Introduction
Sustainable energy has become a major topic on the international agenda. The United Nations (2012) initiative Sustainable Energy for All and the inclusion of energy in the post-2015 Sustainable Development Goals (SDGs) underline the increasing importance of this policy field. Providing sustainable energy to developing countries has also become a core element of a global commitment against global warming as outlined in the 2015 Paris Agreement under the United Nations Framework Convention on Climate Change (UNFCCC). With increasing climate change impacts, growing energy demand, aging infrastructure and energy security concerns linked to rising fuel prices, new and alternative models for energy paths are urgently needed. While some developing countries hope to leapfrog into the low-carbon era, others are trapped in fossil-intensive lock-ins relying on coal and oil. Although growth of renewable energy capacities and investments in recent years has been strongest in countries outside the Organisation for Economic Co-operation and Development (OECD), research related to energy transitions in developing regions is still scarce. Understanding the role of energy-related governance systems and the conditions required for a shift towards renewables in the developing world is urgently needed to tap the full potential of low-carbon energy supply around the world.
Southeast Asia is one of the most vibrant and fastest-growing developing regions in the world. Economic progress is mainly driven by fossil fuels, leading to environmental degradation, negative health impacts and a massive increase in greenhouse gas emissions. Energy transitions in Southeast Asia could significantly reduce worldwide emissions and thus effectively combat climate change. Yet, these transitions are a challenging endeavor in a region with substantial coal and oil resources and ever-increasing energy demand. Energy systems are dominated by fossil fuels, incentives for renewables are rare, and skepticism towards modern renewables is high. Above all, the political systems are anything but consolidated; changes in power structures, societal transformations and political developments are almost impossible to predict. A better understanding of the complex governance systems and power relations will thus make an important contribution to the quest for energy transitions in Southeast Asia.
Taking a multi-level governance approach combined with insights from power theory, this book illuminates how multiple jurisdictional levels affect energy transitions in Southeast Asian countries in general, and donor-driven renewable energy projects specifically. The book reveals how governance structures, power resources and capacities influence the promotion of renewables in Indonesia and the Philippines. Both countries went through a process of radical decentralization, leading to substantial local autonomy. Both archipelagos have ambitious renewable energy targets, but struggle to fully implement supportive policies. Rapid economic growth makes them increasingly relevant for global energy demand and greenhouse gas emissions.
A power-based multi-level governance approach is presented here that helps to shed light on the politics of an energy transition in a developing country context. The framework sheds light on the distribution of resources and the capacities needed to mobilize these resources within complex governance arrangements. Project developers are encouraged to use it as an assessment tool for donor-driven renewable energy activities. Most of the development projects presented here struggle to scale up results due to the complex multi-level governance frameworks in which they operate.
Linking energy to development
Renewable energy development and technology transfer play an increasingly important role in the developing world. International development programs aiming to promote sustainable energy systems have diversified over the decades – from technology-specific small-scale demonstration projects towards more and more advisory activities for supportive market structures, industrial development and regulatory frameworks. This shift towards social and political-institutional aspects underlines that renewable energy technologies are becoming market-ready and economically feasible even in non-OECD countries.
Between 1980 and 2015, donors implemented almost 12,000 projects around the world promoting renewables in the electricity sector alone (AidData 2016). These activities offered US$118 billion of international funding. Being one of the most active donors in the field, Germany’s grants, loans and technical assistance targeted at promoting access to sustainable energy amounted to EUR 1.86 billion in 2011 and to over EUR 6 billion during the period between 2004 and 2011 (BMZ, 2014, p. 9), making energy-related expenses the single largest share of Germany’s aid budget. Despite these large financial flows and a long history of donor-driven support, the relation between isolated donor interventions and more structural effects towards an energy transition remains underexplored. Better understanding the links between development cooperation and an aid-receiving country’s political system will increase the chances of triggering energy system change through international cooperation.
Southeast Asia represents an excellent region for investigating that link. Strong economic development, rapid increase in energy demand, high natural potentials for renewables and an extraordinary active donor community are just a few of the most obvious justifications, which are accompanied by the development of incentive schemes for renewables, environmental degradation due to fossil fuels, and massive climate change impacts. Donors have tried to push green and sustainable energy supply through the promotion of renewable energy projects for more than 50 years. Most activities were designed for local contexts and off-grid electrification to demonstrate the feasibility of specific renewable energy technologies. Today, bi- and multilateral donors also provide policy advice for national governments, acknowledging the multi-level complexity of the political system they are operating in. Despite long-term support from various donors and numerous projects being framed as success stories, no significant shift towards renewables in the electricity sector of Southeast Asian countries can be observed. The International Energy Agency (IEA 2013) even predicts a decreasing share of renewables in the region’s electricity mix.
Contribution of this book
In times of global ecological crises such as climate change, cooperation in efforts to achieve a sustainable future is needed more than ever before. Global collaboration, learning from other experiences, and knowledge exchange in the field of energy systems can contribute to energy transitions and thus a reduction in greenhouse gas emissions all over the world. Supporting emerging countries in reducing the use and development of fossil fuels today can prevent a lock-in into a fossil fuel-based energy system that is just being established today, but would last for decades.
