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Access to ElectricityChristian KornevallDar Es Salaam, September 29

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Who we are...

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

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

download from www.abb.com/sustainability

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1.6 billion people have no Access to Electricity

Sub-Sahara Africa32%

South Asia50% 35% in India alone

East Asia (not including China)14%

Earth’s City lights (NASA)Earth’s City lights (NASA)

Source: IEA World Energy Outlook 2002

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The link between poverty and Access to Electricity

Source: IEA analysis; income from the World Bank’s World Development Indicators, 2001

Tanzania

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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”---

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Access to Electricity – ABB’s response to UN Global Compact                                                                          

• 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

(Source: UNCTAD)

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

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Addressing the bottom of the pyramid

developed countries

developing countries;semi-urban areas

least developed countries;rural areas

1 $ per day

The income pyramid

ABB’s main streamof operations

Focus of Access to Electricity

A bottom up rural transformation concept

ExtendingBusiness asUsual

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Rural electrification – organic growth

village

small town

mine

plantation

stonequarry

minihydro

powertransmissionline

tourist spot

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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

download from www.abb.com/sustainability

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First Pilot Project with WWF - Selous Game Reserve

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

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ABB’s business models for Access to Electricity

ABB’s main stream business model

Organic growth model

Partnership model

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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

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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

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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

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