Senegal - Sustainable & Participatory Energy Management Project

Report No. PIC4673 Project Name Senegal-Sustainable and Participatory Energy Management Project Region Africa Sector Energy Project ID SNPA46768 Borrower Republic of Senegal Implementation Agency Ministry of Environment and Protection of Nature Ministry of Industry and Energy Date the PID was prepared February 3, 1997 Proposed Appraisal Date March 8, 1997 Proposed Board Date May 20, 1997 1. Background. Senegal is a small Sahelian country with a population of about 8 million of which 40% live in urban areas. It has a high population growth rate (2.9% annually) substantially above the recent real GDP growth rate of 1.7%. GNP per capita was estimated to be about US$ 610 in 1994. The modern sector includes fishing, phosphates, chemical products and tourism, all concentrated in the capital city of Dakar and the coastal belt. Agriculture represents roughly 20% of Senegal's GDP and employs 60% of the country's labor force. Groundnuts are the most important agricultural commodity, providing for 75% of total monetary income of a typical farm family. Senegal faces many environmental issues, including soil degradation, salinization of agricultural land in low-lying coastal areas, and loss of forest cover. Total final energy consumption in Senegal for 1992 was estimated at some 1.5 million tons of oil equivalent. Of that total, forest-based traditional fuels (firewood and charcoal) --mostly for household cooking purposes--represent 57%, petroleum fuels 37%, electricity 5% and agricultural residues 1%. Total charcoal consumption in 1992 was estimated at 330,0000 tons (equivalent to 1.8 million tons of fuelwood), of which 76% is consumed in principal urban areas. The capital city of Dakar alone is responsible for an annual consumption of more than 100,000 tons of charcoal. The supply of woodfuels is based on geographically concentrated and non- sustainable forest resource management practices (clear cutting). In addition, given the relatively low efficiency of wood-to-charcoal carbonization, total charcoal consumption is equivalent to 1.2 times the total consumption of fuelwood. Charcoal is currently produced in the Kolda and Tambacounda regions, more than 400 km away form the principal urban areas of Dakar and Thies. Over the years, the operation of the charcoal industry has resulted in: (a) the gradual loss of forest cover (approximately 30,000 ha/year) and thus of the ecosystem's carbon sequestration capacity and biodiversity; (b) the degradation of the rural environment (particularly of the soils); (c) the impoverishment of the rural areas and acceleration of the rural exodus; and, (d) a massive transfer of wealth from the rural to urban areas. In addition to these  negative impacts, it is anticipated that the Niokolo-Koba National Park ("International Biosphere Reserve Park") which is located in the Tambacounda and Kolda regions will come under pressure, with irreparable biodiversity and ecological consequences at the national and global levels. A comprehensive "Review of Policies in the Traditional Energy Sector - RPTES" concluded that Senegal will continue to depend on forest-based traditional fuels to meet the lion's share of the country's urban and rural energy needs well into the next century. While ongoing demand management (improved wood stoves) and inter-fuel substitution (LPG and kerosene) efforts need to continue, they are by themselves not enough. Senegal's principal challenge will be to manage an organized transition from the current non-sustainable commercial woodfuels supply system to one capable of supplying woodfuels--particularly charcoal-- to the rapidly growing urban population in an environmentally sustainable manner. 2. Project Objectives. The objective of the project is to meet an important part of the rapidly growing urban demand for household fuels, without the loss of forest cover and the ecosystem's carbon sequestration potential and biodiversity. 3. Project Description. The project would consist of two main components: a sustainable woodfuels supply system component and a demand management and inter-fuel substitution options component. The supply component would implement and monitor 300,000 hectares of environmentally sustainable community-managed forest resource systems in the Tambacounda and Kolda regions, creating a protection zone around the Niokolo-Koba National Park. The demand component would promote private sector efforts at inter-fuel substitution and private sector and NGO-based improved stoves initiatives. In addition, the project would strengthen institutions involved in the management of the sector and the promotion of participation of the civil society in the operation of the sector. 4. Project Cost and Financing. The total cost of the project is estimated to be US$ 18.9 million, with a foreign exchange cost of about US$ 17.9 (949). The financing plan includes US$ 5.2 million from IDA, US$ 5.2 million from GEF, US$ 1.0 million from the Government of Senegal and the remainder (US$ 7.5 million) from other donors. 5. Project Implementation. The Ministry of Environment and Protection of Nature and the Ministry of Industry and Energy through the appointment of a National Director would be jointly responsible for the overall implementation of the project. 6. Beneficiary Participation and Project Sustainabilitv. The strategy for the project and the project proposals were widely discussed in several workshops and at all levels of Government and with the civil society, including academia, the private sector and the NGO community. The sustainability of the project would be achieved by the following: (i) the effective transfer of responsibility for the management of the forest resources from the Government to the rural communities; (ii) the effective opening of the woodfuels trading system; and, (iii) the - 2 -  implementation of a woodfuels fiscal and pricing policy that promotes long-term sustainable management of forest resources, discourages non-managed resource exploitation and maximizes direct revenues at the producer level (rural communities). 7. Lessons Learned. The proposed project incorporates lessons learned over the past two decades in "household" energy and participatory natural resource management interventions in West Africa, including projects in Burkina Faso, the Gambia, Mali and Niger. 8. Project Benefits. The project would sustainably produce some 860,000 tons of fuelwood during the implementation period and establish a permanent system capable of producing more than 300,000 tons of fuelwood. The project would also reduce woodfuels-related deforestation and net C02 emissions, generate income to some 0 villages, and increase access of low income households to more reliable and efficient charcoal stoves. 9. Environmental Aspects. This is a Category "C" project that seeks to reduce deforestation, soil degradation, C02 emissions, urban charcoal pollution and incidence of respiratory diseases and indoor pollution that would affect the health of women. Contact Point: Public Information Center The World Bank 1818 H Street N.W. Washington D.C. 20433 Telephone No.: (202)458-5454 Fax No.: (202)522-1500 Note: This is information on an evolving project. Certain components may not necessarily be included in the final project. Processed by the Public Information Center week ending February 7, 1997. - 3 -