= D. Balyles, E1ecm”~ ~owerfor Rural Growth @o~der, C(): Westview Press, 1987), pp. 109-118.

~United Nations Center for Human Settlements (Habitat), op. cit., footnote 61.

66Mo~ Munasin@e, Rural E/ecmfication for Development (Bouldex, CO: Weswiew pr~s, 1987), P. 247.

67u.s. Agency for International Development, op. cit., fOOlnOte 50, P. iv.

68fiid., p. 25. A Sli@fly lower es~te ($60 t. $100 billion) from tie World B@ is given ixIA. ~UIC~l ~dRo Saundm, “FiMIIchg Of the ~lg’y

Sector in Developing Countries,” World Bank, Industry and Energy Department Worldng Paper Energy Series, Paper No. 14, April 1989.

@World BanlG World Development Report 1989 (New Yorb NY: Oxford University Press, 1989), tables 3 and 9.

W.S. AID estimates that around 45 percent of capital investment will be in foreign exchange. U.S. Agency for International Development footnote

50, p. 25.

33-718 0 - 90 - 5
106 ● Energy in Developing Countries

Even with the enormous financial, technical, and

institutional effort targeted to the development of the

electricity sector over the past decades, capacity still

is often insufficient to provide reliable, high-quality

power in developing countries. Outages are common

in many countries. For example, Bombay experienced 1,000 outages annually over a recent 5-year

period. 71 Even when power is available, voltage

fluctuations are often extreme, restricting the use of

some types of equipment. The electronic circuits of

today’s compact fluorescent light bulbs, for example, do not tolerate wide voltage fluctuations;72 and

computer operations are disrupted by outages. As a

result, in many countries, poor power quality and

lack of reliability undermine the economic benefits

of electric power.

Low reliability results in formidable losses in

economic productivity. Load shedding in India is

estimated to cost the equivalent of 1 to 3 percent of

GDP annually.73 Accurately estimating the productivity lost when existing equipment cannot be

operated due to power outages is difficult, and

estimating productivity lost as industry forgoes the

purchase and use of new electric equipment is even

more uncertain; however, the impacts may be quite

large.

Ironically, a few developing countries suffer from

an excess of electric capacity. For example, it has

been estimated that seven East African countries

have approximately 7,000 MW of excess generating

capacity (i.e., capacity over and above what is

needed for reliable system operation) .74 This situation results from the “lumpiness” of electric generating facilities, especially hydropower. Putting a

large new generating facility in service before the

domestic load can absorb the new supplies results in

overcapacity, and ties up scarce capital.75

Figure 4-6-Electricity Consumption by Sector in

Selected Regions of the Developing World, 1985

Thousand GWh

: T

= Othe r

= Commercial/public

m Residential

= Agricultural

= Industrial

China India Brazil

SOURCE: International Energy Agency, Wotld Energy Statistics and

Bahrxws 1971 -1987 (Pans: OECD, 1989).

Electricity Consumption

Industry consumes most of the developing world’s

electricity (see figure 4-6 and table 4-5). In contrast,

electricity use in the United States is divided among

the industrial, residential, and public service/

commercial sectors (see table 4-5). China, the largest

electricity user in the developing world,76 uses 75

percent of its electricity in industry. Similarly, India

and Brazil use over half their electricity in industry.

Agriculture uses large amounts of electricity for

pumping in India and China, while residential

lighting and appliances use large amounts of electricity in Brazil.

Outlook for Improvements

The mix of energy supplies varies widely in the

developing world—from China’s heavy reliance on

coal in the industrial and residential sectors to

Brazil’s extensive use of hydropower-based electricity. Despite the diversity of sources, however,

TITa@fierWRe~Wch ~ti~te, Two Strategie~forE/ectric ~~~velingforz~ia, p- I FM Repofi (New Delhi, India: 1987), p. 6., as Citd

inJ. VanDomele~Power to Spare: The WorldBank andE2ecm”cify Conservation (Washington, DC: World Wildlife Fund and Consemation Foundation

1988) p. 4.

Tz~WenceBe&eley~borat~V, Energy Te~hnologyforDeveloping Countries: Zssuesfor the u.S.Natio~lEnergyS~ategy, LBL-28N7 @erkeley,

CA: December 1989).

T3U.S. Agency for International Development, op. cit., footnote 50, P. 21.

TAI. H~e, “~er~ Efficiency in Developing Countries, “ inM. Munasinghe and R. Saunders (eds.), Energy Issues in the Developing World, World

Bank Industry and Energy Department Working Paper, Energy Series Paper No. 1 (Washington DC: World Banlq 1988).

T5Ex~ess ~waci~ cm ~so 1e~ t. distofiom ~ Pficing ~d de~nd. For e~ple, the ~ge SU@US ~pacity in Brazil when Itaipu came On-he kd

the electricity authorities to offer industry exceptionally strong incentives to buy electricity. Electricity was so cheap that it was used by industrial

customers virtually as a boiler fuel. Within a few years, however, load growth in other seetors reduced surplus capacity, but the industrial users were

by then reluctant to give up the highly favorable rates.

Tb@er one-fo~ of the elmtrici~ in the developing world k ~diII China.
Chapter 4--Energy Supplies in the Developing World .107

Table 4-5-Electricity Consumption by Sector, 1985 (percent)

End-use sector China India Brazil United States

Industry . . . . . . . . . . . . . . . . . . . . . 75

Agriculture . . . . . . . . . . . . . . . . . . 12

Residential . . . . . . . . . . . . . . . . . . 7

Public service/commercial . . . . . 5

Railroads . . . . . . . . . . . . . . . . . . . 2

Other/unspecified . . . . . . . . . . . . . ●

Total (percent) . . . . . . . . . . . . . 100

Total generation (GWh) . . . . . 410,700

59

17

12

8

2

1

100

188,500

58

3

20

20

1

*

100

192,700

33

1

35

31*

o

100

2,621,900

● Less than 1 percent.

NOTES: Totals may not add to 100 percent due to rounding. Brazil, China, and India account for 48 percent of

developing world electricity consumption.

SOURCES: Tata Energy Research Institute, Tf3?/EnergyfJata Directoryzmd Yearbook 1988(New Delhi, India: 1989);

IEA, World Energy Statktics and 6a/ances 197W1985 (Paris: OECD, 1987); E/4, Energy Ba/ances of

OECD Counties 1987- 1988( Pans: OECD, 1990).

several important characteristics of the energy supply sector can be identified:

●

●

●

The technologies in use are typically older, less

efficient, and less sophisticated than comparable technologies in the industrialized countries.

The electricity sector accounts for a large share

of foreign exchange resources. Rapid growth in

electricity demand and the high capital requirements of the sector suggest that the gap between needed and available capital for electricity system expansion will widen. Therefore

the electricity systems in many countries could

continue to be relatively undependable, inefficient, and technologically outdated.

The public sector plays a dominant role in most

aspects of energy supply, with the exception of

biomass.

These characteristics of the energy supply sector

in the developing world suggest a number of

productive opportunities for improving the efficiency of the energy supply system, recognizing that

there are wide variations among developing countries, and that many characteristics that appear

inefficient or undesirable when viewed from the

current perspective of highly developed nations may

in fact represent rational choices given prevailing

social, economic, and technical conditions.

A number of institutional, technological, and

engineering options can be considered for improving

the extraction, processing, and conversion of energy

supplies. In oil and gas development, for example,

options include both the deployment of new technologies, such as horizontal drilling, and the development of innovative financing mechanisms. Options

for coal include technologies such as washing and

screening, as well as strategies for minemouth

electricity generation to relieve pressure on transport

systems. Similarly, institutional issues are critical in

any discussion of improving the sustainability of

biomass resources.

Both developing country governments and international development agencies already pay much

attention to opportunities in the electricity sector.

Technological opportunities range from industrial

cogeneration, to upgrades of transmission and distribution system efficiencies, to the use of more

efficient consumer appliances. Institutional opportunities include the contribution of nonutility generators to electricity networks.

Although technology can do much to improve the

energy supply sector, other factors also affect its

operation: financial issues, such as subsidies for

electricity prices or the high cost of natural gas

transportation; institutional and management issues,

including shortages of trained personnel; and the

incentive structure, notably the dominant role played

by government in fossil fuel exploration and delivery systems, all strongly influence system operations, management, and decisionmaking in the

energy supply sector.
Chapter 5

Energy and the Environment

in Developing Countries
Page

Introduction and Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111

The Rural Sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113

Causes of Environmental Degradation ● . . . . . * . . . . . . . . . . . . . * . * . * * + . . . * . * *****..** 113

Environmental Impacts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119

The Urban Sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123

Causes of Environmental Degradation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123

Environmental Impacts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124

Energy Production and Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128

coal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128

Oil and Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128

Hydroelectricity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128

Biomass . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129

Nuclear Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129

Solar, Wind, and Other Renewable Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130

Greenhouse Gases and Global Climate Change . * . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130

Government Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131

Figures

Figure Page

5-1. Suspended Particulate Matter Levels in Selected Cities, 1980-84 . . . . . . . . . . . . . . . 125

5-2. Sulfur Dioxide Levels in Selected Cities, 1980-84 ., * * . . . . . . . . . . . . . . . . . . . . . . . . . 126

Tables

Table Page

5-1. Causes and Consequences of Environmental Degradation in Rural Areas . . . . . . . . 112

5-2. Estimates of Land Use Changes in Closed and Open Tropical Forests,

circa 1980 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115

5-3. Changes in Land Area Uses * . * . . . . . . . . . . . . . *, * . . . . * * . * *,, . . * . . . . * *, + *****.... 117

5-4. Sedimentation Rates of Some Reservoirs in India ● ........*,***..*.......,*,.* 121
Chapter 5

Energy and the Environment in Developing Countries

Introduction and Summary

Many developing countries are experiencing significant environmental degradation. In rural areas,

population pressure and low agricultural productiveties are among the factors forcing people into

marginal and ecologically fragile lands. Woodlands

are being cleared for cropland and pastures and are

being commercially logged. The use of biomass for

fuel or fodder places further demands on woodlands

and grasslands, particularly in arid regions with high

population densities. Farming, ranching, logging,

and the use of biomass fuels are all necessary if the

people dependent on these resources are to survive.

But these various pressures can also have negative

impacts: destruction of tropical forests and biodiversity; desertification; soil erosion and increased

downstream flooding and siltation; and air pollutionlocal, regional, and global.

In many urban areas of developing countries,

rapid population growth, inadequate infrastructure,

and economic and industrial growth with minimal or

inadequately enforced environmental controls have

led to high levels of pollution. Levels of sulfur

dioxide, particulate, ground-level ozone, and nitrogen oxides often exceed those in industrialized

countries. Major sources include electricity generation, transportation, and industrial production. Greater

use of fossil fuels in the modern, primarily urban,

sector can also lead to environmental degradation

and pollution in the rural areas where these fuels are

extracted from the ground and transported to the

cities, and where hydroelectric facilities are sited.

Many have viewed environmental costs--degradation and pollution of the natural resource base-as

the price that must be paid in order to develop

economically. l Increasingly, however, others argue

that environmental protection and economic development are tightly interconnected and mutually

supportive. 2 The landless peasants who migrate to

fragile watersheds in order to feed their families, for

example, clear land that is highly susceptible to

erosion. This can lead to serious soil loss and

downstream flooding and siltation-ultimately reducing the productivity of their land as well as that

of land downstream. In turn, this can exacerbate their ,

and others’ poverty. This may be particularly

significant in developing countries because their

economies are so heavily dependent on agriculture.

For the 2.8 billion people in the lowest income

countries, agriculture accounted for fully 31 percent

of gross domestic product (GDP) in 1987 and an

even greater portion of employment.3 Economic

analyses that include environmental impacts are

improving knowledge of this interdependency and

may assist policymakers in more wisely making

these tradeoffs.

Energy production and use contribute to environmental degradation in developing countries. Other

contributing factors include population growth,

inequitable land tenure, unsustainable agricultural

and forestry practices, industrialization, and government policies. In order to understand the role of

energy in overall environmental degradation, it is

therefore necessary to include these other factors in

the analysis.

Energy, used wisely, might also potentially provide several important environmental benefits in

developing countries. Greater energy inputs into

agriculture in the form of tractive power, fertilizer,

and irrigation, for example, can substantially improve agricultural productivities where soils and

climates are appropriate, and might help slow the

expansion of agricultural lands necessary to feed a

burgeoning population. (At the same time, however,

modern agriculture might also cause environmental

damage: by overuse of pesticides, herbicides, and

fertilizers; by waterlogging and salinizing irrigated

Iclem TiSde~, ~fSuS~ble Deve@=~t: D~e~ persp~tives of ~olo@ts -d &onomists, ad Relev~ce to -s,” Wor/d Developnwnt,

vol. 16, No. 3, 1988, pp. 373-384.

world Commission on Environment and Development, Our Common Future (New York NY: Oxford University Press, 1987).

Sworld Ba~ Wor/d Develop~nt Repo~ 1989 (New York, NY: Oxford University Press, 1989), indicator @bles 1 and 3.

