The two defining challenges of our generation are to overcome global poverty and to manage the risks of climate change. They must be tackled together; if we fail on one, we will fail on the other.
Nowhere is this more obvious than in terms of access to energy in developing countries, with an estimated 1.3 billion people currently without electricity. But we now have the technologies to provide clean and affordable energy for everyone.
In recognition of this, the United Nations Secretary-General, Ban Ki-moon in 2011 launched his Sustainable Energy for All initiative, which seeks to achieve by 2030 universal access to modern energy services, to double the global rate of improvement in energy efficiency, and to double the share of renewable energy in the global energy mix by 2030.
The International Energy Agency estimates that universal access to modern energy can be realised for about US$48 billion a year, less than 0.1% of global GDP. There is no excuse for failing to provide the resources, whether they be public or private. However, it will be the power of the example that will drive progress, as India has shown.
More than 400 million Indians lack access to modern forms of energy; the country has launched one of the largest decentralised, off-grid renewable energy programmes in the world.
The Jawaharlal Nehru National Solar Mission includes the following objectives: by 2022 building 2000 megawatts of solar energy capacity for millions of people who are not linked to the power grid; and deploy 20 million solar lighting systems for rural areas.
This Mission seeks to ensure that people with no access currently to light and power move directly to solar energy, leap-frogging a pathway for economic development that is dependent on fossil fuels. It will also empower them to manage their own affairs by providing them with electricity which is largely under their control, thus avoiding the travails of a very unreliable grid system, often administered corruptly via the threat of disconnect.
The aim of transforming the lives of poor people in India through access to solar energy is being led not just by the national government, but also by private companies and communities.
A powerful example of what can be achieved is provided by SELCO, founded in 1995, which uses solar photovoltaic technology to provide electricity for lighting, water pumping, communications, computing, entertainment and small business appliances.
The company works with financial institutions to find innovative ways for poor people to obtain loans to invest in access to solar energy, and has already directly benefited more than 1.2 million customers.
SELCO has proved that with creativity and imagination; it is possible to provide affordable energy to poor people and also to run a commercial enterprise that also fulfils a social objective. The example underlines that realising change and innovation goes far beyond the technology itself – it is about entrepreneurship, management, finance, markets and the initiative of consumers themselves. We know it is possible.
Such examples have the power to drive a global social and economic transformation, and to shine a light into the lives of hundreds of millions of people across the world.
Professor of Economics and Government, Chair of the Centre for Climate Change Economics and Policy, London School of Economics, London, UK