Expanding access to clean energy in low-income countries is a key component of global development efforts to address energy poverty, food insecurity, and economic growth.
Throughout developing countries, agriculture remains the most prominent source of livelihood for most households. As our population expands, farms and agribusiness will need to produce, process and transport an increasing amount of food. The U.N. Food and Agriculture Organization estimates that at least 70 percent more food will need to be produced on the same amount of agricultural land. Identifying means by which clean energy technology can be used to intensify agricultural production will be crucial in meeting this demand.
Increasing the agricultural sector’s access to clean energy and efficiency technologies will enable farmers to mechanize their operations, add value to commodities through processing and store fresh produce in refrigerated containers to extend its shelf-life. These advancements will lead to more food in the market, increased incomes for farmers and traders and decreased dependency of the agriculture sector on fossil fuels.
Unfortunately, significant barriers exist that hinder the integration of clean energy technology in agriculture development:
- Farmers are not aware of the variety of new technologies that may be appropriate for them;
- Clean energy technologies are relatively new, therefore farmers have limited access to distributors for installation, parts and service;
- Farmers often do not have the means to cover high capital costs associated with clean energy upgrades—and financing is seldom available.
Likewise, clean energy enterprises seeking to serve these farmers face a number of barriers:
- Limited access to debt and equity to support business development and growth;
- Low demand due to a lack of awareness by farmers and other customers of the economic and environmental benefits of the technologies;
- The client base of agricultural communities is remote, scattered and often very poor; and
- There are few examples of successful business models that have been effective in delivering clean energy solutions to the agriculture sector in developing countries.
These issues create an unproductive cycle, in which suppliers and buyers are not connected, and farmers and agribusinesses are unable to leverage more cost-effective clean energy technologies. Strengthening the links between modern energy service providers and the agriculture sector will create positive feedback loops to increase productivity along major components of the agricultural supply chain: (1) on-farm productivity, (2) cold storage; (3) transport; (4) post-harvest agriculture processing; and (5) agriculture waste for energy applications.