 So it's my great pleasure to introduce, privileged to introduce our speaker today, Ms. Dr. Lauren Culver, who's an energy specialist at the World Bank. She's also pleasingly an alumni of our group in Hema City, working with Tim Sweeney and me and a few other people. And five and a half years ago was sitting exactly where you are, and she's now working at the World Bank, working on energy transition scenarios for, or pathways I should say, for developing countries in a big way, which you'll hear about. There are two things I'd like to add to her impressive bio that you already have. One is before she came back to graduate school, after she had two masters at MIT, she decided she would need, she could use a real education. So she had been working at the State Department and as such was one of the specialists at the State Department on how to diversify energy supplies in the Ukraine away from dependence on Russian, I want to say Soviet oil and gas. And number two, kind of a neat tie in showing we have continuity in the seminar series. When she was at MIT, one of the master students she recruited into the program she was in was Sarah Carney, who we heard from two weeks ago, which I should have guessed but didn't. So without any further ado, I'm going to turn it over to Lauren, who's an energy specialist at the World Bank and much more. Thanks. John, thanks so much for the introduction. It's a real pleasure to be here with all of you. As John said, I am a senior energy specialist at the World Bank. I've been working the last couple of years with African, Southern African and Western African countries on a variety of different issues. And recently I've joined an energy modeling team within the World Bank. And we are helping advise countries on how to use energy modeling to think about their development and climate goals and how to achieve them. And as John said, previously at the State Department working on energy diplomacy and at the U.S. Department of Energy working on energy technologies and innovation. And I'm not speaking on behalf of any of those organizations today. I'm speaking more in my private capacity as an engineer that works on the policy space and energy and is quite excited about it. So what I really wanted to share with you all today is just some perspectives on the energy transition and developing economies and particularly what that might mean for climate finance. I imagine many of you are familiar with, that's right, familiar with the $100 billion pledge that was made at the COP15 in Copenhagen back in 2009. And what was hoped for was that advanced economies would mobilize $100 billion each year for developing economies to help them finance the transition from a mitigation and an adaptation perspective. You may also know that so far rather than $100 billion a year since 2020, only $90 billion has been mobilized in total. And so what, as we're going into COP 27 in Egypt next week, the G20 in Indonesia the following week, I really wanted to just kind of scope out for you different ways to think about whether this $100 billion is the right number. Is that what needs to be raised? Should you be concerned that it hasn't been mobilized yet or is there still time? And if that money were to be mobilized, how should we think about using it? So with that, I just want to start with the basics and we'll build from there. I'm sure as all of you know, the best science really comes from the international, the intergovernmental panel on climate change about the need to reduce emissions globally by mid-century in order to avoid the worst effects of climate change. And as the energy sector is 75% of global emissions, the IEA and others are thinking about what is specifically that goal mean for reducing emissions in the energy sector. The IEA came out with its report last year looking at reducing emissions to net zero by 2050. And the net and net zero is important because there's some expectation that negative emission technologies, direct carbon removal will be beneficial. You can see the IEA is not very bullish on that technology as a solution and what that means is somehow we're going to actually reduce emissions. And unfortunately, despite the fact that historical cumulative emissions are mostly in the rich and developed world, as you can see in the chart on the right, reducing emissions only by the top emitters isn't sufficient to reduce emissions to what's required by mid-century. And so whether we like it or not, what that means is that all countries will be needing to reduce emissions in the coming decades if the globe is going to meet these emission targets. And that's really a challenge for low income countries to think about how to meet their development goals in an affordable way. And what I want to talk about first is one of these challenges, one of the reasons behind this challenge is really a story about demand growth. So this is just showing you the difference between energy demand in 2020 and 2050 in different regions of the world. And what you can see is in the advanced economies, energy consumption is predicted to decline. Whereas in the developing world, we're seeing emissions, energy use increase. And this is really driven by two factors that probably won't be a surprise. One is electricity or energy access, providing access to people that don't have modern energy today, and also economic growth. So I'll say a little bit about both of these things. First, energy access. Today, 733 million people lack even basic access to electricity and 2.4 billion lack access to clean