Energy and Poverty

According to Development Initiatives, living in poverty means lacking the resources required to meet basic needs, which can be social, economic, nutritional, cultural or multidimensional. Today, the global community faces poverty at different stages, which can only be eradicated through development. However, for development to occur, one of the most important factors is access to reliable and sustainable energy. This, therefore, directly creates a link between the availability of energy and poverty.

Living in poverty holds a lot of disadvantages at the individual, societal and economic levels. With people living in poverty being vulnerable, some of these challenges include food insecurity, increased mortality and poor educational attainment. According to the International Fund for Agricultural Development (IFAD), about 600 million people still live in extreme poverty; that is, they live on less than $1.90 a day.

The main objective of Sustainable Development Goal 1 (SDG1) is to end poverty in all its forms. However, this can hardly be achieved with the global energy access deficit especially affecting rural communities. According to the World Health Organisation (WHO), over 700 million people around the world still lack access to electricity. Most of these people live in rural communities that may be too far for grid extensions, or the inhabitants of these communities do not have sources of income to pay for energy.

According to the IFAD, two out of three people living in extreme poverty reside in rural areas. This estimates a total of 400 million people, 67 per cent of the global population in extreme poverty. These statistics further imply that individuals living in these conditions barely have access to employment, healthcare services and other basic needs. However, all of these conditions can be improved on with access to energy and further concretise the link between energy and poverty.

Coupled with the fact that the global energy industry is transitioning to be more sustainable, off-grid energy solutions would effectively energise underserved and unserved areas that national grids cannot service. Today, around the world, solutions developers provide customers with flexible payment options that allow them to pay for energy conveniently. Also, developers and industry stakeholders at different levels have begun to collaborate to create productive use of energy programmes to electrify communities while also creating employment and enabling income generation.

An example of a productive use of energy programme is the Power Africa-Nigeria Power Sector Programme’s Productive Use Solar Irrigation Systems in Nigeria. Another example is the Africa Energy Programme by the Rocky Mountain Institute (RMI), which aims to enable the productive use of energy tied to local economic development.

The key to eradicating poverty in all its forms is enabling individual growth, which would ripple into economic development. However, for this to be possible, there must be access to sustainable energy for businesses, healthcare, agriculture, education and other primary industries to thrive. Therefore, the relationship between access to energy and poverty is quite significant if the global community ever plans to achieve the targets of SDG1.