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Strategic Objective

Promote Energy Security, Access to Clean Energy, and the Transition to a Cleaner Global Economy

Strategic Objective

Promote Energy Security, Access to Clean Energy, and the Transition to a Cleaner Global Economy

Lead Office: Under Secretary for Economic Growth, Energy and the Environment (State) and Africa Bureau (USAID)

Themes:

Energy International Affairs

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Overview
Progress Update

Overview

The geopolitics of energy is being transformed, as traditional energy producers address the steeply rising demand from the developing world. Changes in production patterns, such as the Western Hemisphere becoming a larger fossil fuel producer, are altering the global dynamic. The viability of new energy technologies, such as new ways to produce natural gas, and the steep fall in the cost of renewables, are changing energy market trade and consumption patterns.

At the same time, worldwide nearly 1.3 billion people lack access to electricity and 2.7 billion do not have a

At the same time, worldwide nearly 1.3 billion people lack access to electricity and 2.7 billion do not have a safe way to cook food. Although Africa has abundant renewable and hydrocarbon potential, 69 percent of people in sub-Saharan Africa lack access to electricity. According to the International Energy Agency (IEA), global demand for electricity will grow 70 percent by 2035, faster than any other final form of energy. Over 80 percent of this global growth will be in non- OECD countries, with China and India accounting for half.

State and USAID are committed to working with our global partners to establish commercially viable energy sectors that can attract investment to expand access to energy, increase the use of clean energy and energy-efficient technologies, and ensure responsible, transparent, and effective stewardship of energy resources. Global access to reliable, affordable energy is vital to our economic, environment, foreign policy, and development priorities. The Department of State and USAID join together our diplomatic and programmatic efforts to build sustainable, transparent, and predictable international energy markets that advance U.S. national interests, our environmental goals, and a strong global economy.

Our prosperity and that of our international allies and partners depend on global markets for traded energy commodities such as oil and natural gas. While we must protect our energy security today, we must also foster international cooperation toward a global clean energy and energy-efficient future.

Engaging developing nations, which will be the largest contributors to growth in global energy demand in coming decades, is essential to successful energy and climate diplomacy. Expanding access to modern, affordable sustainable energy can be a win-win solution for the climate, the global economy, and development. It can curb greenhouse gas emissions, improve air quality, spur economic growth, and lower energy costs, while attracting private investment to emerging economies to improve national and regional power networks. Strengthening energy sector governance, transparency, and accountability supports economic growth, improves democratic prospects, reduces the potential for resource-fueled conflict, and helps U.S. businesses compete and operate in resource-rich states.

An estimated $17 trillion is needed through 2035 to meet global electricity demand, according to the IEA. Renewables are expected to account for two-thirds of new investment in generation capacity. Transformative technologies and the integration of renewable energy will not only diversify global energy supplies and be critical to meeting the world’s growing demand for electricity, but also offer U.S. manufacturers expansive commercial opportunities. Investment opportunities in global power markets are enormous. We are working to ensure that American companies are well-positioned for these new markets, especially in the fast growing emerging economies. We will continue to work for stable and transparent policy and regulatory frameworks to enable investments in national and regional markets. These markets offer economies of scale for U.S. exports in energy efficient, alternative, and renewable energy technologies.

The main external factor that could affect our work is whether the private sector can make the needed investments in energy infrastructure. This depends to a large extent on governments putting in place a sound energy sector regulatory framework and investment climate, but it also depends on market conditions and the capital that companies can commit. On the diplomatic side, if countries decide not to engage with international energy organizations, it could complicate efforts to strengthen those organizations.

Strategies for Achieving the Objective

To promote energy security, access to clean energy, and mitigate climate change by accelerating the transition to a cleaner global economy, State and USAID will support increased energy efficiency, better energy sector governance, improved energy access, stronger national and regional energy markets, and more public and private financing.

To make energy systems more efficient, commercially viable, and cleaner, State and USAID will support programs that enhance utility performance, reduce technical and commercial losses, and improve air quality. State and USAID will also support energy sector restructuring, increasing the global rate of energy efficiency, and expanding the contribution of renewable energy. This will require improved energy sector planning, including institutional capacity building, technical assistance and integrated resource planning. It will also require expanded collaborations and public-private partnerships with other countries in science, technology, and innovation in clean energy. This work further includes policy and regulatory enhancement and reform efforts to strengthen the investment climate for clean energy projects. State and USAID will also be responsive to changes in natural gas markets in order to increase global availability of this bridge fuel.

Gaining access to energy can transform lives, State and USAID will seek to increase access to reliable, affordable energy services for underserved rural and urban populations across the world. This will require accelerating development and scaling-up appropriate business and financing models for energy access. It also means supporting cross-sectoral development priorities, such as health, agriculture, and education.

