IEA says higher oil prices hurt the world's poorest the most

High oil prices have made it more difficult for the world to close a persistent energy supply gap that has left more than 1.4 billion people without access to electricity and double that number dependent on burning wood and waste to cook food, an official report warns. Governments and international aid organisations would need to invest US$36 billion (Dh132.23bn) a year over the next 20 years to give everyone on the planet regular access to electricity and modern cookers, the International Energy Agency (IEA) said yesterday.

Relatively high prices for oil and gas would preclude poorer countries from relying on fossil fuels, creating incentives for the development of renewable energy sources including so-called "off-grid" sources such as gas from landfills, the IEA said. "For net oil-importing developing countries in particular, rising and volatile prices have amplified the challenge of expanding energy access and put an extra burden on fiscal budgets," said the IEA, a Paris-based group of industrialised oil-importing countries. "In a high energy price and climate-conscious world, it makes sense for governments ? to choose a course consistent with long-term sustainable development goals, rather than choose the energy technologies and mix used in [industrialised] countries in the 1950s and 1960s."

Among oil-exporting countries, including poorer members of OPEC such as Nigeria, Angola and Ecuador, continued energy subsidies tend to flow to wealthier members of the society and have not always succeeded in providing low-cost energy to the poor. The $252bn spent this year on subsidy programmes for products including petrol and kerosene in developing countries has often benefited richer members of society and encouraged wasteful consumption patterns, the IEA said.

The agency noted that "the cost of providing electricity and LPG [liquefied petroleum gas] stoves and canisters to those households without access in the 10 largest oil and gas-exporting countries in Sub-Saharan Africa would be roughly equivalent to only 0.4 per cent of the governments' cumulative take from hydrocarbon exports through 2030". @Email:[e-mail]