cooking. Globally, we've been making a lot of progress on reducing these numbers in the last couple of years. But for the first time since 2014, we've actually seen these deficits grow in the last year. So we're moving in the wrong direction. And if you look at current population growth rates and our ability to expand access right now, unfortunately, we're on track by 2030 when we should be reaching universal access to both electricity and clean cooking, still having 600 million people without access to electricity and 2.1 billion people that still lack access to clean cooking. The investment that would be needed to turn this around is $35 billion a year between now and 2030 and $25 billion a year between now and 2030. So for electricity and for cooking, which may seem like really big numbers, but I think as this conversation progresses, you'll see that this is really a rounding error in the volumes of capital that need to be moved for the energy transition. So it's just kind of imperative that the international community decides, continues to commit to the fact that this needs to be a priority despite the fact that other capital is being mobilized for energy transition. The other thing that's unfortunate about this analysis and the analysis that you saw before is the definition of energy access that we use here, what we're considering as success, is 50 to 100 kilowatt hours per person per day, which is really a paltry amount of electricity. This graph has some work that's been done by the Energy for Growth Hub. On the x-axis, you have gross national income per capita, and on the y-axis, electric power consumption. And what you can see from their work is if you look at what 50 kilowatt hours per day or 1,000 kilowatt hours per person per day translates to into wealth, we're looking at something much less than even a dollar a day. And so even though achieving electricity access, energy access is important and essential for human well-being, it is absolutely not the goal line, cannot be the goal line for economic development and progress. But what that means is even more energy consumption that would need to be delivered in the developing world to be able to turn this story around. So certainly energy demand is a unique challenge that the developing world is facing that feels a little bit different than what you've seen in advanced economies. The other issue is really an issue about affordability. We'll look at affordability in three ways, starting with fiscal affordability. So fiscal space means different things to different people, but basically it's the ability of a government to use its budget to do things, to invest in education, to invest in health, to invest in roads, to invest in anything else. And that can be limited by not only the investment goals of the country, but also by debt service. So to the extent that countries are borrowing to be able to invest in their economies every month or on a regular basis, they are paying the cost of capital for what they've borrowed. And what we see is that high debt is a really big problem and a growing problem in the developing world. 60% of low-income countries are in debt distress or near-debt distress, and 30% of middle-income countries are in that position. And this is a number that's been rising over time. And so that's kind of what's shown in the first figure here. And the second one, you can kind of see the difference between what's happening in advanced economies and emerging economies as it relates to the public budget to advance clean energy transition and to support affordability. So this is actually work the IEA just published last week, had to snag it. And what you can see is that in advanced economies, they're not only spending more in absolute terms to advance the energy transition and to make sure that energy is affordable for its citizens, but even in GDP terms, they are spending far, far more than emerging economies can afford to pay. So it's obviously not that emerging economies aren't willing or wanting to be able to make these investments, but they're unable to do so because of the competition for the limited resources that they do have from their budgets. In addition to fiscal affordability, so the ability of the government to be able to pay for energy transition is also a huge consumer affordability issue in emerging markets. And we think about this in a couple of different ways, depending on who the consumer is. So one thing the World Bank collects data on is looking at household energy poverty. So the metric we use is that if energy costs 10% or more of households expenditure on a monthly regular basis, then we consider that household to be an energy poverty. And so we collect information that looks at how much of a population can afford a given type of energy. And this data is actually just a snapshot looking from the multi-tier framework. And this is looking at for the lowest quintile of a population, so the poorest 20% of a population, whether they're even able to afford, and by that I mean less than 10% of their income, in this case 5%, because it's just looking at electricity, of how much that they can afford from their budgets to be able to get electricity. The other aspect of affordability from a consumer standpoint is from the industrial side. And when we think about industrial consumer affordability, it's really a competitiveness issue. And you can imagine that this is extremely important for energy intensive industries and whether they're able to compete in a global or regional kind of market and selling