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DOCUMENTS "COM"
COM(80)96
Vol.1980/0032

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(80)96 final
Brussels-7thMarch1980
REPORTFROMTHECOMMISSION TOTHECOUNCIL
ENERGYCOOPERATION WITHDEVELOPING COUNTRIES
ANDTHEROLEOFTHECOMMUNITY
y--."
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C0M(80)96final

SUMMARY
Energy cooperation with developing countries and
therole oftheCommunity
This communication isaresponse totheCouncil 'sinvitation of30October
1978 concerning :
–thepresentation ofaworld wide survey ofongoing activities in
energy cooperation
–thepresentation ofdifferent Community aidmeasures inenergy
–theexamination ofthequestion ofwhether ornotother Community actions
might beuseful
Afirst response wastransmitted bytheCommission inMarch 1979^* The
present communi cation provides amore complete survey oftheaction under­
taken allovertheworld .^/
The Commission intends toputforward tothe Council afurther communication
inwhich theconcept ofitscooperation policy ,inparticular with respect
totheLom£ IIconvention ,will bepresented .
1/"First actions ofcooperation with certain developing countries in'the
field ofenergy "C0M(79)155 final of21March 1979 and"List of
activities undertaken atinternational level andbytheMember States "
SEC(79)522 of23March 1979 .
2/Statistics onthis convention andafirst setofshort notes concerning
theenergy situation of6developing countries (Nigeria ,Rwanda ,Tunisia
Turkey ,Pakistan ,Ecuador ,Mexico )will besubmitted separately asa
Commission staff paper *

ENERGYCOOPERATION WITHDEVELOPING COUNTRIES AND
THEROLEOPTHECOMMUNITY
1.International cooperation intheenergyfield
Giventheimportanceoftheproblemandtheeverywhereextremelylimited
resourcesavailableforitssolutionthereisaneedforinternationally
coordinatedaction.Howevertherearesomanypublicandprivateorganisations
andbodiesinvolvedthatcomprehensive coordination isextremelytime–consuming
anddifficultandmayevendomoreharmthangoodasfarasefficientaction
isconcerned.
Basicallythen,theCommissionhasrestricteditselftoestablishing technical
contactsinmattersofenergycooperation withanumberofmajorinternational
organisations (UnitedNations,WorldBank,OECD/lEA,OPEC(Secretariat)).
WiththeECanditsMemberStates,theseorganisations andcountriesprovide
officialdevelopmentaidintheenergyfieldamountingtosome2,300million
EUAin1979,whichrepresentssome85$oftheofficialaid(grantsandloans)
spentonenergycooperation .
Information abouttheremainingaidespeciallyabouttheArabfunds'activities
willbetransmitted later.
million EUA
1979 1980
WorldBank
EC(bilateralandCommunity)
USA
OPECSpecialFund
Japan
UNDP1,5&51,639
503 703
180 47
45
14
355
15
14
2,3102,473
OtherStates(S.Arabia,Kuwait,
GulfEmirates,Canada,Australia,
Scandinavian countries) I400I500

Themajor part ofthetotal amount of2,300 million EUAallocated in1979
toenergy cooperation concerns loans (1,800 million EUAor78%)whilst
grants amount only to500million EUAor22%.Theforecasts for1980
underline this situation (84%versus 16%). With regard toloans ,the
World Bank takes aleading position with 1,565 million EUA .Asfaras
forecasts areconcerned ,theECanditsMember States arethemajor donors
with 300million EUAor60%oftotal amount .
Ananalysis "byenergy sectors shows clearly apreference for the
electricity sector :1,833 million EUAoralmost 80%:
Hydrocarbons andcoal account only forsome 10%and8%respectively of1979
aid.Theshare oftherenewable sources ,2%,isvery low.For1980 abetter
equilibrium maybeobtained }theshare ofelectricity drops to64%infavour
ofthe3other sectors ,climbing to16%foroil/gas,15%forcoal and3%for
renewables .
Theamount ofthetechnical assistance actions intraining ,R&D ,energy -
programming , studies andsending outexperts ,represents intotal only
1%ofthe1979 aid :20million EUA .Forecasts for1980 ,however ,areshowingmillion EUA
Electricity
Oil/gas
Coal
Renewable sources
Training ,studies ,conferences
etc .1979 1980
1,833 1,576
221 404
188382
46 71
22 40
a100% increase–' . ,
1/Forfurther figures theCommission 'sstaff paper ,Chapter I,tables
1and 2.

