CONCEPTUAL FRAMEWORK
2.3 The political economy of energy
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There is no doubt that the issues discussed above unpack a number of development agendas relevant to developing countries. Similarly, securing access to energy for the poor requires multi-sectorial cohesion and consultation in the planning and implementation phases.
However, the role of policy and government institutions is critical for the sustainable reduction of energy poverty. In this regard, the political economy model was deemed a suitable framework within which factors that contribute to energy security and the implementation of renewable energies could be investigated. This is elaborated on in the following section.
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course, add several complexities to energy access within South Africa and highlight the role of state institutions in formulating suitable policy and regulatory frameworks that incorporate the historical and environmental contexts. Furthermore, Brüscher (2009) describes South Africa to be a neo-liberal capitalist economy where energy remains central to production processes which influences social welfare mechanisms. However, increased privatisation, commercialisation and marketisation results in the poor being excluded from these sectors and worsening of poverty cycles.
Adger et al. (2005) define the political economy framework as cross-scale interactions between stakeholders that are guided by a hierarchy based on the distribution of power.
According to Peterson (2000), power at the local level is overt and covert, or structural at higher levels. Additionally, Paul and Verdier (1996) argue that income distribution defines one’s relative power which implies that different income groups experience different levels of political participation or power; for example, the poor experience lower political participation compared to the rich. Adger et al. (2005) reinforce the notion that the most powerful stakeholders are those who can afford to invest in knowledge and thus, have the most pertinent information which influences the manner in which decisions are made and trade- offs are negotiated. Ribot and Peluso (2003) aver that power is undoubtedly linked to the distribution of resources and wealth but it is also influenced by governance and culture. In order to distribute benefits to the less powerful, governance systems need to be strengthened and the poor need to be mobilised (Adger et al., 2005).
Tshuma (1999) is of the opinion that policy and improved governance systems play a central role in advancing development agendas. In terms of energy, Khennas (2012) suggests that democratic approaches to development and substantial financial resources are needed to achieve energy access. Moreover, institutions responsible for energy policy have the tendency to influence energy equality and sustainability (Khennas, 2012). Rehman et al.
(2012) underscore the importance of establishing ‘pro-poor’ energy policies that unpack the technological and socio-economic barriers to ensure equity and reliability in energy access.
Similarly, Kahrl et al. (2013) suggest that policy should focus on energy efficiency rather than economic incentives that reinforce the power imbalances within the system. Studies show that economic growth, investment and political efficacy within the public sector facilitates increased accumulation of financial and capital assets and ultimately reinvestment in energy services by households through increased purchasing power (Chaurey et al., 2004;
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Madubansi & Shackleton, 2007; Nussbaumer et al., 2012; Deaton, 2016; Kakwani & Son, 2016). Furthermore, Chaurey et al. (2004) state that energy access in developing economies are compounded by the lack of sufficient government programmes and access to information and energy markets. In addition, the poor are unable to react to changing energy prices because they lack representation within the energy policy decision-making arena (Buzar, 2007; Cameron et al., 2016; Deaton, 2016). It is also evident that social welfare support falls short in addressing energy poverty, as the root causes are neglected, creating unsustainable dependencies on the state and government social aids (Madubansi & Shackleton, 2007;
Khennas, 2012; Kakwani & Son, 2016). Additionally, the poor are further disadvantaged by their inability to access modern markets as a result of high interest rates, lack of infrastructure (such as roads) and limited access to information, which exacerbates the urban-rural dichotomy and deepens poverty cycles (Pandey, 2002; Sovacool, 2013; Zhang et al., 2016).
Adger et al. (2005) assert that knowledge, action and investment of resources to advance the development agenda are viable options for the poor which will lead to distributing power within the economy. Redistributing power within an economy can also be initiated through public education programmes, where investment in the creation of human capital can result in improved and sustainable economic growth (Paul & Verdier, 1996). However, this raises concerns around affordability of obtaining knowledge and skills within the economy, as many of the poor may not be able to invest factors that promote growth, and could result in a further reduction of power (Rehman et al., 2012).