their goods and services. And this is work, again, by the Energy for Growth Hub that I like, because it looks at not only what's the cost of electricity, but in these countries where the electricity is not reliable, industries have to turn to have backup diesel generation available for them. So basically what they do is a simple weighted average cost of electricity, looking at what does electricity cost when it's available and what is the cost of the diesel substitute when the grid is not available to be able to compute what they call a reliability adjusted cost of electricity. And what you can see here is absolutely enormous electricity costs. I know many of you may not look at your electric bills, but I can guarantee you are not paying anything even close to that for the electricity that you use. A third aspect of affordability that I think it's important to consider is really the affordability for the utility. So utilities play a really important role in energy transition and being able to borrow, to build network infrastructure, either to do VRE integration or to expand access to the grid. They are primarily the off-taker for electricity and PPAs or the private sector. And so they really need to have sound financials to be able to play this role in the in the economy and in the energy transition. But unfortunately what we see is that many, many utilities across the developing world are not financially viable. This is some work that the World Bank did that's looking specifically at African utilities. And 40% of African utilities don't recover enough revenue to even meet their operating and debt service costs. And if you take out the subsidies that some utilities get from the public budget to try and make ends meet, it's actually only 25% of utilities that actually make enough money to cover their operating costs, much less capital costs than other things that you might normally want for a business. So again, just another challenge that the developing world is facing when thinking about how to afford the energy transition. If all of that feels like bad news, the bit of good news is what we've seen in clean energy technology costs. And this, I think, is a story that's probably well known to everyone in this room. A decade ago, what we were all hoping for was the day when renewable energy technologies would be cost competitive with fossil alternatives. And what you see here is in that past decade, renewable energy levelized costs have dropped dramatically into this band, which is kind of what's represented in the cost of fossil alternatives. And this is truly great news. This means that you can make an economic decision that in the long run you are saving money or spending the least amount of money to deliver electricity by choosing a clean option instead of a fossil option. So this is something to celebrate. However, when we look at what's happening in investment trends around the world, we don't see that good news really being reflected. And this is something that we want to think about why that's happening. So in advanced economies, we do see that as renewable energy has gotten to be cheaper and cheaper, there's an expansion in the investment that's made. We see a similar story in China where there are large investments in these technologies and that they are growing over time. You will see that in the developing economies that is just not the case. Not only is it not the case today, but the gap that we need to overcome, because of the demand story I told earlier, means that we will need much, much larger volumes, higher multiples of what is mobilized today if we're going to meet the challenge of energy transition in the coming decades. So this information is actually just looking out until 2030, where we see that developing countries need to mobilize four to seven times more money on average than they are today. And what is also interesting and connecting to the point of fiscal affordability that I made before is that if we look at this number, it's a much higher fraction of GDP than it is in advanced economies where the scale-up is not as large and the impact on their economies will be smaller. And so to just try and unpack and understand why is this happening? Why is it that we see levelized cost of electricity that are so low and yet in markets we don't see that investment? And there are a lot of reasons, but what I would like to argue is the primary reason can be found when you look at the capital structure of these renewable energy technologies. So this is a table that I've just reproduced from the IEA's World Energy Outlook. It's from 2021. I didn't update it last week when the new one came out. So if you forgive me on that one, this is data from India. And what you can just see here is for a couple of generation technologies, coal, gas, solar, and wind, you can see the capital costs, the capacity factors, fuel, CO2, and operating costs. And we use all those numbers, as you I'm sure well know, to calculate levelized cost of electricity. And so what we see just like we did on the graph before, these renewable energy technologies on a levelized basis are cheaper than their fossil alternatives. What I've done is add the last column, which is showing you it's just simple math of the first two columns. If we just divide the capital cost by the capacity factor, you get a better representation of how much upfront investment is needed factoring in the availability of different technologies, obviously different lower capacity factors for renewables. And here all the sudden, so maybe we'll