Access to Electricity

1. Access to Electricity Christian Kornevall Dar Es Salaam, September 29

2. Headquarters: Zurich, Switzerland About 133,000 employees in around 100 countries Orders in 2002: US$ 18.1 billion Revenues in 2002: US$ 18.3 billion Listed on stock exchanges in London/Zurich, Stockholm, Frankfurt and New York A leading power and automation technology company with strong market positions in its core businesses Two units in Tanzania that employ 130 people:- ABB Tanelec in Arusha- ABB in Dar Es Salaam Our aim is to create value for all our stakeholders We seek to meet the needs of our customers, our employees and the communities where we do business download from www.abb.com/sustainability Who we are... • Headquarters: Switzerland • About 133,000 employees in around 100 countries • Orders 2002: US$ 18.1 billion • Revenues 2002: US$ 18.3 billion • Listed on stock exchanges in London/Zurich, Stockholm, Frankfurt and New York

3. 1.6 billion people have no Access to Electricity Earth’s City lights (NASA) Sub-Sahara Africa 32% South Asia 50% 35% in India alone East Asia (not including China) 14% Source: IEA World Energy Outlook 2002

4. The link between poverty and Access to Electricity Tanzania Source: IEA analysis; income from the World Bank’s World Development Indicators, 2001

5. ABB’s Access to Electricity program “Access to electricity is of key importance in the fight against poverty. It is a key enabler and precursor for sustainable development.” • ABB wants to contribute to the electrification of poor rural and semi-urban areas • ABB seeks to improve its ability to meet the needs of the rural poor • ABB will grow its long-term business engagement in the least developed countries “Our main focus in Tanzania is the productive use of affordable energy and the development of local business, SME:s and markets”---

6. • Afghanistan• Angola• Bangladesh• Benin• Bhutan• Burkina Faso• Burundi• Cambodia• Cape Verde• Central African Rep.• Chad• Comoros• DR of Congo• Djibouti• Equatorial Guinea• Eritrea• Ethiopia• Gambia• Guinea• Guinea Bissau• Haiti• Kiribati• Lao People's DR• Lesotho• Liberia • Madagascar• Malawi• Maldives• Mali• Mauritania• Mozambique• Myanmar• Nepal• Niger• Rwanda• Samoa• Sao Tome and Principe• Senegal• Sierra Leone• Solomon Islands• Somalia• Sudan• Togo• Tuvalu• Uganda• United Rep. of Tanzania• Vanuatu• Yemen• Zambia Access to Electricity – ABB’s response to UN Global Compact • An appeal to industry to grow business in the Least Developed Countries (LDC) • ABB does business with 38 of 49 LDCs • The revenues 2001 were 334 million USD, (1.4% of total revenues) • Example: Power supply to Ukerewe Islands 10 MUSD, financed by Spanish government (Source: UNCTAD)

7. ABB’s main stream of operations Extending Business as Usual Focus of Access to Electricity A bottom up rural transformation concept Addressing the bottom of the pyramid The income pyramid developed countries developing countries; semi-urban areas least developed countries; rural areas 1 $ per day

8. mini hydro Rural electrification – organic growth tourist spot village small town plantation stone quarry power transmission line mine

9. download from www.abb.com/sustainability What is an Access to Electricity project? • Local involvement and partnership • Explore alternative business models • Need for commercial and technical expertise • Need for project developers • Projects should be profitable • Broader scope than electrification only – including SME development, water, communications and roads • A good project should follow the intentions of UN Global Compact

10. First Pilot Project with WWF - Selous Game Reserve • Electrify Ngarambe Village275 homesteads, 1800 people • WWF goals: • Reduce pressure on the use of biomass • Renewable energy resources • Energy efficiency and state-of-the-art technology • ABB goals: • Demonstrate the positive impact of electrification • Create economic activity • Explore an economic model for sustainable supply of electricity • Use available ABB low cost technology Selous Game Reserve

11. ABB’s business models for Access to Electricity • ABB’s main stream business model • Organic growth model • Partnership model

12. Potential areas for Access to Electricity projects • Rural growth spots • tourism • mining • agriculture • SME:s • Semi-urban areas • Communities aroundgame reserves • Other development initiatives, e.g. Lake Victoria

13. What ABB offers in Access to Electricity • Adapted business models • Low cost / high value productsmainly produced in Tanzania • Vocational training • Strong local implementation experience • To prove pilot schemesbefore scale-up

14. Our expectations on this meeting • To find a role where we can contribute with our technology to create income, employment and growth in Tanzania • To speed up the implementation of the government’s BEST program and the new SME policy • To be an implementing partner in the team that grows new sustainable business in Tanzania • To generate project ideas for Access to Electricity • To start-up joint pro-poor pilot projects • To accelerate rural electrification in Tanzania