2.Activities oftheUnited Nations
Activities inthefield ,ofenergy cooperation arefinanced bytheUnited
Nations mainly through theDevelopment Program (UNDP :Grants fortechnical
assistance )andtheWorld Bank (loans forcapital projects ).^-/
(a)UNDevelopment Program (UNDP )
UptonowtheUNDP hashadonly modest funds available forthis field
(approximately ^5million in1979 for35projects ).For1980 ,however ,
these resources areto "bestepped upto^20million (forapproximately 56
projects ).Theplanned useofthese resources isasfollows :
1979 1980
'000 i $ »000 %
Energy programming
Energy saving
Electricity
Fossil fuels (oilandcoal )
Renewable sources (solar ,geothermal ,etc)
4,780 100 19,790 100
Thedominant feature ofUNDP technical assistance in1979 isthepromotion of
conventional energy production projects (electricity ,coal andoil,which
account foralmost half theresources .Most oftheoperations involve the
provision ofexperts fortheexploration ofenergy resources ,management training ,
and thesetting upoftraining centres .
In1980 theUNintends toconcentrate farmore onpromoting theproduction
ofrenewable energy supplies (geothermal ,solar andwind )with theresult
that its1979 share of2},%will increase to36$.Asaresult ofthepromotion
ofanumber offairly large oilandcoal projects (inIndia ,Turkey ,Malta
andelsewhere )theproportion ofaidgoing tofossil fuels isalso increasing
considerably ;over three-quarters ofthetechnical assistance will nowbespent
Seealso thespecific comments made bytheCommission initslist of
theactivities undertaken atinternational level andbytheMember
States (SEC(79)522 of23March 1979)•Other detailed figures aregiven
intheCommission 'sgtaff paper ,Chap .I,tables 3and4«1,160 24 2,05010
250 5 210 1
1,350 29 2,590 13
910 19 7,910 40
1,110 23 7,030 36

-4-
onenergy production (including hydroelectric power )compared with alittle
over half in1979 *Twofairly large technical assistance projects scheduled
for1980–involving mineral oilexploration inAlbania (ff1.5million )and
Malta 1.8million )–areofparticular significance .
Aninteresting feature oftheUNDP aid isthefinancing ofenergy programming
projects (Energy Resources Surveys andPlanning ).TheUNhasfinanced seven
operations inthis field in1979 (inBolivia ,Central America ,Jamaica ,Kenya ,
Peru ,Thailand andUganda ).Depending onthewishes ofthedeveloping countries
inquestion ,these operations involve resource evaluation ,energy "balances ,or
energy programming ,which combines theother two .In1979 approximately
1million wasspent onthese operations ,which essentially involve thesending
ofanumber ofexperts foraperiod ofseveral months .For 1980 anincrease to
$2million isscheduled .
•Theoperations intheother twofields referred to(electricity generation and
transmission andenergy saving )arealso based onthesending ofexperts .One
noteworthy point isthat only limited resources aredevoted toenergy saving
(5$ofresources in1979 and 1$in1980). . . . ,
Theregional distribution ofUNDP resources for 1979 isvery well balanced :
Asia andLatin America each take approximately 30$andAfrica and (southern )
Europe each approximately 20$.In1980 ,"thebalance istilting towards Asia
(almost 60$).Thesouthern European countries (Turkey ,Albania ,Romania ,
Bulgaria ,Cyprus ,Malta andYugoslavia )maintain their share at20$,while
Africa andLatin America fall tosome 10$each .
(b)TheWorld Bank
TheWorld Bank nowplays adecisive role inthefinancing ofenergy projects
inthedeveloping countries .Although inpast years itsactivity wasalmost
exclusively concerned with thefinancing ofelectricity projects (approximately
$1,100 million in1978),ithassince last year turned itsattention toall
fields ,with greatly increased resources .Theturning-point wastheWorld
Bank decision ofJuly 1977 toincrease itsactivities intheenergy field and
subsequently intheoilsector aswell .