stick to the PV and gas comparison. Rather than PV being the clear winner over gas, you see here that the upfront capital costs for PV are more than twice as large as they would be for a gas plant. And which just means if you were to go to the store and try and buy one, you would need more upfront money. And what's important to think about and we'll move on to is sometimes when especially for poor households and for poor countries, you aren't trying to minimize your lifetime costs. You're more interested in minimizing your monthly costs. You're living on a day to day month to month basis. And that's how you have to make the decisions that you're making about which options to choose. So before we come back to that, the other element to bring into this mix are the weighted average costs of capital. So in the developed world, this is for a PV project in 2021. So these numbers have probably gone up a little bit in the last year because of interest rates and the impact of that. But what we see is low weighted average costs of capital in the developed world. And you see much higher costs in just these snapshots of the developing world. There are countries not on this list where those numbers are even higher for a variety of reasons that account for country risk, the sectoral risk, and specific project risk. So what we see is when we see these interest or these costs of capital that are two to three times higher, that's affecting then the overall cost of doing these projects. As I'm sure you all well know, the actual kind of financial models that you would build to make these comparisons are quite complicated and very bespoke for an individual project in this specific area. But in the end of the day, it kind of works like a house mortgage or a loan for a car and that you go and you are able to borrow at a certain rate. And every month you pay down the principal for your house, for your car, for your power plant, and you pay something in the interest cost, the cost of capital over time. And so if this interest rate is high, your monthly payments are going to be high as well. I think that's something that you probably are all well familiar with just from your own personal finance. The second figure I just point I want to make is not only is there diversity of these weighted average costs of capital between countries, but this is something that changes over time. And this is actually a positive story in this case in India, we saw much higher weighted average cost of capital when the solar industry was new there, when there was a lot of uncertainties in how the process would work and how results were happening. But as that market was able to demonstrate success, you saw investor confidence rise and the risk premium that they demanded lower and therefore the weighted average cost of capital come down, which fundamentally impacts the cost of these projects. So this is just a little thought experiment, back of the envelope calculation that I want to walk you through just to marry these two concepts together. So you can hypothetically imagine a country needs some new energy and they have an alternative to way between doing a solar PV project or a gas project. So if you can imagine a thousand megawatts of one gigawatt coal plant or gas plant, you need about one LNG tanker every month to run a CGT, CGT plant at about an 80% capacity factor to provide energy. If you want an equivalent amount of energy but you want to deliver it with solar PV, you need many multiples of install capacity. So it's six gigawatts of capacity that you would need to be able to provide a similar amount of energy. So if we think about with this graph, we think about again what's the monthly cost that it's going to be. We can really simplify this problem and the fact that for a PV project what's really driving the monthly cost is going to be the cost of capital times the total amount of capital costs that you have. And what you can see here is that low cost of capital means low monthly cost for that investment. High cost of capital, high cost. That's the yellow line. Alternatively, if we look at this gas project, really the monthly cost of that gas project is going to come down to the cost of your fuel. That's really going to drive the overall economics. So if a few years ago, 2019, you went to the spot market to get an LNG tanker, you could possibly contract around $5 in MBTU of gas. And if that's the case, you need a very low cost of capital on that solar to make that solar plant more cheaper for you on a monthly basis than the alternative. And if you're in the US or in other developed countries, you probably can get that cost of capital, but in most of the developing world it's probably not an option. If we go up to, instead of buying on the spot market, if you wanted to hedge and get a long-term contract, a couple years ago you probably could have done that for about $10 in MBTU for gas and that tanker. And then you can see how the cost of capital starts to make a difference. If you're getting cost of capital around 6% like China, PV project still looks good. If you're getting cost of capital like 11%, 12% like South Africa, you're starting to rethink whether or not this project is going to work. And this is really just a basic demonstration. I haven't done anything to change the long-run economics. These probably could both be very economic projects. The PV could maybe be more economic in the long run in all of these scenarios. But the point is not all countries have the luxury of choosing what to do for their energy supply