Elsevier

World Development

Volume 39, Issue 6, June 2011, Pages 987-1001
World Development

Assessing the Role of Energy in Development and Climate Policies—Conceptual Approach and Key Indicators

https://doi.org/10.1016/j.worlddev.2010.01.002Get rights and content

Summary

The paper discusses a number of key conceptual issues related to the role of energy in development and its potential synergies and tradeoffs with climate change. The relationship between economic development and energy over time is discussed and illustrated by data from China, India and South Africa, and some other countries. It concludes that energy plays an important role as a productivity enhancing factor in economic development and in human well being. Several policy goals related to sustainable development, energy, and climate can be integrated. However, meeting all these policy goals requires a special effort and has significant cost implications.

Introduction

The aim of this paper is to assess the role of energy in economic development as a basis for exploring how climate change mitigation can be integrated in development policies. The idea is to assess energy in the context of sustainable development (SD) and to look for potential synergies and tradeoffs between energy consumption, greenhouse gas (GHG) emissions, and costs.

A key issue is here to assess energy policies that support SD objectives that take local and global climate change policy goals into consideration. Several sub-issues are addressed including:

  • The role of energy in sustainable development seen in a macroeconomic context as well at household levels.

  • The multiple impacts that arise from alternative energy sources and their relationship to various economic, social, and environmental dimensions of sustainable development.

  • The costs of including GHG emission reduction policies and other pollution control measures in energy policies.

The paper briefly introduces a conceptual framework that can be used for integrated assessments of SD, energy, and climate policy objectives. The approach is to use a number of key indicators that reflect economic, social, and environmental dimensions of sustainable development, and to use these to examine specific clean energy policies and GHG emissions.

Section snippets

Sustainable development as a framework for assessing energy and climate change policies

The sustainable development agenda is very wide and the literature includes hundreds of different definitions. It is beyond the scope of this paper to go into an assessment of the theoretical literature about sustainable development, rather the approach taken here is pragmatic and to consider how current development trends in the energy system can be made more sustainable.

The perspective taken is that climate policy goals are not a major priority area in developing countries since other

Energy issues as part of a larger sustainable development menu

Many studies of development and energy linkages assume that energy is a key component in development without a further examination of, in which way and in which configurations energy most effectively supports development. This is a limitation since investments in energy provision compete with other investments about scarce resources, and energy consumption has several externalities including local and global pollution, which negatively affects human wellbeing. Furthermore energy investments

Methodological approach and framework

The starting point for the methodological approach is that an assessment of human wellbeing aspects of energy provision can be structured around an evaluation of specific policy cases in relation to a number of focal indicators that reflect key SD dimensions. One way to organize such an analysis is to formulate a general objective function for policy evaluation that includes arguments in terms of well being indices. These, for example, can reflect areas like:

  • costs, benefits, and other general

Empirical results

Energy’s role in development and wellbeing is in the following illustrated based on selected macroeconomic and household level empirical studies.

GHG emission reduction policy scenarios

As previously concluded, development policies and related energy sector trends are not likely to make large reductions in GHG emission in countries like China, India, and South Africa despite that major reduction in GDP/energy is expected.10 This is the case because the CO2 intensity of energy consumption in these countries tends to be stable or

Conclusions

The paper assesses the role of energy in sustainable development and introduces a general conceptual discussion about energy’s role in development as a production input and as a direct component in human wellbeing. It is concluded that energy plays a large role as a factor that can enhance the productivity of other production factors, and energy is also important in relation to households’ income generation possibilities, education, health, leisure, and other areas. On this basis it is

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