Meyar-Niami and Vaez-Zadeh (2012) argue that sustainable energy policy should reflect on the national goals and must consider the limitations in order to produce meaningful outcomes, especially for the poor. Fragmented energy policy and poor integration of factors that govern energy insecurity within developing contexts do not effectively reflect the disparities between the poor and those that are financially secure (Chang & Berdiev, 2011; Tanaka, 2011;
Schillebeeckx et al., 2012). Sovacool (2012) posits that global and local stakeholders play an important role in the way in which energy policy is implemented and corruption, patronage to fossil-fuel energy, and political instability encumber equitable distribution and access to modern energy services. Enhanced investment in building human capacities through improved access to information and awareness may serve multiple objectives in bridging the technological gaps among the poor, thereby promoting the implementation of modern energy options, such as renewable energy (Pandey, 2002; Pereira et al., 2011a; Rehman et al., 2012).
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Additionally, maintenance and repair of RETs is one of the major causes of poor uptake and can be addressed by developing capacities. Jorgenson et al. (2012) highlight the urban-rural dichotomy in access and distribution of resources and argue for the increased decentralisation of technology and infrastructure investment that could lead to more equity in development patterns across rural and urban sectors.
Sovacool and Mukherjee (2011) propose that the main dimensions and components of energy security in relation to the political economy framework include availability, affordability, sustainability, the development of efficient technologies, and strong governance and regulatory structures. Each of these dimensions are further subdivided into various components, for example, availability is inclusive of security of supply and production, dependency and diversification (see Table 2.1).
Table 2.1: Dimensions and components of the political economy of energy (adapted from Sovacool & Mukherjee, 2011: 5345)
Dimensions Components
Availability
Security of supply and production Dependency
Diversification
Affordability
Price stability Access and equity Decentralisation
Technology Development and Efficiency
Innovation and research Safety, quality and reliability Resilience
Energy efficiency Intensity
Investment and employment
Environmental and Social Sustainability
Land use
Water availability Societal health Environmental health Climate change
Regulation and Governance
Good governance
Trade and regional inter-connectivity Competition and markets
Knowledge and access to information
Infrastructure is a key driver of economic development; sustained investment in roads, water and sanitation, and information and communication technologies are vital in securing access to energy among the poor (Khennas, 2012). In this regard, increased decentralisation of power, knowledge and access to information regarding the most viable energy options is
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primarily dependent on improved political frameworks that prompt changes in attitudes, practices and economic activities at the grassroots level. Additionally, the supply and production of energy services alongside costs are key indicators that need to be factored into general energy debates and policy reform (Pereira et al., 2011a; Sovacool & Mukherjee, 2011; Khennas, 2012; Rehman et al., 2012).
From the discussion above, it is clear that the political economy of development is complex and interrelated and therefore, energy provision is no different. Sustained economic empowerment and income generation of the poor are strongly emphasised as key determinants in accessing improved energy services and technologies (Krupa & Burch, 2011). Given that there are multiple stakeholders within the energy sector and that sustainable energy practices are closely aligned to socio-economic and political well-being, unpacking the political economy of energy is critical. From the literature reviewed above, a model illustrating the cross-cutting nature of the political, economic and social dimensions of energy security was formulated (Figure 2.2). This political economy model for energy highlights the direct and indirect linkages that exist between the far-reaching factors that determine energy insecurity within the developing contexts more broadly, and at a household level. The model examines energy security in terms of the linkages between the political/ institutional and economic influences, whereby energy security/ insecurity can be described as a response to economic and political pressures. The latter include energy prices, energy policy, access and availability of energy infrastructure (or the lack thereof), and investment in the energy sector.
Therefore, the level of energisation within a country is reflective of both economic and political frameworks that determine and impact the social dimensions. An improvement in development initiatives and energy policies will eventually lead to economic growth and consequently influence household investment in related goods and services.
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Figure 2.2: A political economy model for energy based development (Author, 2016)
Political and economic factors play significant roles in energy provision to marginalised groups. However, internal household structures determine energy choices and practices. The latter is considered equally important and can inform broader energy policy. An appreciation of issues such as fuel-switching and prioritisation of energy needs within households may reveal additional factors that determine energy insecurity. Therefore, in addition to the political economy and SLA frameworks, this study uses conceptual models defining household energy behaviours and decision-making processes, as discussed below.