based on long-run economics. They're forced to decide based on what they can afford today at this moment. And that's really driving a lot of countries away from high capital cost technologies when there's a high cost of capital. This is just a classic poverty trap. It happens in countries the same way it happens in households. It's just a common thing where you're making your decisions based on another metric. There's another darker side of this that I'm sure many of you may have anticipated in looking at this graph and that's the issue of volatility. So if you had decided, hey, this $5 in MBTU, a spot market price of gas, excellent deal. Let's just run with this. It's our best option. It might have been great for a few years, but when you hit the market this year when we've seen $30, $40, $60 in MBTU for gas, that $200 million tanker that used to have pull up every month is now a $200 million tanker. And so you're faced with the choice of not funding projects in health and education, things that you probably wanted to have done over the last few years or not buying the fuel at all and just having blackouts and rolling blackouts throughout the country. And that's a real decision that many emerging markets are facing when trying to decide how to secure their energy. So I'll try and go to solutions and end on a happier note. As I said, these meetings that are coming up in the coming weeks, it's going to be a very big topic of conversation of what is the role of different types of finance in really solving these issues. Because it is a finance issue that we're facing. What you're certain to hear over the coming weeks is the critical role for private sector investment. And that is absolutely true. The scale of finance that needs to be mobilized is absolutely enormous just for clean energy. So not for coal phase down, which we haven't talked about, or for mitigation or adaptation, or for reducing emissions in other sectors outside of energy. But just for the clean energy side, we estimate that it will cost $1 trillion a year, starting in 2030 to be able to meet the investment needs. And so the scale of it requires private capital to come in. But private capital at the interest rates that we've just looked at aren't going to be affordable for these developing countries. And so there's a really important conversation that will be happening about the role of concessional finance. Concessional finance is kind of an umbrella term. It goes from grants, loans, or guarantees. The underlying idea is that money is provided at something more generous than commercial terms. And usually it's done so because there is a longer term goal, a public goods goal that motivates the need for that. And affordability is certainly one of the things that is influenced. And so there's a discussion about what is the role, how do you use this concessional finance? It is inherently, it's always going to be limited in amounts. There's not lots of it laying around everywhere because of the fact that it's offered at less than market rates. So how should we be using it? And so some options are to think about using it directly as loans to bolster public budgets so that countries can invest in really critical infrastructure like transmission that can connect renewable generation projects or other things. And other options that are considered are maybe how to use very small amounts of concessional finance to try and change the risk perception around these projects in different countries. And that's specifically to target the story that we looked at. How do we reduce these weighted average costs of capital to be able to make these technologies affordable? And so there's lots of options for how you might try and reduce risk at the country level, at the sector level, and even at the project level. And so that can be planning, setting better government targets with really credible plans on how things can be implemented. This can be improving policy frameworks. This could be strengthening institutions that are either doing the planning or doing the implementation. This is developing auctions and other market and pricing signals that can transparently communicate to the private sector what costs, what's the cost of these different technologies. You can also use concessional finance in more targeted risk mitigation instruments, financial tools that are able to shift who the risk of certain projects falls on so that the risk is managed, is given to the party that has the most opportunity to be able to manage that risk. So all of these are different ways to be spending that money, which kind of gets to one of the original questions I kind of posed of how do we spend this money? I gave you a little bit of a hint on is $100 billion enough a year? And if the bill just for the clean energy transition is a trillion dollars, I'll let you answer whether or not that will be enough climate finance to really meet the development needs and climate needs for these countries. And then really is one of the other questions, is this money needed now? Is it a problem that this is supposed to be mobilized in 2020 and we still haven't gotten around to it? And I would just argue that it takes time for reforms to take hold in a country for this work to be done and for investors risk perceptions to change and that's really what we need to do if we want to see these weighted average costs of capital come down. So in my closing slides I just want to bring this back to energy modeling and I know there's a few of you out there and this is my bread and butter