-5-
!
In1979(thesecondhalfoffiscalyear1979andthefirsthalfoffiscalyear
1980)theWorldBankprovidedsome^2,200millionfor30projects-exclusively
intheformofloans(thisincludestheIDA,thoughtherearedifferencesin
theinterestratescharged).Heretoo,thelion'ssharewenttotheelectricity
sector(77$)•Evenso,loansamountingto$28$millionand$185millionwere
madeavailabletotheoil/gasandcoalsectorsrespectively.In1980thereis
toheafurthermarkedincreaseinactivityintheoil/gasandcoalsectors,
withexpectedspendingof{^538millionand^270millionrespectively ,while
theamountgoingtotheelectricitysectorwilldeclineto^1,476million.
Theproportionoffinancinggoingtotheoil/gassector-23$stillin1980-
isexpectedbytheWorldBanktoincreasetonearly40$fortheperiod1979-83
asawhole.
5^million
1979 1980
Sector
Electricity 1,6831,476
Oil/gas 283538
Coal.. 185 270
Newsourcesofenergy '40 10
Intheelectricitysectorthebreakdownofloansisasfollows:40$forhydro­
electricprojects,23$forthermalpowerstationsand35$fortransmission and
distribution projects.
Intheoilandgassector,theWorldBankisparticularly keentosupportpro­
duction,earmarkingforthispurpose68$ofitsloanstothissector.Ofthe
remainder,explorationandtestdrillingsaccountfor30$andpreliminarygeophysical
workfor2$.
IntheloansallocatedtothecoalsectortheBankalsoconcentrates onproduction
projects(97$)•withonly3$goingtoengineeringprojects.

–6–
TheWorld Bank also recognises theimportance ofdeveloping traditional fuels
(i.e. outside thecommercial energy market ),such aswood ,dung ,etc.,andnew
energy sources (solar ,etc.).However ,because oftheslight commercial interest
ofanyprojects inthis field ,itisunable toallocate more than avery modest
level ofloans toit.
Thesituation issimilar with regard tomeasures inthefield oftechnical
assistance (notconnected with capital projects ).Here theBank isactive
only inafewexceptional cases (e.g. study ontheoildevelopment possibilities
in70countries ,commissioned from theBureau d*Etudes industrielles etde
cooperation del'Institut Frangais duP^trole ).
Anexamination ofWorld Bank activities from theregional viewpoint reveals a
concentration inLatin America (32$in1979»36$in1980 )andinAsia (55$and
31$).Only 12and23$oftheBank ,sloan activities areconcerned with Africa ,
thefigures forsouthern Europe being 1$and10$.
3.United States
Theenergy cooperation policy pursued bytheUnited States has anumber of
features contrasting toUNandECaidpractices
Theproportion oftechnical assistance isrelatively high (55$in1980 ,the
figure for 1979 being appreciably lower because oftwoexceptional power plant
projects for100million ^f);financial assistance islimited toafewfairly
large projects (in1979 seven projects costing ^231.0 million ,in1980 one
project costing ^11.0million )intheelectricity sector andforthedevelopment
ofalternative energy sources ;theregional spread among thedeveloping countries
isvery even anditisnoteworthy that Latin America does notreceive anymore aid
1/than Africa .–7
1/Forfurther figures seeCommission staff paper ,Chapter I,tables 5and6.

