This
project seeks to develop a new Green Growth Diagnostics methodology and
apply it to two African countries: Kenya and Ghana. These countries are
the research hubs of East and West Africa and we believe that they
offer a good opportunity to test our methodology in advance to their
wider application to other African countries and beyond the African
continent.
The
original growth diagnostics methodology was developed by Haussmann et
al (2004) to identify the key constraints holding back economic growth
from its full potential. Their approach was driven by the needs of
policymakers facing the dilemma that most problems have multiple causes,
but governments cannot tackle all of them at once, given limitations in
their financial and executive capacity.
This
gave rise to the idea of concentrating these limited resources on the
binding constraint, which would be identified going through a tool
conceptualised as a decision tree. The proponents of the original growth
diagnostics also realised that this binding constraint varies between
countries and we would argue between sectors. The central point of the
original growth diagnostics method was that it offered researchers and
policy makers a way of identifying priority in analysis and policy; and
finding solutions which take into account local conditions.
The
same rationale applies to our proposed Green Growth Diagnostic method.
We build on the original approach but adapt it in four ways:
- Applying it to the energy sector;
- Taking into account potential knock-on effects on the economy;
- The political economy when going from diagnostics to therapeutics;
- Working out the distributional consequences.
Since
each step takes the project into un(der)explored territory, it is built
around five research questions and corresponding methodologically
distinct work packages.
Our five research questions are:
- What are the binding constraints for investment in economically viable renewable energy?;
- Which policies can more effectively target different binding constraints?;
- Who obstructs/drives the adoption of specific sustainable energy policies?;
- What would be the macroeconomic impacts of an increase in renewable energy investment/capacity, and the reforms needed to bring this increase about?; and
- Under what circumstances increased on-grid renewable energy capacity translates into increased access to and increased reliability of electricity supply in developing countries?
We
use several methodologies to deal with these questions. Firstly, we
create a diagnostics tool that provides a priority ranking of the most
binding constraints for the uptake of economically viable renewable
energy. Engineering, economic, financial and technological expertise is
required to develop this tool.
Second,
we test the macroeconomic and political feasibility of the proposed set
of policies for our two case studies in Kenya and Ghana. Two distinct
methodologies are used: Computable General Equilibrium (CGE) Modelling
and political economy analysis. Purpose-built dynamic CGE models for
Ghana and Kenya simulate the prospective medium-run growth and
distributional implications associated with the policy measures
identified by application of the GGD tool. The political economy
analysis identifies the actors, alignments of interests or alliances
that obstruct or drive the adoption of specific sustainable energy
policies in Kenya and Ghana. This requires continuous and iterative
discussions with the key actors.
Finally,
power system analysis methods are applied to understand the
distributional impacts of increased renewable energy capacity. Metrics
will be developed to quantify the impact that increased on-grid
renewable energy capacity has on access and reliability of electricity
for final users in developing countries.
Visit the IDS Project site
Cost and Returns of Renewable Energy in Sub-Saharan Africa: A Comparison of Kenya and Ghana
IDS Evidence Report 190 (2016)
Pueyo, A., Bawakyillenuo, S. and Osiolo, H.
Pueyo, A., Bawakyillenuo, S. and Osiolo, H.
Green Growth Diagnostics for Africa: Literature Review and Scoping Study
IDS Working Paper 455 (2015)
Pueyo, A., Spratt, S., Schmitz, H., Willenbockel, D., Dent, C., Wade, N., Crossland, A.
Pueyo, A., Spratt, S., Schmitz, H., Willenbockel, D., Dent, C., Wade, N., Crossland, A.
The Political Economy of Low Carbon Energy in Kenya
IDS Working Paper 445 (2014)
Newell, P., Phillips, J., Pueyo, A., Kirumba, E., Ozor, N. and Urama, K.
Newell, P., Phillips, J., Pueyo, A., Kirumba, E., Ozor, N. and Urama, K.
- Dr. Ana Pueyo (PI) (Institute of Development Studies)
- Dr. Stephen Spratt (Institute of Development Studies)
- Professor. H Schmitz (Institute of Development Studies)
- Dr. D Willenbockel (Institute of Development Studies)
- Dr. Simon Bawakyillenuo (Institute of Statistical, Social and Economic Research)
- Neal Wade (Durham University)
- Andrew Barnett (Thepolicypractice.com)
- Dickson Khainga (Kenya Institute for Public Policy Research and Analysis)
- Dr. Chris Dent (Durham University)
- Ashington Ngigi(Kenya Institute for Public Policy Research and Analysis)
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