work these days. The World Bank is one of many organizations that are now starting to think about how to use energy models to help put emerging markets these economies more in control over their investment decisions and how they can be contributing to development and climate impacts simultaneously. And this last year the World Bank launched a new product called the Country Climate and Development Report. We're doing this for many countries and we'll do it for all countries over the next five years and repeat them every year after that. And this is just an example from the work that we've done in Turkey to give you an idea of how specifically the energy modeling can translate into government plans and strategies. So we do things like estimate what's the cost of investment that's needed just to meet the development goals of a country and then what's the incremental cost that's needed to meet the development goals and also meet the climate goals just to give countries an understanding of that. The other thing our work can do is really to help inform countries as they're coming up with just energy transition strategies. So unfortunately for time we didn't get to talk about the other side of the energy transition which is really the phase down of fossil fuel assets across the economy but especially in the power sector. And so some of our work can give us some interesting information about what the value of stranded assets will be in countries as assets are asked to be retired prematurely. So this work in Turkey we found we estimated that the cost of their coal stranded assets could be as much as four billion dollars that will also need to be provided by some combination of public, private, and concessional finance all working together as efficiently as possible. And you know what's happening in Turkey is another issue that's replicated across emerging economies. 89% of stranded assets the World Bank estimates will be in developing economies and that's because the average economic life of a coal plant is about 40 years but 60% of the coal fleet is less than 20 years old today and those young plants are concentrated in developing economies and so the burden of stranded assets is really going to fall to a few countries in the emerging markets. The other thing we can kind of inform is the just energy transition how should countries be planning for budgeting for the management of people, communities, workers, and the land itself as coal plants and coal mines are retired and new opportunities are presented. So as I said the World Bank is only one institution that's thinking about how to bring climate and development together within the modeling sphere and to think about this as we inform national and international strategies. So the last thing I want to end on is just some interesting work that the Energy for Growth Hub again released recently an interesting paper that's asking the question who should be involved in making these decisions about climate and development and using these models and they just they themselves come up with a similar recommendation that in order to do this work well we need to be thinking about development at the same time we're thinking about climate goals otherwise it's unlikely that maximizing one is going to result in the other one working out and they also make another important point number five here and that's about who's doing the work and whose perspectives are really being brought into this and if you've done any energy modeling you know that models are always simplifications of the real world but what makes good energy modeling is making good simplifications and the right simplifications which really is informed by having people that have a really good understanding of the context of what can be simplified and what needs to be represented explicitly. So all in there I mean that's their call to broaden the pool of people thinking about energy modeling but I think it can be applied more broadly that regardless of why you wandered into this room today and which discipline you're coming from or how interdisciplinary you feel these are really really big challenges and people like me and energy at the nexus of climate and development we can use all the help we can get and all the perspectives that we can to see this problem in unique ways and and to be able to see solutions so thanks everybody for your attention and happy to take questions. We're timely talking very thought provoking I think. Let's see if we provoked any questions from the audience here. Why are utilities and developing nations I mean if we're at a time stage profitable or you can break the even. Great question. There are many reasons and they intertwine and unfortunately feed off of each other into a pretty vicious spiral that can go down and down. One issue is typically the I'll start the cycle in they have oftentimes a difficulty meeting load growth or being able to afford fuel and so reliability of the electricity they provide starts to decline and then population say why am I paying for this electricity that I don't even know when it's coming and I can't count on it and so you see collection rates for electricity consumed to go down when you see collection rates go down the utility doesn't have money to be invest it reinvest and operate or in kind of O and M for their system so then you see technical losses in the distribution and transmission grid decline so then you see reliability decline even more and I think you can see how the cycle goes on and on what's particularly damaging and I kind of