-7-
gmillion
1212 1980
Financial assistance 231.0 29.9
Electricity 231.0 11.2
New energy sources 10.4
Notspecified 8.3
Astriking feature here isthemarked decline ininvestment aid .This reflects
thedesire oftheUSGovernment toattach less importance toelectrification in
thefuture .Theresources earmarked for this purpose arefalling from 231
million in1979 to^11million in1980 .Admittedly ,theresource allocation
fornewenergy sources isbeing increased toft10million hutthenetresult is
adecline ininvestment aidofalmost $200million ,leaving total American aid
in1980 atonly$66million .
There ishowever anincrease intechnical assistance from$21million toft36
million .This isconcentrated above allinthemore important areas such as
thedevelopment ofalternative energy sources andenergy technology andinenergy
planning andpolicy andtraining :over 80$ofthetechnical assistance will goto
these four keyareas . '
/
&million
1979 1980
Technical assistance
Training 1.5 3.6
Energy policy andplanning 3.3 7.3
Development ofenergy technology 8.0 8.6
Development ofalternative4.6 10.9energy sources
Development ofother energy sources 1.0 0.4
Other measures 3.0 5.2
21.4 36.0
Training intheenergy field covers mainly energy management andtraining in
thetechnologies involved inalternative energy sources (inter alia through
courses attheUniversity ofFlorida ).

-8-
Inthefield ofenergy policy andprogramming financing isprovided for :
theholding ofworkshops ,
thepreparation ofalternative supply strategies ,
resource management anddevelopment ,
country assessments with regard toenergy demand andsupply .
TheAmerican administration hastwoinstruments available forthecountry
assessment operations .
(i)thetraditional instrument ofsending outsmall teams oftwoorthree
advisers forafewmonths inorder togather together theavailable
data onenergy demand andsupply ;generally speaking ,this work
concentrates ononeortwoparticularly relevant areas ofdemand and/or
resource development ;anassessment ofthis type (forJamaica orthe
Dominican Republic ,forexample ,costs between ^30,000 and^200,000 );
(ii)afarmore complex instrument ,which analyses allsectors ofdemand
systematically ,evaluates allresources andafter acomparison ofboth
results puts forward supply alternatives .Anassessment ofthis type
iscarried outbyteams ofaround twenty experts working forsixto
twelve months onthespot with ifpossible thesame number oflocal
experts .Itcosts around ^700,000 .
Inthefields ofenergy technology andalternative energy sources US-AID mainly
finances studies onbio-resources ,decentralised micro-hydroelectric power plants ,
photovoltaic technologies ,lowcost technology foragriculture andprovides experts
inthese fields for theadministrations andinstitutes indeveloping countries .
4.Japan
Japan 'scooperation intheenergy field hasarather different structures

-9-
1
(i)inthetechnical assistance field ,thecooperation isdiversified
regionally (Asia ,Latin America ,Africa ,andEurope (Turkey ))andby
sectors (training ,exploration ofenergy sources ,development ofnew
energy sources );
(ii)inthefield offinancial assistance ,cooperation isheavily concentrated
inAsiaandontheconstruction ofpower stations ^-/.
Inthefield oftechnical assistance Japanese aidextends totheprovision of
experts toexploit newenergy sources (geothermal power station inGuatemala ,
ocean heat forESCAP )andfortheexploration andopening upofdeposits (Chile ,
Philippines ,Indonesia ).Training covers essentially theorganisation ofstudy .
courses ongeothermal energy inJapan (fifteen trainees in1979 from fourteen
countries inallparts oftheworld ),andgrants fortraining ingeothermal energy
exploration andevaluation attheJapanese geological institute .
Thescale oftheresources devoted byJapan totechnical assistance isestimated
atsome^0.3million ayear inboth 1979and1980 .
In1979 ,financial assistance wasconcerned solely with theconstruction ofpower
stations (hydroelectric andthermal ).Thetennewprojects in1979 areall
located inAsia andarebeing financed bytheJapanese Government with loans
totalling fi19.6 million .
5.Theactivities oftheOPEC Special Fond
TheOPEC countries provide aconsiderable amount ofcapital forcooperation
with developing countries –including theenergy field -both onabilateral
basis andviaArab development funds .Themain providers offunds areSaudi
Arabia ,Kuwait andtheUnited Arab Emirates ,which account fornearly 9®f°of
thenetflow ofOPEC ODA,theremaining 10%also isprovided bytheOPEC
Special Fund .
TheOPEC Special Fund provides loans (inpractic *atazero interest rate )above
allforcountries experiencing particular balance ofpayments difficulties .Its
activities areconcentrated inAsia (76%)butitalso supplies funds toAfrica
(18%)andLatin America (Central America 6%)^
1/Forfigures seeCommission staff paper ,Chapter I,table 7«
2/Detailed figures ,seeCommission staff paper ,Chapter I,tables 8and9.

