Benin Energy Situation

1.1 Energy situation

Biomass energy constitutes a major contribution to the national energy mix of Benin. Main sources are the forests in the North of the country. Wood products – particularly charcoal – are transported to the South of the country to supply the urban energy markets. Sawdust and agro-waste are other biomass energy sources of minor importance. According to the Ministry of Energy, 69% of the energy consumed in Benin is based on biomass. The major consumers are households. While in urban areas charcoal is the main fuel, the rural households predominantly use firewood. Wood is also used for artisanal food processing (e.g. fish smoking, bread baking and in restaurants). Some industries generate their electricity from agro-waste. Biomass as a fuel is still available in all parts of the country. However, in urban settings – particular in the South – it has become an expensive commodity. The Kenyan Ceramic Jiko - locally called Nansu - is the major improved charcoal burning stove available in the country. According to a study implemented in the first EnDev phase, 23% of the households in the three major cities in the South have at least one improved stove (out of usually 2 stoves usually used parallel in the homes).

Key problems of the energy sector

The key problem of the biomass energy sector in Benin is the unsustainable use of the forest resources. This problem has a supply and a demand side. On the supply side, it is first of all not very clear how much forest is left. Studies (FAO, CENATEL) indicated that the area of forest is decreasing every year. There is a loss of about 116.000 ha of forest per year (situation of 2006). However, a new study is currently undertaking under the supervision of the Ministry of Energy to generate an up to date picture of the situation and this study will be the baseline of EnDev 2 for impact analysing on forests. The exploitation of the forest is at large not planned or controlled. This is the result of a lack of capacity in the national authority responsible for this task. On the demand side, due to low purchase power and cooking habits of larger parts of the population, it is impossible to use other fuels than Biomass-energy. Indeed, according to a study of the Ministry of Energy (2003), 88% of rural population and 85% in urban population use firewood for cooking purpose and 13% of rural population and 36% of urban population uses charcoal for cooking purposes (study made on a national level). The current system of biomass energy-use creates increasingly difficulties for urban and rural households because of rising wood fuel prices. In some areas, cooking and grinding has become one of the biggest items on the list of household expenditures. The government is planning projects on alternative energies to biomass-energy but no concrete actions have been undertaken today. The main ―modern energy‖ alternative for cooking is LPG. However, this is expensive and there are already by now shortages in the supply.

1.2. Policy framework, laws and regulations

The Poverty Reduction Strategy is the key document of the Benin development strategy. The final version of April 2007 was updated and the provisional version of June 2009 is available. In both versions it is mentioned that the ―promotion of rational utilization of Energy in all sectors of activities and/or the ―promotion of […] systems to save wood-energy as elements of a sustainable and equilibrated development of the national territory. The provisional version of June 2009 talks about the ―rational management of the biomass-energy and the energies of substitutions. The Energy Policy and Strategy of Benin was formulated under the supervision of the Ministry of Energy in 2003. According to this document, the overall goals of Benin energy policy are:

• Improve the situation of the commercial balance through the reduction of the energy bill and the improvement of the competitiveness of enterprises producing goods and services,
• Better control of energy and of the national energetic system through a better valorisation of natural resources and a reduction of negative impacts of energy activities on environment,
• Utilization of energy in rural areas for production and a slowing-down of rural exodus to cities,
• A better spatial and technical coherence in investments in energy sector in communal, departmental, national and if possible in over-national plans.

Within the above mentioned ―Energy policy and strategy in Benin‖, there are two specific quotes related to Biomass Energy: ―…the introduction of improved cooking stove in rural and urban areas is marginal in our country. The programs of promotion of improved stoves have not succeeded to increase rapidly the penetration of this kind of stoves. This statement was made before the start of EnDev 1 (end of 2005). ―…the policy of the Benin government in the sector of biomass-energy is to improve the efficiency of the consumption of wood-energy at household level and in the sector of artisanal production by a policy to favouring the access to improved cooking stoves (page 44). The national directorate of forests and of natural resources is mandated with the control of the forest exploitation. However, the current tax policy does not allow for a substantial control of the wood exploitation as the commercial value of wood remains low. Also the laws are not enforced by the state servants. Some actions are planned with Directorate of Forests and Natural Resources together with Directorate of Energy:

• Revision of legislation and forestry rules in the taxation in order to favour planed exploitation of natural resources combined with reforestation,
• Creation of wood-energy markets,
• Organization of the commercial chain in wood-energy.

Based on the above it can be shown, that the promotion of improved cook stoves is fully in line with the energy policy targets and strategy of the Ministry of Energy.1.3. Institutional set up in the energy sector, activities of other donors

Governmental institutions

The Ministry of Energy will be the direct partner of the EnDev Programme. The project will share information with that Ministry and will establish a memorandum of partnership with that Ministry. Under the Ministry of Energy is the General Directorate of Energy. It is responsible for:

• Energy policy,
• Elaboration and follow up of documents concerning the sector,
• Follow the national poverty reduction strategy linked with energy issues,
• Coordination and implementation of energy projects,
• Monitoring of quality control.

The EnDev programme will closely work with this directorate. Another important player in the field of biomass-energy is the Ministry of Environment. This Ministry intervenes in: Environmental policy;

• Policy for conservation of natural resources, Elaboration and follow documents on environment,
• Monitor national poverty reduction strategy with a focus on greening,
• Control and Monitoring of environment issues.