–111–
112 ● Energy in Developing Countries

Table 5-l-Causes and Consequences of Environmental Degradation in Rural Areas

Desertification

Air pollution

Commercial agriculture, ranching

Consequences Direct cause Underlying cause

Deforestation Shifting agriculture Population growth

Loss of biodiversity Permanent agriculture Poverty

Soil erosion Permanent pasture Lack of land tenure

Flooding Low-level agriculture inputs

Mechanization of agriculture and/or the consolidation of agricultural lands

Commercial logging Destructive logging, lack of forest management and

protection, poor reforestation

Increased access to forests along logging roads for

farmers and ranchers

Production for export markets

Fiscal policies and legislation, in part to promote

exports of primary products due to need for

foreign exchange to service debt.

Inappropriate economic valuations of natural resources and biodiversity

Use of Biomass Fuels Inefficient use of fuelwood; overcutting of fuelwood

resources

Use of forest biomass for fodder Shortages and lack of alternative sources of fodder

Agricultural expansion onto fragile lands Population growth

Overgrazing Poverty

Burning of grasslands Lack of land tenure

Low-level agriculture and/or the consolidation of

agriculture lands

Use of biomass fuels Inefficient use of fuelwood; overcutting of fuelwood

resources

Climate change Various; not well understood

Use of biomass fuels Lack of access to higher quality fuels and stoves

Slash and burn agriculture Population growth

Burning of grasslands Poverty

Lack of land tenure

Low-level agricultural inputs

Salinization and water-logging Poor planning and management Cheap or free water contributing to inefficiency

of irrigated lands Inadequate investment in infrastructure

SOURCE: Office of Technology Assessment, 1990.

lands; and by use of these techniques under inappropriate soil and climatic conditions).4

Energy-efficient technologies may offer the potential of simultaneously reducing the total cost of

delivering energy services and cutting pollution.

New industrial processes may increase productivity

and lower costs while reducing hazardous wastes.

Much research and development work remains to be

done to bring many of these innovations to fruition.

A later report from this OTA study will examine the

extent to which improved technologies for energy

production and use can contribute to economic

development and environmental protection; under

what circumstances energy technology innovations

might ease the difficult tradeoffs between economic

growth and the environment; and policy issues

associated with accelerating the introduction of

improved energy technologies that minimize environmental degradation.

This chapter traces the causes and consequences

of environmental degradation in developing countries, beginning in rural areas and following them

through to urban areas, modern industry, and the use

of fossil fuels. This organization has several advantages over the more conventional cataloging of

environmental problems by their impacts on land,

water, and air. First, it helps capture the dynamic

causes of environmental degradation in developing

4u.s. Co=ss, ~lce of Twhnolow Assessment Enhancing Agriculture in Afi”ca: A Role for U.S. Development Assistance, OT..-35656

W-O%~: U.S. Government mt@ mice, September 1988). Some note, however, that even steep or acid-infertile lands can be productive

over long periods as shown by the centuries of terraced rice farming in Asia or continuous sugar-cane cropping in the Dominican Republic. See Rieardo

Radulovich “A View on Tropical Deforestatio~” Nature, vol. 346, July 19, 1990, p. 214.
Chapter 5-Energy and the Environment in Developing Countries ● 113

countries in the various contexts of the rural struggle

for survival by the landless peasant, or of the urban

effort to develop modern industry in an economy

that has limited capital, technology, and skilled

human resources. Second, it highlights the differences in the causes and consequences of environmental degradation between rural and urban areas.

Third, it helps illustrate some of the complex

linkages between these environmental problems that

make effective responses so difficult. If economic

needs are to be met while simultaneously maintaining environmental quality, these dynamics and

complex interconnections must be understood and

responded to appropriately.

The Rural Sector

Many developing countries are suffering significant environmental degradation in rural areas, including: rapid devegetation/deforestation and the

loss of irreplaceable biodiversity; desertification;

erosion of crop and pastureland; watershed degradation, siltation of downstream waterways, downstream flooding, and other impacts on water quality

and supplies; and local and regional air pollution. In

turn, these environmental impacts may damage or

destroy farm and range land and force more people

into watersheds and other ecologically fragile lands--

potentially creating a vicious cycle of degradation.

Clearing and burning woodlands and grasslands for

agriculture or pasture also contribute to the global

increase in atmospheric greenhouse gases.

The principal direct causes of these forms of

environmental degradation are shifting cultivation,

conversion of forest lands to permanent pasture and

agriculture, commercial logging, overgrazing, inappropriate management of irrigated land, and the use

of biomass for fuel. These factors are often interconnected. Commercial logging of closed tropical

forests, for example, opens new areas with roads and

partial clearings, which enables settlers to follow,

converting forests to pasture and cropland.

Underlying these causes are factors such as:

population growth; poverty; the lack of access to

modern energy-intensive inputs for agriculture (mechanical traction, irrigation, fertilizers, etc.); the lack

of secure land tenure for many people; and government pricing, tax, and other policies that may

encourage misuse of natural resources. These causes

and consequences are listed in table 5-1.

The extent and rate of environmental degradation

are difficult to quantify accurately under the best of

circumstances, even when reliable data are available. As it is, estimates vary widely on the basis of

the underlying definitions of what constitutes ecological vulnerability or degradation; the methodologies used for the analysis; and the assumptions used

to go from local measures of degradation to global

extrapolations.

The depiction of environmental degradation also

depends on what measure is used for comparison.

Local degradation may be severe and rapid. Irrespective of the hardship this places on people in the

immediate region and the need for local responses,

it does not necessarily translate into corresponding

problems at the regional or global scale. There is

considerable variation in form and degree of environmental degradation from one region to another.

Consequently, an attempt is made below to place

estimates of the rate of local environmental degradation into the global context.

Causes of Environmental Degradation

Agriculture

As the populations of developing countries grow,

the demands on the land for food, fuel, and fodder

increase accordingly. Farmers then face three basic

choices: they can ‘mine’ the land—taking more out

of it than they put in-until the land is exhausted;

they can migrate to new lands; or they can increase

the level of (capital-, energy-, and labor-intensive)

agricultural inputs-mechanical traction, fertilizer,

and irrigation—into the land in order to raise yields.

These might also include higher inputs of information and management as might be the case for

intercropping, agroforestry, integrated crop-livestock, or other sophisticated agricultural systems.s

Mining the Land—”Mining” the land usually

takes the form of shortened fallow periods-leaving

inadequate time for the natural regeneration of

soil-as population pressures mount. It is obviously

a temporary solution, but one often resorted to by

those without access to the modern agricultural

5u.s. COnmSS, O&lce of TeChnOIO~ Assessmen~ Enhancing Agriculture in Af+ca: A Role for U.S. Development Assistance, OTA-F-356

(TVashingto& DC: Government Printing Office, September 1988).
114 ● Energy in Developing Countries

inputs needed to raise crop yields.6 Declining yields

from such “mining” are seen in a number of local

and regional areas, particularly in Africa.7

Migration-Many people migrate to new lands or

to urban areas. In addition to population pressures or

soil exhaustion, factors forcing people to migrate

from long-established farming areas to new lands

include the low productivity of traditional agriculture; inequities in land tenure for many subsistence

farmers; drought or other disasters; and, in some

areas, mechanization of agriculture and/or consolidation of agricultural lands. In many cases, currently

farmed areas have been subdivided among successive generations to the point that the landholdings

for those who remain are, or will soon become,

marginal. In Rwanda, for example, the average

smallholder had 1.2 hectares in 1984 and, by

tradition, would divide it equally among his average

of four sons—leaving them 0.3 hectares each. If the

same trend continues, the following generation will

have less than 0.1 hectare each.8 Estimates of the

number of landless or near-landless (with too little

land to subsist) in developing countries range as high

as 1 billion people, most of them in Asia.9

Wage-paying jobs are scarce for those who are

forced to migrate. Land-anywhere they can get

it—for subsistence agriculture and fuelwood is often

their only means of survival. Increasingly, however,

available lands are remote, only marginally productive, or ecologically fragile--on upland regions that

are easily eroded when groundcover is removed, on

arid or semi-arid lands, or in forested areas of high

biological diversity (but which may have poor soils).

As many as 370 million people in developing

countries may live in rural areas that are ecologically

vulnerable.10 To generate good yields on a sustainable basis on these lands often requires larger inputs

of labor and/or capital and technology than the lands

left behind-inputs to which these people seldom

have access.ll This maybe particularly true in newly

opened areas where infrastructure (including access

to extension efforts) is especially weak. The immigrants into these areas may be unfamiliar with the

different agricultural techniques appropriate (sustainable) to these new lands and resources.

In many regions, shifting agriculture is initially

12 (Sing agricul- practiced by those who migrate.

ture is also practiced traditionally by “long-term”

residents in many areas and is a sustainable form of

agriculture if fallow periods are sufficiently long.)

Shifting agriculture begins with forest-fallow systems in which small patches of land are cleared and

cultivated for a few years and then left fallow for as

long as two to three decades (see ch. 3). This remains

an important form of agriculture in west Africa,

southeast Asian hill communities, parts of South

America, 13 and elsewhere.14 This form of shifting—

or slash and burn-agriculture is believed by many

to be the most important cause of secondary15 forest

destruction and to be roughly comparable to commercial logging in its impact on primary forest (table

5-2). 16 Shifting cultivation consumes enormous

amounts of biomass energy in the process of clearing

the forest.17

Modern Agriculture-Those farmers with access

to good soils and water resources and modern

agricultural inputs can increase the yields of their

croplands. Modern agricultural practices in develop6p~r soilq~~or fid~~teWaterresources may also be signitlca.nt constraints on raising crop yields even with high levek Of agrictimd @u@.

~.S. Congress, OffIce of Technology Assessment op. cit., footnote 5, pp. 63 ff.; United Nations Food and Agriculture Organiza tiom Afi”can

Agriculture: The Next 25 Years, Annex II, “The Land Resource Base” (Rome, Italy: United Nations, 1986).

gufited Nations Population Fund, “The State of World Population 1990,” New Yorlq 1990.

%. Jeffrey Leonard, Enviromnentand the Poor: Deve20pment Strategiesfor a Common Ageti (New Brunswick NJ: Transaction Books, 1989).

l%id.

1lu.s. CO~SS, office of Technology Assessment, op. cit., footnote 5.

lz~~~tive]ythose who migrate may continue their previous pattern of agricuhur~ftenWrmanent agriculture--rather than adopting shifting

agriculture techniques as traditional in the new area.

13Norm~ My~s, D@ore~tation Rates in TroPi~OIFore~ts and Their Cli~tic Implications @ndon: Friends of the ~ Limited, 1989).

14u.s. Conwss, Oflce of T~~ology Assessment, c~nging By DegreeS: ~feps TO Reduce &ee~house Gzses, forthcodlg.

15 Sewn@ forest is ~twhich~b=lo=~ ~the p~t~dthen~ow~ toregrow, or~ oth~~b~nsi~lc~fly affected byhurnanactivity.

IGSee alSO Julia C. Allen and Douglas F. B~=, “The Causes of Deforestation in Developing Countries,” Annals of the Association ofAmeri”can

Geographers, vol. 75, No. 2, 1985, pp. 163-184.

IT~R. Smi@ ~~~e Biofuel T~sitioU” pacific a~Asian Jour~l of Energy, 1987, pp. 1s-s2; T-~, “H~ Ecology Research on

Tropical Agroecosystems in SoutheastAs~” Singapore Journal of Tropical Geography, vol. 3, No. 1, 1982. Some of the biomass ash generated serves

as nutrients for the crops subsequently planted.
Table 5-2—Estimates of Land Use Changes in Closed and Open Tropical Forests, circa 1980 (million hectares per year)

Closed forest Open forest

Seiler and

Crutzen Food and

Agricultural

Seiler and

Crutzen Food and

Agricultural

Land use change Low High Organization Lanly Myers Low High Organization Lanly

Primary forest to:

Shifting cultivation . . . . . . . . . . . 2.6 3.6 3.2 3.4 1.9 — — 1.2 1.7

Permanent pasture ., ,, . . . . . . 1.6 1.4 1.1 2.5 0.6 1.7 2.1 0.8 1.3

Permanent agriculture . . . . . . . 0.3 2.2 1.1 2.3 0.0 0.2 3.0 0.7 0.8

Logged forest . . . . . . . . . . . . . . — – 4.6 3.7 4.5 — — — —

Logged forest to:

Permanent pasture . . . . . . . . . . — — 1.1 — 0.6 — — — —

Permanent agriculture . . . . . . . — — 1.0 — 3.9 — — — —

Secondary forest to: 14.9 40.0 18.5 22.0 3.4 6.9 21.9 11.4 18.6

Shifting cultivation . . . . . . . . . . .

Permanent pasture ...,. . . . . . 0.5 1.5 0.1 — 3.3 1.0 1.0 — —

Permanent agriculture . . . . . . . 0.6 0.8 0.1 — 6.8 0.2 1.4 — —

NOTE: The data in this table maybe significantly inaccurate. The table is presented here only to provide a general indication of the rates and causes of deforestation. The Food and Agricultural

Organization (FAO) and Lanly data are essentially the same (Lanly is the principal author of the FAO study), based primarily on official government statistics, and maybe underestimates

of the rate of deforestation. A more recent review by Myers, for example, indicates substantially higher rates. 1 The UNFAO currently has underway a more detailed study that may resolve

some of these large discrepancies.

I Norman ers, f)efofestatinRatesinTropica/ Forests and Their Clirnatk hnpkations (London: Friends of the EWh, kwmber 19s9).