-10-
This money ismainly used forthefinancing ofelectricity generating
projects ,inparticular hydroelectric power (40$)andcoal (27$).Thermal
power stations "based onoilandgashave hitherto received little promotion
(6$).Other projects ,such asoilandnatural gasexploration have hitherto
taken 8foofthetotal .
Financial assistance 1979 3million
Electricity generation 50.6
ofwhich :
Hydroelectric power 23.6
Thermal 27.0
Electricity transmission 8.5
59.1
Technical assistance
Offshore prospecting 2.0
Energy programming 1.5
3.5
In1979 "theOPEC Special Fund again concentrated onpromoting theelectricity
sectors thetenprojects receiving investment aidwere concerned with the
construction ofhydroelectric power stations inAsia ,Central America and
Africa (40$),acoal-fired power station inIndia (46$)andaproject for
electricity transmission inBangladesh (14$).
Inthetechnical assistance field theFund isfinancing aregional project
for offshore prospecting ineastern Asia and thegreater part oftheenergy
programme forCentral America ,"both ofthese operations "being implemented in
cooperation with theUNDP .
Alist oftheprojects to "befinanced bytheOPEC Special Fund in1980 isnot
yetavailable ,butastheenergy sector isoneofthetwopriority areas of
operation ofthis Fund ,itmaybeassumed that projects will bebacked atleast
onthesame scale asin1979 -assuming that appropriate financing requests are
presented bythedeveloping countries .

-11-
There arealready signs ofincreased activity inthefield oftechnical
cooperation .Forexample ,theOPEC Special Fund isearmarking several
million dollars forthefinancing ofOLADE (Latin American Energy Organisation )
projects .
6.Community andMember States
In1979 "theCommunity and itsMember States accorded thedeveloping countries
aidtothetune ofsome 500million EUAforenergy cooperation .Insodoing ,
with ashare ofjust under 20%oftotal world aidinthis field ,Europe was
thesecond biggest donor after theWorld Bank .
This aidisinfact forecast toexceed 700million EUAin1980 -upbyno
less than 40%on1979»This isdueabove alltothegrowth ofaidfrom
theCommunity assuch ,which will rise from 100million EUA tonearly 190
million EUA.-^ -
There isalso*"likely tobeasharp rise -ofover 100million EUA–inbilateral
aid ,butitdoes notappear asspectacular when expressed asapercentage
since thestarting figure of400million EUA (1979 )isconsiderably higher .
The most important reasons for these increases are theexpected boosts to
begiven toEIBactivities asregards Community aid-/(morethan80million ,
EUA )andtooperations bytheFederal Republic ofGermany inthebilateral
aidcontext rising from just under 200million EUA toover 320million
EUA). ;
TheCommunity and itsMember States give about half itsaidintheform of
grants (60%in1979 »45%in1980 ).They aretheonly donor which hasabroad
spectrum offinancing methods (grants ,loans onspecial terms ,loans on
near-market terms ).TheWorld Bank ,theOPEC Special Fund andJapan accord
virtually alltheir aidintheform ofloans ,whereas theUNDP and .theUS
administration accord only grants forthemost part .Generally speaking ,loans
areemployed only asinvestment assistance anyway ,andeven then only if
warranted bytheeconomic situation inthedeveloping country andthereturn
ontheproposed scheme .
2/Fordetailed figures seeCommission 'sstaff paper ,Chapter I,tables 10-16 .
_/tshould "benotedthatthefifthEDFresources (under Lom6It),flowing
in1980 ,arenotincluded .