Renewable energy technologies have the potential to tackle climate change and ensure an environmentally friendly energy supply without putting economic development at risk. In Southeast Asia, the share held by renewables in the energy mix is low, and in some cases even decreasing. Understanding the divide between international ambitions for renewables and the persistent domination of fossil fuels in most countries makes research in this field highly relevant. Studies about the political dimension of renewable energy development focus heavily on industrialized countries. Qualitative data from the developing world and research on the impact of cooperation between OECD and non-OECD countries on the issue of sustainable energy has been rare so far. Framing it as a major area for further research in social sciences, Sovacool (2014, p. 22) even asks whether “best practices exist for communities wishing to transition to alternative energy sources in the developing world?” This book provides answers to whether and how development assistance can deliver or promote these kinds of best practices.
Over the last six decades, development assistance has changed enormously and has experienced a variety of shifting paradigms (Rauch 2009). In terms of its effectiveness, results have been disheartening (Doucouliagos and Paldam 2009; McGillivray et al. 2006). Organizations such as the OECD (2011) and the World Bank (1999) draw a rather positive picture, but have also identified shortcomings. While no one expects development cooperation to transform societies, there is an expectation, or at least a hope, that the impact of a project will extend beyond the immediate location where it is carried out to contribute to the fulfillment of overarching (sustainable development) goals. This book contributes to broader discussions about the meaning of development cooperation, its impact on sustainable development and its future.
Going beyond mainstream paradigms in development cooperation, this book critically takes into consideration decades of failure and frustration. This reflects a time when unlimited growth and modernization are being questioned and sustainability has become the leading paradigm for both developed and developing countries. Since the term sustainability alone remains fuzzy and highly contested, new ideas and alternative concepts are needed to make international cooperation work so that it can promote broader transitions towards sustainability, not only in the energy sector. Understanding the complex multi-level governance structures in countries like the Philippines or Indonesia is a prerequisite for effective donor-driven clean energy assistance. Making that link needs to incorporate issues of power and coordination. This leads to a power-based multi-level governance approach that helps us not only to better understand energy transitions in developing countries, but also to critically investigate the effectiveness of development cooperation.
This book speaks to practitioners and an academic audience interested in energy transitions in a developing context, in the role of foreign aid in energy policy-making, and in the diffusion of policies and general conditions for renewables. Discussing the meaning of governance structures, power resources and capacities in emerging economies, this contribution aims to spark debate around ways in which sustainable energy transitions can be triggered and sustained where economic pressure for additional energy demand and the potential for leapfrogging are highest. According to the Asian Development Bank (ADB 2013), electricity demand in Southeast Asia is expected to increase by 5 percent annually between 2005 and 2030, tripling the region’s 2005 electricity generation by 2030.
Practitioners promoting renewables in developing countries can benefit from empirical insights from the Philippines and Indonesia, two archipelagos with complex governance structures and fragmented power relations that are struggling to foster the development of renewables despite supportive natural, economic and political conditions. A power-based multi-level governance framework for analyzing the link between development projects and governance structures is developed to shed light on the role of power resources, capacities and structures for energy transitions. The book critically assesses the possibility of triggering structural effects in the electricity system via development cooperation promoting renewables. Finally, promising approaches to support renewables within complex governance structures of developing countries are identified.
Taking a multi-level governance perspective
Sustainable development has become a major paradigm for development cooperation. It was in the aftermath of Our Common Future (Brundtland Report, WCED 1987) and the agreement to the Rio Declaration on Environment and Development (UNEP 1992) that sustainability became a key objective and expectation for development projects. Since then, projects, which are often small-scale, local and temporary, and dependent on external resources, have struggled to fulfill these expectations and provide sustainable impact in aid-receiving countries. Not surprisingly, development cooperation has been criticized for contributing too little to its own sustainable development agenda (Doucouliagos and Paldam 2009; Hansen and Tarp 2000; OECD 2008).
Articulating broad and ambitious goals in declarations like the SDGs, development cooperation aims to achieve structural effects or systemic change in developing countries. In contrast, most projects in the field address very site-specific problems at the local level, with limited effects on overarching, mainly national structures (Stockmann 1997). This gap explains the difficulties that small-scale donor-driven activities face in achieving upscaling, diffusion, spill-over and learning effects. This well-known “micro-macro paradox” (Mosley 1987) also represents a serious challenge for environmental development cooperation and renewable energy projects (Wilkins 2002).
Donors aim to overcome the micro-macro paradox with the help of a multi-level approach that reflects the importance of different jurisdictional levels (Neumann-Silkow 2010). In practice, these projects often fall short of addressing challenges arising from the multi-level governance systems’ complexity. This is especially important for the field of sustainable energy systems, where coordination between stakeholders at different jurisdictional levels is crucial (Ohlhorst and Tews 2013). Taking a multi-level governance perspective means acknowledging the complex political sys...
