The Stanford Social Innovation Review recently published a smart analysis by Rachel Pritzker and Mike Berkowitz about why it's so important for philanthropy to focus on energy. The authors write:
We have come to believe that energy is not—and cannot be seen as—just an environmental issue: It is fundamental to the wide array of issues that contemporary philanthropy is concerned with, including health, education, women's empowerment, and poverty.
Of course, anyone familiar with America's own story of development will know how crucial rural electrification was for lifting millions out of poverty—and, in particular, liberating women from the unending drudgery of manual domestic labor.
Still, as Pritzker and Berkowitz point out, most funders don't see energy as the linchpin issue that it is, and it's mostly environmental funders that give this area any thought at all. "Even among sophisticated donors, very few seem to consider the relevance of energy to their non-environmental issue interests."
One notable exception to this generalization is the Rockefeller Foundation, which has been working on what it refers to as "energy poverty" since 2010. The foundation has poured millions of dollars into this area in India, which has the largest unelectrified population in the world. Some 290 million Indians live without electricity, and pay a steep price. Rockefeller notes that "electricity can increase household per capita income by 39 percent."
We've written often about Rockefeller's energy efforts in India, and now the story is taking a new turn as the foundation doubles down in this area with a big new $75 million commitment. Rockefeller's Smart Power for Rural Development Initiative hopes to reach one million people across 1,000 villages in India within the next three years.
The initiative will start moving toward its goal by first engaging all of the energy stakeholders in India from smaller scale energy service companies (ESCOs) to local community leaders and residents. Here’s a peek at what the Smart Power’s blueprint looks like:
- Offering development support to help ESCOs get their financing, business modeling, area selection, and training underway.
- Facilitating agreements between ESCOs and investors, telecommunication tower companies, investors and technology equipment providers.
- Engaging local communities to help ensure buy-in, promote economic development, and create a sustained demand for power.
- Aligning incentives between governments, investors and ESCOs to reduce long term risk
The project will launch in rural Bihar and Uttar Pradesh, which are among the poorest districts in India. Not only are these two states among the most impoverished financially, but fewer than 10 percent of their rural populations are connected to a national energy grid.
Rockefeller has partnered with Smart Power India, a newcomer on the Indian power scene, to develop the infrastructure and networks necessary to help build its mini-grid energy projects to scale. Ever conscious of the environmental impact of increased energy use, Rockefeller’s initiative will focus on funding ESCOs with sustainable business models using renewable energy sources. Of course, that last piece is key, since an overriding question of our time is how to raise living standards for the world's poor without also raising global temperatures.
By focusing on the use of sustainable and renewable energy, Rockefeller is not only addressing the ecological damage that is often the result of increased energy usage, but also diminishing the use of fossil fuels such as gas, kerosene, and coal on which rural communities largely depend for their energy needs. Those energy sources, it should be noted, don't just produce greenhouse gases; they also produce air pollution, with negative health effects.
Bringing clean energy to the world's poor is so obviously an urgent priority, for so many reasons that we can't help but return to the issue that Pritzker and Berkowitz flagged in their article: the lack of funder interest in energy. When are more foundations going to get with it?