Japan's Official Development Assistance White Paper 2005

Main Text > Part II ODA DISBURSEMENTS IN FISCAL YEAR 2004 > Chapter 2 Details and New Policies about Japan's ODA: Striving for Further ODA Reforms > Section 2. Measures for Each of the Priority Issues > 3. Addressing Global Issues > (5) Energy

(5) Energy

In order to realize economic development and improve living standards, developing countries need to ensure stable energy supplies. The electric consumption per capita in the least developed countries ( LDC ) is less than one percent of that of OECD-DAC countries. 36 There is also a large number of people who have no access to energy services such as electricity and gas commonly used in developed countries. They tend to rely on primitive forms of fuels such as firewood. It is forecasted that the world demand for energy will increase in the future, particularly in Asia and other developing countries. Without appropriate measures to ensure a stable supply of energy and address environmental issues, problems such as tightening energy demands, price hikes, and increases in carbon dioxide emissions could become more prominent, which could in turn affect the sustainable development of developing countries, as well as the global economy and environment. In this way, energy is a global issue related also to the global environmental and sustainable development.

Japan, from the perspective of sustainable development, has been cooperating for stable energy supply in developing countries, taking into account energy efficiency and conservation as well as environmental conservation. Japan has been providing assistance through ODA for projects that are especially difficult to be dealt through the private sector or OOF, and projects that can contribute to the promotion of energy efficiency and conservation or the promotion of the use of renewable energy sources and other helpful measures.

In recent years, Japan has been cooperating increasingly in this sector for projects designed to improve public welfare and reduce poverty, such as rural electrification and the development of electricity transmission facilities. Because these projects are relatively large-scale and have substantial economic benefits, they have been mostly implemented through yen loan. In FY2004, yen loan in the energy sector amounted to approximately ¥109 billion (approximately 16.7% of all yen loan), and grant aid amounted to approximately ¥1.8 billion.

As for cooperation through yen loan, Japan has been assisting such projects as the "Ulubelu Geothermal Power Plant Project" utilizing geothermal power in Indonesia, and the "Yerevan Combined Cycle Co-Generation Power Plant Project" in Armenia, which has reduced the emission of carbon dioxide causing global warming and of nitrogen and sulphur oxide causing air pollution. These projects aim not only to provide stable electricity supply but also to reduce the environmental burden.

For example, Japan extended grant aid to Timor-Leste, where 70% of the infrastructures for social foundation were destroyed during the civil disturbance in 1999. Japan implemented the "Project for Rehabilitation of Power Supply in Dili" as a measure to improve the aging Comoro power station. This is the only power station in the capital city of Dili to which Japan extended emergency grant aid, for building a new power facility within the station. Such efforts are expected to help provide stable electricity supply and revitalize economic and social activities.

As for technical cooperation, Japan has been carrying out technology transfer and human resources development in such fields as energy management, energy efficiency and conservation, and renewable energy.

For the future, Japan intends to advance energy sector cooperation for ensuring stable power supplies in developing countries, as well as promoting energy efficiency and conservation and utilizing renewable energy in assistance. The cooperation will include energy-related infrastructure developments such as electricity transmission and power generation facilities, petroleum and natural gas facilities, and so on.