Mozambique Energy Outlook, 2015-2030. Data, Scenarios and Policy Implications - with Gilberto Mahumane (2015)

This paper presents the first comprehensive Energy Outlook for Mozambique, a country that since long is one of the poorest nations of the world but since recently also developing into a leading energy producer. We present projections until 2030, based on a newly developed integrated long-run scenario model, new national and regional energy statistics, demographic and urbanization trends as well as cross-country based GDP elasticities for biomass consumption, sector structure and vehicle ownership. Our analysis shows an emerging ‘energy-dichotomy’ in Mozambique. On the one hand, the energy sector is characterized by a rapid and huge expansion. Until 2030, exploitation of the country’s reserves of coal, natural gas and hydropower is likely to increase primary energy production at least six-fold and probably much more, most of which is destined for export. We show that, as a result, Mozambique is rapidly developing into an important player at international energy markets; it may well become one of the leading global producers of natural gas and coal. On the other hand, our analysis shows that households continue to account for the major part of total energy consumption, with the majority of the population still being deprived from access to modern energy fuels by 2030. Hence, despite the spectacular rise of the extractive industry sector, population growth continues to be a key driver of energy consumption growth in Mozambique. Finally, we discuss the major challenges these findings pose for energy policy in Mozambique.

* Available as FEWEB Research Memorandum 2015-7, VU University Amsterdam. (Download below, or under "Publications")

 

Introducing MOZLEAP: an integrated long-run scenario model of the emerging energy sector of Mozambique - with Gilberto Mahumane (2015)

Since recently Mozambique is actively developing its large reserves of coal, natural gas and hydropower. Against this background, we present in this paper the first integrated long-run scenario model of the Mozambican energy sector. Our model makes use of the LEAP framework and is calibrated on the basis of recently developed local energy statistics, demographic and urbanization trends as well as cross-country based GDP elasticities for biomass consumption, sector structure and vehicle ownership. We develop four scenarios to evaluate the impact of the anticipated surge in natural resources exploration on aggregate trends in energy supply and demand, the energy infrastructure and economic growth in Mozambique. Our analysis shows that until 2030, primary energy production is likely to increase at least six-fold, and probably much more. This is roughly 10 times the expected increase in energy demand; most of the increase in energy production is destined for export. As a result, Mozambique is rapidly developing into an important player at international energy markets. Therefore, a major challenge for energy policy in Mozambique is to strike a balance in meeting domestic and international demand for energy, such that energy production benefits the entire Mozambican population.

* Available as FEWEB Research Memorandum 2015-2, VU University Amsterdam. (Download below, or under "Publications")

 

International Specialization, Sector Structure and the Evolution of Manufacturing Energy Intensity in OECD Countries (2015)

We present new evidence that changes in sector structure explain a considerable and increasing part of Manufacturing energy intensity trends across 19 OECD countries. We show that cross-country convergence of Manufacturing energy intensity levels is caused by efficiency improvements in lagging countries, while undermined by increasing international differences in sector structure. Particularly, we find that efficiency-driven catching-up processes only began to dominate the diverging impact of structural changes after 1995, reversing gradual cross-country divergence of Manufacturing energy intensity levels into rapid convergence. Subsequently, we link sector structure dynamics to changing global production patterns under influence of international trade and specialization. We conclude that increasing trade and market integration helped reducing energy productivity gaps across countries, despite the contribution of increasing specialization to growing cross-country variation in sector structure. These trends are mainly driven by energy-intensive sectors, while various countries specialize in sectors for which they do not have a comparative energy productivity advantage.

* Available as: Mulder, P. (2015), International Specialization, Sector Structure and the Evolution of Manufacturing Energy Intensity in OECD Countries, The Energy Journal 36(3), pp. 111-136. (Download executive summary below, or full paper via link under "Publications")