SOURCE: R.P. Detwiler and Charles A.S. Hall, “Tropical Forests and the Global Carbon Cycle,” Science, vol. 239, Jan. 1, 1988, pp. 42-47, citing Seiler and Cmtzen, Food and Agricultural

Organization, Lanly, and Myers.
116 . Energy in Developing Countries

 ing countries use, to varying degrees, improved

plant species, synthetic fertilizers, pesticides and

herbicides, irrigation, and mechanized operations to

generate higher crop yields. These require high

levels of capital and energy inputs.

Modern agriculture has, with mixed success, provided environmental, social, and economic benefits.

It has moderated cropland expansion into ecologically fragile or particularly valuable lands through

technological advance (the green revolution) and

energy inputs in the form of fertilizer, irrigation, and

mechanical operations. Over the 20-year period

from 1965 to 1985, cropped areas increased by only

14 percent, 35 percent, and 4 percent in Africa, South

America, and Asia while their populations increased

by roughly 75 percent, 60 percent, and 50 percent

respectively (table 5-3). Modern agriculture has also

raised the personal incomes of many farmers; and it

has contributed to national economic growth in

many countries, especially in Asia.

Modern agriculture has also had serious shortcomings. It has increased economic inequities between those farmers who have sufficient land and

access to capital and other inputs necessary for

high-yield agriculture and those farmers who do not

have such resources, and it has displaced laborers in

many cases. It has caused environmental damage

through the misuse of fertilizers, pesticides, and

herbicides. Inadequate investment and poor management have led to waterlogging and salinization of

valuable irrigated lands. Finally, modern agricultural techniques require dramatic increases in commercial energy use. 18 Concern over environmental

impacts and high dependence on purchased inputs

has led to considerable interest in farming systems

that depend more on resources internal to the

 farming system and less on external purchases.

These agricultural and agroforestry systems tend to

be very information and management-intensive.19

Irrigated Lands—Irrigation is an important element in modern agriculture. It frees the farmer from

dependence on irregular rains and raises yields,

allowing double- and even triple-cropping. Some

160 million hectares of land in developing countries

are irrigated. In Asia alone, 100 million hectares are

irrigated, and this land produces roughly 60 percent

of the region’s food on just 45 percent of its cropped

area.20 In India, more than 6 million electric and 3

million diesel pump sets have been deployed (see ch.

3), consuming nearly 2,000 GWh of electricity and

3 million tons of diesel fuel in 1985.21

Inadequate investment and poor management

have resulted in various degrees of salinization

and/or waterlogging of irrigated lands in many

countries. For example, by one estimate 75 percent

of Pakistan’s irrigated land suffers salinization

and/or waterlogging, with corresponding reductions

in crop yields.22 Some 20 million hectares-roughly

half--of India’s irrigated croplands have sufficient

salt buildup to reduce productivity; another 7 million

hectares of land in India now lie unused due to

excessive salt.23 (Similar problems afflict the United

States, where 20 to 25 percent of the 20 million

hectares of irrigated lands are affected by salinization. 24) Reclamation is possible through improvements in canals and other infrastructure to reduce

leakage and by providing drainage from the fields,

but it is expensive.

The technology to prevent or minimize salinization and waterlogging has been available since the

IsNote ~tthe ener~ intensity of shifting+r slash and burn-cultivation may be significantly higher than commercial agrkxdture when the energy

consumed by burning off the standing biomass is taken into account. However, commercial fuels are little used, if at all, in shifthg agriculture.

lgAdvisoV co~tte on the s~el, Agrofores@ in the ~e~~ African Sahel, Bo~d on Science ~d Techno@y for kternational Development

National Research Council (Washington DC: National Academy Press, 1983, 1984); U.S. Congress, Office of Technology Assessment, op. cit., footnote

5; Clive A. Edwards et al., Sustainable Agricultural Systems (Ankeny, Iow& Soil and Water Consemation Society, 1990); Robert Winterbottom and

Peter ‘E Hazlewood, “Agroforestry and Sustainable Development: Making The CormectioQ” AWBZO, vol. 16, No. 2-3, 1987, pp. 1(W11O; C. Okail

and J.E. Sumberg, “Sheep and Goats, Men and Women: Household Relations and Small Ruminant Production in Southwest Nige@” Understandz”ng

Afi”ca’s Rural Households and Farming Systems, Joyce Lewinger Moock (cd.) (Boulder, CO: Westview Press, 1986).

mMon~We Yude@“Sus~ble~d Equitable Development in krigilted WvkonmentS,” Environment and the Poor: Development Strategies

for a ConvnonAgendiz, Jeffrey Leonard (cd.) (New BrunswI“ckj NJ: Transaction Books, 1989).

ZIAshok De@ ‘fiergyB~nc~ for~di~ 1985-86,” contractor report prepared for the Office of Technology Assessment, 1990. wis @vd~t

to 125,000 GJ.

~udehna~ op. cit., footnote 20. Total cmp areas from World Resources Institute, World Resources 1990-91 (New York NY: Oxford University

Press, 1990). For other estimates, see C.E. Whitman et al. (eds.), RainfedAgricu/ture in the Near East Region, proceedings of the worlmhop at Amman

Jorda~ Jan. 18-23, 1986, USDA and USAID, p. 92.

~Yude~~ op. cit., footnote 20. Total crop areas from World Resources 1990 -91,’ op. Cit., fOOblOk 22.

~World ReSo~eS Institute, World Resources 1987 (New York NY: Basic BOOkS, 1987), p. 280.
Table 5-3-Changes in Land Area Uses

Cropland area Permanent pasture Forest/woodlands Other land

1964-66 to 1964-66 to 1964-66 to 1964-66 to

Total Population 1985-87 1983-85 1985-87 1983-85 1985-87 1983-85 1985-87 1983-85

area density, 1989 percent percent percent percent percent percent percent percent

(million (people per of total change of total change of total change of total change

Region hectares) thousand ha) land area in cropland land area in pasture land area in forest land area in other uses

Africa . . . . . . . . . 2,965 212 6.2 14.0 26.7 –0.5 23.2 -8.6 43.9 3.6

N. America . . . . 2,139 197 12.8 7.7 17.2 –2.4 32.0 -5.9 38.0 1.5

S. America . . . . 1,753 166 8.0 35.2 27.0 9.4 51.6 -7.3 13.4 -1.4

Asia . . . . . . . . . . 2,679 1,139 16.8 4.2 25.3 -3.0 20.2 -4.6 37.7 -0.7

Europe . . . . . . . 473 1,050 29.6 –5.0 17.8 -4.9 33.2 7.1 19.4 3.9

SOURCE: World Resources Institute, 14btfd Resources 1988-89 (New York, NY: Bask Books, 19SS) table 16.1; World Resources institute, Work/ Resources 1990-91 (New YorlG NY: Oxford

University Press, 1990), table 17.1.
118 . Energy in Developing Countries

1950’s, yet designers frequently fail to incorporate

these improvements in their projects. Many factors

contribute to this failure. One factor may be that

designers tend to be overly optimistic in their initial

appraisals: they assume that waterlogging and salinization will not occur for 20 to 30 years, and that

drainage systems and other capital-intensive improvements will not be necessary before then. This

lowers the apparent costs of their projects and may

improve the chances that the projects will be

approved. 25

Pasture-The opening up of lands for pasture is

a significant cause of deforestation (table 5-2)

particularly in Central and South America where

grazing lands have increased by more than 9 percent

during the past 20 years (table 5-3).

Overgrazing may also play a significant role in the

desertification of semi-arid regions.26 Overgrazing

and trampling can quickly destroy the grass layer.

Without the protection of ground cover, topsoil can

be washed or blown away, lowering fertility. In

some areas, the full force of rain on the soil can bring

clay particles to the surface and cause surface

hardening and sealing that seeds cannot penetrate.27

The end result of such processes can be desertification.28

Herders burn grasslands to encourage new

growth; numerous studies have shown this new

growth to be particularly good forage for their

herds.29 More generally, repeated burning is believed to help create and maintain much of the

world’s savannah and grassland.30 Such brushfires

in the African grasslands may burn as much as 2

billion tons of biomass annually, cause volatilization

of organic nitrogen and sulfur, and allow excessive

leaching of other valuable nutrients.31 This maybe

particularly damaging in much of the Sahel, where

growth is already strongly limited by the lack of

nutrients. 32 Thus, brushfires help the herder feed his

animals in the near term but, in the longer term,

lower soil fertility, and kill brush and trees that hold

the soils and pull nutrients up from deep in the

ground. 33 Brush and grassland fires may also be

significant contributors to regional air pollution and

may contribute modestly to the global increase in

greenhouse gases.34

More stable supplies of forage might reduce the

need of herders to maintain large numbers of animals

in order to ensure the survival of a few through

periods of drought. Higher quality forage (higher

protein content) would reduce the need to burn

grasslands. Inputs of capital- and energy-intensive

fertilizer, increased supplies of water, and mechanical harvesting of the forage (or even grain crops)

when its protein content is at a maximum-as is

common in industrial countries-might aid in achieving both of these goals.

Commercial Logging--Commercial logging impacts perhaps 3 to 5 million hectares of primary

tropical forest annually (table 5-2). In many areas,

only the highest grade logs are removed from the

forest. But for every tree removed, roughly 5 to 10

other trees are destroyed.35 Commercial logging also

develops roads that allow settlers access to forested

regions, where they can clear the forests for farms or

ranches.

Biomass Fuels—Biomass-wood, crop residues,

and animal dung-is the primary fuel for people in

25yu&.~n, Op. Cit., fOO~Ote 20.

xwil~ H. Schlesinger et al., “Biological Feedbacks in Global Desetilcatioq” Science, vol. 247, Mar. 2, 1990, pp. 1043-1048.

ZTNatio~Re=hCoUcil,Board On science andT~~ologyfiD~elopmen~Agf~~~~e~~ ~~ ~~e West@icansaheJ (waShh@O~Dc: National

Academy of Sciences, 1983); Georges Novikoff and Mohamed Skouri, “Balancing Development and Conservation in Pre-Saharan ‘Iimish” AMBZO,

vol. 10, NOS. 2-3, 1981, pp. 135-141.

~Ufited Natiom Food and Agric~~ ~ga~tioq African Agn”cu/~re: The ~~t 25 years, hex n, “me Land Resource Base,” Op. Cit.,

footnote 7.

mJ. Dirck Stryker, “Technology, Human Pnxsure, and Ecology in the Arid and Semi-Arid Tropics,‘‘in H. Jeffrey I.scmard (cd.), op. cit., footnote 9.

~Cml Sagm, ow~ B. T~~ ~d James B. pollac~ “~~opogefic~b~o ages and the ~’s climate,” science, vol. ZM, 1979, pp .

1363-1368; Daniel FiruL “Land Use and Abuse in the East African Region,” AMBZO, vol. 12, No. 6, 1983, pp. 296-301; DJ. Pratt and M.D. Gwynne

(eds.),RangelandiUanagement and Ecology in East A&-ca (Huntington NY: Robert E. Kreiger Publishing Co., 1977).

slNatio~Re~emhCowcil,BOmdon Science ~dT~~ology ~Developrnen~E~vi~o~~~ra/ Change in the WestAfi-can SaheZ(Washingto~ DC:

National Academy of Sciences, 1983); World Resources Institute, World Resources 1990-91 (New Yorkj NY: Oxford University Press, 1990).

32H. Bre~n ~d C-T. dewi~ $’~gel~d productivity ~d &ploitation iII he s~e~” Science, VO1. 221, 1983, pp. 1341-1347.

sss~ker, op. cit., footnote 29.

~World Reso~ces mti~te, World Resources 1990-91 (New York NY: Oxford University press, 19$0.

ssFred pe~e, “Hit and RW in saraw~” ~ew Scientist, my 12, 1990, pp. %9.
Chapter 5--Energy and the Environment in Developing Countries ● 119

rural areas, and in many regions it is also important

for the urban poor (see ch. 3). Until recently, it was

widely believed that many developing countries

were on the verge of being transformed into treeless

deserts or mountain wastelands due to the demand

for fuelwood. These predictions were largely based

on the “gap” model, which assumed a freed

per-capita demand for fuelwood and a growing

population while at the same time the forest base was

declining due to agricultural expansion and overcutting of the forest.36

In more recent studies, however, it has been found

that the use of fuelwood is highly elastic according

to its availability and the labor required to collect it

or, if traded, its price. When fuelwood is difficult to

obtain by foraging, people quickly resort to lower

quality wood, agricultural residues, or dung. More

generally, rural subsistence farmers cause relatively

little damage to forests, as they usually take only

deadwood or small limbs. They do not have the tools

to cut down large trees. Much of the wood they

collect is from hedgerows or other sources near their

farms. In Kenya, for example, trees outside the forest

supply half the fuelwood demand.37 And in West

Java, one study found that three-fourths of all the

fuel collected came from within family courtyards

and gardens, and two-thirds of this fuel was branches

and twigs .38

In contrast to rural foragers, commercialized

fuelwood and charcoal operations to supply urban

households, commercial facilities and industrial

operations often cut whole trees and can damage or

destroy forested areas. The impact of commercial

demands for fuelwood are limited, however, as users

will switch to fossil fuels when fuelwood becomes

scarce and prices climb (ch. 3).39 The extent of the

damage to the forest resulting from commercialized

fuel demand will then depend on the distance

between the user and the forest, the size of the forest,

the size of the demand, the rate of regrowth, and

other factors. The use of biomass for fuel is not

usually a principal cause of deforestation. It does,

however, add additional pressure on forest resources. In arid or semi-arid regions, where forest

growth is slow and there is a high population density

or a concentrated urban demand for fuelwood, such

as the African Sahel, the use of biomass fuels can

contribute significantly to local deforestation.40

Similarly, the use of biomass fuels can lead to local

deforestation in some cases where there is a concentrated commercial or industrial demand.