-12-
Anexamination oftheenergy sectors that have received aidshows that
electricity production has clearly benefited themost :this sector received
82$,or410million EUA ,in1979® Europe 'scontribution here wasabove
theworld average of80$.Inrelative terms thedonors that arekeenest on
this sector areJapan (100$),theOPEC Special Fund (93$),theUSA (92$)and'
theWorld Bank (77$),which accorded 1,200 million EUAforelectricity
production in1979 *This preferential position canchiefly beattributed
tothevery high costs ofhydroelectric power stations ,andtotheneed for
rapid electrification toserve industry andurban areas growing up.
In1980 theCommunity anditsMember States *aidtotheelectricity sector
will drop back to64$byvalues some 446million EUA ,ofwhich 15million
EUA for technical assistance and 431million EUA for financial assistance .
Itisnoteworthy that there isgreat interest inthepromotion ofrenewable
energy sources (excluding hydro power ):in1980 theamount earmarked forthis
purpose intheCommunity isatleast 40million EUA ascompared with 11million
EUA theyear before .USaid ,too ,will grow from 3million EUAto17million
EUAandtheUNDP allocation will gofrom 1million EUAto5million EUA .Hence ,
activities inthis field will expand from aworld figure ofjust under 50
\
million EUA (1979 )"toover 70million EUA.
(a)Technical assistance oftheCommunity anditsMember States
Thestructure oftheCommunity 'saidresources deployed orprojected for1979
and1980inthefield oftechnical assistance israther unbalanced .-^/
million EUA
Ν
Community ' Bilateral
19791980 1979 1980
Electricity 0.2 2.1 20.3 13.2
Oil/gas 0.2 1.5 2.8
Coal 2.4
Renewable energy sources 0.5 0.7 0.3 13.2
R&D 6.4 14.6
Trainmg 1.4 0.3 0.3 0.4
Other technical
assistance 0.6 0.2 0.2 0.4
Energy programming 0.1 2.1
3.0 5.4 ' 29.0 47.0
l/Detailed figures ,seeCommission 'sstaff paper ,Chapter I,tables 10-16 .

-13-
Theaboveremarksabout"thespecialencouragement Toeinggiventotheelectricity
sectoralsoapplyhere.Itisparticularly trueof"bilateralaid.Whatis
particularly noticeablehere,too,isthattheCommunityisdoingpractically .
nothingtopromoteactivityinthefieldoffossilfuels.Evenbilateralaid
hereisverymeagre(5$in1979t1in1980),butthesituationlooksasthough
itwillstraightenoutin1980.
HowevertheMemberStates(andmainlytheGermantechnicalassistance)are
particularly bentonsteppingupactivitiesinthefieldofrenewableenergy
sources.Thesameappliestotechnicalassistanceforresearchanddevelopment ..
Communityaidfortrainingisfairlyconsiderable (especiallyin1979because
ofalarge-scale (1millionEUA)projectbenefitingJordan).However,there
aresomegapsintheinformationsuppliedbycertainMemberStatesinthis
particularfield,withtheresultthattheactualfigurescouldbehigherthan
theCommission'sratherconservative estimates.
Therehavenotbeenanyenergyprogramming (establishment ofbalancesand
forecastsofsectoralenergydemandandsupply)projectsasyetintheEEC-
*
withtheexceptionofoneGermanprojectinColombia.Thisfieldisofspecial
significance ,however,becauseofthekeyroleitcanplayinpromotingtheuse
andrationalmanagementoflocalenergyresourcesindevelopingcountries,and
inachievingindustrialdevelopment andeconomicgrowth.
Themainorganisations andcountriesgivingaidtoresourcedevelopment –
namelytheWorldBank,theUNDP,theOPECSpecialFundandtheUSAID–
agreeonthis.
Onelastnoteworthymeasureinthesphereoftechnicalassistance-which
(alsohappenstolinkupcloselywiththeparticularsubjectinhand,energy
programming-istheorganisation ofseminarsandconferences .In1979"the