State and USAID will also promote improved energy sector governance on the national level and internationally through the International Energy Agency (IEA), the Extractive Industries Transparency Initiative (EITI), and the International Renewable Energy Agency (IRENA).

Strengthening national and regional energy markets is another key step toward reaching this objective. State and USAID will contribute by advancing Presidential initiatives in Asia, the Americas, and Africa to deploy clean energy and expand cross-border trade in electricity. One initiative is Power Africa, which aims to double access to power in sub-Saharan Africa, initially focusing on six countries – Ethiopia, Ghana, Kenya, Liberia, Nigeria, and Tanzania. We will also encourage international financial institutions and private sector companies to invest in power sector investments in sub-Saharan Africa. This requires mobilization of public and private sector finance. State and USAID will push for transparent and streamlined processes for due diligence, tendering, and procurement to accelerate power projects to reach financial close. State and USAID will also work for enhanced access to credit and risk mitigation.

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Progress Update

The Department of State and USAID have made significant progress in their efforts to promote energy security and the transition to a more climate friendly clean global economy in the past year. For example, research shows that the Asia-Pacific region and emerging market countries now drive world energy demand growth. Therefore, State and USAID are focused on reshaping institutions to reflect today’s energy realities and to ensure U.S. and global energy security, which includes working to sustainably alleviate energy poverty.

State and USAID are also working to update the Global Energy Governance Architecture through its partnership with the IEA, IRENA and EITI.

Recognizing that the level of funding needed to electrify the continent far outstrips what any government or donor can do, the Power Africa initiative supports an innovative, transaction-focused model, in partnership with governments and private sector companies. This initiative focuses on removing the barriers to successful power projects and promoting better governance of the growing power sector throughout sub-Saharan Africa. Power Africa strives to increase regional, cross-border energy trading, while also working with partner countries and regions of Africa to meet critical energy needs and achieve energy security. At the same time it promotes sustainable development and improving lives across the continent. By the end of FY 2014 Power Africa has assisted in bringing an additional 4,229 megawatts (MW) of energy to financial closure, including 3,667 MWs gained through privatization of Nigeria power assets.

The Department of State’s Partnership on Women’s Entrepreneurship in Renewables is addressing energy poverty in East Africa and India by working across sectors to empower more than 8,000 women clean energy entrepreneurs.

USAID’s Regional Clean Energy Initiative for Central America is a five-year, $10 million project to increase public and private investment in renewable energy. It does so by improving the enabling environment and institutional capacity, while also supporting enhanced energy efficiency in the region. Project managers are working to encourage U.S. investor participation in the transformation of Central America’s energy markets.

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Strategic Goals

Strategic Goal:

Promote the Transition to a Low-Emission, Climate-Resilient World while Expanding Global Access to Sustainable Energy

Statement:

Promote the Transition to a Low-Emission, Climate-Resilient World while Expanding Global Access to Sustainable Energy

Strategic Objectives

Building on Strong Domestic Action, Lead International Actions to Combat Climate Change

Statement:No Data Available

Description:

Addressing climate change successfully demands action at home and more intensive engagement with other countries. Domestically, by 2020, the United States plans to meet its commitment to cut greenhouse gas emissions in the range of 17 percent below 2005 levels.

Internationally, as a result of recent progress in negotiations under the UN Framework Convention on Climate Change (UNFCCC), the international climate regime now reflects pledges through 2020 by more than 80 countries constituting about 80 percent of global emissions, including the world’s major emitters, and holds countries accountable for their actions through regular and robust reporting and reviews. In December 2015, the 195 countries party to the UNFCCC are to conclude a new agreement addressing the global climate response in the post-2020 era. This will be a major milestone in the effort to combat climate change over the next two decades. Simultaneously, we will enhance engagement bilaterally, plurilaterally, and multilaterally to deliver results that will contribute to an ambitious and effective global response to climate change, through 2020 and beyond.

External factors that could affect our efforts include negotiating stances of other countries and domestic actions some countries take to combat climate change. The private sector plays a major role, as investment decisions such as the choice of technologies for new power generation and design of new cars and trucks can have a climate impact for years to come. Also, partnering with countries to encourage a low-emissions development path will be more successful when working with foreign governments that make combating climate change a priority.