Environmental Impacts

The environmental impacts of agriculture, ranching, lumbering, and the use of biomass for fuel

include deforestation, desertification, soil erosion,

flooding, pesticide and fertilizer runoff from cropland, and air pollution from biomass fuels.

Deforestation41

The forests of the developing world provide a

number of resources and benefits, including food,

fuel, fodder, fiber, timber, and medicines. Forests are

a vital ecological resource, protecting soils, maintaining diverse plant and animal life, regulating the

flow of water, and playing an important role in the

global carbon cycle. Forests may also strongly

influence regional climates.42 The loss of tropical

forests not only threatens to deprive the world of

valuable resources on which it currently depends,

but also to foreclose opportunities to discover new

36@r~dF01ey, “DiscussionPaper on De~nd_gemen~* proceedings of the ESMAP titern~dSouthemAtiicaHousehold ~~gyplx

Seminar, Harare Zimbabwe, Feb. 1-5, 1988, UNDP/World Bank Energy Sector Management Assistance Program, Activity Completion Report No.

085/88.

ST~ O’Keefe, “Fuel for the people: Fuelwood in the Third WorlL” AiUBZO, VO1. 12, 1983, W. 21-26.

38M, ~di Swsasw, “policy ~ysis of R~ Household Energy N~& in West Jav~” Rural Energy to Meet Develop~ntNeeds: Asian Village

Approaches, M. Nund Is~ Richard Morse, and M. Hadi Soesastro (eds.) (Boulder, CO: WestView Press, 1984), p. 114.

s~ug~ F. Barnes, ‘‘Understanding Fuelwood Prices in Developing Nations,” draft, Household Energy Uni4 Industry and Energy Departrnen$

World B@ Washington DC, Oct. 31, 1989.

‘%ouglas F. Barnes, World B* “Population Growth, Wood Fuels, and Resource problems in Sub-Saharan Africa,” Industry and Energy

Department Working Paper No. 26, March 199Q R. Moss and W. Morga~ Fuelwood and Rural Energy Production and Supply in the Hunu”d Tropics

(Dubl@ Ireland: ~cooly International Publishing Ltd., 1981); Finq op. cit., footnote 30; Dennis Anderson and Robert Fishwic~ World B@

“Fuelwood Comumption and Deforestation in African Countries,” World Bank Staff Working Paper, No. 704, 1984.

alForde@~ rWiews of defores~tion and po~~ re~mes to i~ see: U.S. Congress, ~lce of Technology Assessm@ Changing By Degrees: Steps

To Reduce Greenhouse Gases, forthcom@ U.S. Congress, Offke of Technology Assessment, Technologies to Sustain Tropical Forest Resources,

OTA-F-214 (Springfield, VA: National Technical Information Service, March 1984); and Robert Winterbotto~ “Taking Stock: The Tropical Forestry

Action Plan After Five Years,” World Resources Institute, Washington, DC, June 1990.

42J. Shul@ C. Nobre, and P. Sellers, “Amazon Deforestation and Climate Change,” Science, vol. 247, Mar. 16, 1990, pp. 1322-1325.
120 . Energy in Developing Countries

potential sources of wealth and scientific knowledge. On the other hand, tropical forests offer an

economic opportunity that the poor in developing

countries wish to seize as quickly as possible.43

Governments may also want to colonize forest lands

in order to establish more clearly their legal claim to

national territory.

The rate of global deforestation-from all causes--

is highly uncertain, with estimated rates in the early

1980s ranging from roughly 0.5 percent44 to 1.8

percent45 annually. These rates appear to be accelerating due to increasing population and other pressures noted above.

The UNFAO 1990 Forest Resources Assessment

estimates the current annual global deforestation

rate as 1.2 percent-double their estimate for

1980.46 Forested areas and deforestation rates vary

widely between countries. Indonesia and Brazil have

huge areas of closed forests (100 and 350 million

hectares, respectively) and annual rates of deforestation of perhaps 0.4 to 1.4 percent and 0.5 to 2.3

percent, respectively. Aggregate figures, however,

tend to obscure severe deforestation occurring in

certain regions. Ivory Coast, for example, has just 16

million hectares of forest remaining, and suffers an

annual deforestation rate variously estimated between 6.5 and 15.6 percent. A number of other

countries lie between these extremes, with forested

areas of 5 to 50 million hectares and deforestation

rates variously estimated in the range of 2 to 8

percent annually .47 At these rates, their closed

forests could disappear in a few decades.

Desertification

Desertification can result from a variety of factors,

depending on the region, including long-term climate trends, overgrazing, poor farming practices,

and deforestation.48 Although anecdotal evidence

indicates that drylands in many regions are becoming decertified at an increasing rate, there is little

reliable data to support the case. The “Global

Assessment of Soil Degradation,” initiated in late

1987 by the United Nations Environmental Program

and the International Soil Reference and Information

Centre in the Netherlands, should provide some of

these data.

Impacts of Deforestation and Desertification

Among the potential impacts of deforestation and

desertification are soil erosion and degradation,

fuelwood and fodder shortages, increased flooding,

microclimatic changes, and loss of biodiversity.49

Soils—Little soil is lost from forests or grasslands. When vegetation is removed, massive amounts

of soil can be washed away as rainwater flows across

the surface. Measurements in Tanzania indicated

that up to half the rainfall was lost as runoff from

bare fallow (3.5° slope), carrying with it some 70

tons of soil per hectare.50 Similar impacts have been

noted elsewhere.51 With no shading, soil temperatures rise dramatically and can greatly reduce the

vital biological activity in the soil.52 Loss of tree

cover also allows higher average wind velocities

(and soil erosion) and, combined with the reduced

soil moisture content, can lower crop yields.53

AsMcmdo ~ulovich “A View on Tropical Deforestation,” Nature, vol. 346, July 19, 1990, p. 214.

44Jean.pa~ My, “Tropical Forest ReSOWCeS, “ Forestry Paper No. 30, United Nations Food and Agriculture Organization, Rome 1982.

45Mye~, op. Cit., foo~ote 13-

‘

i

’’World Deforestation Increases at Quicker Rate Than Expected,” MultinationalEnvironmental Outlook, Aug. 21, 1990, p. 134.

47Myem, op. cit., fOOtnOte 13) P. 2*

4

0

48G0 No~ofi, ‘~ Desefimtionby ~er@g,’’~B]O, vol. 12, No. 2, 1983, pp. l@-105; H-F. ~rey iuidI-IusseinYussuf, “P~todism~d

Desert Encroachment in NorthernKeny~’ AMBZO, vol. 10, Nos. 2-3,1981, pp. 131-134; National Research Council, Environmental Change in the West

@“can Sahel, op. cit., footnote 31; D. kdersom and R. Fishwiclq “Fuelwood Consumption and Deforestation in Mrican Countries,” World Ba~

Staff Working Paper No. 704, 1984; Schlesinger et al., op. cit., footnote 26.

A~mwa~~~~et~., “~e~pactof -of a Tropic~For@ i.ll~done@’’AJfBz(J, VO1. 10, NOS. 2-3,1981, pp. 115-1 19; L@erR. Bm~

“World Population Grow@ Soil Erosiom and Food Security,” Science, vol. 214, 1981, pp. 995-1002; Alain Grainger, Deser@cation (londom

-C% 1984), p. 94.

50phil O*K&fe, ~~’rhe CauKs, co~~~ms ad Remedies of Sofl Erosion ~ K~y~” AMBZO, VO1. 12, No. 6, 1983, pp. 302-305.

51u.s. CoweSs, ~lce of T~~oloWAss=ment, “p+ cit., fm~o~ 41; F~op. cit., footnote 3Q Ene~ Sakfi and Peter B. Vose, “Depletion of

Tropical Rainforests;” AMBIO, vol. 12, No. 2, 1983, pp. 67-71, Vaclav Smil, “Deforestation in China,” AMBIO, vol. 12, No. 5, 1983, pp. 226-231;

Nigel J.H. Smi@ “Colonization Lessons from a Tropical Foresg” Science, vol. 214, 1981, pp. 755-761; A.H. Gentry and J. @ez-Par~

“Deforestation and Increased Flooding of the Upper AmazoU” Science, vol. 210, 1980, p. 1354.

52s~ti ~d Vose, op. cit., foo~ote 51; He~ ~sso, J- ~uis Gui~ume~ and l@cohrI I@l@. “md Use Problems fi a Tropical Fores4°

AMBZO, vol. 10, No. 2-3, 1981.

ssDe~s ~erso~ “Declining Tree Stocks in African Countries,” World Development, vol. 14, No. 7, 1986, pp. 853-863.
Chapter 5--Energy and the Environment in Developing Countries . 121

Fuel and Fodder—As forests and grasslands

disappear, rural people are increasingly forced to

rely on agricultural residues and dung for their

cooking and heating needs, and on crop residues for

animal fodder. The failure to return organic materials to the soil can have significant environmental

impacts, even if these impacts are longer term and

more subtle than is sometimes suggested. People in

many areas already divert organic residues to other

uses, often with little apparent near-term effect on

yields. For example, crop residues such as millet or

sorghum stalks tend to be poor fertilizers and are

difficult to recycle; they are often burned in the

fields to prevent them from harboring crop pests.

Similarly, dung quickly loses its nitrogen and much

of its effectiveness as a fertilizer when left lying in

the sun, as is comrnon.54 In areas with poor soils

and/or high rainfalls that quickly leach nutrients out,

however, crop yields may drop quickly if residues

are not returned to the soil.

In the longer term, the loss of organic material can

reduce the productivity of even the highest quality

soils. Organic matter in soils provides important

nutrients needed by plants; it helps the soil bind

important minerals-e. g., magnesium, calcium, and

potassium-that would otherwise be leached away;

it buffers the acidity of the soil; and it improves

water retention and other physical characteristics.55

Wafer—When the natural water regulation system provided by forests and grasslands is removed,

stream flows tend to become more erratic, with

reduced flows during dry seasons and worse floods

in the wet season. This can interfere with agriculture,

fishing, and darns and can threaten inhabitants.

Table 5-4-Sedimentation Rates of Some

Reservoirs in India

Lifetime (years)

Reservoir Planned Revised

Bhakra . . . . . . . . . . . . . 88 47

Maithon . . . . . . . . . . . . . 246 24

Hirakund . . . . . . . . . . . . 100 35

Ram Ganga . . . . . . . . . 185 48

SOURCE: Kunwar Jalees, “Loss of Productive Soil in India,” /nterndona/

Journal of Envfronmentai Studies, vol. 24,1985, pp. 245-250.

Eroded soils choke downstream waterways and

reservoirs, reducing their ability to handle the

increased volumes of water running directly off the

watersheds. 56 Over the past 10 years, the area

annually flooded in India has increased by 18

percent. 57 Some observers attribute this increased

flooding to the clearing of regional forests. Flood

and erosion damage due to the clearing of India’s

forests has been estimated at $20 billion for the

period from roughly 1960 to 1980, including loss of

topsoil, loss of property to floods, and shortened

reservoir lifetimes (table 5-4).58 Other estimates

place the direct costs of repairing flood damage in

India at more than $250 million per year.59

Climate—In some regions, a significant portion

of the rainfall is generated from moisture pumped

back into the atmosphere by vegetation. Removal of

this vegetation may then contribute to climatic

change in the region.60 The surface reflectance is

changed and may likewise affect climate.61 To the

extent that the local climate changes due to the loss

of vegetation, it may become more difficult to

reverse the process and restore grasslands and

WGoCo Agg-~, “J~&cio~U= of~gin The l%ird World,” Energy, vol. 14, No. 6, 19*9, PP. 349-352

SsGeoffr~ Barnard and IAWS KristofersoU Agn”cultural Residues as Fuel in The Third WorZd (London: -CmW*S.

MW p. fiho~~sing Ground: EnViro~ntal Stress and World Food Prospects (New York NY: W.W. Norton& CO., IW@.

57u.s. Conwss, GflIce of Technology Assessment, op. cit., footnote Al.

sg~id. Amoreg~m~reviewof this problem inlnd~ is given in The State ofIndia’sEnvironment 1984-84; The SecondCitizen’sReport (New Delhi:

Center for Science and Environment).

sgJohn Speazs, “Preserving Watershed Environment.s,” UM4SYLVA, VOI. 34, No. 137, 1982, pp. 10-14.

@Sag~ et al., op. cit., footnote 30; J. Shukls and Y. Mintz. “Inthence of Land-Surface Evspotranspiration on the Earth’s Climate,” Science, VO1.