-14-
Commission organised andfinanced alarge international conference
(inVarese )ontheuseofsolar energy indeveloping countries .In
sodoing itmade acontribution tointernational discussion onthe
subject andprovided considerable food forthought andpoints of
departure forfurther work inthis area .
Aregional overview oftheCommunity and itsMember States *technical
assistance reveals that itisnot concentrated onthe associated States
andtheAfrican continent .About half theassistance does gotothese
countries (1.5million EUAin1979 and3.3million EUAin1980),but
since bilateral aid isactive mainly inAsia and istentimes thevolume
ofCommunity assistance ,itisAsia which benefits themost .
Technical assistance
Africa
Asia
Latin America
All developing
countries (regional )and
global1212
8.8
17.0
4.5
1.7
32.0million EUA
ofwhich EC 1980
1.5 12.7
18.8
0.1 16.5
1.4
3.04.4
52.4ofwhich EC
3.3
0.1
2.0
5-4
The scale ofthe financial aids inLatin America issimilar tothatm
Africa because ofMember States *aids .There were noCommunity or
Member States *financed schemes inEuropean developing countries in1979 »
andnone areplanned for1980 either .
Community technical assistance projects financed in1979 orplanned for
1980 comprise 38schemes inthefollowing fields :
million EUA
1979
0.2
1.3Hydroelectricity
Thermal power stations
Electricity distribution
Newenergy sources (esp.geothermal
energy inEthiopia ,andsolar energy )5*0
Technical assistance fortraining ,
seminaries ,energy programming 2.11980
3.4
2.0
0.4
1.3
2.6

(b)FinancialassistanceoftheCommunityanditsMemberStates
Financialassistancein1979and1980isagainchieflyforelectricity :
ECand
MemberStatesEU
1979198019791280
Electricity 390431 94108
Oil/gas 159
Coal 56184 72
Newenergysources 1027 53
471651 99182
In1979theelectricitysharewas83%»butaccordingtotheestimatesit
shouldfallto66foin1980.CertainMemberStates(inparticularGermany),
andtheCommissiontoo,willbeprovidingmoresupportin1980forprojects
inthecoalsector.Thepercentageofaidgoingtonewenergysourceswill
probablybedoubled.Thefollowingbreakdownofoverallinvestmentaid(in
millionEUA)byregionalsoshowsthatthelargestamountgoestoAsia.This
isexplainedbyasmallnumberoflarge–scaleelectricityprojectsbeing
carriedoutbyGermanaidinBangladesh,Indonesia,ThailandandPakistan,and
UKaidtoPakistan,India,MalaysiaandBangladesh,whichtogetheraccountfor
two–thirdsofthetotal.
1979ofwhichEC1980ofwhichEC
Africa 14118 17929
Asia 163- 216
\
LatinAmerica 45- 56-
Europe 12281 200153
47199 651182
Thescaleof(mainlybilateral)aidgoingtotheMediterranean areasof
Europeisalsohuge:twomajorGermanprojectsandoneUKproject(in
Portugal,TurkeyandCyprus)accountbetweenthemfor77millionEUA,
including48millionEUAforaligniteproject.

