07/10/2019 – News / Energy / Environment / Fossil Fuel / IFC

New IFC study details ‘dirty footprint’ of the world’s broken energy grids


Fossil fuel burning back-up generators in developing countries produce as much power as 700-1,000 coal-fired power stations, consume up to US$50 billion in fuel costs annually, and emit dangerous chemicals into homes and businesses, according to a new report by the IFC, a member of the World Bank Group.

Researched in partnership with the Schatz Energy Research Center at Humboldt State University and the International Institute for Applied Systems Analysis (IIASA) with support from the IKEA Foundation, the report – entitled ‘The Dirty Footprint of the Broken Grid’ – documents for the first time the economic, environmental, and health effects of fossil fuel generators, and calls for the rapid adoption of clean alternatives.


Stark findings from the report


Among its key findings, the report finds that in developing countries, generators serve 20-30 million unique sites, with the potential to produce the energy equivalent of 700-1,000 coal fired power stations. Astonishingly, in some countries back-up generators provide more electrical capacity than the national power grid itself.


The study also reveals that annual spending on generator fuel reaches up to US$50bn – nearly twice the average hourly cost of grid-produced electricity. And in much of sub-Saharan Africa, there is more annual spending on generator fuel than on the maintenance and management of the national grid. 


Generators are a significant source of dangerous pollution, including sulphur dioxide, nitrous oxide, and carbon dioxide. While cars, trucks, and motorcycles also release these chemicals, generators are usually operated extremely close to homes, businesses, and in crowded commercial districts, and therefore are potentially even more harmful. Moreover, the potential health impact of these “tailpipe” emissions is broad – from serious respiratory illnesses to cancer.  


Back-up generators emit more than 100 megatons of CO2 into the atmosphere every year, the report finds. In sub-Saharan Africa alone, the CO2 emitted by generators is equal to nearly 20 per cent of vehicle emissions – the equivalent of 22 million more passenger vehicles on the road.



Solar – the path out of generator dependency?


The study notes that modern, cost-effective solar technology may offer developing countries a commercially viable path out of generator dependency.


“The private sector has an opportunity to establish a new market for modern energy access – and vastly improve economic conditions in parts of the world that still rely on inefficient electrical grids,” said Philippe Le Houérou, CEO of IFC. “Adopting new solar and storage solutions will require innovative programmes and catalytic finance.” 


The Dutch Ministry of Foreign Affairs, the Italian Ministry of Environment, Land and Sea, and the IKEA Foundation are working alongside IFC to advance solar energy services in emerging markets. 


“Those living in poverty are often solving their energy needs, but at a high price – their energy options are often expensive, noisy and polluting, such as the diesel gen-set,” noted Jeffrey Prins – Head of the Renewable Energy Portfolio for the IKEA Foundation. “Through research and by championing renewable energy alternatives, IFC is enabling change – a change that ensures that more and more families in the world’s poorest communities can power their homes and livelihoods with renewable energy in an affordable way. That is why we are supporting IFC with a €4.3 million grant for enabling a new renewables environment.” 


A member of the World Bank Group, IFC is the largest global development institution focused on the private sector in emerging markets. In fiscal year 2019, the organisation delivered more than US$19 billion in long-term financing for developing countries.

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