215, 1982, pp. 1498-1501.

slRobert S. ~del, Mechanisms Governing the Cliwte of the Sahel:A Survey ofRecent Modelling and Observational Studies, OECD/~S/Club

du Sahel, Report Sahel D(84)252, October 1984. See also Sagan et al., op. cit., footnote 30, estimates of slbedo changes are given in Gregory Morris,

“Environmental Impacts of Bioenergy Developmen~” Biomass Energy Systems: Building Blocks for Sustainable Agriculture, Jan. 29-Feb. 1, 1985,

Airlie House, Airlie, VA, The Rockefeller Brothers Fund and World Resources Institute, Wsshingto~ DC.
122 . Energy in Developing Countries

forests to something approaching their original form

and extent.62

Biodiversity 63--Plants in tropical rain forests

have evolved a particularly rich array of potentially

useful chemicals, yet fewer than 1 percent of all

tropical plant species have so far been screened for

biochemical of use to man.64 A number of valuable

medical products have already been developed from

tropical plants, including highly effective drugs for

leukemia and hypertension, muscle relaxants, and

others. 65 Many other aesthetic, scientific, and commercial benefits may be realized from tropical forest

products. Tropical deforestation and the loss of

species would foreclose many of these opportunities.66

Although they have received much less attention,

plants in arid and semi-arid regions similarly offer

many potential benefits. These areas harbor a

number of wild relatives to our basic crops-beans,

potatoes, wheats, barleys, millets, sorghums, and

many others—and are sources for genetic resistance

to drought, heat, pests, and disease. The diverse

genetic resources of wild varieties can be an

important input into the higher yielding but genetically narrow varieties used in intensive agriculture.

Many valuable genetic strains and species may beat

risk in these arid and semi-arid regions.67

Deforestation can result in a direct conflict

between the survival of species and the livelihoods

of people who exploit the land. Such a conflict

recently erupted in the United States over the

endangered northern spotted owl.68 There are similar

conflicts in many developing countries. Tropical

rain forests contain at least half and perhaps as many

as 90 percent or more of the species found on earth,

yet cover just 7 percent of the total land area. No one

knows precisely the share of species held by tropical

rain forests, because fewer than 2 million species

have been officially classified out of a total number

that is variously estimated to range from less than 5

to more than 50 million.69 Many countries are taking

steps to protect their biodiversity, and a few are

realizing some success. Protection of the browantlered deer in northeast India, for example, is

helping it make a comeback from near extinction.70

There are concerns in developing countries,

however, that the costs of conserving biodiversity—

in jobs and/or access to land and resources for the

poor, security enforcement, administration, and the

mistrust generated as governments deny their own

people access to much-needed resources-will be

born by the developing countries, but the benefits

will be largely captured by commercial interests in

industrialized countries.71

Air Pollution

The burning of biomass generates large amounts

of air pollution in developing countries. Food is

typically cooked over an open fire or a poorly vented

stove-exposing women and children, as well as

other members of the family, to high levels of toxic

smoke (ch. 3). Similarly, in colder climates, homes

in rural areas are often heated by open fires, further

increasing exposures to toxic smoke.72 One impact

of this indoor air pollution is exacerbation of one of

the most deadly classes of infectious illness, acute

respiratory infections in children.

The use of biomass for fuel, clearing forest land

for agriculture, and burning grasslands to generate

GZJ. Shuklz C. Nobre, P. Sellers, “AmazonDeforestation and Climate Change” Science, vol. 247, Mar. 16, 1990, pp. 1322-1325. H. Schlesinger et

al., op. cit., footnote 26.

GsFor a complete review of this complex issue, see U.S. Congress, Offke of Technology Assessmen4 Technology to Maintain BioZogicaZDivertify,

OZ&F-330 (Springfield, VA: National Technical Information Service, March 1987).

~Nefl A. Belso~ ‘ ‘Tropical Deforestation and the Response of the United SGXfX COWWN,” Georgetown International Environmental Law Review,

vol. 2, Fall 1989; U.S. Congress, Office of Technology Assessmen~ op. cit., footnote 41.

fiu.s. CO~SS, tilce of Technology Assessment, op. cit., f@@e 41.

66~w~d (). Wilsou ~~~ats t. Biodiv~i@,~> Scientific American, &@e~r 1989, pp. 108-1 16; w~ter V. Reid md Kenton R. Miller, Keeping

Options Alive: The Scientific Basis for Conserving Biodiversity (Washingto% DC: World Resources Institute, October 1989).

GTG~Nab~~ “HowAreTropi~ Defores~on and Desertiflcation Affecting Plant Genetic Resources, “Annals ofEarth, vol. 4, No. 1, pp. 21-22,

1986; Paul Raebur% “Seeds of Despair,” Zssues in Science and Technology, Winter 1989-90, pp. 71-76.

6sLibrq of Congress, Congressional Research !kviw, ‘‘Economic Impacts of Rotecting the Northern Spotted Owl,” 90-74 ~ Mar. 5, 1990.

@Robert M. May, “How Many Species Are There on Ear@” Science, Sept. 16, 1988, pp. 1441-1449.

‘Sanjoy Hamrika, “A Deer Comes Back From the Brink in India,” New York Times, July 31, 1990.

71~c~o ~ulovicm “A View on Tropic~ Defo~s@tio~” Na~e, VOI. 346, J~y 19, 1~, p. 214.

72~ R. s~~ Bio@el~, Air Pollution, andHealth: A Glo~lRe~w mew York ~: plen~ press, 1987).
Chapter 5--Energy and the Environment in Developing Countries ● 123

fresh forage for livestock all generate large amounts

of smoke that contributes to regional air pollution.

These activities also pump greenhouse gases into the

atmosphere, potentially contributing to global climate change.73 This is discussed in much more detail in the forthcoming OTA report, Changing By

Degrees: Steps To Reduce Greenhouse Gases.

The Urban Sector

Causes of Environmental Degradation

Urban areas of developing countries are growing

rapidly, in large part due to migration from rural

areas. For the low-income countries, urban population jumped from 17 percent of total population in

1965 to 30 percent in 1987. In 1960, there were 59

cities with more than 500,000 persons in developing

countries; by 1980 that number had grown to 165

cities. 74 In the early 1990’s, cities in developing

countries will need to absorb more than 100 million

additional people annually.75 This trend has important implications for both energy use and energyrelated environmental impacts.

Urbanization and modernization can provide many

desirable benefits-improved standards of living,

increased opportunities for education and employment, and greater insulation from the vagaries of

drought endured by those in rural areas. (They also

reduce pressures on some aspects of the rural

environment.) They also have costs, including

potential damage to the environment.

Urbanization changes the consumption patterns

of goods and energy-related services (ch. 3). Households make a transition from biomass to commercial

fuels for cooking and other domestic services.

Demand for consumer goods, notably electric appliances, increases. The economic base changes from

agriculture and small rural industry to larger manufacturing and services, with a corresponding change

in the demand for commercial energy. The need for

public and personal transport grows as employment

shifts from agriculture or rural industry located

within walking distance of residences to large

industry and commerce located further away. The

high concentration of people requires the transport

of food, fuel, and other materials from long distances, as well as effective management of wastes.

These changes have significant impacts on energy

use and on the environment.

Residential/Commercial Sector

The transition from biomass to clean commercial

fuels such as liquefied petroleum gas (LPG) and

electricity for residential cooking generally reduces

the total amount of air pollution emitted and largely

shifts that which is emitted from the household to

distant refineries and electricity generation plants

(ch. 3).76 In some countries, however, clean commercial fuels are not widely available or remain too

expensive. China, for example, uses about one-third

of its coal in residences, of which nearly half is used

for cooking (app. 3-A). Due in part to heavy

residential coal use, some northern Chinese cities,

such as Beijing and Tianjin, have very high sulfur

dioxide concentrations.

Lights, refrigerators, air conditioners, and other

electrical appliances in the residential/commercial

sector provide highly desirable services and are

penetrating urban areas much more rapidly than

rural areas (ch. 3). These appliances consume large

amounts of electricity, however, the generation of

which can cause significant environmental damage

if not properly controlled. Refrigerators and air

conditioners also use chlorofluorocarbons (CFCs),

which have already damaged the earth’s protective

ozone layer and are potent greenhouse gases.

Industrial Sector

Industry provides many goods that contribute to

our material comfort and well-being. Industry can

damage the environment through a variety of

activities, however, if they are mismanaged or

inadequately controlled. These include: placing

heavy demands on natural resources as feedstocks or

other inputs; intensively using electricity for mechanical drive and other needs; burning fossil fuels

TqR.p. D~~~ ~d -1= A-s. ~, c’Tropic~ For~ts ad he Glob~ &bon ~cle,” science, VO1. 239, J~. 1, lgs& pp. 4247; Ritid A.

Houghto~ “TheFutureRoleof Tropical Forests inliffecting the Carbon Dioxide Concentration of the Atmosphere, ’’AMBlO, vol. 19, No. 4, July 1990,

pp. 204-209.

Tdworld B@ World D#e/op~nt Repo~ 1989 (New York NY: OxfOrd Ufivemity press, 1989).

TsWor/dDoezopmntReportJ990, op. cit.; ~d,icator~bles 1 ~d31, me mb~pop~tio~l percent of thedevelopingcountrytoti of 3.95 billion

people-1.6 billion people and is growing at 6.9 percent annually.

76~~ ~efer~ t. ~~n monoxide, p~c~t~,-diofide, fi~gen oxides, and o~er such che~~ ~ies. It does not refer to carbon dioxide,

which may be increased by the use of nonbiomass fuels but not by biomass if the biomass is being produced on a sustainable basis.
124 . Energy in Developing Countries

for process heat; and generating hazardous wastes

that may be discharged into landfills, water systems,

or the air. Each industry has a different mix of these

activities, and each activity has a different set of

environmental impacts, depending on the use of

environmental controls and other means of mitigation.

Industrial pollution can pose a particularly severe

health hazard in developing countries when industries are established near existing residential areas,

or when residential areas buildup around them. This

has led to tragedies such as Bhopal, as well as serious

systemic pollution such as found in Cubatao, Brazil,

in the 1970’s and early 1980’s.77 Often, the lowest

income people are most seriously affected. This can

lead to the situation in which the poor face all of their

traditional risks to health-infectious disease, hunger and malnutrition, air pollution from biomass

fuels-and at the same time face even greater than

normal modem risks-such as exposure to hazardous wastes and toxic air pollutants.78

Transportation Sector

The transportation sector is the largest contributor

to air pollution in many cities. For example, in

Indian cities, gasoline-fueled vehicles—mostly two

and three wheelers—are responsible for 85 percent

of carbon monoxide and 35 to 65 percent of

hydrocarbons in the air from fossil fuels.79 Diesel

vehicles—buses and trucks-are responsible for

over 90 percent of nitrogen oxide (NOX) emissions

in urban India.80 Use of emission control devices and

engine modifications have significantly reduced

exhaust emissions on newer vehicles in the United

States, but these pollution controls are usually not

standard on vehicles in developing countries. Runoff

from roads also contributes to water pollution.

In each of these sectors, there are often difficult

tradeoffs between longer term environmental imacts and immediate financial costs to consumers.

Many developing countries also have shortages of

skilled technical manpower to implement mitigation

efforts. The extent to which technological innovations or other advances might ease these tradeoffs

will be examined in a later report of this OTA study.

Environmental Impacts

Air

Air quality in many of the developing world’s

cities is poor, and has been deteriorating. The United

Nations Environment Program (UNEP) estimates

that up to one-half of the world’s urban population,

including residents of many industrialized countries,

live in areas with marginal or unacceptable levels of

sulfur dioxide (S02) in the air. Concentrations of

SO2 (see figure 5-1) and concentrations of total

suspended particulate (see figure 5-2) in major

cities in the developing world are considerably

above World Health Organization guidelines. Photochemical smog has become a recurrent seasonal

problem in many large tropical and subtropical

cities.

The sources of these pollutants vary. Coal-used

for electricity generation, industrial power and

process heat, and domestic heating and cooking

(China)--primarily emits sulfur dioxide, particulate, and nitrogen oxides. The combustion of oil or

gas in stationary sources, such as electric generating

units, emits many of the same pollutants-nitrogen

oxides, hydrocarbons, particulate, and sulfur dioxide--but in much different proportions.81 Nitrogen

oxide, a major ingredient of urban smog, is the most

harmful pollutant released on a large scale when

electricity is generated from oil or gas. Mobile

sources--cars, trucks, two and three wheelers, and

buses-release large amounts of carbon monoxide,

NO=, hydrocarbons, and particulate and are typically the largest source of these pollutants in urban

areas. These mobile sources are also major contributors of lead pollution due to the use of lead as an

octane booster in gasoline. Burning fossil fuels

unavoidably generates carbon dioxide, the most

important greenhouse gas. These pollutants (except

carbon dioxide (C02)) can damage crops, forests,

and structures and can aggravate human health

problems.

~world Resources Institute, World Resources 1990-91 (New York NY: Oxford University hess, W90), P. 41.

Tsk the more gene~ C&, mere is a shift in the ~es of risk that people are exposed to from the traditional to b modem. S* fik R. Smi@ “me

Risk Transitio~” Znternatiomd Environmental &airs, vol. 2, No. 3, in press.

~ta Energy Research Institute, T~Energy Data Directory and Yearbook 1988 (New Deti India: 1989), p. 250.

%id.

