UN seeks private sector perspectives for bringing electricity to off-grid communities

The Asia and the Pacific region has approximately 628 million people without access to electricity, many of those in rural areas. Responding to this need, the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) is building on innovative initiatives with the private sector through their “Pro-Poor Public-Private Partnership” (5P) project.

The 5P programme focuses on electrifying off-grid communities by developing partnership opportunities for the private sector and communities to create an energy utility, such as a mini solar grid, in the form of a joint-venture allowing the community to earn returns through their ownership share. These revenue returns can then be used for community and economic development activities. First initiated by ESCAP in Cinta Mekar, Indonesia ten years ago, the model is now being piloted in Nepal and Lao PDR.

This week more than 30 business leaders from 19 countries, joined policy makers, international organizations and donor agencies, as well as members of Lao PDR’s private sector for an international forum, “Pro-Poor Public-Private Partnership: Scaling-up off-grid rural electrification in Lao PDR,” to consider the successes of this programme and make recommendations on promoting and pushing the partnership model forward.

Led by the Global Institute for Tomorrow (GIFT) Global Leaders Programme, this comprehensive analysis of 5P within the local context has provided private sector perspectives on business, financing and policy recommendations for amplifying the model. The team redefined what the goals of rural electrification are, taking an approach in which market expansion and enterprise development through venture capital, can lead to community economic development, based on access to energy services.

These recommendations will now be considered and incorporated into the 5P framework for implementation where appropriate, specifically at the 5P project site in Nam Ngim Village, Xayabouly Province, Lao PDR.

Mr. Thongkhan Pimvilay, Director-General, Institute of Renewable Energy Promotion noted the importance of the GIFT programme in Lao PDR, particularly the amount of private sector expertise which has been lent to the conceptualization of the business model presented noted: “I trust that the recommendations of the GIFT team will be able to be integrated into the 5P approach and also the Ministry of Energy’s priorities at the national level.”

Mr. Hongpeng Liu, Chief, Energy Security and Water Resources Section, ESCAP Environment and Development Division said: “The programme’s business-oriented outlook is an important perspective to incorporate into projects, such as ESCAP’s 5P. The outcomes will enhance the innovation and sustainability of this public-private approach to off-grid electrification.”

The 5P project has been financed by the International Fund for Agricultural Development (IFAD) and the United Nation’s Development Account since 2012, as part of an effort in expanding Public-Private Partnerships in the energy sector.

The final business proposal and report from the forum will be available at: http://www.unescap.org/our-work/environment-development/energy in January 2015.