Strategies for Achieving the Objective

Through the President’s Climate Action Plan, the President’s Global Climate Change Initiative, and USAID’s Climate Change and Development Strategy, the United States has made low-emissions, climate-resilient sustainable economic growth a priority in our diplomacy and development. Our efforts involve two major areas of engagement: (1) lowering the atmospheric accumulation rate of greenhouse gases that cause climate change; and (2) helping societies anticipate and incorporate plans for responding to potential climate change impacts. The United States is leading efforts to address climate change through international climate negotiations while enhancing multilateral and bilateral engagement with major economies. It is also enhancing partnerships with other key countries and regions. The U.S. is focusing its efforts on actions that support a successful global approach to climate change, as reflected in discussions leading up to the Paris climate conference in 2015, and for subsequent United Nations Framework Convention on Climate Change (UNFCCC) sessions. These efforts deliver results that contribute to an ambitious and effective global response to climate change to the year 2020 and beyond.

The U.S. is building partnerships to reduce emissions of short-lived climate pollutants and from deforestation. For example, the U.S. works to secure a global phase-down of hydro-fluoro-carbons through the Montreal Protocol. If implemented, this could reduce global greenhouse gas emissions by 90 gigatons of CO2 equivalent by 2050. The U.S. is also building capacity for countries to undertake low-emission development policies. This work includes assisting countries to increase their capacity for cross-sector planning and formulating sectoral policies for low-emissions growth. Other efforts aim to expand clean energy generation and transmission and to increase energy efficiency while phasing out inefficient fossil fuel subsidies that encourage wasteful consumption. This requires mobilizing public and private investments in cleaner energy, implementing enhanced land-use practices, and building public-private partnerships that reduce emissions from deforestation and forest degradation.

The Department of State and USAID’s climate-smart agriculture efforts involve implementing technologies that increase climate resilience and reduce greenhouse gas emissions. State and USAID are also working to promote sustainable land uses, which combine climate change mitigation and resilience with long-term growth. Additionally, State and USAID support adaptation planning processes in vulnerable countries and communities by developing support tools that use climate science and improve access to data. These integrate climate data into planning decisions. They also strengthen public participation in climate change planning, especially by women, vulnerable populations, indigenous groups, and minorities. State and USAID back actions that increase climate resilience with respect to water security, land management, disaster planning, financial risk management, and management of biodiversity and natural resources.

The United States supports bilateral and multilateral programs by working with the most vulnerable communities, least developed and developing nations, and the major greenhouse gas emitters. Among the programs and efforts to achieve their overall climate change objectives, State and USAID have chosen to highlight efforts to support Low Emission Development Strategies (LEDS) as a cross-cutting Agency Priority Goal. Through LEDS assistance, State and USAID seek to guide policy-makers in analyzing, formulating, and making policy decisions enabling them to develop along a lower emission pathway, which contributes to greenhouse gas reduction efforts. The main program for providing LEDS Assistance, the Enhancing Capacity for LEDS (EC-LEDS) program is a unique State and USAID partnership that blends their respective strengths in diplomacy and development. EC-LEDS stands as a key element of U.S. climate assistance, alongside their critical efforts including: (1) the Major Economies Forum; (2) Clean Energy Ministerial; (3) Climate and Clean Air Coalition; (4) Tropical Forest Alliance (TFA)2020; and (5) a range of multilateral funds, such as the Clean Investment Funds and funds focusing on adaptation such as the Least Developed Countries Fund and the Special Climate Change Fund.

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FY 14-15 Priority Goal: Climate Change

Statement:

Enable economic growth concurrent with significant reductions in national emissions trajectories through 2020 and the longer term by supporting the development and implementation of low emission development strategies (LEDS). By the end of 2015, U.S. bilateral assistance under LEDS will reach at least 25 countries (from the previous baseline of 22 countries) and will result in the achievement of at least 45 major individual country milestones, each reflecting a significant, measureable improvement in that country’s development or implementation of LEDS. Also by the end of 2015, at least 1,200 additional developing country government officials and practitioners (from a baseline of 0) will strengthen their LEDS capacity through participation in the LEDS Global Partnership and that capacity will be meaningfully applied to 25 countries (from a baseline of 0).

Description:

The focus of this Agency Priority Goal (APG) is to enable economic growth concurrent with significant reductions in national emissions trajectories through 2020 and the longer term by supporting the development and implementation of low emission development strategies (LEDS). Specifically, this APG measures the progress of Enhancing Capacity for Low Emission Development Strategies (EC-LEDS) and the multilateral Low Emission Development Strategies Global Partnership (LEDS GP).

Through EC-LEDS, a multiagency U.S. Government team is working with partner countries to identify and advance effective economy-wide LEDS.

The LEDS Global Partnership is a multilateral platform for enhanced coordination, information exchange, and cooperation among countries and international programs working to advance low emission climate resilient growth that the U.S. State Department founded.

Low-emission, climate-resilient sustainable economic growth is highlighted as a U.S. diplomatic and development priority in the U.S. National Security Strategy, the President’s development policy, the President’s Climate Action Plan, and the Quadrennial Diplomacy and Development Review.

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