81 Mitre Corp., “Healthand EnvinmmentalEffeets of Oil and Gas Technologies: Researeh Needs,” report to the Federal Interagency Committee on

the Health and Environmental Effects of Energy Technologies, July 1981.
Chapter 5--Energy and the Environment in Developing Countries ● 125

Figure 5-1-SuIfur Dioxide Levels in Selected Cities, 1980-84

Shown is the range of annual values at individual sites and the composite 5-year average for the city.

WHO Guideline 40-60 ug/m3

1 Concentration (ug/m3

) 10 / \ 100

I I I I I I I I I I I I I I I I I I I I I I

Key

1. Milan

2.. Shenyang 3.Tehran

4. Seoul

5. Rio de Janeiro

6. Sao Paulo

7. Xian

8. Paris

9. Beijing

10. Madrid

11. Manila

12. Guangzhou

13. Glasgow

14. Frankfurt

15. Zagreb

16. Santiago

17. Brussels

18. Calcutta

19. London

20. New York City

21. Shanghai

22.Hong Kong 23. Dublin

24. St. Louis

25. Medellin

26. Montreal

27. New Delhi

28. Warsaw

29. Athens

30. Wroclaw

31. Tokyo

32. Caracas

33. Osaka

34. Hamilton

35. Amsterdam

36. Copenhagen

37. Bombay

38. Christchurch

39. Sydney

40. Lisbon

41. Helsinki

42. Munich

43. Kuala Lumpur

44. Houston

45. Chicago

46. Bangkok

47. Toronto

48. Vancouver

49. Bucharest

50. Tel Aviv

51. Cali

52. Auckland

53. Melbourne

54. Craiova

Range of individual site I I [ 1.

annual averages I

I 12.

~

I I 3.

I I 14.

4

[ I

I 5.

Combined site

I I 6.

I I I 7.

average 1980-84 I I 8.

[

I 19.

I I I 10.

I I

I 11.

I

I 12.

I I 13.

I 14.

I

[ 15.

I

[ 16.

I 17:

1 I 18.

I I

I 19.

I

[ 20.

I

I 21.

I I 22.

I

I ~ 23.

24.

I 25.

I 126.

I I 127,

I ]28.

I

]29.

\ , ,1

30.

31.

132.

I I [ 33.

[ ] 34

1 35.

I I 36.

[

] 37.

1

] 36.

1 I

I 39.

I

I

I

~ 42.

43.

I I 47.

I ] 48.

I

] 49.

150.

I I

51.

I I 52.

I J 53.

I

I

I 54.

a Note logarithmic scale.

SOURCE: Wortd Health Organization and United Nations Environment Programme, G/o&/ Po//ution md/fea/th (Imndon: Yale University Press, 1987), figure

2, p. 5. (Logarithmic scale.)
126 ● Energy in Developing Countries

Figure 5-2-Suspended Particulate Matter Levels in Selected Cities, 1980-84

Shown is the range of annual values at individual sites and the composite 5-year average for the city.

WHO Guideline 60-90 ug/m3

10 ~ 10 0 1,000

I I I I I I I I I I I I I I I I I I

Key

1. Kuwait

2. Shenyang

3. Xian

4. New Delhi

5. Beijing

6. Calcutta

7. Tehran

8. Jakarta

9. Shanghai

10. Guangzhou

11. Illigan City

12. Bangkok

13. Bombay

14. Kuala Lumpur

15. Zagreb

16. Rio de Janeiro

17. Bucharest

18. Accra

19. Lisbon

20. Manila

21. Chicago

22. Caracas

23. Birmingham

24. Helsinki

25. Hamilton

26. Sydney

27. Houston

28. Craiova

29. Toronto

30. Melbourne

31. Medellin

32. Chattanooga

33. Fairfield

34. Montreal

35. Vancouver

36. New York City

37. Tokyo

38. Osaka

39. Cali

40. Copenhagen

41. Frankfurt

Range of individual site I 1 J 1.

annual averages I 2.

I I

I I 3.

I I 1 I I “4.

4 1 I 5.

Combined site I I 16.

average 1980.84 I I 7.

I I 16.

I I

I 9.

[ I 10.

I 11.

[

I 12.

I 13.

I

I

14.

I 15.

1!

16.

I

17. .,*

/ ,

1

16.

19.

I 20.

II 21.

I l l

22.

I

I I

I I

25.

I

26.

I I 127.

[

26.

129.

I I

33.

I 34.

1 ’ I

35.

] 36.

I I 37.

38.

39.

I I 140.

1 1 1

41.

a Note logarithmic scale.

SOURCE: Wortd Health Organization and United Nations Environment Programme, Globa/PolMion andlfedth (Imndon: Yale University Press, 1987), figure

3, p. 6. (kgarithmie scale.)

Efforts to reduce emissions from coal burning bers”) controls sulfur emissions by capturing the

usually involve removing harmful material from sulfur in the form of liquid sludges. Electrostatic

exhaust gases after combustion. Pollution controls, precipitators are widely used in the developing

such as electrostatic precipitators or baghouses to world, but FGD systems are not common.82 This

control particulate, capture pollutants from exhaust may be due in part to the high costs of such systems.

gases, but they create solid wastes in the process. One study in India found that the addition of an FGD

Flue gas desulfurization (FGD) equipment (“scrub- system would add about 15 percent to the cost of

8~~rmtio~~velopment ~dlhm~As=~tm, ~c.~ “Clean Coal Technologies for Developing Countries,” contractor report prepared for the

Mice of Technology Assessment Msy 1990, p. 25.
Chapter 5--Energy and the Environment in Developing Countries ● 127

electricity .83 Perhaps as significant is that Indian and

Chinese coals have relatively low sulfur contents—

typically 0.5 to 2.0 percent compared to 3 to 6

percent for Eastern European and some U.S. Coals.84

Adoption of more effective pollution control

technologies already common in the industrialized

world and improvements in energy efficiencies

might significantly improve air quality in many

cities of the developing world.

Water

The primary urban water pollution problem is the

discharge of untreated or minimally treated human

waste into water systems (this is also a significant

problem in rural areas). As of the mid-1980’s, only

about half the developing world’s urban population

had adequate sewage facilities, and perhaps threefourths had access to safe “ drinking water. This

situation contributes to the growth and spread of

pathogenic viruses, bacteria, and protozoa and is

directly or indirectly responsible for perhaps threefourths of all illness and 80 percent of all child

deaths.85

Industrial wastes also contribute significantly to

water pollution in some areas. These range from

agricultural industry wastes to heavy metals (mercury, cadmium, lead, and chromium) and chlorinated hydrocarbons-to name only a few. These

pollutants can have serious impacts on water resources all the way downstream to the ocean. Many

coastal areas are also being affected.86 A recent

study found that World Health Organization (WHO)

standards for heavy metals-cadmium, lead, and

mercury-were exceeded in one-third to threefourths of the fish and shellfish samples taken from

Jakarta Bay, Indonesia. 87 Mitigation strategies that

might be applied include treatment of industrial

effluents and reduction of the generation of hazardous materials themselves through improvements in

manufacturing processes.88

Land

The major causes of soil pollution in urban areas

are the disposal of solid wastes and the deposition of

air pollutants such as S02 and particulate. The

focus here is on solid wastes. Low-income countries

generate much less urban refuse (around 0.5 kg per

capita per day) than industrial countries (0.7 to 1.8

kg per capita per day).89 In large cities, however,

even modest per-capita levels can lead to large

amounts of waste generation. Mexico City is estimated to generate 11,000 tons a day. Most of this

waste originates from households, largely in the

form of vegetable and putrescible materials. There is

also a significant component of hazardous wastes

(containing chemicals, heavy metals, and/or radioactive wastes) from industries.

In the developing countries, current procedures

for disposing of such wastes are inadequate. Much

household garbage is not collected at all, but left to

decompose. Hazardous wastes may be dumped on

uncontrolled municipal landfills. Only a small part

of total wastes are disposed of in an environmentally

safe reamer. Nonetheless, costs of even inadequate

disposal can amount to as much as 30 percent of

municipal budgets.90

Energy could, however, play a part in solving

these problems. Urban waste can be used as feedstock for cogeneration plants. Process changes in

energy-intensive industries such as steel, cement,

and fertilizer may well, by economizing on the use

of all materials, also reduce hazardous wastes.

831bid., p. 25.

~Ibid., pp. 7, 8, 27.

gsworld R60mc~~sti~te, World Resources 1990-91 (New York NY: Oxford University Press, 1990); World Resources mtitute, “Development

and Pollution in the Third Worl~” Tokyo Conference on the Global li!nvironment and Human Response, Sept. 11-14, 1989; World Health Organization

The International Drinkz”ng Water Supply and Sanitation Decade (Geneva: United Nations, 1986); World Health Organization and United Nations

Environment Programme, Global Pollution and Health (New Haveu CT: Yale University Press, 1987).

~United Nations Environment Programme, “The State of the Marine Environment,” 1990.

gTWorld Reso~ces ~ti~te, “Development and Pollution in the Thhd WOrlL” op. Cit., footnote 85.

S8uos+ CoWss, ~lce of TW~olom~sesmm~ Sen”ous Red~tion of Hazar&us Waste For pollution prevention and lnd~t?ial Eficiency,

OTA-ITE-317 (Washingto~ DC: U.S. Government Printing Gfllce, September 1986). U.S. Congress, ~lce of Technology Assessmen~FromPo/lution

to Prevention: A Progress Repon on Waste Reduction, OTA-ITE-347 (Wasbingto~ DC: U.S. Government Printing Office, June 1987).

89sm~ J. coin~~u, J7nviron~ntalMamgeme~ of ur~n Solid Wastes in Developing Counm”es:A proje~ @fi, quoted in “Development ~d

Pollution in the Third Worl~” prepared by The World Resources Institute for the To~o Conference on the Global Environment and Human Response,

Sept. 11-14, 1989 (Washingto~ DC: World Resources Institute, July 1989).

World Resources Institute, World Resources 1988-89 (New York NY: Basic Books, Inc., 1988), p. 46.
128 ● Energy in Developing Countries

Energy Production and Conversion

Energy plays a critical role in fueling the transition from a traditional to a modern society and thus

aiding economic and social development. In turn,

this energy is extracted from rural areas-either as

fossil fuels or renewable energy-and can have

significant impacts on the rural economy and

environment. Energy thus provides an important

two-way linkage between rural and urban areas.

Used wisely, energy can provide environmental

benefits; if misused it can also exact substantial

environmental costs to the land, water, and air. The

many social, economic, and environmental benefits

have been reviewed in the preceding chapters; the

environmental costs of extracting and transporting

the major energy resources used in developing

countries today--coal, oil, gas, hydroelectricity, and

biomass-are briefly reviewed below.

Coal

Coal has significant environmental effects throughout the fuel cycle.91 The environmental effects of

coal mining depend on the techniques used. Mining

methods are selected according to the depth of the

coal, the thickness of the seams, and the availability

of capital and equipment. In surface mining, topsoil

and overburden are removed to expose the coal. The

mining process can disturb surface lands and waters,

and may also contaminate or disturb underground

aquifers. Increased erosion, downstream siltation,

and water contamination can follow if excavated

material is not properly managed during mining.

Soil productivity and water resources can be degraded if lands are not reclaimed adequately. The

most severe impacts associated with underground

mining are surface subsidence over mined-out areas,

disruption of aquifers, and contamination of water

by acid drainage. Additionally, dust and emissions

from coal mining, preparation, and transport or

related equipment can contribute to local air pollution.92

Oil and Gas

Oil and gas production have similar environmental impacts. During exploration and production,

the major environmental concerns onshore include

land disturbances, aquifer contamination, leaks and

spills, and disposal of liquid and solid wastes. For

offshore operations, concerns include the impacts of

operations on fisheries and marine habitats, leaks

and spills, and waste disposal.

Large spills of oil or petroleum products, which

occasionally occur during production, storage, or

transportation, are perhaps the most dramatic environmental threat associated with oil production.

Small leaks and spills are much more common,

however, and may have a greater overall impact on

the environment. Oil spills can poison fish and

aquatic animal and plant life. Additionally, sediments can trap oil, creating a long-term source of

pollution. The well-publicized Alaskan oil spill of

1989 revealed the difficulties inherent in cleaning up

large oil spills in difficult ocean environments.93

Developing countries have had their share of oil

spills too. The June 1979 blowout of the IXTOC 1

production well in the Mexican Caribbean was the

largest oil spill to date.94 It released an estimated 139

to 428 million gallons of crude oil into surrounding

waters, as much as 40 times the amount spilled by

the Exxon Valdez. Natural gas leaks pose little toxic

threat to plants and animals but can explode or cause

fires. The primary constituent of natural gas—

methane--is also a potent greenhouse gas.

Petroleum refining generates hazardous liquid

and solid wastes, as well as air emissions. These

facilities have pollution control requirements similar

to many other large industrial and chemical plants,

but leaks of toxic compounds occur nevertheless.

Hydroelectricity

The major environmental impacts of large hydropower production projects result from the initial

construction of the hydropower facilities, filling the

reservoirs, and changing river flows. This is in

91u.s. C~~B=S, OfiCe of T~~oloWAs=ssment, The Dire~ Use of Coal, OTA-E86 (Sp~leI&VA: Natio@ Technic~ hlfo~tion SCIViCe,

April 1979), p. 186.

%bid.

