Why Energy Philanthropy Is High-Impact Philanthropy

Imagine living permanently without power. What would this mean for your health, for your children’s education, for your livelihood?

This is the reality currently facing the more than 1.3 billion people across the globe who live without any access to electricity. And it is a reality that those of us in philanthropy should be addressing, given the vital role that energy plays in a range of causes that funders care about.

Our work has deepened our understanding of the importance of energy. The more we have studied climate change and energy access issues, and learned what it will take to decarbonize the global energy system, the more aware we have become of the tensions and interrelationships between reducing carbon emissions and providing electricity to the global poor. 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. A 2005 report by the United Nations Development Programme argued that energy access was  “a prerequisite” to achieving all eight UN Millennium Development Goals (MDGs).

Yet within organized philanthropy, energy is largely relegated to the purview of environmental funders. Even among sophisticated donors, very few seem to consider the relevance of energy to their non-environmental issue interests. Just google phrases like “energy philanthropy” or “energy access philanthropy” to see how little conversation there is about energy-related issues in the social sector beyond debates about the environment. As a result, global efforts to address climate change often deprioritize or overlook human needs. We argue over how to make fossil fuels more expensive to decrease demand, but give little thought to how to make clean energy cheap and abundant for those whose lives it would improve.

Here are a number of ways in which energy impacts some of the issues funders care about most:

• Health: Vaccinating people from easily preventable diseases requires that we refrigerate vaccines, which in turn requires constant and reliable access to electricity. Doctors need electricity for the light to see their patients, and hospitals need it to run life-saving equipment such as incubators and ventilators. Electrifying homes can help reduce the use of solid fuels such as wood and dung for cooking, which currently leads to more than 4 million premature deaths each year.
• Education: Energy access plays an important role in enabling a quality education. Building a school or providing scholarships to students in a developing community is unlikely to produce the desired outcomes if the schools lack electricity to do basic things like copying assignments or connecting to the Internet, or if students don't have electricity at home to read or do their homework at night. According to the ONE Campaign, 90 million children in Sub-Saharan Africa go to primary schools without electricity.
• Women’s Empowerment: Energy access is an important condition for the empowerment of women. As Hans Rosling argues in a now-famous TED Talk about the washing machine, electricity liberates women from difficult, time-consuming labor and allows them to focus on things like reading and education. A scholarly review of the linkages between gender, energy, and the MDGs also found evidence that “energy access has empowered women by giving them more choices about how to organi[z]e their work more effectively,” and that in homes with electricity women read more and have greater exposure to information through TV and other media.
• Poverty: The International Energy Agency calls energy poverty a “brake” on development and growth, one that we must release to build modern economies and raise living standards. The single most successful poverty alleviation program in history has arguably been China’s effort to move 500 million people out of extreme poverty over the past three decades, which has required tremendous quantities of energy. As of 2011, China is the world’s largest power generator, and its total primary energy consumption was six times higher than its consumption in 1980. (Of course, in addressing poverty, China has also created a host of environmental problems, underscoring the need for clean and cheap energy sources). Businesses also need energy to operate productively: Half of African firms cite electricity as a major constraint on their competitiveness, profitability, and expansion potential.

Many advocates have responded to these challenges by promoting rural distributed generation and small-scale energy technologies, such as solar lamps, as the solution. While these technologies can make life in poverty better, they do not lift people out of poverty. They are no replacement for real modern energy access—especially in urban and near-urban areas where the developing world’s population increasingly clusters. Such communities need large-scale, 24/7 power generation so that hospitals and businesses—indeed entire cities—can thrive at modern levels. Providing this magnitude of energy without overheating the climate will require that we use all the tools in our clean-energy toolbox, as well as continued innovation to ensure that the choice of clean energy is an economical one.

While energy is clearly a new area for non-environmental funders, there are a number of catalytic ways that philanthropy can engage in these issues:

• Research: Funders can support needed research into better understanding the impact of electricity on people’s lives, where the gaps are, and what it will take to ensure that clean energy is cheap and abundant.
• Policy: Funders can support or engage in advocacy to change the energy access and innovation policies of the United States, developing world governments, and multilateral agencies like the United Nations and World Bank. Given the scale of the challenge, tackling energy poverty will require bold government action.
• Innovation: We are still at the earliest stages of developing the technologies and business models needed to generate and provide clean energy to the global poor. Funders can support innovators developing new ideas on these issues.
• Energy service delivery: While this is generally the realm of public utilities and private companies, there may be a niche for funders to play in subsidizing the “last mile” expansion of energy access to the extreme poor who might otherwise be left out.

We initially got involved in energy because of climate change, but we remain engaged because of the myriad other issues it encompasses. We hope to build a community of funders who likewise recognize that energy is fundamental to the causes they care about. Without a broader set of voices at the table, we run the risk of making global energy choices that do not reflect these important priorities.

Making clean energy cheap and providing meaningful energy access are systemic interventions that can tangibly improve the lives of billions of people across the planet. Indeed, energy philanthropy is high-impact philanthropy.

Read more stories by Mike Berkowitz & Rachel Pritzker.