alluded to this on the volatility issue is that you know lots of events can happen they climate impacts you can imagine how this will happen more and more and countries are put in an emergency situation so it's very common for countries there's these things called power ships literally a barge drives up to the port with it just has a whole bunch of generators on it but it usually runs on diesel it's extremely expensive fuel also an extremely expensive usually PPA because you need it in an emergency you're stuck in a hard place and so you're going to pay for it and then if you're unable to pass those costs through to the consumer because of affordability issue we said and if the government that made you buy this power ship get into this contract force you to do it but now it doesn't have any money to help you make up that gap you you see these like just incremental step changes in the in the financial viability of utilities is there just kind of wedged and having costs go up and no way to increase revenues so it's a pretty it's a pretty vicious vicious cycle so the reason you ask that we don't have the same exposure is it because there's more capital so we can buffer the volatility or those we have existing grid infrastructure yeah i i think there's a variety of reasons one is we have so the grid itself in this country as you probably well know was mostly publicly financed i mean the government built it all it wasn't necessarily passed on to consumers developing world where we are adding those costs on to consumer bills in many cases and so there's a little bit of the pace of development maybe isn't right or the way that we fund those things and so then yes cost of electricity can often be higher people can't pay and then and the cycle continues that way we don't really see that in this country we're able to design rates in a way that we can both deal with the affordability issues where they are and the competitive issues but still still manage cost recovery but if you've ever looked into the tariff process it's it's complicated even in this country it's not that straightforward to make sure that you're achieving cost recovery and they're constantly tweaking and trying to think of better ways to do that so it's not easy but i think that's part of why it's possible and in advanced economies one question i had was i was slightly surprised by the chart towards the beginning that was looking at the short-term energy affordability as a percentage of GDP like the subsidies that they're providing in emerging markets versus advanced economies yeah i was expecting that that the in lower income countries it was going to be actually higher especially because there's a lot of conversation right now currently around like dual subsidies both for you know transportation and then a lot around cooking especially in in africa um and so i'm curious if you could speak to a little bit more around that and then also how you know government should be thinking about removing those fuel subsidies um you know i know in any of this past it was a big part of the election cycle um that the president had to sort of consider so curious how you're thinking about that yeah thanks so um i'll have to cop out a little on this and that this is the ias analysis and of their in their new report um so i'm not exactly sure on their methodology of what they've included in here and what they haven't but it's a free report and you can you can read it just as well as i can um but i had the same shock i mean i think the narrative is that it's developing countries whose governments are just spending left and right on on um on consumer affordability on subsidy issues and then that's not an issue here in the developed world and this status obviously suggests the opposite we're perfectly comfortable um willing and able um in advanced economies to for public money to be used um to put our finger on the scale of of the cost of electricity and what the mix of electricity will be it's it's not all just uh a free for all um but your point on fuel subsidies is is an important one and this is something that i think there's a consensus uh about is that they're it's the way they're usually structured is not uh not helpful usually a fuel subsidy is um applied directly to the product um and not to the household in a sense and so what happens the the more of that you buy the more gasoline the more gas that you buy um the more subsidy the more you're benefiting from a subsidy but if you're the one buying a lot you already were the household that didn't need the subsidy um so you're in a sense that type of subsidy application is benefiting the wrong people so it's not that the government's instincts are wrong that there are vulnerable parts of the population poor parts of the population that should um you know should be accounted for in the structure but the way they do it is is uh is a little bit sloppy and so you can you there's a lot of literature out there about how do you target subsidies um where do you how do you calculate it where do you apply it um as so that it is helpful to the people that need it most um but it's not um prodigal to a level that that governments can't afford to do it and that it's not sending the wrong um market signals about what the real costs of certain energies are there were two questions oh they're multiplying maybe i take them all at once i don't know okay hi thank you for coming i really appreciate it uh it's one question i have was you should have mapped at the very beginning of your presentation um and uh basically