93For a discussion of the technologies reklted to~spill cleanup, see U.S. Congress, Office of Technology Assessmen~ Coping With An Oiled

Sea: An Analysis of Oil Spill Response Technologies, OTA-BP-O-63 (WashingtorL DC: U.S. Government Printing Office, March 1990).

~~id.WY of tie lmge spills listed in the OTA background paper occumd in or near developing COuntrieS.
Chapter 5--Energy and the Environment in Developing Countries ● 129

contrast with other energy sources, for which major

impacts are spread over the entire fuel cycle.

Large dam construction often requires the clearing of lands for access routes and sometimes for

removal of construction material, with resulting soil

degradation and erosion. Filling the reservoir can

flood large tracts of land, uprooting people and

leading to loss of forests, wildlife habitat, and

species diversity. For example the Akosombo reservoir on the Volta in Ghana, with a land requirement

of 8,730 km2, approaches the size of such small

countries as Lebanon or Cyprus.95 Some currently

proposed very large dam projects would inundate

highly populated valleys and require large-scale

resettlement of local residents.

The Three Gorges Dam project under consideration for the Yangtze river in China would be the

world’s largest hydroelectric project, generating the

equivalent of approximately one-fifth the hydroelectricity currently produced in all of China each year,

as well as providing flood control. Debate over this

project has continued for six decades because it

would entail the resettlement of approximately 1

million people; because it would deface one of

China’s most famous natural sites, and because

critics believe that power could be provided more

cheaply with smaller thermal and hydroelectric

plants or through conservation.96

Dams disrupt the natural flow of rivers. Changed

flows can erode riverbeds, alter flood patterns, harm

aquatic ecosystems, and interrupt the spawning and

migratory patterns of fish and other species. The

introduction of a new lake can affect water tables and

groundwater flows and interfere with the necessary

flow of nutrients, and may induce microclimatic

changes in humidity, cloud cover, and rainfall. In

addition, if the vegetation is not cleared from the

reservoir area before flooding, rotting organic matter

releases significant amounts of C02 and methane,

two potent greenhouse gases.

Hydropower facilities, in turn, are vulnerable to

environmental degradation. Heavier than expected

siltation of reservoirs from deforested and/or degraded lands upstream can reduce the lifespan of

hydroelectric projects (see table 5-4).97 The Hirakud

reservoir in India, for example, was expected to be

productive for about 110 years, but now has an

estimated productive lifetime of 35 years.98 In Costa

Rica, excess sedimentation from soil eroded from

steep slopes planted with coffee trees over the past

20 years has caused estimated losses of $133 million

to $274 million at the Cachi hydroelectric station.99

Dams and the irrigation schemes dependent on

these dams have also contributed to increased

incidence of debilitating diseases, such as schistosomiasis. l00 Smaller hydroelectric systems and

better management may minimize some of the above

adverse consequences.

Biomass

Biomass fuels, which are critical to the rural and

poor urban sectors of developing countries (chs. 2,

3, and 4), can have a variety of environmental

impacts. These are discussed above and are closely

intertwined with deforestation, desertification, and

rural air quality. A later report from this study will

examine the environmental effects of biomass use in

detail, particularly in the context of producing clean

biomass fuels (e.g., ethanol) and using them to fuel

modern equipment.

Nuclear Energy

Nuclear energy currently makes little contribution

to the overall energy requirements of developing

countries. Seven developing countries produce uranium: South Africa, Niger, Gabon, India, Argentina,

Brazil, and Pakistan.lO1 Eight developing countries

had operating commercial reactors as of late 1989

and several more had commercial reactors under

g5R.S. P~day (cd.), Man-made Lakes and Human Health (pm- bo: University of Suriname, 1979).

wRobcrt Delfs, “wealth and Woe: The LOW StfUggle tO ~eSS~Waters,” Far Eastern Econonu”c Review, vol. 147, Mar. 15, 1990, pp. 22-23;

She@ We “In China, Dam’s Delay Spares a Valley for Now,” New York Times, Apr. 18, 1989, p. Cl.

WU.S. Congress, Ofilce of Technology Assessment, op. Cit., footnote 41, p. 43.

Wbid., p. 43.

~avid Dudenhoefer, “Forest Crisis Nears,” The Tiw Times, vol. 34, Feb. 16, 1990.

l~fited Nations Food and Agricultural Organizatio~ op. cit., foo~ote 7, p. 69.

lolunited Nations, Energy Statistics Yearbook, 1986 (New York ~: 1988).
130 ● Energy in Developing Countries

construction (ch. 4). A total of 28 developing

countries had research reactors as of late 1988.102

The conventional nuclear fuel cycle includes

uranium mining and processing, fuel fabrication,

electricity generation, and radioactive waste disposal. Each of these steps has the potential to release

varying amounts of toxic and/or radioactive materials to the environment. Releases usually take the

form of small leakages but have, on rare occasion,

also resulted in catastrophes such as Chernobyl. On

the other hand, the nuclear power option releases

little carbon dioxide or other greenhouse gases to the

atmosphere, nor does it emit much sulfur dioxide,

nitrogen oxides, or other air pollutants.103 These

tradeoffs pose difficult environmental choices.

Solar, Wind, and Other Renewable Energy

Solar energy can be used to heat water or dry

crops, or can be turned directly into electricity by

photovoltaic cells. Winds can be harnessed for

pumping water or generating electricity. Though

holding great promise for the provision of decentralized forms of energy for remote areas, as yet these

sources provide only small amounts of energy for

developing countries.

Geothermal energy, though still a very small part

of total energy supply in developing countries, is

being used in several Latin American and Asian

developing countries and in Kenya. The environmental problems associated with geothermal energy

production are highly dependent on the geochemical

characteristics of each specific site and the extent to

which good environmental practice is followed.

Potential adverse environmental impacts include the

release of gases (particularly CO2

), contamination of

local aquifers by saline (and sometimes toxic)

geothermal fluids into groundwater, subsidence of

land overlying wells from which geothermal fluids

have been extracted, and the generation of hightemperature liquid effluents containing metals and

dissolved solids. With existing economically proven

technologies and good management, however, these

potentially adverse impacts can be kept under

control.

Greenhouse Gases

Climate Change

and Global

The environmental impacts described above are

largely limited to the individual countries concerned. Some activities-notably, the combustion of

fossil fuels and deforestation-can have a wider

impact, including impacts on the global climate. An

international panel of scientific experts of the Intergovernmental Panel on Climate Change (IPCC)104

recently concluded that: “emissions resulting from

human activities are substantially increasing the

atmospheric concentrations of the greenhouse gases:

carbon dioxide, methane, chlorofluorocarbons (CFCs)

and nitrous oxide. These increases will enhance the

natural greenhouse effect, resulting, on average, in

an additional warming of the Earth’s surface. ’’105

Under the IPCC “Business as Usual” scenario,

emissions of carbon dioxide are projected to grow

from approximately 7 billion metric tonnes of carbon in 1985 to 11-15 billion metric tomes in

2025.106 Methane emissions are projected to increase from 300 million metric tonnes in 1985 to 500

million metric tonnes by 2025. Based on current

models and with these trends in greenhouse gas

emissions continuing, scientists predict that global

mean temperature will increase at a rate of about 0.3

‘C per decade during the next century, a rate higher

than that seen over the past 10,000 years.l07

lo~orld Resources Institute, World ResoWces 1990-1991 (New York, NY: Oxford University Press, 1990). Installed capacities ~~dq~te

indicators by themselves, as capacity factors for nuclear, thermal, and hydroelectric plants vary considerably. Installed capacities and capacity factors

can be found in World Ba~ “Summary Data Sheets of 1987 Power and Commercial Energy Statistics for 100 Developing Countries,” Industry and

Energy Department Working Paper Energy Series No. 23, March 1990.

IosSome -bon dioxide may be released during *g, trampo~ or other operations by fossil-fueled equipment and some maybe released in

fabricating the construction materials-particularly cement.

104~e ~te%ove-e~~ Panel on Cltite -eWC) is ~ fitemtio~ ~ force -ted by tie World Meteorological Organization ~d the

United Nations Environment Program. Initiated in 1987, this body focuses on analyziug current information available on climate change issues and

devising strategies to address climate change.

los~~rgovernmen~ Panel on Climate Change, ‘‘Policymakers’ S~of the Scientific Assessment of Climate Change: Report to WCC From

Working Group I,” June 1990, p. i.

l~~tergovernmen~ Pmel on climate Change, Working Group III (Response StIlitCgiM WOIk.iIlg tiup), “policyma.kers’s~ of tie

Formulation of Response Strategies: Report Prepared for WCC,” June 1990, p. iii.

loTIpcc Working Group I, op. cit., footnote 105, p. ii.
Chapter 5--Energy and the Environment in Developing Countries . 131

More than half of the warming has been attributed

to carbon dioxide. Atmospheric concentrations of

carbon dioxide have increased by about 25 percent

since preindustrial times. This rise is largely due to

carbon dioxide emissions from the burning of fossil

fuels and from deforestation.

In 1985, according to estimates for the IPCC

Working Group III, developing countries contributed about one-quarter (26 percent) of annual global

energy sector CO2 emissions; 108 three-fourths came

from the industrialized market countries and the

centrally planned European countries (including the

U.S.S.R.). By 2025, with expanding populations and

rapidly increasing energy use, developing countries

are projected to produce roughly 44 percent of global

energy sector CO2 emissions.

While the CO2 emissions from the energy sector

are fairly well known, there are large uncertainties

about the contribution of emissions from deforestation and other land use changes. This makes it

difficult to calculate with confidence the developing

country share of both total annual and cumulative

emissions for CO2 and other gases. Estimates of the

CO2 emissions from tropical deforestation differ by

a factor of four.109 By various estimates, deforestation could be the source of between roughly 7 to 35

percent of total annual CO2 emissions. Developing

countries are also responsible for at least half of the

global anthropogenic generation of two other important greenhouse gases, methane and nitrogen oxides.

In addition to increases in mean global temperature, other effects expected to occur with global

warming would include increases in sea level110 and

shifts in regional temperature, wind, rainfall, and

storm patterns. These, in turn, would submerge some

low-lying coastal areas and wetlands, threaten buildings and other structures in these areas, and increase

the salinity of coastal aquifers and estuaries. Such

changes could disrupt human communities and

aquatic and terrestrial ecosystems and affect food

production and water availability.lll A number of

developing countries may be especially vulnerable

to these effects.112 No one, however, can yet predict

the timing, severity, or extent of the potential

impacts with certainty.

The IPCC scientists also noted that climate

models suggest that controlling emissions can slow

global warming, perhaps from 0.3 to 0.1 ‘C per

decade. Emission control strategies that countries

could consider today include improved energy

efficiency and cleaner energy sources-strategies

that may also have economic benefits. The expansion of forested areas, improved livestock waste

management, altered use and formulation of fertilizers, and improved management of landfills and

wastewater treatment might also reduce or offset

emissions.

Achieving meaningful reductions in emissions

will require unprecedented levels of international

cooperation and must include developing countries.

In addition to the technological challenges for the

energy, agriculture, and industrial sectors, governments of the industrial and developing countries face

challenges in improving and expanding institutional

mechanisms for technology transfer to developing

countries for providing vital energy services while

limiting emissions. These issues are discussed in the

forthcoming OTA report Changing By Degrees:

Steps To Reduce Greenhouse Gases.

Government Policies

Responses to the deteriorating quality of the

environment in developing countries show a mixed

picture. On the one hand, progress is being made in

setting up the government apparatus of environmental control, and concern and activity at the

108I’PCC wor~g &oup III, op. ci~, footnote 106, p. 10, table 2.

WIPcc, ‘‘Policymaker’s summary of the Formulation of Response Strategies: Report Repared for IPCC by Working Group III,” June 1990, p. 5.

Estimates of COZ emissions from deforestation and land use changes (including wood fuel) were 0.6 to 2.5 PtC in 1980 according to a report prepared

for the IPCC Working Group 1. “Scientilc Assessment of Climate Change: Peer Reviewed Assessment for WG1 Plenary Meeting, May 1990,” Apr.

30, 1990, p. 1-9. More recent evidence from selected countries would indicate deforestation rates now are higher than they were in 1980. Estimates of

C02 emissions in 1987 were 5.7 +0.5 PtC from fossil fuel burning and total emissions were of 7 +1.1 PtC.

ll~e IPCC wor~g ~OUp pr~ct~ an avemge rate of global mean sea level rise of about 6 cm per decade over the next century, 20 cm by 2030,

and 65 cm by the end of the century with significant regional variations. This increase is prirnarily due to thermal expansion of the oceans and melting

of some land ice.

11 lrntergovernmenM Panel on Clhnate Change, ‘Policymakers’ summary of the Potential Impacts of Climate Change: Report from Working Group

II to the IPCC,” May 1990, p. 8.

112J.D. Milliman et rd., “Environmental and Economic Implications of Rising Sea Level and Subsiding Deltas: The Nile and Bengal Examples,”

AMBIO, vol. 18, 1989, pp. 340-345.
132 ● Energy in Developing Countries

grassroots level is rising rapidly. On the other hand,

implementation of environmental policies is frequently difficult to achieve, and progress is sometimes impeded by unintended environmental impacts of other policies.