EnDev programme will search for synergies with this Ministry and share information. The Ministry of Environment has officers on the ground able to work with EnDev (schema already in place under EnDev 1). The Ministry of Agriculture is an important player in rural areas. It has a good extension system on the ground and a history of promoting ―rural development. As the Ministry of Energy does not always have extension officers in the project implementation area, the EnDev programme seeks collaboration with the Ministry of Agriculture for the implementation of rural stove promotion.

Private sector (enterprises)

Major private companies take an important role for the production and provision of electricity and petroleum products. However, they do not have a role (yet) for the promotion of a sustainable wood fuel market. The private business actors in the field of biomass energy are rather small (e.g. charcoal producers, stove producers and vendors). In the context of this proposal they are rather to be considered as beneficiaries or target groups of programme activities than being a partner to the programme.

Activities of other donors, activities of NGOs

The only other major donor active in the promotion of improved cook stoves in Benin is the World Bank through Ministry of Energy. They are promoting the Kenya Ceramic Jiko – ―Nansu – under the PFSE programme (Programme de fourniture de services énergétiques) in South of the country. Their target is the sale of 20,000 stoves until June 2010. Their objective is to create a credit line with an institution of micro finance to enable the selling of theses stove. However, at the present date, they haven‘t started their activities. There is also a programme of the Ministry of Environment (programme PANA) that has an improved stove component. However, this programme is still in the reflexion level. There are a few small initiatives of other donors and NGOs concerning improved cook stoves in the South of the country. However, their efforts are very small both in number of stoves as well as geographical outreach.

Short explanation to what degree EnDev activities

will be coordinated with other donor activities In the Northwest of Benin, there will be no coordination as there are so far no other donors activities in the field of improved stoves. However, activities will be coordinated to a certain extent with activities of the GTZ Programme for Conservation and Management of Natura Resources (ProCGRN) as this programme intervenes in the agricultural sector and some people transform agricultural products using improved ―institutional stoves. The ProCGRN however does not finance to any extent the activities concerning the improved stoves. In the urban areas of the South, it is important to consider the current interventions of the PFSE World Bank funded programme. As the implementation area is overlapping, it will have a big impact on the baseline situation analysis as well as on the market situation in which the EnDev promoted product will be entering. As the World Bank funded Programme is implemented through the direct partner of the EnDev Programme, there will be exchange of information, synergy of actions and harmonizing of strategies.

Short explanation to which degree EnDev will be in line with capacity development needs of the partner

According to the official document on the ―Energy policy and strategy in Benin elaborated in December 2003 under the supervision of the Ministry of Energy, the directorate of Energy needs capacity development in the following fields:

• financial facilities,
• Trainings in the following fields:
  • Processing and organization of information in the energy sector,
  • Financial and economic analysis,
  • Analysis of risks in the energy sector,
  • Strategic sector management,
  • Development of programmes and operational planning,
  • Energy and environment.

The EnDev activities in the field of improved cook stoves will cover the needed capacity development in the Biomass energy sector through:

• a. Involvement of MoE in the execution of all studies,
• b. Involvement of MoE staff in the implementation of training activities,
• c. Support MoE staff participation in selected international conferences related to Biomass Energy issues,
• d. Joint planning of the EnDev programme activities in Benin.

1.4. Other major activities in the country financed by BMZ or DGIS

The Benin-German development cooperation is focussing on three focal areas:

• a. Program of decentralization and municipal development (PDDC) that also promotes connecting rural settlements and municipalities to the national power grid. This Programme is supported by DGIS;
• b. Program to integrated water resource management and drinking water supply in urban and rural areas (PEP);
• c. Program of conservation and sustainable management of natural resources (ProCGRN).

Benin is part of the regional Public Private Partnership ―Cotton made in Africa‖. The objective is that an alliance of major retail businesses regularly buys ‗Cotton made in Africa‘, that African cotton producers practice sustainable cultivation methods and that Cotton growers turn in a greater profit thanks to higher demand and improved productivity. The BMZ also finances a project in Macroeconomic advising on poverty. The objective is that the project‘s partner ministries are successful in formulating, implementing and monitoring the national poverty reduction strategy. They initiate reforms in the management of public finances and harmonise the various development projects in accordance with the Paris Declaration on Aid Effectiveness (2005). The Netherlands are among the most important technical and financial partners of Benin. In 2001 Benin was added to the 19 + 3 list of partner countries. The bilateral development programme has been under construction since then and seeks to harmonise with the PRSP. The following organisations are also active in Benin: SNV, whose programmes have been running there for the past 30 years, IUCN Netherlands, Agriterra, the National Federation of Christian Trade Unions‘ World Solidarity Programme (CNV/AKO), Plan International, ICCO, VNG and the Netherlands Management Cooperation Programme (PUM). Benin is an active partner to the Netherlands in promoting policy coherence on cotton subsidies. The embassy of the Netherlands focuses on four main fields:

• Water and sanitation,
• Education,
• Governance,
• Improvement of business climate.

The embassy of the Kingdom of the Netherlands is promoting the development of the private sector through different programmes for stimulating the world of business. There is collaboration with the harbour, activities to promote good governance and also some project to help enterprises in a direct manner. There is the PSOM that favours the investments of Dutch enterprise together with a local partner in a developing country. In Benin there is for example a Cashew factory. There is also the PUM with advices from senior experts, the CIB that promotes the importation of products from development countries for example in advising in laws and regulation of development countries.