showing like the decrease in demand um in developed countries i understand why demand will increase in developing countries but i'm just also is it a function like greater efficiency that demand is decreasing or yeah thanks let me take it that one and that one yeah you can just yeah i mean i just read deposit and how it like has really negative impacts on like health outcomes and poverty alleviation programs in various countries so how do you justify like some of these like forcing these countries to cut programs um like with your goals of saying like you want to be equitable yeah thanks great question yeah uh again thank you for i had actually i had a bunch of them i just restrict myself to one uh so affordability cost competitiveness rising infrastructure uh up predation of the bridge the gist of the indians up on all of these things are looking as there is a solution in the horizon eventually there will be a problem there's also as much with the political will uh bureaucracies outside of the story so how does an international institution uh or in your in an hour one impact this political will of you know solution versus a short term not solution impact that one's harder glad it's last um so uh the question on uh on demand so yes efficiency uh what you would normally think of efficiency is included in this but this is also all um energy demand not just electricity and just a fact that as we move to electrification of things um it's more efficient um it's just a more efficient so that's a really those those negative numbers um are largely driven by the greater electrification that we will see in the overall energy mix um in in the future your question on structural adjustment uh that's a really challenging uh history of the world bank and honestly outside of my my lane of expertise i'm more in the infrastructure infrastructure space than the kind of macro fiscal bigger picture um but certainly what your goal is thinking of is uh how do we use this concessional finance without jeopardizing other development objectives of the country and how do we achieve those development you know objectives of the country so personal opinion um I think one important thing is making sure the government is part of that conversation from the beginning that they are um thinking about that and we're giving the tools for them to think about climate and development simultaneously um and then I think another issue and and this is really about um how do we use concessional finance um as little as possible to the greatest amount of leverage and that's why so much thinking is going into this because there's something about the energy sector um where we can use private capital um and that's more challenging in other sectors I mean you just don't see as much even in in advanced economies you don't see as much um private funding for education or for health or for recent I mean there's certain things that have a quality that's public about them and so um it's important to to not pillage that money just for the energy transition and with the limited pool of concessional capital the only way to do that is to use that concessionality as targeted as you can um to the to the biggest amount of impact and that is exactly what all of the conversations will be about over the coming weeks because people have different of opinions on what is the best way um how do you get the most bang for your buck so it's not just about we need more bucks we do um that that's for sure um but also there's a responsibility I think of people in the space to be able to use this efficiently as possible and to be advising governments are borrowing for this money um and so it's not sometimes it's grants sometimes it's free money um hopefully there'll be more of that but governments are borrowing for this so they also need to be assured that they're getting the most bang for for their buck two minutes for the hard question two minutes for the hard question um yeah political will for long-term solutions so we um the good news story on this um is a lot of energy transition not all but we can go a long long way is economic in the long run it is a better decision um and so I think the hard work is how do we make that real for countries I mean how can we um solve these finance issues so that clean energy actually is delivering more affordable reliable energy so countries actually are freed from this volatility and this poverty trap that they're set in countries want this change they want to be able to move forward in this way they're just kind of prevented from doing so and so I think um a lot can be done if we solve these these finance issues then stickier stuff comes eventually things aren't necessarily more economic and there will be you know higher costs of different parts of the transition uh people are thinking about that even now but that's not necessarily my my focus so I uh yeah it's hard to say when when it gets really tight how we might think different I think we'll think differently about it by then maybe you know technology advancement will postpone when that hard conversation has to happen um hopefully hopefully some people in this room are working on those issues uh but yeah that's that's what I would say is um there is so much that's good right now how do we make that possible and have countries be able to experience those benefits of energy security and affordability that they could have um if we're able to solve this finance issue great with that said uh thanks to uh Lauren for great answers to the great questions from us thank you all