The past two decades have seen considerable

environmental policymaking activity in the developing world, including the establishment of national

environmental agencies and organizations113 and the

adoption of laws and practices designed to prevent

environmental pollution and degradation or to protect unique natural environments and wildlife. All in

all, more than 100 developing countries now have

governmental bodies whose responsibilities include

environmental protection. 114 However, only a limited

number of countries115 have established independent

environmental agencies in their central governments. Most have increased their environmental

oversight capabilities by creating or expanding

sections or offices within environment-related government departments such as agriculture, energy,

fisheries, forestry, irrigation, natural resources, or

tourism.

The larger developing nations with traditions of

extensive government policymaking and implementation and a relatively advanced domestic research

base have formulated and adopted a variety of

environmental protection laws and standards, including the requirement of environmental impact

statements for large projects. Developing countries

with detailed nationwide air and water quality

standards or with regulations specifying the levels of

permissible pesticide residues in food are still,

however, in the minority. Those that do have such

regulations have usually based their legislation on

the standards in force in the industrialized nations;

consequently, their specifications-at least on paper

—are usually as strict as and sometimes even stricter

than, those of the industrial countries, although

implementation may lag.116

Some developing countries have shown a significant commitment to protecting the environment.

China’s most polluted coal-burning cities have mean

sulfur dioxide levels between 100 and 300 ug/m3,

about the same as in British cities prior to the

introduction of Britain’s Clean Air Act in the early

1950’s. China, with levels of income much lower

than the United Kingdom in the early 1950’s, has

already begun to respond to the problem by introducing cleaner urban fuels and outfitting coal-fired

plants with effective particulate controls117.

Environmental concerns in developing countries

have not been limited to domestic issues. Developing countries have also participated in international

environmental protection treaties. Most of the developing countries belong to the World Heritage,

Endangered Species, and Law of the Sea conventions. Nine developing countries, including Mexico,

Egypt, Morocco, and Venezuela, have already

signed the Montreal protocol for protection of the

ozone layer.

Many developing countries have also experienced

an increase in grassroots environmentalism in addition to this official activity. In Ecuador, Colombia,

Guatemala, and Brazil movements organized by

citizen groups have led to the banning of toxic

pesticides and the initiation of major urban cleanups. 118 Indigenous nongovernmental organizations

(NGOs) have increasingly involved themselves in

environmentally oriented efforts. More than 600

Brazilian and Indonesian NGOs currently are working on environmental issues, as are several thousand

groups in India.119

113JefieyH.~~dandDavid Moreu, “EmergenceofEnvironrnen~ ConcerninDeveloping Countries: Apolitical Perspective,” StanfordJournul

of International Luw, Issue 2, Summex 1981.

l14B~~J. ~~che, world B- “Environment and Natural Resources Management Institutions in Developing Countries,’ Mckground paper,

draft, Oct. 10, 1989.

llsBermu@ BW~ FZMO, Gaboq Ind~Keny~ Omaq Papua New Guin% SenegiQ Singapore, Trinidad and Tobago, Venenek and *.

116The ~ew&ily avaage s~d~d for ~ient~~fioxide is stricter ixI each of the thr~ c~~s(m-~llut~SE@ lllb~ residential

locations, and industrial districts) tban the U.S. values; maximum nitrogen oxide levels permissible in residential areas are equivalent to the Japanese

standara and the maximum carbon monoxide levels allowed at any time am much lower than the l-hour averages in West Germany or the United States.

T.A. Siddiqi and C.X. Zhang, “Ambient Air Quality Standard in Ch@” Environmental A4anugentent, vol. 8, 1984, pp. 473A79.

117Vaclav S@ “Environment in Developing COurltries, ” contractor report prepared for the GffIce of Technology Assessment June 1990.

118WorldR~o~c=~ti~~, “DevelopmentandP ollution in the Third Worl&’ paper prepared for the ‘1’bkyo Conference on the Global Mvironment

and Human Response, Sept. 11-14, 1989, July 1989, p. 33.

ll~id.
Chapter 5--Energy and the Environment in Developing Countries ● 133

Despite these achievements, major problems remain. A fundamental constraint on environmental

policymaking in all but a handful of developing

countries is the absence of systematic, integrated

data on the current state of environmental pollution

and degradation. While there is sometimes a great

deal of site-specific information connected with

particular projects, virtually all the developing

countries lack spatially representative networks for

monitoring land, water, and air quality or accurately

measuring the rates of deforestation or changes in

agricultural land and soil quality. China and India,

however, have accumulated a fairly extensive information base through the combined activities of

various government departments and universitybased researchers.

The implementation and monitoring of environmental policies and standards are also difficult. In

most countries, the budgets of the environmental

agencies are a small fraction of their minimum

needs, and staffing is inadequate. Enforcement is

often lax; prosecutions are often costly, uncertain,

and slow; and the punishments actually meted out

may be inadequate deterrents.120

Environmental protection is also sometimes impeded-in both developing and industrialized countries-by government policies intended to promote

economic growth, generate employment, service

foreign debts, or meet other important national

needs. In Brazil, for example, a variety of government policies have encouraged rapid development—

and thus rapid deforestation-of the Amazon. These

include tax exemptions, tax credits, subsidies of

rural credit, and land acquisition laws (squatter

rights).121 These inducements have inadvertently encouraged a number of activities that would not be

economical in the absence of direct or indirect

government supports. For example, the implicit

government subsidy for ranching alone during the

period 1975 to 1986 has been estimated by the

World Bank at more than $1 billion.122The Brazilian

government has recently begun to reverse many of

these policies as awareness of their costs and

environmental impacts has grown.

Similarly, commercial logging has also been

encouraged by many governments through low

royalties and fees, reduced export taxes, and other

tax breaks for timber companies and other domestic

wood products industries.123

Tax credits, investment subsidies, and other fiscal

supports may be necessary and justified to encourage needed development, and such policies are

widely used in developing and industrialized countries. The value of depletable natural resources and

the costs of environmental degradation, however,

are often not properly accounted for by these

financial instruments. For this reason, many economists advocate policies that more accurately include

these costs than has sometimes been done in the past.

With proper valuation of the natural resources,

environmental impacts, and other costs and benefits,

such investments might be made more wisely.124

Government policies in some industrialized nations may also inadvertently affect the environment

in developing countries. In 1988, the European

Community, the United States, and Japan provided

subsidies to their agricultural sectors totaling $97.5

billion, $67.2 billion, and $57.8 billion respectively—

a total of $222.5 billion.125 This is nearly one-third of

Izocritiques of government enforcement of environmenttd laws in developing countries can be found in: R. Abmmsz and L. @tolano, 1987,

Environmental impact assessment in the Philippines: 1977-1985. Environmental Impact Assessment Review, vol. 7, pp. 293-310. C.M. Abraham and

A. Rosencranz, 1986, “AnEvaluationof Pollution Control I@slationinIndi~” CoZumbia Journal ofEnvironmentaZ L.uw, vol. 11,1986, pp. 101-1 18;

H. Hae~ “Conservation in Indonesia,” AMBIO, vol. 17, 1988, pp. 218-222; A.D. Johns, Economic Development and Wildlife Conservation in

Brazilian Amazonia,” AMBIO, vol. 17, 1988, pp. 302-306; J. May&, “Environmental Legislation in Developing Countries: Some Param eters and

Constraints,” Ecology Law Quarterly, vol. 12, 1985, pp. 997-1 (Y24; K. Ramalms“ hna, “The Emergence of Environmental Law in the Developing

Countries, a Case Study of India,” Eco20gy LawJ Quarterly, vol. 12, 1985, pp. 907-935; A.S. Tolentino, “hgislative Response to Marine Threats in

the ASEAN Subregio&”AMBIO, vol. 17, 1988, pp. 238-242.

lzl~e ~overment mspended provisions tit~de C1 earing for ranches profitable and penalized owners of unimproved lands, but ranches are still

attractive as a speculative hedge against inflation. See U.S. Congress, Gfflce of Technology Assessmen4 op. cit., footnote 14; Climate Institute, “Climate

News Around the Globe,’ CZimateAZert, vol. 2, No. 3, Fall 1989, p. 8; S.B. Hechg “The Sacred Cow in the GnxmHell: Livestock and Forest Conversion

in the BrazilianAmazon,” The Ecologist, vol. 19, No. 6, November/December 1989, pp. 229-234.

122~ p. BinswaWer, World B~, “Fis~~ and ~g~ ~centives with EnvirOnmen~ Effects On the B@fi hMZO~” A@cdhd ~dRd

Development Department, Operational Policy Staff, May 1987; N. Myers, Deforestation Rates in Tropical Forests and Their Climatic Implications

(London: Friends of the Earth Limited, 1989).

123Robert Repetto, ‘‘Deforestation in the Tropics,’ Scient#ic American, vol. 262, No. 4, April 1990, pp. 36-42.

12’lRobertRepetto et~., WastingAssets:NaturalResources in theNationalIncomeAccounts (WaSh@tO~ DC: World Resources Institute, J~e 1989).

lzssfiw Auerbach, “Statement Aimed at Farm Subsidies hnpaSSe, “ Washington Post, July 12, 1990, p. A9.
134 ● Energy in Developing Countries

the GDP of the 2.8 billion people who live in

low-income developing countries, and it is comparable to the GDP of their entire agricultural sector.126

Some of these subsidies may tend to hold agricultural prices down in developing countries as well as

limiting their export opportunities.127 If this occurs

and reduces developing countries’ earnings for their

agricultural output, they may have less incentive and

ability to invest in agricultural research and development or infrastructure to achieve higher yields and

quality. As noted above, low agricultural productiveties (together with inequitable land tenure, etc.)

contribute to the expansion of croplands into ecologically fragile areas. Similarly, import tariffs to

protect domestic timber industries in industrial

countries may encourage inefficient harvesting in

tropical forests because the full market value of the

resources cannot be obtained.128

However well-intentioned, the development policies of bilateral development agencies and multilateral development banks have also sometimes directly contributed to environmental degradation due

to their emphasis on large projects--transportation infrastructures, hydroelectric facilities, and

industrial complexes. 129 Development agencies are,

however, becoming more sensitive to these environmental concerns.130 The role of development agencies in promoting the adoption of more environmentally sound energy technologies will be examined in

a later report of this OTA study.

126worldB@ wor~DeYeJop~~fRepo~ ~$lggI (w~~toq ~: 1989), indicator~bles 1 ~d q.Note ~t~s does not include the 1 billion people

in middle-income developing countries who had a 1987 GDP of nearly $2 trillion.

127Vmnon 0. Roningen and ~ven M. D~t,Econo~”c I@ications ofAgriculturalpolicy R~o~s in Indusrn”al Market Econo~”es (wdlhlgtt)~

DC: U.S. Department of Agriculture, Economic Research Service, 1989).

128u.s. Conmess, Office of Technology Assessment Op. cit., footnote 14.

12~.s. Covess, ~lce of Tmhnology Assessmen4 op. cit., f~~ote 14; Bmce M. Rich “The M~ti~ter~ Development Ban.ks, Environmental

Policy, and the United States,” Ecology Law Quarterly, vol. 12, No. 4, 1985; P. Aufderheideand B. RiclL “EnvironmentalR eform and the Multinational

Banks,” World Policy Journal, Spring 1988, pp. 301-321; W. Reid, “Sustainable Development: Lessons From Success,” Environment, vol. 31, No.

4, May 1989, pp. 7-35,

130See, fore-pie, WorldBa~ ‘{ AReviewof the Tr~~entofEnvironmenW As~ts of B@ Enmgy projects,” ~d~~ and Energy Department

Working Paper, Energy Series Paper No. 24, March 1990.
Appendix A

Glossary of Energy Units
Appendix A

Glossary of Energy Units

British thermal unit (Btu)--The basic unit of energy in

the English system of units. The energy required to

heat 1 pound of water 1 oF. One Btu is about the

energy given off by burning a single match tip.

Hectare (ha)-An area of land measuring 10,000 square

meters or equivalently 100 meters by 100 meters.

One hectare is equal to about 2.5 acres.

Joule (J)--A basic unit of energy in the metric system. A

joule of energy is very small (a single match tip

gives off about 1,000 joules), so joules are often

multiplied by orders often (10, 100, 1,000, etc.) to

yield useful units:

Name Value Abbreviation Equivalent

kilojoule thousand ( 1 0

3

) joules kJ 0.95 Btu

megajoule million (106) joules MJ

gigajoule billion (109) joules GJ

terajoule 1 0

12 joules TJ

petajoule 1 0

15 joules PJ

exajoule 1 0

18 joules EJ 0.95 quads

Total energy production and consumption for a country is

typically given in exajoules; per capita energy consumption is

typically given in gigajoules (1 GJ is equivalent to the energy in

about 7.5 gallons of gasoline).

Kilogram (kg)--The basic unit of weight in the metric

system, equal to 2.2 pounds.

Kilowatt (kW)--The power (energy per unit time) unit in

which electricity is measured.

Kilowatthour (kWh)--The energy unit in which electricity is measured. A 100-watt light bulb burning

for 10 hours consumes 100 W X 10 hours= 1,000

Wh = 1 kWh of energy.

Meter (m)--The basic unit of length in the metric system,

equal to 39.4 inches.

Quad—1015 Btus. The United States currently consumes

about 80 quads (80X 1015 Btus) of energy per year.

1 Quad is equal to about 1.05 exajoules (EJ).

Tonne (t)--Short for metric tonne, equal to 1,000

kilograms or about 2,200 pounds.

–137–