-16–
In1979 "theEIBfinanced ,three projects inMediterranean Europe ,allin
theelectricity sector ,atatotal cost of74million EUA .
AidtoLatin America ,ontheother hand ,isstill relatively low ,accounting
forabout 10$oftotal financial assistance .Itdoes notlook asthough
thegeographical distribution will "bemuch different in1980 .
Atthemoment there islittle point inundertaking amore detailed analysis
ofprojects inthevarious sectors ,since some Member States have only
provided some global information andothers have submitted only incomplete
orimprecise figures .Commission staff therefore have been estimating sectoral
breakdowns based onavailable data from those Member States which have supplied
figures .Full cooperation with theMember States isclearly desirable inthis
field toenable theCommission tomake acomparative analysis ,asitwas
instructed todobytheCouncil on30October 1978 *
I
Thetenfinancial assistance projects financed bytheCommunity in1979
concerned :
million EUA
Hydroelectric power generation
Thermal power stations
Electricity transmission
New energy sources
(geothermal energy 4»1million EUA ;
solar energy 1.2million EUA )
* \
Four projects worth atotal of93million EUAwere financed byloans from the
EIB .
For1980 theEIBcould increase energy activities (possibly involving up
to175million EUA).Grants under thefourth EDFwill beupfrom 6.3
million EUA to7»1million EUA .They will continue tobeused mainly for
projects intheelectricity sector .55.3
8.1
32.0
5.3

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7.Conclusions
Theabove preliminary investigation ofinternational energy cooperation ,
which together accounts for2,300 million EUAorabout 85%oftotal world
ODAinthis sector ,calls foranumber ofcomments andconclusion .
(a)Thetotal amount ofmoney finding itswaytothedeveloping countries
in1979 and1980 isconsiderable :2,300 million EUAand2,500 million
EUArespectively .This corresponds to10%oftheworld total for
official development assistance .(TheCommunity ,wiiii abilateral and
multilateral contribution of500million EUAand700million EUA ,
comes insecond place after theWorld Bank ,with 1,600 million EUA).
Itisimpossible tosaydefinitely whether thetotal sum isenough to
meet theurgent needs ofthedeveloping countries ortoprevent a
further deterioration intheir energy supply position ,andinmany
cases their economic position aswell ;notenough isknown about the
structure andextent oftheir foreseeable energy needs ,ortheresources
available tomeet them .
(b)Theaidpattern intheenergy sector isuneven :
i.electricity accounted in1979 for80% (inthecase ofECand
Member States *aidtheproportion iseven higher :82%),and
in1980 will still take 64% (ECandMember States :64%);
ii.coal andoil/gas,ontheother hand ,arereceiving respectively
only 10%,this figure will increase however to15%in1980$
iii .although thepercentage ofaidgoing torenewable energy sources
hasrisen byhalf from 2%to3%j i"tisstill very small ;
iv.even less isbeing done inthefield oftechnical assistance
forhorizontal operations (R&D ,training ,energy programming ),
which receives only 1%ofthetotal world assistance .

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(c)Loans account for78%of "totalOMin1979 and84%in1980 .
(d)Clearly information issubstantially lacking concerning :
i.ananalysis oftheworld aidintheenergy sector ;
ii.adetailed ,comparative study oftheMember States bilateral
operations ;
iii .thefuture scale andstructure ofthedeveloping countries *energy
requirements andthescope forsupplying these needs ,mainly by
theutilisation oflocal resources andtheavailability ofstaff .
(e)TheCommission will continue itsefforts inanalysing theaidgiven
bymain donors andbyallMember States inorder tofill this
information gap .
(f)TheCommission will also carry out,in1980 ,attherequest ofinterested
countries energy programming tohelp fill thegaps concerning theavail­
ability ofenergy balances ,theforecasts ofdemand andsupply and ,finally ,
thechoice ofanenergy supply strategy adapted tothedeveloping countries *
real needs .
(g)TheCommission thus replies totheCouncil 'sinvitation of30October 1978
concerning "complementary Community action where itmight beuseful ". By
itsactivity inenergy programming ,theCommunity will follow two
objectives :
–acontribution toworld wide activities inquantifying medium and
long term energy demand andsupply ,anactivity which ought to
develop inthepresent context ofglobal orregional negotiations ;
–aconcrete reply tothedeveloping countries *requests formeans
ofevaluating energy projects tobefinanced byECorother sources .